Slots and Horses

Having drawn the short straw, Thomas Perez was tasked by Martin O’Malley with providing the governor some cover on allowing slots at race tracks. His recent report concludes that the state must support the horse racing and horse breeding industries in Maryland, using either general revenues or proceeds from legalizing slot machines.

An editorial in the Post finds that the recent report by Perez provides a specious argument in favor of slot machine gambling. The Post indicates that the Perez report makes the assumption that the racing industry is worth saving.” That’s a fair point – the report insists that the horse industry “is an important economic engine for Maryland, and provides an important buffer against sprawl development” – but doesn’t really make that case. The other conclusion, lamented by the Post, is that the industry is worth subsidizing.

I have to note that the racing industry is already subsidized by the state, to the tune of about $10 million annually. Most of that goes to bulk up the purses for winners. In theory, the greater the winnings, the better the horses, and the larger the number of patrons. I assume the Post is in favor of ending those direct subsidies – I sure am.

Contradictorily (since when did that every stop a government program?), the state also subsidizes every competitor of the horse racing industry, by prohibiting slot machines at the tracks. Since these states allowed slot machines, racetracks there have pulled in hundreds millions of dollars from Maryland customers. This prohibition, therefore, constitutes a subsidy to competing racetracks in Pennsylvania, Delaware, and West Virginia, and to competing entertainment businesses within Maryland.

I agree with the Post – the industry is not worth subsidizing, nor penalizing. The state should stop giving tax monies to the racetrack owners, and the state should stop handicapping (sorry) the racetracks by preventing them from competing. Let them install slot machines (or candy machines or video games!), and use the revenues to maintain their own businesses.

But not a dollar of taxes – from general revenues or from the slots – should be doled out to these businesses.

 

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Explore posts in the same categories: Budget and Taxes, Maryland, Regulation

2 Comments on “Slots and Horses”

  1. Ted Says:

    Ted

    This is great


  2. The best medication for horses or greyhounds


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