Home > Uncategorized > Sin Tax Brings in Millions for Schools… But Is It Economically Sustainable… or Right?

Sin Tax Brings in Millions for Schools… But Is It Economically Sustainable… or Right?

February 5, 2020

Our local newspaper this morning featured an article by Concord (NH) Monitor writer Ethan DeWitt reporting that the State residents bet $2,310,000 on the Super Bowl whose net revenues will be used to underwrite public school funding in the State. In the article, Mr. DeWit offered these statistics on betting to date:

The online sports betting program, managed via DraftKings after a bidding process, has been up and running since late December.

Created last year after being championed by Sununu, the program has so far attracted 34,800 registered users, who have collectively placed $20.8 million in bets, according to the state Lottery Commission.

So far, the $20.8 million has translated into $1.2 million in net revenue for New Hampshire’s educational programs, the Commission said. The Commission estimates the new program should bring in $10 million a year to the state’s education trust fund, which is distributed to schools.

This sounds like a win for public education, but it is a victory only if two things occur: the level of betting provides the projected revenues from gambling and the sports gamblers are not the same individuals who bet regularly on other revenue sources like lotteries.

If the most recent gambling legislation, Keno, is any indication the revenues generated by Sports Gambling might fall short of the mark. Last February, Mr. DeWitt reported that Keno, which was forecast to generate enough revenue to underwrite Kindergarten in the state, was struggling to get enough revenue. According to the State’s Lottery Commission Keno was $3.8 million, far below the $11 million built into the revenue forecast. What happens when there is a revenue shortfall? Budget cuts are necessary. In the most recent budget, the state legislature decided it would fully fund full-day kindergarten programs regardless of revenues generated by keno and funding for stabilization grants was restored. The budget ax fell hard on health  and human services, though, where the Commissioner will need to find $25 million in cuts without touching money for developmental services, county programs, or Medicaid rates. This cannot be good news for children raised in poverty or experiencing stress outside of school due to mental and physical health challenges their families are experiencing.

The reason keno fell short of the mark was accurately described by Judd Gregg and John Lynch, leading New Hampshire legislators from both sides of the aisle, in an article they co-authored in 2017 when legislation was proposed to legalize casinos in New Hampshire. In the op ed essay they surmised that gambling revenues are a zero sum game: cannot increase unless the incremental discretionary income of gamblers increases or the pool of those who gamble increases. In the article they cautioned against reliance on gambling revenues foreseeing that if the revenues fell short in one gambling gambit the legislators would likely turn to another source of gambling revenue setting in motion a vicious cycle that would ultimately result in the need for more and more revenue streams based on gambling.

As a Buddhist practitioner I find the whole notion of raising money through gambling “wrong”. In Buddhism, something is  “right” if it goes “…in the direction of well-being and happiness”.  I do not see reliance on gambling as the direction of well-being and happiness… rather it reinforces an addiction that some people have and the need for a fast payback to get more stuff— the grasping and craving that create an endless cycle of needing more and more… the very cycle that John Lynch and Judd Gregg decry.

Bottom line: gambling revenues feed the wrong motives in us in every way and should be avoided as a quick fix to complicated problems.

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