Do you ever pay attention to ads for prescription medications? Do you listen to their long list of possible side effects? Sometimes the side effects seem more frightening than the condition they’re treating. I often wonder if it’s worth the risk.
There is legislation in Frankfort that should cause similar risk assessment. In 2018 the U.S. Supreme Court opened the door for states to legalize gambling on sports, internet poker and fantasy sports leagues. Several states are working through the legalization of this type of wagering and Kentucky is one of them.
Expanding gambling is not a new discussion in Kentucky. It’s been around for years.
What is new is the understanding of the mess the state pension system is in. Someone would have to be living in a sink hole to not know the state retirement system is in a pit. Earlier this winter State Auditor Mike Harmon said it was around $42 billion.
Proponents of legalizing sports gambling believe this could be a way to help fund the ailing pension system. They’re betting on $20 to $50 million per year in new tax revenue if it becomes legal.
Yet, there is always a catch when they share those numbers. First, it’s consistently said they will need part of the income to help people who develop gambling addictions. Will the revenue benefits outweigh the societal risks? We should also consider the effectiveness of the bailout. How long will it take for the projected revenue to provide meaningful lift to the pension system?
In a May 14, 2018 USA Today article responding to the Supreme Court’s ruling, gambling addiction expert Arnie Wexler says, “We’ve opened up a real circus here. You’re going to have so many people addicted to gambling in the next couple of years, it’s going to be crazy. We’re going to have a volcano of gambling addiction in America.”
The piece also cites Keith Whyte of the National Council on Problem Gambling: “There’s massive gaping holes in the safety net and now you have the potential for massive expansion. Hopefully this is a teachable moment for people to come together and realize that you have to look at gambling addiction as a national public health issue.”
The legislators and industry experts know there is great risk to expanding gambling. Is the help to the pension system worth the side effects? Is it worth the toll on individuals, families and the commonwealth?
Then there’s the financial side. The most publicized benefit is how the new income will help rescue the pension system. Consider this, if the proceeds contribute $50 million per year toward the $42 billion deficit, providing the deficit remains the same, it would take 840 years to break even. If the revenue is $20 million, it will take 2,100 years to balance the fund.
Considering the risk to families and society, does sports wagering provide a good return to Kentucky? Let’s think of healthier ways to rescue the retirement of our valuable state workers.
Brandon Porter is the interim Communications Director of the Kentucky Baptist Convention.