Against All Odds : Gambling: With the income from their new Foxwoods Casino, the Pequot Indians hope to regain the economic power they once held.

Once upon a time, the piney wood hills here echoed with screams of terror. In a bloody pre-dawn raid, English settlers massacred the Pequot Indian nation, and a tribe that had dominated the economy of southern New England all but disappeared after the war of 1637.

This week, the same green hills are filled with the clamor of impatient motorists. They’re itching to place bets at the new Foxwoods Casino run by Pequot Indians, and their pockets are jingling with cash. The tribe that once lost everything to the white man is an economic power again.

“We believe nature and all things move in cycles,” says Gary Carter, one of the tribe’s five leaders and the casino’s personnel director. “The Pequot have a long and bitter history. But we have returned to our land.”

The land. For centuries, surviving Pequot dreamed of reclaiming the forests and rolling foothills their ancestors ruled. These days, they’re talking about building more parking spaces and adding blackjack tables to meet the demands of 13,000 daily visitors. Soon, the casino and an adjacent bingo parlor will be flanked by a golf course and hotel.

When it opened last week, the Foxwoods complex became the most sophisticated Indian gaming operation in America and the only East Coast casino outside Atlantic City, N.J. Although the project by itself doesn’t threaten the economy of Las Vegas or other resorts, experts believe it could become the model for Indian-run halls of chance in California, Arizona and elsewhere. In Palm Springs, for example, the Agua Caliente Indians are planning a lavish casino.

The spread of such gambling--made possible by federal law--has alarmed Nevada gaming officials. Some fear that once Indians get a foot in the door, cash-strapped Western states may open additional casinos and create new resort meccas.

“Frankly, this is where the real threat exists, to Western resort areas like Las Vegas,” says Alfred J. Luciani, chairman of the Foxwoods casino and a former consultant to Merv Griffin’s Resorts International in Atlantic City.

But that’s not a Pequot priority, adds Luciani: “These clients are different from any I’ve dealt with. I’m interested in bottom lines and quarterly reports, and they’re interested in the millennium. There’s a spiritual dimension. They want to know where they’ll be 350 years from now.”

They also want to set the record straight. Some historians have written that the Pequot, once 15,000 strong, are extinct. That’s an insult to people who were the first North American victims of European genocidal warfare but kept their traditions alive, says University of Connecticut anthropologist Kevin McBride.

“It’s nothing short of amazing, what the Pequot have been able to do,” McBride notes. “You’re witnessing the reformation of an Indian tribe that had been all but eliminated in a rather brutal fashion. They’ve never forgotten this.”

To put themselves back on the map, the Pequot built a casino that may surprise veteran gamblers. The blue-green hall is decorated with Indian motifs and has a waterfall in the lobby. It features large bay windows that look out on a lush forest, and there are clocks throughout the building, something never seen in the timeless bedlam of Las Vegas or Atlantic City.

Downstairs, the owners are building a museum that will tell the story of the Mashentucket Pequot, as they are formally known. Upstairs, waitresses rush about wearing feathers in their hair and Pocahontas shifts slit to the hip.

“We wanted to convey a sense of who we are in this building,” says Terry Bell, the tribe’s director of cultural relations. “This is not an ordinary casino. It’s not a big, black hole. It reflects our effort to survive.”

The Pequot success is surprising because there are only 187 tribal members living quietly on a reservation here. To build the casino, they bucked opposition from Connecticut Gov. Lowell Weicker, the state Legislature and the gambling industry. They fought bitter court battles--and won each time.

After getting the cold shoulder from U.S. banks, the Pequot secured a construction loan from a Malaysian company. They also overcame the skepticism of local businessmen, who joked that the tribe would never win approval for its controversial gambling project. These days, nobody’s laughing.

Amid the recession, the $58-million casino is a badly needed shot in the arm for Connecticut and a new source of jobs for an area that has been heavily dependent on defense spending. The complex is expected to generate $100 million in profits and pump $40 million into the local economy in its first year.

“God bless ‘em,” says Arthur Levine, a Rhode Island gambler who came to visit the new casino last weekend. “It’s big bucks all around.”

But the story of the Foxwoods casino is not just about money. It says much about spiritual persistence, and shows that American Indians continue to walk a long trail of broken promises in the late 20th Century.

Long before white men came to Connecticut, the Pequot Indians were the economic kingpins in a region extending from Rhode Island and Connecticut to eastern Long Island. They controlled the lucrative wampum trade, and anyone wanting to do business in that part of North America had to deal with them.

By 1600, Dutch and English traders had appeared on the scene, hoping to send furs back to Europe. They brought trinkets to trade and a wave of deadly diseases: Within two decades, the Pequot were ravaged by smallpox, and their numbers shrank from 15,000 to fewer than 4,000 members.

Economic tensions led to full-scale war in 1637, after several settlers were mysteriously murdered. On May 26, English soldiers and rival Indian tribes attacked the Pequot’s stockade some 10 miles from Ledyard. They set fire to the fort, and hundreds perished. Later skirmishes wiped out most of the remaining warriors, who were either hacked to death or sold into slavery.

The few Pequot who survived became the first North American Indians to be placed on a reservation. For nearly 300 years, they lived in poverty and neglect on a run-down preserve of about 2,000 acres. As their numbers dwindled, so did the land. In 1880, Connecticut sold much of the reservation; as recently as 1970, only 178 of the original acres were left.

One of the Indians who remained was Elizabeth George, a tribal leader who constantly reminded her grandchildren of the bitter past. “Hold onto the land,” she told them, and they listened. In the early 1970s, Richard (Skip) Hayward, one of her grandchildren, vowed to restore the Pequot legacy.

Inspired by the civil rights movement, he and other Pequot began organizing tribal members; Hayward was eventually elected chairman. Although he held a comfortable job building submarines at a nearby base, the new leader had bigger dreams. Allying himself with American Indian legal aid groups, he filed a lawsuit challenging Connecticut’s sale of the Pequot land on the grounds that it had never been approved by the federal government.

The Pequot prevailed and settled the case in 1983, winning $900,000 from Congress to buy back reservation land. Soon, the tribe received federal funds to build housing. It was all part of an effort to lure other Pequot back home.

“We needed to become self-sufficient,” says Bell, who has lived on or near the reservation all her life. “We couldn’t build a life on handouts.”

As more Pequot returned, the tribe launched a series of small businesses, none of which succeeded. Reluctantly, members decided to try their hand at the bingo games sprouting on Indian reservations across the country.

They opened a large bingo parlor in 1986, but not before clashing with the state in court. Connecticut, which runs a $286-million gaming industry of its own, opposed the Pequot plan to offer high-stakes prizes. Eventually, a federal court ruled that because the state ran jai alai games, dog racing and lottery contests to raise millions of dollars, the Pequot had the same right.

The real breakthrough came with a 1987 Supreme Court decision and passage the next year of the U.S. Indian Gaming Regulatory Act. They allowed American Indians to run games of chance if similar contests were licensed by their home states. The financial stakes were high: Because the Pequot and other Indians are considered sovereign people on their own land, the gambling revenues would be non-taxable.

“We knew that this (casino gambling), more than anything, would allow us to become self-sufficient,” says Carter. “But our fight was just beginning.”

In a novel legal theory, the Pequot and their attorneys claimed that Connecticut already sanctioned games such as blackjack through annual “Las Vegas Nights.” At these fund-raising events, nonprofit groups charge admission and stage gambling contests for prizes.

State officials, including Weicker, scoffed at the idea that charity fund-raisers were similar to casino gambling. But the courts disagreed. The project finally seemed to be on track--but two key obstacles remained.

First, the Nevada Resorts Assn. lobbied Interior Secretary Manuel Lujan to block the casino. They recruited Ken Duberstein, a former aide to then-California Gov. George Deukmejian, plus the law firm of former Democratic National Committee Chairman Robert Strauss, according to Barry Margolin, the lead attorney for the Pequot in the casino case.

But Lujan approved the plan. “The law is the law,” he said.

Next, Weicker tried to repeal the law permitting Las Vegas nights. Although the move was defeated, it sparked bitterness among the Pequot. Once again, it seemed, the government was changing the rules and breaking its word.

“Indian people have faced a long and tragic history of broken treaties,” Hayward said at the time. “It would be very sad if Connecticut added another chapter to that history. We can’t believe the state would do this to us now.”

One year later, the casino is booming and the Pequot reservation looks more like a suburb than a trading post. Flush with bingo money, the tribe has built 35 homes, executive offices, a softball field and a fire station. There are few signs of the alcoholism and unemployment plaguing other Indian homesteads.

Someday, Carter says, the 200 to 300 remaining Pequots scattered across America will return home and the legacy of 1637 may be forgotten.

To be sure, there are concerns: Indian leaders worry that drugs, prostitution and organized crime may threaten their enterprise, as with other gaming sites nationwide. But they insist that strict steps have been taken to screen all employees and monitor gambling operations.

It’s not just a legal question, they say, it’s a moral issue. An effort to keep faith with the past and honor the land.

“There’s not a lot of good news in Indian country these days, and that’s why this story is so amazing,” says attorney Margolin. “It’s not just a symbolic victory, it’s something real. Something that can survive.”