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In Nevada, gaming is a high-stakes issue

Times Staff Writers

Barack Obama has warned about the dangers of gambling -- that it carries a “moral and social cost” that could “devastate” poor communities. As a state senator in Illinois, he at times opposed plans to expand gambling, worrying that it could be especially harmful to low-income people.

Today, those views are posing a problem for Obama in the gambling mecca of Nevada, which holds its presidential nominating caucuses Saturday. While his top rival, Sen. Hillary Rodham Clinton, also talks often about aiding low-income Americans, she has embraced the gambling industry and its executives, and her campaign has used Obama’s past statements in an effort to turn casino workers and other Nevada voters against him.

The split on gambling between the Democratic rivals is a little-noticed but meaningful development that could affect the caucus vote Saturday and the broader election, as Obama and Clinton try to raise money and win votes in what is likely to be a drawn-out fight for the presidential nomination.

The differences could also help shape the outcome of the primary election in California, where the Feb. 5 ballot will carry four high-profile initiatives that could either rescind or allow an expansion of slot machines at Indian casinos. Californians who turn out to vote on those initiatives may also be motivated by a candidate’s position on gambling when they cast ballots in the presidential contest.

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“There’s a fundamental question here,” said the Rev. Tom Grey, executive director of the National Coalition Against Legalized Gambling. “Until this point, Obama’s statements seemed to suggest that he did not buy into the industry arguments that this is a product like golf or Starbucks that should just go on Main Street. And Hillary, by attacking him, seems to have come down clearly on the side of the industry that this is economic development.”

Although critical of Clinton’s stance, Grey and others who want to limit the gambling industry are now watching Obama with a wary eye. Obama is courting union workers at casinos and has calibrated his criticisms to declare Nevada a “model” for properly regulated casino gambling.

The issue has come into focus primarily due to the Clinton campaign, which has distributed a document to local reporters, headlined, “Obama Blasted Gambling as Socially Destructive and Economically Irresponsible,” listing several of his past quotes.

Among them are a 2003 comment in the Chicago Defender, a black newspaper, in which Obama argued that the “moral and social cost of gambling, particularly in low-income communities, could be devastating.”

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In 2001, the Clinton memo states, Obama described himself as “generally skeptical” of gambling as an economic development tool and likened the expansion of slot machines to the state lottery, in which, he said, “you’ll have a whole bunch of people who can’t afford gambling their money away, yet they’re going to do it.”

As part of its efforts to publicize those statements, the Clinton campaign has secured the help of top industry players -- several of whom participated in a campaign-sponsored conference call with the media last week designed to chastise Obama.

Former Las Vegas Mayor Jan Jones, now a senior executive at Harrah’s Entertainment, and Philip Satre, a former Harrah’s executive and top industry spokesman, argued on the conference call that gambling had brought jobs and much-needed tax revenue to many communities, including economically challenged places in Obama’s home state, such as Joliet, Ill., home to a casino.

They disputed the argument that gambling causes social problems and that those problems disproportionately affect lower-income people.

“People are not gambling away their mortgages,” Jones said in an interview later, adding that she planned to raise campaign money for Clinton.

“We saw the caucus as an opportunity to really showcase how important this industry is to providing capital investment and jobs that give Nevada residents the opportunity to live the American dream,” she said.

Former Nevada Gov. Bob Miller, an official in Clinton’s campaign and a board member of International Game Technology and Wynn Resorts, said Obama’s stance was reason for Nevada voters to choose Clinton.

Obama, said Miller, has been “critical not just of gaming in Illinois, but gaming as an industry. Sen. Clinton, to the contrary, has always been supportive and understanding of our industry.” He said he was not speaking for Wynn Resorts or International Game when talking about the presidential contest.

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Satre, former chairman and chief executive of Harrah’s Entertainment, said he too would help raise money for Clinton. Obama, he said in an interview, “doesn’t think gambling should expand. He thinks gambling has a moral and social corruption attached to it.”

Satre and Jones are part of a group of Clinton supporters called the Nevada Business Leadership Council. Satre said the group’s purpose is to act as a sounding board for the candidate on Nevada’s business climate.

Clinton aides said the New York senator had long supported communities’ efforts to lure new casinos to economically struggling places outside New York City, such as upstate New York and the Catskills.

One proposed casino, to be built in the Catskills by the St. Regis Mohawk Tribe, was rejected by the federal government earlier this month. That casino would be operated in partnership with Nevada-based Empire Resorts, which lists Clinton on its website as a key supporter. The tribe is appealing the federal rejection, and the decision could be left to the next administration.

In a brief interview Thursday with The Times, Clinton described the gambling industry as an “economic development tool” and said that “for many places in the country, it seems to be an important part of what they are trying to do to revive and maintain an economic base.”

Clinton likened the potential social costs of gambling to the costs of other industries that pollute or leave toxic dumps, saying that the impact “depends on how well-regulated it is.”

“Any human activity has social costs, really,” she said, adding later: “Life is filled with trade-offs, and you have to do the best you can to balance the pluses and the minuses.”

Grey, who heads the coalition against legalized gambling and is also a Methodist minister, said Clinton’s position conflicted with the church’s Social Principles, its statement of values, which Clinton has cited as a personal moral guide.

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He pointed to a quote published last month in the Christian Science Monitor in which Clinton said: “For me, the Social Principles of the Methodist Church have been as much a description of our history as a prod to my future actions.”

The Social Principles say: “We call on Christians to abstain from gambling and to be in ministry with persons who are the victims of this societal menace,” according to a copy posted on the United Methodist Church website.

Grey said: “It’s perplexing to me that she would use the principles and choose to omit the one on gambling.” The Clinton campaign did not respond to questions about whether Clinton’s stance on gambling conflicted with church policy.

Obama, an avid poker player, developed a reputation in Illinois as a critic of gambling. He voted against a 1999 measure to extend riverboat gambling to include boats stationed at dockside.

But Obama was not dogmatic. In submitting campaign questionnaires in 1998 and 2002 for the anti-gambling group Illinois Churches in Action, he left himself room to back the industry, answering “undecided” on whether he favored adding riverboat and land-based casinos. On a 2002 questionnaire bearing his signature, the words “not sure” were penciled in as answers to questions about several forms of expansion, such as moving casinos from rivers to land and raising the gambling age to 21.

Asked about Obama’s stance on gambling, his presidential campaign sent a list of quotations from the candidate in which he distinguished between Illinois and Nevada when talking about the industry.

In the comments cited by the campaign, Obama cast the industry’s effect on Nevada in a positive light. For example, he told the Associated Press last month that gambling could be a “successful economic model” as long as it was “properly regulated.”

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peter.nicholas@latimes.com

peter.wallsten@latimes.com

Nicholas reported from Las Vegas and Los Angeles; Wallsten from Washington.


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