A Minute With...

John Kindt, expert on business and legal policy

4/3/2012  8:00 am

John W. Kindt, a professor of business and legal policy at Illinois, is a leading national gambling critic who has testified before Congress about the societal, business and economic impacts of decriminalizing gambling.

Kindt is the author of the recently published book “The Gambling Threat to Economies and Financial Systems: Internet Gambling.” He spoke with News Bureau business and law Editor Phil Ciciora about Illinois becoming the first state to sell lottery tickets online.

What’s the motivation behind bringing the lottery to the Internet? Does this mean that Illinois is ahead of the technological curve, or that it’s skating on thin financial ice?

image of professor john kindtThat’s a good question – why would you want to bring a regressive tax that makes poor people poorer by putting gambling on every computer and cellphone? It just speaks to the kind of dire straits the state of Illinois is in right now, to bring such a destructive social problem online. And they’re only making an already tenuous economic situation that much worse.

I think this raises issues of responsibility. Why would Illinois rush forward to be the vanguard of such a questionable activity? None of the other state-sanctioned gambling activities of the past 30 years have worked out. How are buying lottery tickets over the Internet going to be any better?

Twenty years ago, when Illinois decided to go down the gambling path, the state of Virginia decided not to go that route. Today, Illinois has the worst state budget in the country, followed closely by California and Nevada, two other pro-gambling states. By contrast, Virginia, which rejected Illinois-style gambling, now has a budget surplus – not just a balanced budget, but a surplus.

What’s the danger in bringing the state lottery online?

Here’s the danger: The measly $100 million the state expects to rake in this year is going to cause a $1 billion social problem, because the state is going to be creating all these new addicted gamblers, particularly among young people, the most vulnerable and fastest growing gambling market.

Gambling is not just a major drag on tax revenues, but also on local economies. The fact that only New York and Illinois were pushing for this, whereas other states with lotteries did not join with them, suggests that these other states are cognizant of the problems associated with online gambling.

This also points to the accessibility factor of gambling. The accessibility factor says if it’s in your backyard, you’re more likely to do it. Well, now it’s not just in your backyard, it’s on your cellphone. If the state of Illinois continues to sell lottery tickets online, it could even open itself up to lawsuits from addicted gamblers.

Is there a significant risk in creating a new generation addicted to Internet gambling? Sure, you have to click a box that says you’re 18 years old, but is that really a deterrent?

The people involved in gambling know that the next generation is a prime market, because young people show double the gambling addiction rate of older adults. That means they’re more likely to get hooked on harder forms of gambling through the lottery, which is the gateway drug of gambling.

The website is also asking for people’s Social Security numbers to verify their age. With all the identity theft that’s going on today, that’s another risk right there. And here’s another question: Where are those numbers going? You’ve got private companies running the lottery website. What are they doing with that information? How secure is that information?

I think it’s very likely that the Department of Justice will reverse its opinion on online lotteries once there’s an outcry from the public and Congress.

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