NATIONAL GAMBLING IMPACT STUDY COMMISSION
N G I S C Chicago Meeting, May 21, 1998
QUESTION/ANSWER SESSION I
CHAIRMAN JAMES: We have one final panelist that will be addressing the Commission. But at this point I'd like to go ahead and open up for discussion, question and answers among these various panelists. I would also encourage among the Commissioners and I would also encourage the panelists if they would like to engage in some discussion or dialogue. We have also found that to be helpful, if you want to do that among yourselves.
COMMISSIONER McCARTHY: First of all, I wanted to thank both Mr. Eadington and Mr. Kindt for the materials they mailed to me some months back when I started out on this trail of trying to understand what they have spent a lifetime studying.
Mr. Eadington, I have a question I wanted to ask you. One of the comments that you made is should we be examining whether people should be responsible for themselves or protected from themselves. That seems to suggest that unless there are really compelling public policy reasons and they would really have to be compelling, that the least government regulation and government oversight the better because it's really not justified, that this is a behavior, a free choice that we should allow people to make. Do I understand correctly what you're saying?
MR. EADINGTON: I'm not sure. Continue, please. What I was saying is that the issue of gambling poses the challenge to society at large as to how much freedom it should give to individuals to make their own decision. Historically, societies have protected lower income groups, working class from various forms of gambling, primarily by geographically separating where the gambling is permitted from where people live. This has changed in many countries over the last decade or so. And gambling has come much closer to where people live.
I think this is a by-product of a combination of increased social acceptance of gambling as an entertainment activity as well as an increased level of affluence that prevails in many countries and a willingness of people to define their own ethical standards rather than rely upon institutions to do so.
COMMISSIONER McCARTHY: Is there any form of gambling that, under that test, you would find really objectionable from a society point of view?
MR. EADINGTON: Actually I think personally I would not. I think the underlying issue behind that is that there is a lot of differentiation among different types of gambling, some of which may pose greater instability questions than others. This is the kind of issue that has been raised over video poker in recent years as being apparently or allegedly more seductive and therefore, more addictive than other forms of gambling. It's an issue that is likely to become more important in the years to come as new technologies are developed and new ways of delivering the gambling product to the consumer evolve.
COMMISSIONER McCARTHY: Let me ask you to comment on Internet gambling, on whether that should remain as a private sector form of business, essentially unregulated and allow business people to go out and compete. How do you feel about Internet gambling?
MR. EADINGTON: I think Internet gambling is in some respects is a very difficult industry to regulate for reasons I'm sure you're going to hear a lot about this afternoon. It is one that certainly people have access to, along with a wide variety of other products over the Internet. Whether it's desireable or not is another question. The balance of benefits and costs that accrue both to the consumer and to society at large may be very questionable. But nonetheless, the ability of individual countries or jurisdictions to prevent this from occurring is going to be quite challenging.
COMMISSIONER McCARTHY: How do you distinguish the benefits to society from Internet gambling, say, from any of the major casinos in Las Vegas or Reno?
MR. EADINGTON: I think one thing regarding gambling generally is that we have an activity that for the most part has gone from a prohibited status into a limited permitted status for a lot of ulterior motives; to capture economic benefits for the state or for economic development purposes, whatever. As gambling becomes more and more prolific, as it becomes more and more available, the ability to capture those economic benefits for other beneficiaries becomes limited and the ultimate beneficiary or victim perhaps is the consumer himself. So the implication of Internet gambling coming into the home is going to be a challenge as to whether you can do anything to prevent the individual from access and consuming that particular product, whether it does the individual good or not.
COMMISSIONER McCARTHY: We have certain forms of gambling that can come into the home right now.
MR. EADINGTON: Such as?
COMMISSIONER McCARTHY: Mr. Leone, you gave me an example of that I think yesterday, as I recall. Is it para-mutual betting?
COMMISSIONER LEONE: In the state of Kentucky you can bet over your cable system.
MR. EADINGTON: Yes.
COMMISSIONER McCARTHY: And I think someone said that there are several states that allow that.
MR. EADINGTON: There are a number of states that will be introducing that technology within the next year or so.
COMMISSIONER McCARTHY: You would ban betting at home?
MR. EADINGTON: No, I'm not saying that at all. I'm just saying that these are issues that are certainly challenging from a public policy perspective. I think the ability to ban is very, very limited.
COMMISSIONER McCARTHY: At some point we have to figure out when we want to respond to the challenge. That's really what I'm trying to get at here. What are the parameters for public policy for us to try to address this issue? Here, you say should people be responsible for themselves or protected from themselves. That sounds pretty much like leave it wide open and after all, people should be personally accountable. That's what I think I hear coming from you.
MR. EADINGTON: That is certainly part of the message. I think gambling along with the other purported vices including alcohol and tobacco pose a lot of challenges in the public policy arena insofar as a society we try to somehow constrain or limit the amount of damage that an individual can do to himself through consumption of these products.
COMMISSIONER McCARTHY: Thank you. We've been wrestling with the question of how you try to measure social impact cost and I heard you say it was extremely difficult to do so and to establish a causal relationship. Apparently the people at the Harvard Medical Addiction Center feel that those measurements are sufficiently valid for them to analyze 120 studies to come up with a lot of the numbers that Mr. Kindt just showed us, part of it in the graphs. How would you characterize the validity of the Harvard medical study? Is it something we can be guided by? Is in fact there are at least four and a half million pathological gamblers as that study suggests, they've identified in the last several years.
MR. EADINGTON: I think it's a fairly good start. Keep in mind, the major finding of the Harvard study is the rough estimate of the severe pathological gambler and the problem gambler estimates and it is not primary research, rather it is a consolidation.
COMMISSIONER McCARTHY: I understand.
MR. EADINGTON: But the point is that that's about as far as they can go and that's as far as Howard Schaffer purports to go within that study. There's no attempt to try to link the cost to the individual gamblers, even though I think other researchers have attempted to do that and that has led to some very misleading, not terribly useful, information.
COMMISSIONER McCARTHY: As you know, this Commission has just authorized a national survey which will try to pinpoint many of the patterns of pathological and problem gambling. Do you believe there is a way to frame questions to ask people that will give valid returns, valid samples so that we can be guided, state, local and federal officials of this country can be guided in trying to formulate some kind of response, try to measure the cost to government, whether it's in bankruptcies or crimes or divorce courts or whatever it might be? Is that a valid pursuit?
MR. EADINGTON: I think it certainly is a valid pursuit. I think what you need to keep in mind all the way through with regard to research is that the ultimate product is good public policy at the end. You therefore, need to build a base of realistic reasonable and understandable research that gives you facts as opposed to myths. I think this is the real public policy challenge.
COMMISSIONER McCARTHY: The difficulty I've had up to now is that an awful lot of people say, hey, this is too intangible, that you can't really show a causal relationship between gambling and social impact problems. I notice the Anderson study commissioned by part of the industry made that statement in the macro-economic study, the first one out. They studied the plus, the accounting side, the increase in revenues. But they said really the information to try to measure social problems is really just too hard to get at. It's unreliable in effect. And I see that theme related over and over and over again.
Because a lot of people have respect for you, I was trying to get at whether you think we can ever come up with specific answers or whether we'll be in a state of denial that there are some substantial social impact costs.
MR. EADINGTON; I think there are two parts of that that are important. One is that we'll never get precise answers because it is a very loose and intangible area we're dealing with. The second and perhaps more important point, however, is even though that measurement issues are very difficult, it is a terrible mistake to assume therefore they don't exist. I think there's a tendency for people to want to do this. If they're hard to pin down, why don't we just pretend they're not there? I think that is going to lead to bad public policy as well.
I think one can argue that if we ignore the social impact issues surrounding gambling, we're likely to allow it to expand to the point where as a society we say, enough is enough, this is too much, we therefore, have to roll back an awful lot of gambling that we have previously permitted. This is the delicate balance we have with gambling.
CHAIRMAN JAMES: Can I ask each of the other panelists to respond to the same question? I'm curious as to your perspective.
MR. KINDT: I would like to provide some transparencies again, with the indulgence of the Commission. I think it emphasizes the point a little bit.
CHAIRMAN JAMES: Mr. Anderson, would you go ahead and respond while he does that?
MR. ANDERSON; Again, I'm filtering all of the questions and the issues from my own personal experience which I guess is my most valid source of information. I tell you that included in your packet is a survey that Dr. Henry Lesieur and I did of compulsive gamblers and I again say that if you understand the nature of the problem then the questions that you ask -- this is an easy addiction to diagnose if you know the right questions to ask. If you don't know the questions to ask, you can't find it and it stays very muddy and you say, well, these are very difficult issues to answer.
CHAIRMAN JAMES: Have you formulated a list of what you believe to be the right questions to ask?
MR. ANDERSON: We have been here in this survey. For example, how many of you have attempted suicide? How many of you had a definite plan? There are suicide scales in order to determine that. There are measures that can say how many people in the criminal justice system -- see, the beauty of gambling research is that you can follow the money trail.
For example, every transaction I did in the securities market in my gambling had a time stamp, it had a date stamp, there is a specific paper trail. When I take cash advances off my ATM at the casino, that ATM has a specific number identifying on it that you can do a specific correlation study.
If I'm a credit card issuer, I can do a study, I guess with the right computer programs and link up, credit card delinquencies with cash advances at ATMs, at casinos or race tracks or OTBs, and then I can begin to collect data. Is there a correlation between bankruptcies, delinquencies and people who are using that money to gamble with. So you follow the money trail if you want to find out what's really going on within the criminal justice system.
Again, you can follow the money trail because gamblers steal money to gamble. There's nothing to show for it. A lot of the prosecutors are used to dealing with cases of theft where people use the money to go buy houses, cars, various things and with gambling they're running around wondering where is the money, what did you do with the money. They say, they gambled away a half a million dollars at the casino or the race track. And they say people can't gamble away that. Yes, they can. You follow the money trails, not only that, but the casinos have cards that track people's play. So there are a lot of ways of following this if we simply ask the questions.
CHAIRMAN JAMES: Professor Kindt.
MR. KINDT: Let me just preface a couple remarks about Internet gambling. Sociologists I'm sure you've interviewed said the more accessibility you have and the more acceptability you have in gambling the more pathological gamblers you'll have, the more of these problems you'll have in society.
When you put gambling on the Internet you maximize accessibility, you maximize acceptability. You put it in every living room, at every work station and it only takes one employee to get hooked and bankrupt an entire company. Barings Bank is a good example. And it puts it in every school. And it destabilizes what the Fortune 500 companies want to do on Internet gambling. So I just wanted to put that in as an impact on stability of expectations, if I may. It destabilizes the business environment and the financial community. It would be possible for a person to use their entire life savings in one night gambling in their living room. Everything is getting linked together.
Now, talking just as -- one of my backgrounds is a legal background. We talk about what's authoritative, relevant and current all the time. Well, these are the Supreme Court cases in the instance of how to analyze or view addictions, bankruptcy, crime and corruption. The first one is by Valerie Loren, Robert Pulitzer and by Bob Yaffey the statistician that did this. This is a 1990 report but it's on the strategic scale. You've got to look at the strategic scale. So this is the leading edge report there.
The leading edge report on bankruptcies is by SMR research. It's less than a year old. I hope that you've interviewed the authors of this because it's an excellent report. It's authoritative, it's relevant, it's current, it's right on the money so to speak and I would encourage you to view this as your starting point for bankruptcies. It's precedent.
With regard to crime and corruption, the leading edge report is still this 1994 report out of state of Florida, a team of economists there. Their methodology is the best and the more advanced with regard to trying to calculate the cost of crime in society.
And with regard to the military cost, this is the MTIS survey from which the base line was taken for pathological and problem gamblers in the military in 1991.
And this state of California report, which I mentioned earlier, this is a good overview. Remember, if you put a fence up around Nevada, my distinguished colleague Professor Eadington has said, well, we haven't seen this, we haven't seen that. You put a fence up around Nevada and you will see addictions, bankruptcies, crime and corruption off the chart. As a matter of fact, Nevada right now has the highest suicide rate, the highest crime rate, not every year, but it's usually in the top with regard to these areas.
And finally, just down the street here we have the Better Government Association of Chicago. It's my understanding they weren't invited to testify here. But one of the Commissioners raised the point yesterday about gambling in Joliet and the impacts there. And they've done several reports which are leading edge reports, including reports by Professor Gazel; William Thompson from the University of Nevada, Las Vegas; Dan Rickman, and that would have specifically answered the point that was raised with regard to the mall situation in Joliet. I've seen that in one of their reports. And this is a leading edge report. They should have been here.
Again, we need to look at the feeder markets. If you look to the right there, you can see the increasing acceptability and accessibility factors. But the point here is to stay focused on the national scale and on the speed of the gambling. The type of the gambling is not relevant per se. It's the speed of the gambling as a function of how fast the money is coming out of society. And then you can pretty much track the social costs as a function of the speed of the gambling and how fast the money is coming out of society.
Finally, just on the new numbers out of Harvard, 1.5 million people, .5 percent of the U.S. population, are new pathological gamblers. These are government-created new pathological gamblers. We're trying to estimate the cost. I've tried to put everybody up there who said something currently with regard to these new numbers, taking it out of the press. You can check the citations yourself. There are numerous citations on all of my tables, and again, we'll revise them as new information comes out. But there's the range of social cost we're talking about. And yes, the range is large, but these are just the new pathological gamblers.
The problem with, for example, the Arthur Anderson studies, they always put in a disclaimer that says we're not looking at the social cost. And the point should be raised that many of these parties which are doing these studies are contributing members to the American Gaming Association. This is one of the AGA's ads where they put their contributors or their associates. And here we have the Journal of Gambling studies.
My distinguished colleague, Professor Eadington here is one of the editors. Henry Lesieur is the old editor; the new one is Professor Schaffer. And these figures are coming from people on Professor Eadington's editorial board, Duran Jacobs, Lesieur, Valerie Lorenz, Robert Yaffey, Robert Pulitzer, Howard Schaffer, William Thompson. So we've got 120 studies out there, and they're coming straight out of these journals and the literature.
CHAIRMAN JAMES: Thank you very much. Commissioner Wilhelm.
COMMISSIONER WILHELM: A comment and a question. Professor Kindt, your ability to extrapolate is impressive indeed. I did want to try to inject one fact. That is that you commented that the Harvard people wouldn't provide some of the prevalence, the data and so on. It's my understanding that the Harvard people are providing that data to the National Research Council in connection with the work that this Commission has contracted for with that group. But I have a question of Mr. Anderson.
Speaking personally, I can relate to your using your own experience for reference point. I have what I consider to be an addictive personality. I can't drink in moderation, so I don't drink. I can't smoke in moderation, so I don't smoke. You can't not eat, so I'm fat.
COMMISSIONER WILHELM: And in trying to look at myself -- and by the way, I wouldn't be able to gamble in moderation, so I don't gamble either, at least in the forms of gambling we're talking about. Has anything authoritative in your opinion been done to try to figure out what the relationships are among different kinds of addictive behavior? Although I'm certainly not an expert in the field, I do know that there's been some work done on the relationship between alcohol abuse and other forms of substance abuse, for example.
Intuitively, based on my own experience, I would think that if a person isn't a gambling addict, they're probably some other kind of an addict. That would be true of me. Is anything authoritative been done to try to figure out what those relationships might be?
MR. ANDERSON: The answer to that is a definitive yes and no.
COMMISSIONER WILHELM: Speaking moderately.
MR. ANDERSON: Yes, speaking moderately. I think unfortunately one of the great areas of negligence in addressing this issue is my own profession, the mental health profession. And this thing has been in DSM since 1980, but if you look at the volume of literature on treatment and recovery issues, you're not going to find but a handful of books. If we were at a drug and alcohol conference, we could line books and literature from that end of the table over to there, but our collection of gambling literature would go from there to there. So it's an issue that's been broadly ignored within the mental health community. I know. I train psychiatrists, psychologists all over, and they wouldn't know a compulsive gambler if they stepped on one.
Now, having said that, there is the beginning -- see, this is where the money is critical because it seems like unless there's dollars for treatment or until people come into a clinician's office and say my husband or my wife is gambling away our estate, or my children or my parents, can you help and until the clinicians are forced to look at that, then they don't start even asking the questions about, okay, what do we do, how do we address that and the researchers start researching. So it takes dollars. When we go in to try and get programs set up, the first thing administrators say is well, how are we going to get paid for creating this population? And I say, well, I don't know. When we're in court and judges say I want to do a deferred adjudication or an alternative to sentencing, like we do with drugs and alcohol, and they look at me and say, well, where are the programs to refer people to? And I shrug my shoulders and say, well, we really don't have many.
So even having said that, there are some people in the field who are beginning to do research, collecting that data. The Journal of Gambling Studies I guess right now is the largest collection of literature and clearly there is a high percentage of co-morbidity. In our survey that we did here in the Chicagoland area, compulsive gamblers, almost 30 percent acknowledged that they had a co-morbid alcohol problem.
I can walk out of this room and take you all to any of the drug and alcohol treatment programs in this city and we can walk in and we can find people who are undergoing treatment for drug and alcohol problems, where if we really look, their primary clinical diagnosis is pathological gambling, and that their substance abuse is a consequence of that but we're not treating the gambling because there are no dollars out there to treat the gambling but there are dollars out there to treat drug and alcohol.
I've had compulsive gamblers go through the criminal justice system where they at least recognize that there was an addictive problem and they stuck them in a drug and alcohol treatment program, gave them a diagnosis of substance dependence even though the individual did not drink at all. Why? Because the diagnosis of substance dependence was necessary in order to get funding.
So yeah, there's co-morbid issues, but there's a tremendous need for a lot more research in that area. Absolutely.
COMMISSIONER WILHELM: Just as a follow up, if I might, you were impliedly critical of the state of Illinois for not providing funding, if I understood you right, for treatment and you mentioned that in some way the riverboat industry in Illinois does something in that area. Yesterday when we had testimony from Indiana State Senator Rogers, I believe, if I heard her right, she said that in the law in that state there's some allocation of a portion of the gambling tax for treatment. Can you tell us a little bit about either or both of those and among other things, in you view, how what's available relates to what is needed?
MR. ANDERSON: Okay. I can speak to both of those. In fact, in the state of Indiana basically the training program that took place using those dollars was basically a model designed by us. I trained most of the professionals. There was a small amount of money that was allocated to do training, which in my opinion is very inadequate. But what's happening in Indiana is that the money is only going to mental health agencies and many of those people do not have any training in how to treat pathological gambling.
One of the things that we discover is that what is stated and what is put in print, in other words, how it's represented about what is being done when we take a look at what is actually happening in reality, we discover they're in different universes. For example, what happens in Indiana, there is a percentage of head tax that is allocated specifically for compulsive gambling and yet that's not yet being taken advantage of.
Part of the problem also in Indiana is that when people call the state run help line for compulsive gamblers, they get referred to mental health agencies because that's simply on their provider list and they do not get referred to the Gamblers Anonymous meetings. In fact, they specifically will not refer people with gambling problems in Indiana to Gamblers Anonymous because they're not on the provider list that the state help line runs.
Now, there's something very ludicrous about that in my mind. So we've got a long way to go in Indiana in terms of training the professional community and how the funds are allocated. I was just in South Dakota earlier this week training professionals there and the universal complaint among the people in the trenches, in the field was the agency said yeah, we got all of $5,000 from the state to treat gamblers. We won't even advertise that we have a program because $5,000 won't even go far enough to pay for the advertising, maybe it will print some brochures. We can't do anything with it. So the money that's allocated is not enough.
Let me comment on the industry here in Illinois. The state, as I have said, has been grossly negligent and I stand by that and we have plenty of evidence for that.
COMMISSIONER WILHELM: I guess I shouldn't have said impliedly.
MR. ANDERSON: No, there's nothing implied here at all. That's the track record. However, the industry has stepped forward in that vacuum and I think that it seems to me that what the industry decided is that they would rather do some things to determine their own fate and their own direction as opposed to waiting for the bureaucrats and the legislators to come in and tell them what to do.
Now, what the industry has done in Illinois has been a good start. They've provided funding for the statewide help line that actually is funding for the National Council on Problem Gambling help line which by the way was expanded through money from Harrah's Corporation several years ago. So the National Council on Problem Gambling, 800-522-4700 help line, you can call that anywhere in the United States anytime of the day, any day of the week and you can get help.
Now, the Illinois Casino Gaming Association has funded that. That's been operated primarily by a private entity. They've also funded the Illinois Council on Problem and Compulsive Gambling for the last several years to do training, public awareness and education, training of the professional community. However, having said that, all that is the under the heading of the industry's responsible gaming program or Project 21. I want to say very specifically that that program is a good start. It's necessary. It begins to get a prevention message out there, but the program is only as good as the advertising.
And if you look at the data from the help line that was presented to the Illinois Gaming Board last month or two months ago, what it shows is that 80 percent of the calls to the official help line here in Illinois came from the gamblers. What that says to me is that the number is not being broadly advertised, because in places where the number is being broadly advertised, half of the calls coming into the help lines come from spouses, family members, employers. So until that number is put on billboards, it's put in the newspaper, where the radio PSAs that we have developed are being played on the radio, then half of the population that needs to hear the message is not getting the message. So we can have the most wonderful program in place, and if they're not getting the message then it does not good or it does limited good.
Now, the other thing that's critical to remember is that the industry's responsible gaming program does not address compulsive gambling. You do not send a message to the alcoholic to know when to say when. They've long since passed that point. The industry message is bet with your head and not over it, and they are prevention message for the people who have not crossed the line yet. I applaud that. It's necessary. It's imperative. But I repeat, it is not a program designed to address problem and compulsive gambling. So we have to move in that whole additional direction.
I think it's very difficult, it's a difficult issue for the industry to address because they're in the business of making money and clearly people who have gambling problems are contributing a tremendous amount of revenue. I don't know how much. I"m not a statistician, but I know it's a lot of tremendous amount of revenue to the industry. So there are a lot of problems.
But the program only goes so far. And insofar it hasn't gone further. We've got a long way to go but we've gotten a start.
COMMISSIONER WILHELM: Thank you.
CHAIRMAN JAMES: Commissioner Moore.
COMMISSIONER MOORE: I'd just like to make one comment. We hear all of you people report about the research that you've done. We see all your papers and it's almost too many to read. It's like in medicine, you can't read it all. I just hope that the people in the audience, especially news reporters, realize what a heck of a job that these nine people sitting around here are going to have to do. All of you people who report all of what you find, but I don't see any answers of what to do.
I don't really believe that we're going to do away with gambling. I don't believe that that's the function of this committee. So what we're looking for, what I'm looking for, it's not going to be too long that someone on this committee is going to have to sit down and decide what's going to be in this report, and what we're going to recommend.
I think if we come out with a report without recommendations, then we don't have really a report. So this is the problem that I'm facing. What in the world are we going to recommend that this country do, if the country does anything?
MR. KINDT: If I could address that. That's one reason why I tried to put the leading edge reports up there was to simply the process. None of those were by me, by the way. They're by the leading edge people, as I would judge them, as the most authoritative people out there. I would urge the Commission to use those as a starting point for the methodology in doing the research.
With regard to the question about how do you determine what's a pathological gambler, the majority rule, as we say, is the South Oaks gambling screen. That's the most widely used, the most widely accepted. Henry Lesieur and associates developed it and that seems to be the rule. I don't think we should rewrite the rule. It's precedent. It's been there for years and years. That should be used. The minority use is the MGS or the Massachusetts gambling screen and they're both just about the same. You're not really comparing apples and oranges but they get results which can be analyzed. So I would just draw your attention to that.
Finally, I would say that on the methodology on some of these, the methodology has been published in the Journal of Gambling study by Dr. Lorenz. I remember reading a 1990 article. So this is out there. The information is there. In my tables, what I tried to do is simply report what the other experts are saying around the country. If they correct me, I'll be glad to revise those numbers. You can see in the tables some of the numbers haven't been filled in yet. I'll be happy to fill those in. I'm just waiting for the information. But I tried to simply the process for the Commission to some extent in trying to get a handle on what the studies are that are out there and I think most of them are listed in my footnotes.
MR. EADINGTON: I'd like to address that, if I could. I think one of the issues that we need to look at is that we've gone from prohibition to permitted gambling under a regulated environment over the last 25 years. We have largely concentrated on insuring the integrity and honesty of the various commercial gaming industries that have been authorized. I think that certainly has been both a legitimate activity and one that we have been somewhat successful in achieving.
However, if we look at other jurisdictions, notably the United Kingdom, one of the explicit charges of its regulatory structure, along with protecting the integrity of the industry and ownership and accounts is to also protect the vulnerable as an explicit charge of the regulatory body. If this is indeed a wise direction to go, and if the analysis provided by a lot of researchers in problem gambling is that problem gamblers are a distinct minority, a very small proportion of all the customers involved in gambling, I think the direction of public policy is to try to identify and isolate problems gamblers and provide protections for them without interfering with the rights of the other 95 or 98 or 99 percent of the population.
One possible direction to start thinking about is parallel to what we do with driver's licenses. If indeed people have the right to pursue an activity, to drive a motor vehicle, unless they abuse that right, we should start looking at technological or other policy alternatives that would allow us to isolate the problem gambler and revoke rights to participate in mainstream bona fide gambling. This I suspect is going to be very difficult to achieve, but given the kinds of directions and technology I suspect over the next ten or 20 years, we will probably have the ability to foreclose some people from mainstream gambling especially if it is state sanctioned or state operated.
CHAIRMAN JAMES: Commissioner Dobson.
COMMISSIONER DOBSON: Professor Kindt, I was the person who asked the question yesterday of Mr. Thanas with regard to the mall in Joliet. He seemed to indicate from his view that its closure had nothing to do with the riverboat situation. You just mentioned it again. Is there more information for us?
MR. KINDT: Well, as I indicated, I recall reading I think it was a newspaper article reported from the Chicago Tribune in the Better Government Association report of a few years ago, there have been several news media personnel out there who have reported that that was at least one of the causes for the closing of this establishment. I don't mean to personalize this, but I happen to be one of those parties last fall when a crew came over from the United Kingdom who heard about this and they were interviewing people right there in the mall. There were about five or six stores left, all the rest were closed. I remember it in particular, because they took my picture under the one major activity that was still going on there which was an off-track betting parlor. So they filmed me underneath that particular sign.
COMMISSIONER DOBSON: Would you comment just generally, on the criticism of the research in this area that it is not academically supportable and lacks validity and reliability and so on?
MR. KINDT: I don't want to address another panelist, but one of the questions to simplify my job in collecting the data, I'd like to ask my colleague here, Professor Eadington, what he says are the annual cost of a pathological gambler to society for a year or what he thinks the range of that would be. I think that we have to go with what we call the best evidence. We look for authority. We look for the most relevant and current authority that we have. Some of these reports were done in 1994.
But one of the interesting things about the Florida report and one that I did in 1994, which by the way, was indirectly confirmed by Harvard with their projections when they reported the increases in pathological gambling is that they were basically done without knowledge of the others. So there were three reports which came out in 1994; mine, one out of Florida and one by Professor Goodman which were basically looking at the same issues and arrived at similar types of conclusions. So there was an independent corroboration there.
But that aside, there are 120 studies out there. And we have to assume that they're done reasonably in good faith. Nothing is ever perfect. But we need to be able to draw some conclusions from these and there's a sufficient amount of data out there that we can put the range of what the costs are.
COMMISSIONER DOBSON: I spent 11 years in full time research at the University of Southern California School of Medicine. Research is always a compromise and it's never perfect. But you can eventually begin to get at an understanding. I think it's a mistake to just wave it off. That begins to feel to me a little bit like the tobacco industry telling us for many years we weren't able to find out that cigarettes were harmful, when in fact the truth was right there in front of us all the time.
One other question to Mr. Anderson. Do I understand from your written report that you take gambling contributions toward your operation, your treatment program, is that right?
MR. ANDERSON: Yes, sir. The Illinois Council has been funded by the Illinois Casino Gaming Association for the last several years and prior to that a small amount of money from individual casinos.
COMMISSIONER DOBSON: Does that influence the way you operate at all?
MR. ANDERSON: Well, since I'm under oath and since I'm sitting in a room full of people who are in the process of determining right now whether we're going to receive ongoing funding, that places me in the middle here in a very difficult situation. The answer to that is yes and no.
There are segments of the industry, corporations, individuals that are very concerned with this issue and have been very pro-active. There are other segments of the industry that wonder why the heck they're doing anything at all to address the issue of problem and compulsive gambling and it's my experience there are those in the middle who say, well, we don't really want to deal with it, but I guess since we're out of Atlantic City and out of Nevada, I guess it makes good business sense and we have to deal with it.
The way it plays out is that with specific issues, even though the funds are contributed with the statement that there is no strings attached, the fact is within some segments of the industry there are strings attached. We're in an awkward position in that when I get calls from the media and asked about specific issues, I'm going to address them honestly. I'm going to address them out of our experience and I'm going to address them on the basis of the calls that we get.
I was in a meeting with the Illinois Casino Gaming Association last fall and I was asked by one of the members, quote, "how do you weigh in the balance, what you say to the media versus biting the hand that feeds you?" Now, the individual that asked me that question I don't believe for a second that that was his position. I believe he was verbalizing that on behalf of some of the industry representatives that were there. Because as it happens, there was an article that appeared in the newspaper, there was a formal complaint filed with the Illinois Gaming Board with regard to the extension of credit. There was an individual who filed that. The issue came under review.
I was called by the media and asked to respond to a quote by the administrator of the Illinois Gaming Board who testified yesterday who basically said we don't really have any evidence that there's any problem here. The extension of credit is simply a courtesy extended to high rollers.
I told the reporter that you cannot print my first response but my second response is I know many, many, many, many compulsive gamblers who have been extended credit by the casinos who couldn't borrow a plug nickel from the stick man down the street. It is a common occurrence with problem and compulsive gamblers. That issue was widely discussed at the Illinois Casino Gaming Association meeting and it was out of that context that I was asked that question. And when they asked me how I weigh in the balance, what I say to the media versus biting the hand that feeds me, I said I do not. That our message is the same today with funding as it was yesterday when we were talking on the phone out of the living room of our house, paying for it out of our own pocket as it would be tomorrow if they decided to stop funding the organization.
So there is an ongoing tension there that is very real, that is very alive, that is very awkward to deal with and your very question places me in an awkward position. That is the fact and I know there are people in the industry that are well aware of this and we've had discussions.
In fact, right now we're in discussions about ongoing funding for the program. We had an agreement that lapsed and it was voted to not continue the agreement, except we have ongoing funding now on a month to month basis with a ten day termination clause in it. So we're not at a place right now where we can plan for ongoing programs because we have no assurance that we will have any funding ten days from now.
COMMISSIONER DOBSON: Forgive me for asking the question. It's obviously delicate.
CHAIRMAN JAMES; Mr. McCarthy.
COMMISSIONER McCARTHY: One quick question to Mr. Anderson. It's on the same subject. Yesterday we had one or two witnesses of whom I raised the issue of credit card usage and extension of credit. Not at this moment, but if there are a compendium of experiences which you have had, and I apply this to any of you, regarding how credit cards or ATM ease of availability or anything in this area lends to worsening the problems of pathological or problem gamblers, I would very much appreciate receiving information. I think it's an area that we want to pursue and get much better defined in our mind.
Right now, the data we have is very, very loose.
MR. ANDERSON: I know there are a number of other members of other state councils here in the audience and I think they'd be more than happy to do that. I would comment that what's interesting to note is that when gambling is legalized and proliferated, we use the term we want people using their discretionary entertainment dollars. I would say that, for the compulsive gamblers that we know, by definition when they're using their credit card to take cash advances, unless they're paying that amount off within 30 days and using their credit card as a cash management tool, by definition they've crossed the line into using borrowed money in order to gamble.
COMMISSIONER McCARTHY: I think what I'd like to suggest doing is if you could see us after and maybe contact, if I may Madam Chair, Tim Kelly our research director, we could formulate some questions so that we go about this in a somewhat uniform way.
CHAIRMAN JAMES: As a matter of fact, as we bring this particular portion of this panel to a close, I would like to suggest to all three of our presenters that you stay in close contact with the Commission as we go about our work. Any additional information that you would like to submit to us, we would be happy to receive. And we would particularly be interested in your continued comment on the work.