What are the odds that gambling improves your economic future?

Gambling is a hot political issue in some places, but the centerpiece of the economy in a few others. In all places, though, gambling is a bit like a tax on people who don’t understand math.

I don’t understand the allure of gambling, so it’s never been a temptation to me. (But the various other things considered vices have never been of interest to me, either, so that’s not a surprise.) But if people choose to waste their money on gambling as a form of entertainment, hey, it’s their money, not mine. The people who make arguments against gambling on religious grounds or social grounds are basically asserting the right to make the decision for other people — and that’s wrong.

A friend asked me this over the weekend:

“What do you think gambling does to the economy? Of course I don’t think it should be illegal, but I don’t think it’s necessarily good for our economy, either. But I don’t know because I don’t have enough information on that to make a decent conclusion. Now playing the lottery is what my cousin always called ‘the stupid tax’ (and I agree there, because you’re really just giving more money to the government unless you’re one of the very few who wins), but I wonder about casinos and such, too. It’s so intricate, because where there’s gambling there’s addiction and people going into debt.”

First, I agree completely with my friend about the legality of gambling. If you want to gamble, that’s your business. It’s your life. It’s your money. I don’t think it’s a wise decision, but you probably don’t think some of my decisions are wise. I don’t have the right to control you any more than you have the right to control me.

Second, I think that people who claim gambling is a good thing are ultimately deluding themselves. It’s true that it does enrich certain people — casino operators and the state, mostly — but gambling doesn’t produce anything. It adds nothing to the economy, so it’s nothing but a drain on overall wealth. But I have to point out that the same thing can be said about almost all segments of the entertainment and leisure industries. So while spending money on movies, music and gambling might give us some enjoyment, I don’t think you can argue that you’re increasing the wealth of a nation. They’re merely sucking up some of the excess wealth that a strong economy produces. The problem is that a nation accustomed to frivolous spending has trouble putting on the brakes when times get bad — as we’re seeing today.

Third, real people suffer when they destroy the wealth they’ve accumulated. It’s their right to do it. As long it’s their money, it’s even their right to do it is it’s not the best decision for their families. But I can’t ignore the fact that millions of people are materially worse off because of gambling.

Fourth, a nation is most prosperous with people who produce more than they consume. The more industrious we are and the smarter we are, the more things of value that we create. The more lazy and dull we are, the more we destroy of the wealth that’s been built up by previous generations. They modern idea has become that all spending is good. (This comes from the insane ideas of John Maynard Keynes in the ’30s, of course.) But spending to consume (which ultimately reduces wealth) doesn’t have the same result as spending to produce (which ultimately increases wealth).

We’re a nation today of consumers. People think of themselves that way. Politicians use the word. It’s true that we have to consume in order to live. But when that becomes the focus of life — as it is for a growing percentage of our population — people quit doing the things that made the United States into a world economic powerhouse.

Gambling destroys wealth. It should be completely legal in all of its typical forms. But I see it as a cancer. It will make a few people wealthy, but it will make a lot more people poor. It’s a drain on the economy.