Wednesday, July 05, 2006

A Puzzling Situation

I live in New Jersey. Governor Jon Corzine has been at war with our state legislature, trying to force some more responsible spending than has been done in the past. The biggest sticking point is Corzine's insistence on a sales tax increase from 6% to 7%. The upshot is that New Jersey's government has been shut down, except for essential services.

The thing that I find puzzling about this is that among the items shut down are the state lottery and Atlantic City's casinos. The number I've heard on lost casino revenue is $1.2 or $1.3 million/day. I'm sure the lottery also generates meaningful revenue on a daily basis. I'm sure the Governor wants to keep the pressure high on the legislature, but I can't understand his stance on the casinos. Apparently, there are state authorities (I think called casino inspectors) who are required to be there for the casinos to operate.

My feeling is that the closure of the casinos will cause many Atlantic City gamblers to try alternatives they haven't tried, such as the Indian casinos in Connecticut, and perhaps some of them will continue to frequent those casinos when the casinos in Atlantic City reopen.

My question is why not either let the casinos operate with the inspectors absent or designate the casino inspectors as essential. This would allow the state to continue to receive revenue from the casinos and not cause the Atlantic City gamblers to investigate their competition.

Further, I understand that the missed work by non-essential employees will likely have to be made up with overtime AND that the time off may need to be paid because of contractual agreements with state employees. The result may be that this shutdown may cost the state a LOT of money. If it puts New Jersey on the right path, it may be worthwhile, but I'm not very confident of that.

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