Discuss Detroit » Archives - Beginning January 2007 » For Economic Development, Casinos Don't Pay « Previous Next »
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Bvos
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Post Number: 2196
Registered: 10-2003
Posted on Thursday, June 14, 2007 - 3:45 pm:   Edit PostDelete Post   Move Post (Moderator/Admin Only)

Here's a Wall Street Journal article on how gambling as an economic development tool doesn't pay. It's closes with a quote from a WSU prof. who is an avid gambler (am I the only one who finds this concerning?).

http://www.planetizen.com/node /25022
(free link for those without a subscription to the WSJ)
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Danindc
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Username: Danindc

Post Number: 2660
Registered: 10-2003
Posted on Thursday, June 14, 2007 - 3:47 pm:   Edit PostDelete Post   Move Post (Moderator/Admin Only)

Buckle up. Here come the math-illiterate!
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Detroitplanner
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Username: Detroitplanner

Post Number: 1276
Registered: 04-2006
Posted on Thursday, June 14, 2007 - 3:54 pm:   Edit PostDelete Post   Move Post (Moderator/Admin Only)

Tell that to Marian Ilitch and the Keewadhin Tribe! :-)
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Iheartthed
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Username: Iheartthed

Post Number: 970
Registered: 04-2006
Posted on Thursday, June 14, 2007 - 4:02 pm:   Edit PostDelete Post   Move Post (Moderator/Admin Only)

LOL.

Stunning I tell you!

Really Detroit, it's time to get into that international tourist destination niche before everyone else catches on too. You will attract the Europeans a lot faster than the Americans...
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Gistok
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Username: Gistok

Post Number: 4545
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Posted on Thursday, June 14, 2007 - 4:11 pm:   Edit PostDelete Post   Move Post (Moderator/Admin Only)

Well as long as there are lines and lines of buses from Ohio and Indiana lined up outside all 3 Detroit casinos every day....

Let's see, the Tiger attendance is up... Red Wings Games haven't been hurting, neither have the Pistons or the Lions... not sure about whether or not sports bars are hurting or not...

And downtown Detroit is busier than its been in 30 years, and has had billions in new investments...

So, no I ain't worried... but maybe Ohio and Indiana should be?
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Mackinaw
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Username: Mackinaw

Post Number: 2975
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Posted on Thursday, June 14, 2007 - 4:51 pm:   Edit PostDelete Post   Move Post (Moderator/Admin Only)

Haha..I'll take Ohio's money all day long. Michigander's so willingly dump our money at Cedar Point.

It's hard to tell if the casino's are working as an econ. development tool or not in Detroit because so many other positive developments are revitalizing downtown at the same time. The hotels, at the very least, are a major addition to downtown. Then there is the new employment, and the increased downtown tourism. I'm still going to say that it is positive, though I'm not much of a casino fan.
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Emu_steve
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Username: Emu_steve

Post Number: 340
Registered: 11-2006
Posted on Thursday, June 14, 2007 - 5:06 pm:   Edit PostDelete Post   Move Post (Moderator/Admin Only)

Man, I don't agree with that article.

Couple of thoughts:

1). I didn't realize casinos took folks away from sporting events. I thought they took them from race tracks but I'd rather see a beautiful hotel-casino then a race track.

2). I think casinos are useful if they are part of a planned urban strategy or development plan. Detroit's are making a contribution to its downtown. I'm not a fan of a casino in the middle of no where as many are.
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Danindc
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Post Number: 2664
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Posted on Thursday, June 14, 2007 - 5:09 pm:   Edit PostDelete Post   Move Post (Moderator/Admin Only)

Emu_steve, I respect your opinions, but with this:

quote:

I think casinos are useful if they are part of a planned urban strategy or development plan.



I have to disagree. There simply isn't any evidence to suggest this is the case.
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Iheartthed
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Username: Iheartthed

Post Number: 974
Registered: 04-2006
Posted on Thursday, June 14, 2007 - 5:15 pm:   Edit PostDelete Post   Move Post (Moderator/Admin Only)

"2). I think casinos are useful if they are part of a planned urban strategy or development plan. Detroit's are making a contribution to its downtown."

Honestly, the only one that does this is Greektown.

I'm not necessarily anti-casino, but I would guess that the streetscape improvements, the re-birth of Campus Martius and bringing the stadiums into that centralized area are significantly more the cause of the current revival.
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Supersport
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Username: Supersport

Post Number: 11601
Registered: 10-2003
Posted on Thursday, June 14, 2007 - 5:20 pm:   Edit PostDelete Post   Move Post (Moderator/Admin Only)

quote:

There simply isn't any evidence to suggest this is the case.



You mean aside from all of the economic development taking place in Detroit? You'd have to be an idiot to assume that a large portion of Detroit's businesses and development over the past 7 years would have happened without the casinos. Some people obviously don't spend a lot of time in Detroit, as they are oblivious to the number of people wandering the streets that came for the casinos. Contrary to popular belief, many people DO leave the casino to eat and check out the town.
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Danindc
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Username: Danindc

Post Number: 2665
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Posted on Thursday, June 14, 2007 - 5:24 pm:   Edit PostDelete Post   Move Post (Moderator/Admin Only)

quote:

You mean aside from all of the economic development taking place in Detroit? You'd have to be an idiot to assume that a large portion of Detroit's businesses and development over the past 7 years would have happened without the casinos.



Well, you'd have to be an idiot to think that it's all attributable to the casinos, when Atlantic City has 12 casinos and has barely seen any redevelopment in 30 years.

Detroit is really the first major city to have casinos in its downtown, so it's an experiment. There's a whole host of factors at work in Detroit, though, so it's very simple-minded to label correlated events as a cause/effect relationship.

And even still--three casinos notwithstanding, Detroit's amount of economic development pales when compared to some other cities that don't even have casinos. Try again, simplesport.
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Jimaz
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Username: Jimaz

Post Number: 2297
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Posted on Thursday, June 14, 2007 - 5:29 pm:   Edit PostDelete Post   Move Post (Moderator/Admin Only)

Near the end of the article:
quote:

"Casinos always make money, but how much good they're doing for Detroit's economy is another question completely," [Prof. Wacker of WSU] says. "I don't see much community development."

I wonder what he meant by that?
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Charlottepaul
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Username: Charlottepaul

Post Number: 1112
Registered: 10-2006
Posted on Thursday, June 14, 2007 - 5:35 pm:   Edit PostDelete Post   Move Post (Moderator/Admin Only)

Detroit hasn't "...see[n] much community development." Seems to me rather that the city has seen quite a bit recently. The prof. should have just argued that the new development isn't due to the casinos.
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Jimaz
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Post Number: 2298
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Posted on Thursday, June 14, 2007 - 5:57 pm:   Edit PostDelete Post   Move Post (Moderator/Admin Only)

That's what I thought too. Maybe he meant neighborhood development. Well, that's supposed to be coming up next.
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Emu_steve
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Username: Emu_steve

Post Number: 341
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Posted on Thursday, June 14, 2007 - 7:38 pm:   Edit PostDelete Post   Move Post (Moderator/Admin Only)

I agree with couple of the 'rebuttals' to my comment above.

I believe Detroit's casinos pretty well MINIMIZED the possible pluses by the way they ended up.

HOWEVER, Greektown fits and MGM eats up 20+ acres of underutilized land. Both are pluses to me.

If I had my way, I'd put all three in the area behind the Fox and extending out to where the new MGM is. I bet casino owners didn't want gamblers WALKING from casino to casino (they'd rather have a gambler with his car in their garage and not likely to drive a mile or two to another casino).

Then the new hockey arena could have gone by Gratiot.

P.S. I hope many folks didn't think gambling would save Atlantic City. I remember when those casinos were being built (I was playing Bally options in the stock market).
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Detroitplanner
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Username: Detroitplanner

Post Number: 1278
Registered: 04-2006
Posted on Thursday, June 14, 2007 - 9:06 pm:   Edit PostDelete Post   Move Post (Moderator/Admin Only)

According to Planning Magazine, Atlantic City is really taking off. It looks like it is worlds better than when I made it there 10 years ago.

http://www.baltimoresun.com/tr avel/beaches/bal-bz.cordish30m ar30,0,6001915.story?page=2&co ll=bal-bayandbeach-headlines
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Kslice
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Post Number: 63
Registered: 04-2007
Posted on Thursday, June 14, 2007 - 9:31 pm:   Edit PostDelete Post   Move Post (Moderator/Admin Only)

Casinos like other businesses have good and bad points.

It's better to have three rather than zero because otherwise all the Detroiters would be going to Canada to spend their money.
On the other hand they dont always attract the best people and dont give a lot back to the communiy.

You've got to agree to disagree, the casinos are here and they aren't leaving.
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Jimaz
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Username: Jimaz

Post Number: 2306
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Posted on Thursday, June 14, 2007 - 9:50 pm:   Edit PostDelete Post   Move Post (Moderator/Admin Only)

An alternative to the Detroit casinos would have been to persuade Windsor's to shut down in the spirit of responsible cooperation with Detroit. But that's water under the bridge.

I like the new Motor City appearance. It seems designed to attract outsiders. I hope it does.

The casinos will be forced to leave in the long term. There's a long history of this cycle in American politics regarding gambling. For Detroit, it's about what can be leveraged in the short term.

Godspeed, Detroit. Build when you can.
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Jerome81
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Username: Jerome81

Post Number: 1493
Registered: 11-2003
Posted on Friday, June 15, 2007 - 3:56 am:   Edit PostDelete Post   Move Post (Moderator/Admin Only)

Totally unrelated but not completely...


Did I hear they don't serve free drinks at the Detroit casinos like they do in Vegas??!!

That alone may keep me out. Sure I like to play craps or blackjack every 6 months or so, but when I go blowing my money (usually), I'd at least like to not have to pay for my beer too.

Back on topic.... I think they're good. At least Greektown. I probably wouldn't go to the other 2. Greektown is great cause it can be part of your adventure, not the only part. Go to a game, grab a bit, hit the tables, grab a drink, etc. The others are fortresses that have people come in, spend money, and get out.
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Charlottepaul
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Post Number: 1114
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Posted on Friday, June 15, 2007 - 8:23 am:   Edit PostDelete Post   Move Post (Moderator/Admin Only)

I think that is illegal to serve free drinks; might just be a Michigan thing. Either that or the other casinos in other states might have exemptions that Detroit doesn't.
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Ray1936
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Username: Ray1936

Post Number: 1552
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Posted on Friday, June 15, 2007 - 9:22 am:   Edit PostDelete Post   Move Post (Moderator/Admin Only)

Liquor laws all vary from state to state. Even within states, some counties have further restrictions, with many being completely "dry". That's 180 degrees from Nevada which allows liquor 24/7. Which is as it should be.
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Detourdetroit
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Username: Detourdetroit

Post Number: 317
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Posted on Friday, June 15, 2007 - 9:31 am:   Edit PostDelete Post   Move Post (Moderator/Admin Only)

yes, downtown's more crowded with activity - good thing! and while i've no puritanical bias against gaming or casinos (or drinking for that matter!), it's all very depressing to have casinos as a growth industry in this city. there is no product or intellectual property as a result. it saps money from people who can probably least afford it. it is anti urban, anti social and anti progressive and something that, in the long term, will no doubt bite us in the *&@. just my two cents...
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56packman
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Username: 56packman

Post Number: 1425
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Posted on Friday, June 15, 2007 - 11:38 am:   Edit PostDelete Post   Move Post (Moderator/Admin Only)

Well, we don't want to do any of that dirty manufacturing in Detroit (or the USA), we'd much rather send all of that WORK to EPA/OSHA free China, There's only so much money to be made selling wigs & nails, liquor/lotto and check cashing businesses, so Casinos are the only easy big money solution left.
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Erikd
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Username: Erikd

Post Number: 863
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Posted on Friday, June 15, 2007 - 8:20 pm:   Edit PostDelete Post   Move Post (Moderator/Admin Only)

quote:

Did I hear they don't serve free drinks at the Detroit casinos like they do in Vegas??!!



Michigan law prohibits giving away free drinks, so you won't get any freebies at the Detroit casinos.
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Verifiable
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Username: Verifiable

Post Number: 50
Registered: 05-2007
Posted on Friday, June 15, 2007 - 10:31 pm:   Edit PostDelete Post   Move Post (Moderator/Admin Only)

Gistok,

Wings attendance was poor during the playoffs. Various Columnists around the country made note that it was never sold out, bagged on Ilitch for inflating the ticket prices.

Maybe Ilitch should formulate some plan to support a casino tax in order to pay for a new Wings Arena. After all, 1/3rd of his annual revenue stream now comes from MotorCity Casino (nearly half a billion dollars annually) and valued at $1 billion plus the casino certainly contributes to his $1.5 billion net worth.
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Erikd
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Username: Erikd

Post Number: 865
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Posted on Sunday, June 17, 2007 - 11:36 pm:   Edit PostDelete Post   Move Post (Moderator/Admin Only)

quote:

Wings attendance was poor during the playoffs.



Verifiable,

The lack of sellouts during the playoffs caused much consternation in the local media, but the attendance numbers show that Red Wing attendance was far from "poor".

The Red Wings finished 2nd in the entire NHL in regular season attendance last year. There was a decline in post-season attendance, but it was fairly small. The Red Wings averaged 19,513 in attendance for the 2007 playoff games, which is only 553 short of the 20,066 capacity at the JLA.

The slight decline in Red Wing playoff attendance is far outweighed by the excellent attendance for the Pistons (with the 2nd highest attendance in the NBA this season), and the growth of attendance for the Tigers. The Tigers average attendance is 34,758 this year, up from 32,048 in 2006, and almost 10,000 higher PER GAME than the 2005 average of 25,306.

In summary, there is absolutely no evidence that the Detroit casinos have had any negative impact on attendance for Detroit's professional sports teams. The slight decline in Red Wing playoff attendance is the result of the Red Wings lack of recent playoff success, combined with the recent playoff success of the Tigers and Pistons, and the detrimental effects of the NHL lockout two years ago.
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Gistok
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Username: Gistok

Post Number: 4568
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Posted on Sunday, June 17, 2007 - 11:46 pm:   Edit PostDelete Post   Move Post (Moderator/Admin Only)

Verifiable, I'm sure that most of us on this forum appreciate all the work you have done in accumulating all of the information on the Ilitch land dealings, etc.

But one also gets the subtle impression that perhaps you somehow have a "personal ax to grind" against them.

It almost appears that you have spent more time researching them than Steve Wilson has Kwame Kilpatrick! :-)
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Cgunn
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Username: Cgunn

Post Number: 59
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Posted on Monday, June 18, 2007 - 12:06 am:   Edit PostDelete Post   Move Post (Moderator/Admin Only)

I belive the 1.5B figure comes from his profit from Ilitch Holdings. If that's true, then none of that comes from MotorCity Casino.
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Chow
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Username: Chow

Post Number: 377
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Posted on Monday, June 18, 2007 - 1:03 am:   Edit PostDelete Post   Move Post (Moderator/Admin Only)

i guess everyone who says the casinos are bad has a job... the casinos created thousands of jobs overnight. i don't see any other industry looking to expand in detroit. and let us not forget the city's problems are economic.
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Danindc
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Username: Danindc

Post Number: 2675
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Posted on Monday, June 18, 2007 - 12:48 pm:   Edit PostDelete Post   Move Post (Moderator/Admin Only)

quote:

i guess everyone who says the casinos are bad has a job... the casinos created thousands of jobs overnight. i don't see any other industry looking to expand in detroit. and let us not forget the city's problems are economic.



The people employed by the casinos were not derelicts on the street, collecting unemployment checks. I'd be willing to bet that most of the casino employees were already working somewhere else. This is not unlike saying that Comerica Park brings more people downtown. While that might be true on the surface, the people are really just transferred from somewhere else.

Of course, we all know that $10/hour table dealers and $6 beer vendors at baseball games are the way to build an economy that is bleeding decent employment. Watch the new college graduates line up to become craps dealers!
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Gistok
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Post Number: 4574
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Posted on Monday, June 18, 2007 - 12:53 pm:   Edit PostDelete Post   Move Post (Moderator/Admin Only)

The Detroit Casino employees that I've talked to say they make 30-40% of their salary on tips. So that $10 figure isn't the whole picture.

So $15-$16 is a more accurate figure. And who said you have to be a college grad to be a table dealer?
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Danindc
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Post Number: 2677
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Posted on Monday, June 18, 2007 - 1:04 pm:   Edit PostDelete Post   Move Post (Moderator/Admin Only)

$15/hr = $31,200/year Almost makes you salivate just thinking about the growth potential, doesn't it?

Cheers to the future of Detroit!
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El_jimbo
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Username: El_jimbo

Post Number: 239
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Posted on Monday, June 18, 2007 - 1:32 pm:   Edit PostDelete Post   Move Post (Moderator/Admin Only)

Danindc,

Not everybody is going to make $100K or more a year. However, there is a niche there that will provide people with perhaps a reduced educational background the opportunity to make a decent wage. They'll never get rich but they won't be hurting too bad.
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Danindc
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Post Number: 2680
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Posted on Monday, June 18, 2007 - 1:37 pm:   Edit PostDelete Post   Move Post (Moderator/Admin Only)

^^^I agree. But you can make more money than that waiting tables instead of dealing tables. Since the people employed at casinos are largely displaced from other jobs, though, the increased employment is perhaps negligible. That is the point of the article at the top of the thread. The casinos help to stifle growth in other businesses by luring away their employees. Of course, most people willfully ignore this because they see three (cheaply constructed) high-rise buildings being constructed downtown.
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El_jimbo
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Username: El_jimbo

Post Number: 241
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Posted on Monday, June 18, 2007 - 1:41 pm:   Edit PostDelete Post   Move Post (Moderator/Admin Only)

Does that model of luring away employees from other jobs really work in a state with 7% unemployment? I would assume there would be plenty of other people who would be ready to fill any vacant positions.

Also, could the region support 3,000 additional waiters and waitresses right now? The reality is that these are 3,000 jobs that weren't there before and will be filled by people who otherwise might not have a job.
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Danindc
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Username: Danindc

Post Number: 2684
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Posted on Monday, June 18, 2007 - 3:28 pm:   Edit PostDelete Post   Move Post (Moderator/Admin Only)

quote:

Also, could the region support 3,000 additional waiters and waitresses right now? The reality is that these are 3,000 jobs that weren't there before and will be filled by people who otherwise might not have a job.



You don't read so well, do you? These casino employees are NOT coming off the unemployment lines!

Casinos have been in Detroit for nine years. Where's the huge economic impact that was promised with all these new jobs? Seems to me, things have only become worse.
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Gistok
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Post Number: 4577
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Posted on Monday, June 18, 2007 - 3:49 pm:   Edit PostDelete Post   Move Post (Moderator/Admin Only)

LOL... yeah Dan that's right!! Soooo many Detroit restaurants had to close because they ran out of folks to employee... The casinos sucked them all up, and now there's no employable people left.

And oh yea... a $750 million MGM Casino is "cheaply constructed".

Dan, just go back and listen to yourself. Must you play the devils advocate on every single topic on this thread? Do you actually make this stuff up? Is Skulker right about you after all? It's certainly starting to look that way!
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Jimaz
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Username: Jimaz

Post Number: 2332
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Posted on Monday, June 18, 2007 - 3:56 pm:   Edit PostDelete Post   Move Post (Moderator/Admin Only)

quote:

Where's the huge economic impact that was promised with all these new jobs?

It's also important to consider from where the revenue came to pay these workers. If casino patrons all came from outside the area, the economic impact would be much better. I doubt that has been the case but I hold hope for the new casinos.
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Johnlodge
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Post Number: 652
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Posted on Monday, June 18, 2007 - 4:03 pm:   Edit PostDelete Post   Move Post (Moderator/Admin Only)

Perhaps it was the BELIEF that the Casino's would turn the city around that led to the economic development, hmm? People only have to believe they know an area is about to have a revival to start investing their money there. Even if the Casino's contributed NOTHING, they may have contributed MUCH.
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El_jimbo
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Post Number: 243
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Posted on Monday, June 18, 2007 - 4:07 pm:   Edit PostDelete Post   Move Post (Moderator/Admin Only)

Look at it this way, where would the city be without the 100 million or so in yearly tax revenue they get from the casinos?
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Oliverdouglas
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Username: Oliverdouglas

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Posted on Monday, June 18, 2007 - 4:13 pm:   Edit PostDelete Post   Move Post (Moderator/Admin Only)

Odd that no one has mentioned the revenue the city realizes from the Casinos. If anyone thought that the casinos alone would turn Detroit around, then obviously they were mistaken (DID anyone think that?). Still, they contribute significantly - they're just part of the mix.
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Danindc
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Username: Danindc

Post Number: 2688
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Posted on Monday, June 18, 2007 - 4:40 pm:   Edit PostDelete Post   Move Post (Moderator/Admin Only)

quote:

LOL... yeah Dan that's right!! Soooo many Detroit restaurants had to close because they ran out of folks to employee... The casinos sucked them all up, and now there's no employable people left.

And oh yea... a $750 million MGM Casino is "cheaply constructed".



Again, Detroit does it correctly. It's everywhere else that's wrong, isn't it???
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Erikd
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Username: Erikd

Post Number: 868
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Posted on Wednesday, June 20, 2007 - 12:40 am:   Edit PostDelete Post   Move Post (Moderator/Admin Only)

Dan,

Your posts on this thread are filled with incorrect assumptions, baseless claims, and statements that are flat-out false.

Detroit casino employees are compensated FAR better than you think.

Most of the JANITORS working at the Detroit casinos make over $35,000 per year, PLUS full health care, PLUS a few weeks of paid vacation time, PLUS a nice 401K package, PLUS free meals at work, PLUS educational funding.

The compensation for table games dealers, slot machine techs, cage cashiers, facility maintenance, bartenders, cocktail servers, and most other casino employees is even better.

I personally know a number of guys that make over $50,000 a year, PLUS benefits, working valet at the Detroit casinos, and they are just normal hourly employees, not supervisors or management.
--------------------

The rest of your claims on this thread are just as weak:

quote:

I'd be willing to bet that most of the casino employees were already working somewhere else.



Considering the fact that the unemployment rate in Michigan has been around 7% for the last few years, it is a good assumption that most casino employees were working *somewhere* else before they got a casino job, but it is obvious that most of these people were working a job that was not as good as the casino. You can't equate a part-time job at Wal-Mart, paying 8 bucks an hour with no benefits, to a full-time casino job paying over 35 grand a year plus benefits.
-----------

quote:

Since the people employed at casinos are largely displaced from other jobs, though, the increased employment is perhaps negligible. That is the point of the article at the top of the thread. The casinos help to stifle growth in other businesses by luring away their employees.



That would be a good point, if it was actually true. In reality, there is no evidence that the Detroit casinos have stifled growth in other businesses by luring away employees. If anything, there has been an increase in service jobs since the Detroit casinos opened, especially in the downtown area where the casinos are located.
----------------

quote:

Casinos have been in Detroit for nine years. Where's the huge economic impact that was promised with all these new jobs? Seems to me, things have only become worse.



The positive economic impact of 10,000 new casino jobs has been very real, and should not be dismissed. The recent loss of some 250,000 manufacturing jobs in Michigan is the reason why things have become worse, and that has nothing to do with the Detroit casinos.
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Danindc
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Username: Danindc

Post Number: 2700
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Posted on Wednesday, June 20, 2007 - 11:58 am:   Edit PostDelete Post   Move Post (Moderator/Admin Only)

Well, Erikd, I'm glad you have warm and fuzzy feelings about the casinos in Detroit. But I wonder if you even followed the link at the top of the thread? I'm going to quote a few passages here.

quote:

"There are two simple questions: Where does the money come from, and where does the money go?" says William Thomson, a professor of public administration at the University of Nevada in Las Vegas. "If the customers live in the local area, there's no way you can have economic development."



Perhaps you should tell Professor Thomson that his research is full of shit, baseless claims, and faulty assumptions?

Does this sound like anyone you know:

quote:

"The problem with cities is that they only look at the positive side," says Ricardo Gazel, who is an economist at the Washington, D.C.-based Inter-American Development Bank, and who authored a paper on casinos and economic development while at the Federal Reserve Bank of Kansas City. "They look at revenues and the creation of jobs, but they don't look at the destruction of other jobs."



Let's look at all that economic growth the casinos are bringing to Detroit:

quote:

Also, casinos don't necessarily provide the same benefits that most other businesses do. If, for example, a city or state attracts software or biotech firms, the community is likely to benefit not only from job creation, but from the services or products that these types of companies provide. In the case of software, that "utility" is added productivity or entertainment for anyone who uses the product. For biotech, it can be health benefits.



In other words, nothing of tangible value is produced, so the cycle of money is stopped as the profits flow out of town to Vegas and other casino investors. And we all know that rich people don't get rich by spending all their money.

quote:

Many people aren't shelling out that money purely for entertainment: Prof. Grinols, citing various studies, estimates problem and pathological gamblers, on average, account for as much as half of casinos' gaming revenues. That suggests that to a large extent, casinos do little more than transfer money from one group of people to another -- in this case, from their customers to their investors and employees. "With a service like gambling you don't have that mutual value of trade," says Prof. Thomson.



In other words, the casinos are just moving money--out of the hands of ordinary people, and concentrated into the hands of billionaires.

Then again, Detroit is the same city that lavishes incredibly needless public subsidies on one of its wealthiest citizens, and dominated by three companies that do nothing but hemorrhage money, so I wouldn't expect the local culture to promote fiscal prudence all too much.

But if you sleep well at night thinking that the casinos are putting Detroit on the rebound, bless your sweet little heart.
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Spartacus
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Username: Spartacus

Post Number: 187
Registered: 07-2005
Posted on Wednesday, June 20, 2007 - 1:27 pm:   Edit PostDelete Post   Move Post (Moderator/Admin Only)

Dan, why do you have to be such a prick? I'm sure you can make your points without the attitude.

You're assumption is that the only people gambling in Detroit are from Detroit. I'm not sure what percentage of the money is coming from people who live in the tri-county area, but I can assure you that it is not 100%. Everytime I go by the Greektown casino there are about a dozen tour buses in the vicinity. It is not uncommon to see Ohio plates on the buses.

One of the reasons the City required that the casinos build hotels was to assure that people would be pulled in from out of town. I'm not sure we'll know what percentage of the dollars will be flowing in from outside the metro area until the hotels are complete. I am hopeful that the casinos will aggressively market in places like Cleveland. They could, for example, offer a package deal that would include tickets to a Tigers/Indians game. I think that this sort of marketing, could also be extended to other events like major shows at the DIA.

Above you acknowledge:

"Detroit is really the first major city to have casinos in its downtown, so it's an experiment."

You recognize that the Detroit casinos are unique, so why are you so convinced it won't be a net positive for the City?

Also, only one of the Casino's is owned by a Vegas Casino. Your claim that all the profits are flowing to Las Vegas is an exaggeration at best.

Your criticisms also ignore the fact that there is a multiplier effect that is created because of the increased economic activity in the City. And before you go there, don't even try to tell me that this activity replaced other economic activity that would have happened in the City.

In summary, if the Detroit casinos can attract people from outside the tri-county area, and specifically from southern Ontario, northern Indiana and northern Ohio, they will undoubtedly be a net positive for the City.


What should not be lost in this is Detroit's hand was forced when Casino Windsor opened. Detroiters losing their money to a Canadian casino would have been much worse.
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Danindc
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Username: Danindc

Post Number: 2701
Registered: 10-2003
Posted on Wednesday, June 20, 2007 - 1:44 pm:   Edit PostDelete Post   Move Post (Moderator/Admin Only)

Why am I a prick? Because I can't tolerate willful idiocy. Fair enough?

Believe what you want. I'm just reading what researchers have documented.

quote:

Your criticisms also ignore the fact that there is a multiplier effect that is created because of the increased economic activity in the City.



I'm not sure what this "multiplier effect" is exactly (perhaps you can define it?) but the point of the article is that there IS NO NET INCREASE in economic activity due to the casinos. Why is that so hard for some people to comprehend? You can't rebuild a city on wishes and dreams, pal. And you certainly can't rebuild the city by sending otherwise-productive capital to Vegas, the Ilitches, and Indian tribes.
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Gistok
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Username: Gistok

Post Number: 4611
Registered: 08-2004
Posted on Wednesday, June 20, 2007 - 2:12 pm:   Edit PostDelete Post   Move Post (Moderator/Admin Only)

Well we can all be thankful for the thousands of construction jobs that the Casinos are generating during this time of stagnation in the building industry in Metro Detroit.

I know a lot of builders, carpenters and electricians that are hurting right now, and are considering relocating. I have friends in that industry that are temporarily relocated in Arizona, Utah and Nevada (with the wife and kids still here in metro Detroit).

At least the casinos are keeping thousands of folks in that depressed industry busy right now.

But published "experts" and "consultants" know more about this situation than do the folks who actually live here...
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Danindc
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Username: Danindc

Post Number: 2702
Registered: 10-2003
Posted on Wednesday, June 20, 2007 - 2:20 pm:   Edit PostDelete Post   Move Post (Moderator/Admin Only)

quote:

But published "experts" and "consultants" know more about this situation than do the folks who actually live here...



The researchers who have studied casino gambling have documented their assumptions and research, and have had same published in peer-reviewed publications. The locals say, "OOOOOOH! TOWER CRANE!" and therefore assume it MUST be good.

Which seems more rigorous to you?
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Dds
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Username: Dds

Post Number: 258
Registered: 10-2006
Posted on Wednesday, June 20, 2007 - 2:43 pm:   Edit PostDelete Post   Move Post (Moderator/Admin Only)

quote:

At least the casinos are keeping thousands of folks in that depressed industry busy right now.



The key words being "right now." According to one of the laborers who has worked on the Motor City and Greektown expansions, there are two of the contracting firms actively recruiting people to go to Las Vegas and Florida and promising them 2 years of work. I guess the scuttlebutt is that soon after the casino jobs are done, the contractors are not too positive to have work locally.

The jobs seem to be slowly leaking away. And as far as the casinos keeping locals employed, of the 40 or so I know, only one still resides in the city. Most of the rest have relocated to the suburbs.
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Spartacus
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Username: Spartacus

Post Number: 188
Registered: 07-2005
Posted on Wednesday, June 20, 2007 - 3:29 pm:   Edit PostDelete Post   Move Post (Moderator/Admin Only)

Here is a comprehensive study reviewing the results of a large number of casino economic impact studies.

http://govinfo.library.unt.edu /ngisc/reports/ecoimprpt.pdf

I couldn't cut and paste portions of it, because it is a PDF. An explanation of the multiplier effect, as it relates to casinos, can be found on page 19 of the study.

The author's conclusion is that casinos can have a net positive impact on a region.
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Gistok
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Username: Gistok

Post Number: 4614
Registered: 08-2004
Posted on Wednesday, June 20, 2007 - 3:44 pm:   Edit PostDelete Post   Move Post (Moderator/Admin Only)

Thanks Spartacus, looks like Dan must have missed a study! :-)

If you look hard enough on the internet, you will find a study somewhere that fits what you want to hear! Just go look at all the studies bandied about by the lefties and righties on the Non-Detroit Issues forum.

Maybe someone should do a study on studies, and the people who swear by them? :-)
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Erikd
Member
Username: Erikd

Post Number: 870
Registered: 10-2003
Posted on Friday, June 22, 2007 - 1:01 am:   Edit PostDelete Post   Move Post (Moderator/Admin Only)

Dan,

This article is filled with vague generalizations and theoretical assumptions, and it lacks any hard data concerning the Detroit casinos.

Let's take a look at the passages that you quoted:

quote:

"There are two simple questions: Where does the money come from, and where does the money go?" says William Thomson, a professor of public administration at the University of Nevada in Las Vegas. "If the customers live in the local area, there's no way you can have economic development."



In theory, If ALL the customers live in the local area, there would be no economic development.

In reality, the Detroit casinos currently draw a large amount of customers from outside the state, and this number will go up even further after the casino hotels open. Therefore, the Detroit casinos ARE drawing customers from outside the area, rendering this "expert opinion" invalid.

quote:

"The problem with cities is that they only look at the positive side," says Ricardo Gazel, who is an economist at the Washington, D.C.-based Inter-American Development Bank, and who authored a paper on casinos and economic development while at the Federal Reserve Bank of Kansas City. "They look at revenues and the creation of jobs, but they don't look at the destruction of other jobs."



This quote brings accusations of casinos destroying other jobs, with absolutely no evidence that this has been the case in Detroit. Since the Detroit casinos have opened, there has been a growth in non-casino entertainment jobs in the greater downtown area, where the casinos are located.

quote:

Also, casinos don't necessarily provide the same benefits that most other businesses do. If, for example, a city or state attracts software or biotech firms, the community is likely to benefit not only from job creation, but from the services or products that these types of companies provide. In the case of software, that "utility" is added productivity or entertainment for anyone who uses the product. For biotech, it can be health benefits.



This may be the most nonsensical and irrelevant statement in the entire article.

Allowing the construction of casinos and attracting other types of businesses is not an "either-or" situation.

This article makes it sound like Detroit was turning away software companies, like Compuware, in favor building casinos. This is simply not true. If anything, the new casinos in Detroit have made the city more attractive to other types of businesses, and the additional revenue from the casinos has made it easier to offer incentives to attract other development.
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Gistok
Member
Username: Gistok

Post Number: 4643
Registered: 08-2004
Posted on Friday, June 22, 2007 - 1:21 am:   Edit PostDelete Post   Move Post (Moderator/Admin Only)

Peter Karmanos, founder and CEO of Compuware has publicly stated that he probably would NOT have brought his HQ downtown were it not for the casinos and the other entertainments that came to downtown in the last 10 years. And now it looks like Quicken will follow suit for exactly the same reason, the excitement that is growing in the city center.
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Verifiable
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Username: Verifiable

Post Number: 66
Registered: 05-2007
Posted on Friday, June 22, 2007 - 1:46 am:   Edit PostDelete Post   Move Post (Moderator/Admin Only)

Gistok,

What Karmanos is likley saying is because other "businesses" are bringing vitality to the downtown area ... and it just happens that casinos are among those businesses. Because after all, what added value does a casino specifically add to Karmanos core business?
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Erikd
Member
Username: Erikd

Post Number: 872
Registered: 10-2003
Posted on Sunday, June 24, 2007 - 3:19 am:   Edit PostDelete Post   Move Post (Moderator/Admin Only)

quote:

what added value does a casino specifically add to Karmanos core business?



What added value does new sports stadia, new nightclubs, or new condos "specifically" add to Compuware's core business?

The addition of 1200 brand new downtown hotel rooms (at the casinos) is more beneficial to a large software company than new housing, new stadia, or new nightclubs.

Despite all of this, any attempt to single out the "specific" value of Detroit casinos to Compuware's core business is an exercise in futility.

Downtown Detroit is becoming more attractive to visitors, residents, and investors due to a confluence of events. The casinos are part of the reason, the stadia are part of the reason, the new housing is part of the reason, the new public spaces are part of the reason, the new bars and restaurants are part of the reason, etc...

You can't just take one part of the massive downtown redevelopment movement, and look at it as a stand alone project. All of the recent downtown developments have to be looked at within the context of the larger redevelopment picture.

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