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p12 Stateside 23/3/09 10:54 Page 12
STATESIDE
Stateside
Sharon Harris looks at the how the new administration
is affecting gaming in the US…
A
s journalists, we in the media recognize the House. I don’t think it ever came.
power of our words and their intent. That is Coincidentally, the gradual Las Vegas business
why the good ones edit and revise their slowdown accelerated after Obama and Congress
work. spoke against corporate excesses, spending and
On the campaign trail, then-Senator Barack Obama executive compensation. The Las Vegas Convention
talked about “just words, just speeches”. Perception is and Visitors Authority reported 340 event
often reality. Ironically, he too has learned his own cancellations between early December and early
words are under intense scrutiny. Some comments March, a projected loss of about $131.6 million in
have come back to haunt him. lost non-gaming spending.
For weeks after taking office, Obama and his Statistics report that 2.8 million people came to Las
spokespeople traveled the country and held Vegas in January, 11.9% down from last year. Convention
interviews. They described the economy as “dire”, a attendance weakened and room rates dropped by almost
“crisis” or a potential “catastrophe”; the public halted 20%. Local resorts lost 111,800 guests, 236,700 room
its investing and spending. nights and an unknown amount of gambling dollars.
After assessing public opinion, the Obama In February, American Gaming Association
Administration representatives sharply changed its President and CEO Frank Fahrenkopf Jr. and Roger
approach. The language then projected hope and Dow, President and CEO of the US Travel Association,
encouragement about the country’s financial posted an open letter accusing Washington legislators
condition and future. Whether they calmed the of worrying about saving and creating jobs for
Harrah’s, MGM
public’s apprehension is unclear. everyone but those employed in the hospitality/travel
The stock market fell 20% since Obama took office, industry. They claimed that verbally using business
Mirage, Las Vegas
but Wall Street rallied a bit in March. Maybe it was travel as the scapegoat for excesses endangers more
Sands, Boyd
the change in language, but experts warn against than one million jobs – 300,000 directly in gaming –
evaluating its long-term health too soon. and eliminates $16 billion in tax revenues.
Gaming, Trump
Crippled by the falling stock market, the nation’s The reaction reached the White House. In mid-
Entertainment
largest gaming companies have swerved dangerously March, Obama invited travel executives and major
and others face
off course. Harrah’s, MGM Mirage, Las Vegas Sands, hotel chain CEOs to Washington. He promised to
Boyd Gaming, Trump Entertainment and others face actively advocate responsible corporate travel.
extreme financial
extreme financial challenges and shaky futures. If passed, the Travel Promotion Act will collect $10
challenges and
Many of these companies operate casinos across from every foreign visitor not required to pay for a US
America. Restructuring has caused massive layoffs visa, to create a fund to promote the US as a welcoming
shaky futures
and shutdowns. country for foreign visitors.
As bailouts, stimulus spending and budget cuts In this new era, giant corporations, banks and Wall
continue across the US, what should Obama say? Street firms receiving taxpayer bailouts must follow
How careful must he be? strict guidelines, but language that targets individual
As the $787 billion Recovery and Reinvestment Act industries is counterproductive. As Congress, funded
of 2009 passed in February, Obama warned corporate by taxpayers, seeks greater say over how businesses
America against excessive tax-deductible meetings and operate, it should clean up its own act.
conventions. He said: “You can’t take a trip to Las Vegas These public “servants” should refine their own
or down to the Super Bowl on the taxpayers’ dime.” rhetoric and spending. Recently, Democrats and
A furious Mayor Oscar Goodman publicly rejected Republicans held separate retreats at luxury resorts
Obama’s comments about Las Vegas. Sheldon Adelson near Washington. It appears they consider themselves
also denounced Obama’s words. immune from tight budgets, despite public sentiment.
In various interviews, Goodman said, “This is a very Wednesday is party night at the White House.
important place for people to conduct very important Every week, they have held a dinner or reception with
business. For them to change their mind and go top entertainment. I live near Atlantic City, where the
someplace else and to cancel at the suggestion of the economy has hit the nightlife; maybe I can bag an
President of the United States… is outrageous.” invite.
Goodman sought a public apology from the White Conga, anyone?
12 APRIL 2009
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