- Historic Sites
Nation Of Gamblers
Once seen as a vice and now as a public panacea, the national passion that got Thomas Jefferson in trouble has been expanding for two centuries
September 1994 | Volume 45, Issue 5
“I’m dad-gum disgusted at trying to police every half-square and every half-house,” Sen. Huey Long told a radio audience in Louisiana in May 1935. “You can’t close gambling nowhere where the people want to gamble.”
Dozens of casinos in St. Bernard and Jefferson parishes reopened the next day, after a nearly five-month hiatus.
In California, Santa Anita Race Track was in the midst of its second season in the summer of 1935. As sleek as a luxury ocean liner, it brought horseracing to the West Coast, whereupon a network of bookmakers brought it to the neighborhoods. “1 had a wedding at four o’clock yesterday,” wrote a minister from Pico Boulevard in Los Angeles. “It was with no little reluctance that the bride’s parents turned off the radio which bore the news of their horses.”
Back on the East Coast, Harlem ministers reported that gamblers couldn’t wait to go to church. Once there they waited anxiously for the hymn to be announced, so that they could bet it, by its numerical designation, in the numbers game. That New York game was controlled by Dutch Schultz, a gangster who feast- ed upon such superstition, though one day when the winning number in his game came up 0-0-0, he was gunned downed by rivals.
Three weeks later the police in Grand Rapids cracked down by put- ting Mrs. Eleanor Girodat in jail. She had organized a bingo game to raise money for the Catholic Daughters of America.
That one year, 1935, served as a trial for Huey Long’s supposition that “you can’t close gambling nowhere where people want to gamble.” Every other year in American history has tested it as well and, so far, proved it.
The lines were drawn tightest around gambling in America in the nineteenth century, when the betting crowd was small and maverick, pushing around in search of “a place where everybody can do what they please, just so they don’t interfere with other people’s rights,” as a Reno man later said. The best that could be said of professional gamblers in those days was that some of them had nice clothes.
Some of them did not. In 1835 the upstanding citizens of Vicksburg, Mississippi, rose up in rage against the gamblers who camped along the river there. They went from shack to shack, chasing the bettors into the swamp, and when they found resistance at one dark place, they dragged five of its denizens out and hanged them from a tree. The incident was widely publicized, and it drew a line between good and bad in the gambling issue, for both sides to see.
Since that eerie night the line has faded. Gambling itself has turned from a social ill to a social remedy; the town today that tried to chase gambling interests out might trip over its own head.
Nothing in gambling has changed as much as have the gambling interests, the people behind it. They create the games, run them, and, in the process, define the bettors. Gambling interests include gangsters and syndicates, but also church groups, charities, corporation stockholders, Indian tribes, and state and local governments. The newcomers are at once part of the tradition of gambling in America and a departure from it. Vicksburg, as a matter of fact, is still chasing bettors down to the river—but only as far as the casinos lined up there.
The Puritans of Massachusetts lost little time in enacting America’s first law against gambling in 1638, and in 1682 Quakers in Pennsylvania passed their own law against gambling and “such like enticing, vain, and evil sports and games.” Other colonies, especially New York under the Dutch, were not so strict about private games, but all the colonies depended on one public game, the lottery, as a respectable financial tool. At a time when capital was scarce and taxation an extremely sensitive issue, lotteries supported most schools and public works. Harvard College resorted to lotteries for many capital projects until 1793, when the Stoughton Hall lottery didn’t raise enough money to pay the grand-prize winner, who was unsympathetic and caused a fracas.
Just before he died, Thomas Jefferson was planning to raise money by staging his own lottery, with most of the Monticello estate as the prize. As heartbreaking as Jefferson’s situation was (especially since it was brought on in part by gambling debts), the lottery was often used as a means of liquidating property when no single buyer could be found.
Early lotteries were comparable to today’s raffles in that players received tickets in order, rather than choose their own number. Tickets were very expensive at five, ten, or twenty dollars each; that is a lot of money for a lottery ticket even today, and in colonial days it was inaccessible to people of average or modest means. But they still wanted to play.
Independent operators gave them a chance by offering an “insurance policy” on any specific number involved in the lottery. A policy number cost only a few cents, and the proceeds benefited the operator solely. It had nothing to do with insurance in the regular sense, except in one dismaying aspect. Around the turn of the twentieth century, Metropolitan Life and other reputable companies reported that in poorer neighborhoods more than half their life and health insurance policies were lapsing because customers were spending their premium money on “policy” numbers.
Policy players chose their own lucky numbers and learned the winning number through the drawing in the established lottery. Policy games had the same parasitic relationship to the lotteries that bucket shops had to legitimate stock markets, both offering parallel gambling experiences for the lower classes. Bucket shops allowed people to gamble on the fluctuations of market prices without actually investing in a company. The margins were so fantastic that a customer could buy ten thousand dollars’ worth of (fake) stock for one hundred dollars. If the stock market went up in price on the legitimate exchange, the bucket-shop customer made money in proportion. In practice, though, the bucket shop was less of a gamble than a con game, with a sticky spider web of margin systems that could ruin anyone. Such operations survived until the Great Depression made something of a mockery of the bucket-shop theme.
When lotteries were banned throughout America between 1830 and 1860, the policy game stumbled, but it flourished more than ever after a West Indian man devised a way to base the winning number not on a lottery result but on three digits of some mundane financial figure published in the daily paper. In this way policy grew into the numbers game that continues to this day.
During the late eighteenth century, card games were enjoyed as a fashionable after-dinner alternative to music in private homes in the Southern and Middle Atlantic colonies. When Abigail Adams, a New Englander, visited Philadelphia in 1791, she was aghast: “I should have a winter of dissipation indeed, if I accepted all my invitations to routs [big parties] and teaand-cards.” One of the best cardplayers in Philadelphia was Mary Morris, wife of the financier Robert Morris; another was Lucy Knox, whose husband, Gen. Henry Knox, was Washington’s chief artillerist. The games of loo and whist were the most common in such circles.
A typical colonist in attitude was the untypical man George Washington, who was content to gamble at cards all day, especially if it was raining out. According to his ledgers—and assuming that in this one specific case a gambler’s own records can be trusted—he broke even overall, despite a stinging stretch from January 1768 to April 1769, when he never won once, and lost a total of twelve pounds, ten shillings, and threepence.
Even during the dire winter at Valley Forge, Washington worried about the gambling among his troops.
As a soldier, however, Washington had far greater problems with gambling, that by the men in the ranks. In 1756, when he was the leader of the Virginia militia, he was warned that he would lose the support of the Virginia House of Burgesses if he could not do a better job of controlling gambling among his men. During the Revolutionary War, as commander in chief of the Continental Army, he issued vehement orders against all “games of chance,” but the fact that he had to issue such orders regularly indicates the frustration he faced over the issue. Even at Valley Forge, where men were freezing and going hungry for lack of supplies—or, especially at Valley Forge, where morale was so low among the troops—gambling was rampant, and it was a keen concern for General Washington.
The favorite game among the soldiers was “toss-up.” One player, (say, a sergeant) called heads or tails (say, heads) as the other threw a handful of wagered halfpennies in the air. When they landed, the sergeant gathered up the ones facing up heads, and the other player took all the tails. No one could stop a game so simple that it required only spare change and boredom, not where both were in good supply.
As the country expanded, each new advance in transportation brought a new chapter in gambling history. Transportation lines attract professional gamblers because they offer easy avenues of escape, along with a continuing supply of travelers burdened with large amounts of cash. Turnpikes, canal houses, riverboats, Great Lakes ships, and railroads all developed distinct traditions in gambling. The automobile brought a great deal of this to a halt simply because it precluded chance contact, the very elbowing among hundreds of people that brings about the games. Even today, teams of three-card monte players wander through the cars of Chicago el trains, acting out parts written for them a hundred and fifty years ago.
The greatest of the lot, of course, were the riverboat gamblers, plying the Mississippi and the Ohio. They are more important as romantic figures than for their small influence over actual history, for they became heroes to little boys and girls and, after they were long gone, to adults too. Being a romantic figure, the riverboat gambler had his uniform, just as the idealized cowboy and the knight-errant have theirs, and even today everyone knows what it was: black hat, suit, and tie; black high-heel boots; frill shirt; and diamond rings. And the keystone, as the writer Herbert Asbury described it: “a fancy vest of unspeakable gaudiness.”
Being a romantic figure, the riverboat gambler acted with honor. When a young Englishman lost all his money and even his luggage to John Powell in a riverboat poker game in 1858, he went on deck and politely said goodbye to the other passengers before shooting himself dead. Powell was devastated, and he sent the luggage and all the money back to the man’s relatives in England. Poker was the most popular game when professional gamblers were playing with strangers, but among themselves they often preferred the bank type of game faro, which allows a player the best winning percentage of nearly any game of chance. Unfortunately it is also among the easiest to rig.
The riverboat gambler cheated too, of course. In fact, New York firms circulated catalogues devoted to cheating devices: “poker rings” with tiny needles that marked cards, “stripper plates” that shaved the cards so that they could be shuffled into an advantageous order, and special ink, applied with the fingertips, that could be detected only through the lenses of special eyeglasses. One gambler specialized in reworking the roulette wheel: sometimes he would stick three or four extra “16 reds” over the numbers on the wheel (and then bet on 16), and other times, for a change, he would attach tiny wires over most of the other numbers, so that the ball almost had to stop on 16 red.
An outgoing riverboat gambler named George Devol was so proud of his ability to bring a stacked deck into the game undetected that he once brought four of them into a single poker hand, dealing four aces to each of his four opponents. The betting was spirited.
“To me as a boy, the gambler was an object of awed admiration,” Hugh Fullerton recalled of his childhood in the 187Os. “There was one old fellow who took a great liking to me, and during the summers we often fished together while he told me tales of the great poker games ‘on the river.’ Four or five times a year he went away, down the river to New Orleans on the boats. He was a strikingly handsome man, low-voiced, pleasant, always perfectly dressed.”
Faro offers the best chance of winning of any gambling game. Alas, it is also among the easiest to rig.
Taking his place in folklore, the riverboat gambler, again like the cowboy and the knight-errant, represented a life of freedom, adventure, and independence. Like those others, he was more likely to be, in fact, a slave to a system in which he had long since stopped believing. Most riverboat gamblers died poor; worse than that, they had to live out many years without enough money to gamble anymore. So the pertinent reality regarding the riverboat gambler existed in the minds of the children who followed his image into new eras of popularity for gambling in America.
Before polls and projections, great suspense was attached to election day, and it became a day for heavy wagering. In 1864-August Belmont, the millionaire, told the New York Herald that he would bet all comers that George McClellan would defeat Abraham Lincoln in the presidential election. Editors at the reformminded New York Times noticed that and, disdaining McClellan even more than they did the vice of gambling, offered to direct willing bettors to Belmont’s address.
Baseball developed into a professional sport during the 186Os, and eight teams formed the National Association in 1871. Betting booths were a common feature at ballparks, and players were known to use them; rumors of “thrown” games abounded, but it took the farce perpetrated by the Louisville Grays in the 1877 season to clean up the sport. Louisville was so far ahead in the standings in mid-August that the second-place Boston Reds were considered a lost cause. The Grays, though, were losers from that point on, as the result of the lackluster play of their four starters. The Louisville Courier-Journal ran the story under the headline !!!—???—!!!. Forty-two years later this headline would be aptly translated by a boy’s legendary remark to a player implicated in the Black Sox fix: “Say it ain’t so, Joe.”
It was so in the case of the Grays, as evidenced by a series of telegraphed messages from a New York gambler named McCloud to Al Nichols, a Louisville infielder. After the fixes became public, baseball was given a dim future as a “national pastime,” but the efforts of two Chicago businessmen resuscitated it into the National League and chastened its image, at least until about 1910, when gamblers returned to baseball parks and betting pools handled millions of dollars a week in baseball betting. As before, rumors flew around, until 1919 when a New York gambler named Arnold Rothstein thought to perfect Mr. McCloud’s scheme, directing eight Chicago White Sox players to throw the World Series; Rothstein walked away from the Black Sox scandal with as much as $350,000 (and a place in literature as F. Scott Fitzgerald’s model for Meyer Wolfshiem in The Great Gatsby ). Baseball has been understandably rigid on the subject of gambling ever since.
Three inventions developed in the latter part of the nineteenth century allowed gambling in America to expand from a diversion into a major industry. The first one, the telegraph, could have done the job all by itself. The others were the parimutuel system and the slot machine.
The telegraph was first exhibited in the United States in 1837 by S. F. B. Morse, but an 1872 refinement called the duplex system allowed more than one message to go through a line at once. Thomas Edison invented the quadruplex system in 1874 that allowed for simultaneous transmission of four messages; through these means, telegraph lines were soon readily available to private concerns. Bookmakers could obtain information on races all over the country, almost immediately. They could also make connections with bookmakers in other cities, forming powerful syndicates for moving around money and bets.
From about 1890 to 1908 the horseracing world was in turmoil. There were too many tracks (314 in 1897) and too many days (364 days of racing at East St. Louis in 1893) to allow for an effective policing system. Tracks did not handle betting in those days, though they could charge book-makers a fee to operate on the premises. Sometimes they took a profit from a crooked race: bookmakers had access to jockeys and trainers, and most of them, even the great rider Todhunter Sloan, were accommodating to offers of bribery. Nearly every state had banned horseracing by 1908, when just 25 tracks remained in all America. In fact, it was during this dry spell in racing that bookies and professional gamblers found an unfortunate substitute in baseball.
Three nineteenth-century inventions allowed gambling to grow from a diversion into an industry.
Horseracing was nearly dead, and then, just before the Kentucky Derby in May 1908 the mayor of Louisville served what seemed to be a death stroke by banning bookmaking at the track. The track manager of Churchill Downs, Matt Winn, knew that without betting, racing was not viable. He appealed in court but was offered only a slight concession: bookmaking was outlawed, but not pool betting. Winn accepted the decision and retired to the basement rooms at Churchill Downs, where he rummaged around until he found some parimutuel machines that had been purchased from the French manufacturer about thirty years before. The machines could add each new bet to a general pool and calculate each winner’s share of that pool, after overhead expenses had been subtracted. Not only did parimutuel wagering obviate the trackside book-makers, it also allowed state governments to take a tax on bets. New York State legalized parimutuel betting in 1913, and many other states followed suit. Never again, however, could the country support as many as 314 race-tracks—not when, thanks in part to the telegraph, it was supporting nearly ten thousand local bookies.
The modern slot machine was invented by Charles Fey in San Francisco in 1895, but Chicago has been the manufacturing center for them almost ever since. They quickly became common- place in many drugstores, taverns, gas stations, country clubs, and veterans’ and fraternal clubs. Most slot machines paid off in cash, though some of the ones in public places would pay off in gum or cigarettes, which could easily be redeemed for cash.
Perhaps because the slot machine is inanimate, it identified and attracted a vast population of dormant bettors, people who found gambling appealing but contact with gamblers repugnant. Standing at a slot machine, a person is alone and in control, as at the wheel of an automobile or sitting with a radio or television; such things come quite naturally to most people, whereas standing at a craps table, for example, does not, with jostling and shouting, dice flying, and money- one’s own!—pushed and pulled by a snappy croupier. Gamblers usually like the company of other gamblers, but slot-machine players are a world unto themselves. That is the covenant that has made slot-machine play, which a gambler out of the Old West once disparaged as “teasing nickels out of Rebeckah lodge hellions,” the most popular form of casino gaming in America.
Even as the telegraph, the parimutuel system, and the slot machine were promising stunning growth for gambling, the frontier was closing, as far as gambling law was concerned. By 1907 Arizona and New Mexico were far more interested in obtaining the respectability of statehood than in continuing to entertain a demimonde. Arizona Territory outlawed gambling that year with a law that inventoried the trade, banning “Faro, monte, roulette, lansquenet, rouge-et-noir, rondo, fantan, poker, seven-and-a-half, twenty-one, chuck-a-luck, slot machine or any banking or percentage game, or any other kind of game played with cards, dice or any device.” It was a brash move for Arizona, which derived most of its education budget from its tax on casinos. Aside from that, the reform proscribed a certain way of life in both territories. “Oh, this place is dead now,” said a young Arizona man in 1908. “Sleeping has become one of our principal industries.”
Nevada held out, until 1913, as the last state to allow open gambling. It had fewer farms than any other state in the Union, though it had more than the District of Columbia. It had fewer manufacturing companies than any other state or the District of Columbia. It had the smallest population of any state or the District; in fact, during the decade 1910-20, it was one of only three states to lose population, and it lost the most—5.5 percent. The entire state depended on mineral production, a good business, but one in decline. This was the Nevada that banned gambling in 1913.
Many Westerners, newly fenced in on the gambling issue, blamed their plight on what one youth called “undesirable Puritans from the East.” As a matter of fact, these discontented young men should have gone East, where casinos were a thriving tradition in such towns as Newport, Rhode Island; Saratoga, New York; Palm Beach, Florida; Hot Springs, Arkansas; and Aiken, South Carolina. Such enclaves catered to the upperclass bettor, and since most patrons were from out of town, local officials could be especially tolerant. The casinos were often run by colorful independent operators, like Richard Canfield, of New York and Saratoga, or Col. E. R. Bradley, who not only controlled the casino at Palm Beach but saw four of his horses win the Kentucky Derby.
The quintessential plunger, John (“Bet-a-Million”) Gates represented the type of gambler who frequented resort casinos. Starting out as a barbedwire salesman, he worked his way into a fifty-million-dollar fortune. Andrew Carnegie referred to him as “a broken-down gambler,” but then Carnegie was a rare specimen among millionaires in that he never forgot the value of a dollar. Gates did. On one occasion his train stopped at Memphis, where members of the Chickasaw Guards Club had amassed a stake with which they hoped to entice Bet-a-Million into a poker game. He declined and explained that his train was leaving in an hour’s time. The emissary from the club mentioned that the stake was thirty-five thousand dollars. “Fm sorry, gentlemen, I can’t stay, but I’ll tell you what I’ll do,” Gates replied, obviously tempted. “I’ll match you heads or tails for it.”
He won the bet and caught the train.
For Gates, that was the value of a dollar, or thirty-five thousand of them: a moment’s distraction from some sort of boredom. On one night during the month-long season at the casino in Palm Beach in 1913, a reporter counted ninety-one millionaires at the gaming tables, winning thousands, and still , according to the reporter, looking notably bored.
In 1934 an East Coast numbers syndicate issued a case study on one of its regular customers, “Mrs. Average Player” (the syndicate provided or sold such information for use by subordinates). “Mrs. Average Player” earned $7 a week, plus carfare, as a domestic, supporting two young children and an unemployed husband. She bet an average of 211/2 cents per day, or $146.42 for 681 days, during which time she won twice: for a two-cent bet on the 366th day and for a penny on the 402d day. At 600:1, and with the runner’s commission taken out, she won $16.60, accounting for an overall loss of $126.62.
When millionaires bet thousands, it can be vexing at worst, but throughout American history the idea that a “Mrs. Average Player” hands over a fifth of her wages to a game that is stacked against her has understandably outraged moralists. At the end of the twenties, the last great moral debate over gambling erupted when Bishop James Cannon, a Methodist, disclosed in August 1929 that he did speculate actively in the stock market but that since he used careful consideration in making choices, it was not risky, and it was not the same as gambling, which he rejected.
“It seems to me that the Bishop is trying to say that it is sinful to follow a bad tip and virtuous to follow a good one,” responded Heywood Broun in The Nation . “The late Arnold Rothstein was just as eager as the Methodist leader to eliminate the evil factor of chance from his transactions …”
While Bishop Cannon was trying to explain the difference between speculation and gambling, leaders of the Catholic Church in America were reinforcing a belief that gambling is not a sin but rather, according to the chancellor of the Roman Catholic diocese in Cincinnati, “a legitimate amusement or recreation because it is intended as a necessary relaxation of the mind.” Throughout the thirties bingo, raffles, and Monte Carlo casino nights became important sources of fundraising for local Catholic churches; a 1938 Gallup poll showed that more people gambled at church games than at any other legal or illegal form.
The Roman Catholic Church, both the institution and its adherents, was closely aligned with European traditions, including those of gambling games. Because of this and the fact that, as one church representative said, “there is no eleventh commandment against gambling,” the church did not fight it as a fundraising activity for local churches, which were sorely burdened during the Great Depression.
Catholic churches undoubtedly used their gambling revenues for good, charitable causes. Conservative Protestants took a dim view of it, however, and they lashed out at church gambling as the thin edge of a wedge that would legitimize gambling and other vices. “I find it impossible even in my weakest moments,” wrote Richard Emrich in the Christian Century , “when the financial needs of the church are most pressing, to imagine St. John, St. Paul or St. Peter running a bingo party or our Lord sending out his disciples to sell chances. And I shudder at the thought that some young person might say, ‘It’s all right to gamble. We do it at church.’ ”
One church representative declared: “There is no eleventh commandment against gambling.”
The moral attack on gambling in America became divided among denominations and over which aspects of gambling reflected “legitimate amusement” and which were “evil circumstances.” Any prospective gambler could walk through the loopholes that opened up in the argument, and obviously a great many did, without for a minute compromising their religious ideals or their intentions to go to heaven.
Championed by ambitious politicians and hampered by greedy ones, the legal assault on gambling progressed in fits and starts through the first half of the twentieth century. Among those who leveled broadside attacks were the New York City district attorney William Jerome; the New York governor Charles Evans Hughes; the Illinois governor Adlai Stevenson, and the New York governor Thomas Dewey. And Sen. Huey Long (who was alleged to have taken a cut of the illegal slot-machine revenue in Louisiana) used the state police to close down gambling casinos there until two local political bosses visited him at his hotel, according to New Orleans newspapers, and let him know that if he kept the ban on casinos, he would receive no further political support from St. Bernard and Jefferson parishes. Two days later Long went on the radio to reverse his position on casinos. He concluded, “I’ll be dad-gum if it ain’t a puzzling thing what to do about gambling.”
Gambling interests could have said the same thing about politicians. “Those guys want it all,” said a casino manager in New York City in 1913. “Last week, on top of the regular $250, they learned I’d trimmed a guy from Atlanta for $2,500 and demanded half of it. How can a fellow be square with them crooks robbing him?”
In 1956, when the mayor of Reading, Pennsylvania, called off his own antigambling drive nineteen days after he took office, federal officials stepped in and forced a major raid on slot-machine operators, one of which, the Reading House tavern, was found to be the property of the mayor’s brother. The title had only recently been transferred out of the mayor’s name.
Elected officials have assumed first rank in the monumental problem of corruption, and it would be hard to blame a Reading policeman for taking a bribe in the prevailing atmosphere of 1956, especially if it happened to be tendered by the mayor. Police are, however, the second half of the corruption issue. The New York City police department, as an example, was about fifteen years old when the state legislature first investigated its ties with gambling operations. In 1892 the police superintendent was pressured into admitting that the department was thoroughly corrupted by gamblers’ money —but not without adding the strange boast that despite the bribery, he had “obtained more years of convictions against criminals than the detective forces of Scotland Yard, Paris, and Jersey City all put together.” In 1912 Lt. Charles Backer was at the head of the department’s vice squad, and his association with the degenerate influence of criminals was so advanced that when a key witness was on the brink of implicating the squad’s system of graft, Becker had him murdered on the street. Becker was eventually executed in the electric chair. Corruption scandals have rustled through the department every ten years or so ever since, but the amount of money involved seems to have been irresistible in the interims.
Throughout the early fifties energetic investigations attacked gambling nests all over the country, along with the police who cooperated with them. The investigators were young and determined, a small army headed in spirit by the freshman senator Estes Kefauver of Tennessee, whose Senate Special Committee to Investigate Organized Crime in Interstate Commerce touched heavily on gambling and showed syndicates a force that would be neither bribed nor beaten. That force was not merely the senators’ own sense of integrity but the outrage aroused across America by televised interrogations of gangland figures. Only a few of the major bills written by the Kefauver Committee passed the U.S. Senate, and it did not eradicate illegal gambling in America, but it did succeed in smothering the momentum that organized crime had been gathering since Prohibition.
The lawyers, district attorneys, reporters, and members of Congress who went to work against illegal gambling were probably less motivated by the morality of gambling itself than by a statement contained in the Kefauver Committee report: “gambling profits are the principal support of big-time racketeering and gangsterism.” That feeling was echoed by Willie Moretti, a gambling boss in Bergen County, New Jersey, who was being investigated in 1953 by Nelson Stamler, a deputy attorney general. “Willie Moretti,” Stamler wrote, “who was mixed up with Owney Madden, Waxey Gordon, Lucky Luciano and other high-ranking hoodlums during Prohibition, once confided to me that his gambling take always made his rum-running profits look like peanuts.”
Under vociferous attack in new holdouts like Bergen County, as well as old ones like Saratoga, Hot Springs, Newport, Florida, and Kentucky, the gambling syndicates looked around for respite. A few of them went to Havana, Cuba, but many never left the country.
By 1931 Nevada was asking itself the very question it would ask millions of visitors in the future: What have you got to lose? The legislature passed laws that year legalizing gambling and making divorce a relatively simple procedure. The story was big news all over America. “Nevada is tired of cactus, alkali wastes, sparse population, hard times and virtue,” reported the Montgomery (Alabama) Advertiser . “Hell’s hundred thousand acres,” spit the Dallas Morning News . The Hartford Times was equanimous about Nevada: “Perhaps it is merely being honest in writing laws which are hypocritically evaded almost everywhere else.”
The first casinos were opened in Reno, and they were owned by Westerners like William Harrah and Raymond Smith, of Harold’s Club. By 1945, with relatively minor intervention from outside gambling interests, the Nevada gambling handle was close to a billion dollars. The following ten years witnessed the development of Las Vegas, in the southern part of the state, as a gambling center; much of the capital for that development came from Eastern syndicates. A Los Angeles gangster named Bugsy Siegel was the visionary behind the personality of Las Vegas, which became a symbol for American gambling as recognizable and as “unspeakably gaudy” as the vest of the riverboat gambler. In 1945 Siegel started to build the Flamingo Hotel on the Los Angeles side of town, the “Strip.” Like Wilbur Clark, who followed him with the Desert Inn, Siegel ran out of money halfway into construction. Both men turned to the Cleveland syndicate, one of the toughest and the richest. Siegel was murdered before his hotel was finished, but he had already pushed Nevada gambling forward, far past the days of saloon doors and sawdust.
In the Las Vegas Strip the gambling syndicates had a Utopia. Like William Penn creating Philadelphia or Brigham Young arriving at Salt Lake, they had a place in America to make of what they wanted. In it they acknowledged what they knew best by building a series of hotels in the milieu of the forties nightclub: in names, themes, neon signs, muted lighting, entertainment, costume, and even in the roaming cocktail waitresses and cigarette girls. The Strip’s founding fathers removed any coherent sense of place. They replaced greenbacks with colorful chips and suspended time, with round-the-clock gambling, a nearly total absence of clocks, and bright lights on the Strip that give to the night the liveliest hours in the day. By careful design Las Vegas had nothing, but everything, to do with the rest of America. After nearly fifty years the Nevada experiment was a sustained success, and it finally took on a competitor in the form of Atlantic City, where gambling was legalized in 1978.
In 1964 New Hampshire conducted a lottery. Tickets cost $3 each, the top prize was $100,000, and the state earned $2.5 million: a success. Tellingly, all but one of the eighteen winners were from out of state. The lottery fever has spread ever since then to thirty-three states, and in most cases the states have imbued their lotteries with benign purpose: education in the cases of New York and New Hampshire, the elderly in Pennsylvania.
The Strip’s founding fathers made sure Las Vegas had nothing, but everything, to do with America.
In 1980 New York State paid one of its most unsavory elements the compliment of imitation, instituting a numbers game just like “policy.” A thousand numbers runners reacted by staging a protest in front of the governor’s office. They needn’t have worried, however, because most accounts show that the state’s games of chance, including Off-Track Betting, have not cut into the illegal business. They have, however, helped bring gambling as a way of life to a greater population than ever before.
About five years ago the example set by Nevada combined with the popularity of state lotteries to obscure gambling’s long history of causing problems. A new era began. In the old one gambling was one of the vices, but in the new one it has been recast as “gaming,” an amusement, and it doesn’t cause problems but solves them: relatively recent problems, like unbalanced state budgets, and longterm ones, like the economic displacement of Indian tribes.
For states the new era in gambling began in 1989, when Deadwood, South Dakota, opened its streets to casinos. It was an experiment that soared, pulling in $90 million in betting revenues the first year. Other states followed South Dakota’s formula, lured by the instant economic boost and a piece of the handle. Though states have taken part in parimutuel revenues for decades, one of the most fervent issues surrounding gambling today is the morality of a government’s augmenting straightforward taxes with gambling money, the losses of its citizens.
Gaming on Indian reservations picked up a string, in law, that was left by the churches that established charity bingo in the 1930s. In 1988 Congress passed the Indian Gaming Regulatory Act. In any state where games of chance (including bingo) were allowed for church, temple, or veterans’ and other groups, the same games had to be allowed, by compact, at Indian reservations. Many of the tribes that have embraced gaming have been wildly successful, especially since they are not subject to standard taxation, being sovereign nations. Within the Indian community some individuals and tribes regard the exploitation of others—whatever the rewards—as profane and contrary to traditional Indian ways. Bitterness on this issue has led to a breach in the more than fourhundred-year-old Iroquois Confederacy, wherein two of the six nations now operate casinos.
Although a majority of states now feature some form of legalized gambling, illegal operations are still thriving. Legal gambling has even been accused of incubating new gamblers who later graduate to illegal avenues, where big wins are not reported to the Internal Revenue Service; where credit is easily extended (on varying terms), and where payoffs in numbers and horseracing are nearly always better than those in state lottery operations and Off-Track Betting. Equally important, a bookie or a syndicate will also handle sports betting, which generates far more revenue overall than any other form of wagering.
Gambling is a lot of fun—especially when one is winning. Unfortunately, though, a percentage of people find it just as satisfying, in some sad way, to lose. A number of people are simply inept at games, and a number happen to be born without a whit of luck. The issue of gambling as a temptation has been around before, but in our time the unpredictability and the risk have been multiplied by a grand factor: nearly the whole country. George Washington didn’t worry when he himself lost at whist but, rather, when his whole army was throwing halfpennies in the air.