All in? Economic Factors to Consider in Native American Gaming

All in? Economic Factors to Consider in Native American Gaming Native Gaming: The Economics Frame By Shalin Hai-Jew

Abstract: • The economic frame focuses on the context of the need for economic development on Indian reservations. This offers a range of considerations for Native economic development. It also looks at the pros and cons of Indian gaming as an economic solution. This asks learners to consider issues of economic development and empowerment. Native Gaming: The Economics Frame

Learning Outcomes • Explore the economic, job creation / shifting and secondary industries impacts of Indian gaming; understand up front costs of setting up Indian gaming • Probe competition between tribes of Indian gaming • Explore the use of reservation resources for economic health • See how different tribes approach the economics questions in terms of their resources Native Gaming: The Economics Frame

Learning Outcomes (cont.) • Think of strategies to diversify the economic base beyond Indian gaming! • List the possible positive and negative externalities to Native gaming; consider the mitigations to gaming effects • Know what some primary decisions are once casinos open. • Understand law enforcement issues around Indian gaming Native Gaming: The Economics Frame

Struggles with Tribal Growth and Development • Insufficient access to capital markets • Low levels of education • Poor endowments of natural resources • Indians’ goals and attitudes • Institutional resource allocation • Ill-advised federal policies • A culture of paternalism towards Native Americans • Former mismanagement of Native American resources Native Gaming: The Economics Frame

Obstacles to Tribal Development • Low access to financial capital • Lack of human capital • Lack of effective planning • Excessive planning with insufficient action • Low natural resources • Lack of control over natural resources Native Gaming: The Economics Frame

Obstacles to Tribal Development (cont.) • Physical distance from markets and the high costs of transportation • Intense competition from non-Indian communities • Counterproductive and / or discriminatory federal and state policies • Inept, corrupt or uninterested BIA leadership Native Gaming: The Economics Frame

Obstacles to Tribal Development (cont.) • Non-Indian outsider control or confounding of tribal decision – making • Unworkable or externally imposed systems of government • Inept or corrupt tribal politicians and bureaucrats • On-reservation factionalism leading to instability in tribal decisions Native Gaming: The Economics Frame

Obstacles to Tribal Development (cont.) • Instability of tribal government discouraging outside investment • Low reservation savings • Scarce entrepreneurial skills and experience • Non-Indian management techniques fail to work on the reservation Native Gaming: The Economics Frame

Obstacles to Tribal Development (cont.) • “Non-Indian management techniques will work, but are absent” • Inhibitory tribal cultures • Long-term negative effects of racism undermining tribal self-confidence • Alcoholism’s deleterious effects (Cornell and Kalt, Reloading the dice…, n.d., p. 6) Native Gaming: The Economics Frame

Environmental Scan • Market analysis • High cost of entry for infrastructure • High tech demands • Risks to the casino / house • Possibility of failure due to booms and busts, competition, and economic challenges Native Gaming: The Economics Frame

Environmental Scan (cont.) • Opportunity costs • Risks in policy shifts Native Gaming: The Economics Frame

Earmarked Funds for Taxation, Governance and Industry Self-Regulation • Taxation (employment) • Governance and infrastructure building for the tribe • Industry self-regulation Native Gaming: The Economics Frame

Location Selection/ Siting an Indian Casino • Urbanized or rural environment for the most benefit? • Nearness of business competitors • Optimal customer-friendliness of gaming type for the region • State laws / county laws • Land use consdierations Native Gaming: The Economics Frame

Larger Community Issues • Shared benefits • Intercommunications • Relationships with other tribes • Forming alliances Native Gaming: The Economics Frame

Mitigating Potential Problem Gambling • Up to 8% of gamblers may have a “problem (pathological) gambling” issue Native Gaming: The Economics Frame

Role Playing: • Scenario: The scenario is a tribal council meeting. A local tribe is considering whether to adopt gaming as part of their economic development strategy. All who may be impacted should attend. Native Gaming: The Economics Frame

Roles and Stances • Have learners choose various roles. Have them research what an individual or group in their role may think, and have them argue a coherent stand. Each individual or group will have particular aims that they want to achieve. Allow room for changes and shifts in ideas if particular aims are met. Have them keep the aims private generally unless they feel it’s strategically helpful to share that with the group. See what sort of final agreement the various individuals may come to. Native Gaming: The Economics Frame

Roles • Tribal Elders: • Larger Outside Community: • Tribal Community Members: • The Economic Development Committee from the Tribe: • Pro-Casino Investors: • State Officials: • Private Gaming Representatives: Native Gaming: The Economics Frame

Conclusion Native Gaming: The Economics Frame

All in? Economic Factors to Consider in Native American Gaming