Sharon Harris wonders what Bugsy Siegel might make of the modern, highly-regulated gaming industry.
If given the chance once you ‘meet your maker’, would you return to this world to observe how things had gone? I would for sure. It would be fascinating to witness changing public perceptions and modern culture.
Since 1931, casino gaming has gone from what was often a backroom operation to a highly-regulated industry requiring superior business management skills. How would those associated with gaming’s early days react if they could return from that ‘casino in the sky?’ My guess? They would be amazed at the operation and mainstream acceptance of today’s industry.
Casino gaming began as an entrepreneurial endeavor that often involved both families with a do-it-yourself spirit and others with dishonorable intent. Over several decades, that changed as technology advanced and more jurisdictions and properties opened. The public demanded more accountability from individuals and companies.
From a small organization formed in 1995 to fight off a potential federal gaming tax, the American Gaming Association (AGA) has grown into a 25-employee trade group whose $17 million annual budget manages the needs of its 46 core/25 ally members. This high-power roster comprises commercial and tribal operators, US-licensed gaming suppliers, financial institutions, food and beverage suppliers, destination marketing organizations and other gaming industry stakeholders.
Proving the point that not just anyone will do in these times, the AGA just released its new CEO/President job description to fill the vacancy after former executive Geoff Freeman departed last month. As G2E approaches, the search committee has ramped up its recruitment efforts. I’m confident the new chief executive will continue where original CEO Frank Fahrenkopf Jr. and Geoff left off.
What a far cry from the early days when Nevada enjoyed a monopoly. In March 1931, Nevada lawmakers legalized gambling – the original term – to counteract the Great Depression’s economic devastation.
Historically, Nevada’s hot, dry desert regions saw its first settlers arrive after its American territorial acquisition from Mexico in 1848. Once pioneers discovered the silver/gold “Comstock Lode” in 1859, hopeful miners flocked to Nevada to get rich. To strengthen the Union’s forces during the Civil War, Nevada became the 36th US state in 1864. Las Vegas was founded in 1905.
When the national economy crashed in 1929, Nevada’s depleted mines and economy were in shambles. With only 91,000 residents statewide, the legislature fought the population exodus with two dramatic steps in 1931 to entice visitors to spend money in Nevada.
First they legalized gambling, hoping for a big windfall. Almost 90 years later, gaming taxes now comprise most of Nevada’s overall tax revenues.
Next, lawmakers made Reno – in northern Nevada – the ‘divorce capital of the US’. Famous celebrities like Clark Gable, Frank Sinatra and countless others divorced after a six-week residency requirement.
However, those decades also brought unsavory people who often controlled the rough-and-tumble casino environment. One example was the charismatic, but criminally lethal Ben ‘Bugsy’ Siegel, an early ‘face’ of Las Vegas gambling. The handsome, unpredictable Siegel hated the slang nickname, meaning ‘crazy’.
The lifelong mobster’s grand vision of the original Flamingo, built in the isolated Las Vegas desert in 1946, influenced the roots of today’s $261 billion US industry. But Siegel’s June 1947 murder, at age 41, ended his dream. Still unsolved, the case cast an early cloud on gaming.
Many experts believe Siegel’s irresponsible spending and negative publicity for casinos angered the wrong people and hastened his end. Siegel’s death ushered in an era of alleged racketeering, which only reinforced the public’s negative perception.
By the 1970s, that was changing and corporate America was entering the market. In 1978, Atlantic City lawmakers were committed to keepingthe bad guys out. However, intheir zeal, New Jersey regulators and enforcement investigators went overboard and often stifledbusiness growth.
Today, tight regulation is a mainstay of gaming. As each new jurisdiction has opened nationwide, most have copied the current Nevada and/or New Jersey standards as templates for their own programs.
American gaming interests have spent millions and expended untold thousands of hours promoting itself as a responsible, accountable and regulated industry. Gaming’s public figures now reflect a higher degree of professionalism and integrity. Since the 1990s, for different reasons at different times, states and local jurisdictions have accepted and often welcomed gaming as an economic engine.
The AGA must hire a chief executive who can ably navigate the many aspects of operating a nationwide industry that includes so many geographic, cultural and logistical variables. With the industry facing an ever-changing array of technological, legal, legislative and financial issues, the AGA’s stated core goals are:
- Accomplish for the industry what individual members cannot do alone.
- Lead a rigorous and inclusive process to define industry positions on contentious or significant issues.
- Support policies that promote industry reinvestment and innovation.
- Drive focus and execution on the highest value priorities.
During Freeman’s tenure in 2017, the AGA evaluated its significant achievements from 2014. The association then created the four-prong Strategic Plan 2020 that incorporates legislative, social and economic, business and educational components to enhance the industry’s image and profitability.
What would Ben ‘Bugsy’ Siegel and his cronies think of a modern regulated 21st century gaming industry, filled with educated, talented professionals? One can only imagine.
