Irresponsible gambling

April 18, 2011

The problem with irresponsible gamblers is the word “irresponsible” not the word “gambler”. The same is true with “irresponsible drinking” or “irresponsible drug-use” or any other irresponsible action. It is not the existence of gambling or alcohol or drugs that create irresponsible behaviour. And yet the nanny-state campaigners want to punish the product instead of addressing the underlying problem. With wowsers Nick Xenophon and Andrew Wilkie in parliament, and the government in trouble with the carbon tax, the pressure is growing for the government to “do something” about poker machines.

It’s easy to attack poker machines. I don’t like them. I enjoy playing texas hold’em poker for the judgement, excitement and social element… none of which I get from poker machines. But personal preference is besides the point. In a free society, people should be free to pursue their own hobbies and activities, and I shouldn’t force my preferences on others. People who use poker machines (like smokers and shooters) are the new whipping boys of politics. While “progressive” politicians love to wax lyrical about defending minorities, they only seem to defend fashionable minorities. And while trendy lefties will advertise the moral superiority of their tolerance, they only seem to tolerate groups which they actually like.

People who enjoy playing poker machines are seen as the “wrong sort of minority” and therefore they apparently deserve no tolerance.

Of course, intolerant bigots always find excuses for their intolerance. The excuse given to attack poker machines (and gambling more generally) is that some people have a gambling problem. That is certainly true. But then… some people have problems in general. The simple truth is that being irresponsible leads to irresponsible behaviour — which could include a gambling problem, drinking problem, drug problem, anger problem, or many other sorts of life-management problem. Irresponsible people will do stupid things, and get themselves into bad situations.

It is absurd to blame the product for the irresponsible behaviour of the user. This is especially true when the vast majority of people manage to live with the same product without developing a problem. Most drinkers do not run around at 3am starting fights with strangers, and most gamblers do not waste all of their income on poker machines.

Most people enjoy gambling — with over 80% of Australians gambling occasionally and 40% gambling regularly. Only about 1% of the adult population has a real gambling problem. While the gambling industry makes up 1.5% of GDP, employing over 100,000 people in over 7000 businesses… by far the biggest benefit is the enjoyment of consumers who don’t have a problem (79% of Australians). Simplistic reports sometimes talk of Australians “losing” $11 billion in gambling, but it makes no sense to talk of “losing”. We do not say that consumers “lose” $10 when they buy a movie ticket. Gambling is a service where people enjoy the activity, for a price. For gamblers without a problem, their spending on gambling represents a welfare gain.

For the 1% of problem gamblers, the thing to remember is that the underlying issue is a behaviour problem. Punishing the product, and in the process hurting 79% of innocent Australians (not to mention the business and employment costs) will do nothing to address the underlying issue.

This is not to say that there isn’t a problem. On the contrary, personal irresponsibility is a significant problem in Australia, and one that we need to take very seriously. But the first requirement is that we correctly identify the problem. By pretending that “irresponsible gambling” is a gambling problem, the government (and their nanny-statist backers) are not just hurting innocent gamblers, but they are failing to address the irresponsibility.

Once we recognise the real problem there are several approaches we can take. One approach is to try and identify the “irresponsible people” and then allow the government to control their decisions. This approach can be seen with the idea of quarantining welfare payments, to ensure that a basic minimum is spent on food, shelter and other basics. These restrictions should not apply to responsible people, such as those who don’t need hand-outs or bail-outs. This idea was considered in more detail in a short book called “Declaring Dependence, Declaring Independence” written by Peter Saunders, Eugene Dubossarsky, Stephen Samild and myself.

Another approach is to consider what leads people to become more or less responsible. This is where the big-government types suddenly lose their interest in the discussion. The truth is that responsibility and freedom are linked. You cannot have freedom without also taking responsibility for your choices… and you cannot learn responsibility without having the freedom to make choices (and live with the consequences). This is a truism understood by all parents, and the same lessons are true at a national scale.

If we take away decision-making opportunities, we are taking away people’s ability to learn responsibility. If we shield people from the consequences of their decisions, then they do not learn to make better decisions. Incentives matter — so if we continue to tax good decisions and subsidise bad decisions, then we should not be surprised if we find that people make more bad decisions. There are lessons here for both the left and the right. Some on the left want freedom without responsibility, where the government protects people from their mistakes. But such an approach will inevitably lead to more mistakes, and then less freedom as the government has to continually “fix” irresponsible behaviour. Some on the right want responsibility without freedom, but responsibility comes from making individual choices, and so restricting freedom will inevitably lead to less responsible behaviour.

As the cliche goes — freedom and responsibility are two sides of the same coin.

At first, the idea of “taking responsibility” may seem harsh. The consequence is that some people will fall into poverty. But the alternative is worse. A responsible person who falls into poverty will be able to work their way out of poverty. An irresponsible person who escapes poverty with a hand-out will not be able to run forever from their own irresponsibility. They will be more likely to develop serious problems (whether alcohol, drugs, gambling or other) and they will continually need more hand-outs to deal with their bad life decisions, like a child who never fully develops. If it is cruel to let people suffer the consequences of their actions… it is much more cruel to prevent them developing a proper sense of responsibility.

Irresponsible gambling (like any irresponsible behaviour) is a problem, but the government would be wrong to jump straight to the populist solution of nanny-state regulation. We should not blame a product for a behavioural problem, and we should not punish the majority of innocent people for the mistakes of a few. If we really want to address the problem of irresponsible behaviour we need *less* of the nanny-welfare-state, replaced with more individual freedom and personal responsibility.

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  1. TerjeP
    April 19, 2011 at 7:08 am

    This is a truism understood by all parents, and the same lessons are true at a national scale.

    You should check your figures. 100% seems a bit high to me. Some parents have no clue about this stuff. 🙂

  2. April 19, 2011 at 8:18 am

    Touche. I should have written “by all good parents”.

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