Inside Gaming: Industry loonies emerge from political fray
Hard as it seems, Peter Carlino and the folks at Penn National Gaming outdid Sheldon Adelson, Steve Wynn and Donald Trump in terms of political lunacy this year.
And it only cost the regional gaming giant $42 million to embarrass itself.
Adelson, chairman and chief executive officer of Las Vegas Sands Corp., dumped at least $53 million of his own money into a variety of super PACs that supported Republican candidates around the country, including GOP presidential nominee Mitt Romney. Other than U.S. Sen. Dean Heller, R-Nev., all his picks fell flat.
Wynn, chairman and CEO of Wynn Resorts Ltd., seemed to spend more time appearing on Fox News than in his company’s boardroom. Wynn used any and every occasion to attack President Barack Obama’s policies.
“It would be a complete disaster if Obama wins, which is why I’m urging my employees to vote for Romney,” Wynn told the Huffington Post the week before the election.
Obama beat Romney in Nevada by more than 66,000 votes.
Trump, the billionaire New York real estate magnate whose name is still attached to two Atlantic City casinos, brought his own special brand of crazy to the election.
Via Twitter, Trump’s thousands of political rants and campaign conspiracy theories earned him lifetime membership in the Tinfoil Hat Club. A slew of inane comments via Twitter soon after the networks called the election for Obama promoted Trump to CEO of the loon brigade.
But those efforts pale in comparison to Carlino, chairman of Penn National. The company owns M Resort among its 28 casinos in 19 states and the province of Ontario.
Penn National was the sole funding source behind a scorched-earth campaign against Maryland’s Question 7 gaming expansion initiative.
The measure authorizes a Las Vegas-style casino for suburban Prince George’s County and would permit the state’s five existing or planned slot machine-only casinos to add table games.
Penn National thought its Prince George’s County racetrack should get the casino, and that a new Maryland casino would steal business from its gambling hall in neighboring West Virginia.
Groups financed by Penn unleashed a brutal multimedia attack on the gaming industry. Casino expansion, the messages stated, would bring the state more gambling addicts, increase underage gambling and give tax breaks to casino owners who don’t fulfill promises. The tax money raised by casino expansion would never find its way to education budgets.
The campaign was carried out with such fervor that it forced the American Gaming Association to drop its neutrality stance concerning statewide gaming referendums to counter some of the negative rhetoric concerning casino jobs.
What was never revealed in the television ads or mailings was that Penn National funded the anti-gaming messages.
The harshest barrage came toward the end of campaign and was directed at MGM Resorts International, which wants to build an $800 million casino in the National Harbor complex. MGM funded the Yes on Question 7 effort to the tune of $41 million.
Several television ads dredged up MGM Resorts’ much-debated Macau partnership with Hong Kong businesswoman Pansy Ho, which caused the company to divest its holdings in Atlantic City. New Jersey gaming regulators found the partnership unsuitable because Ho’s father, billionaire casino magnate Stanley Ho, has properties allegedly influenced by Chinese organized crime triads.
“Bad for New Jersey, but good for Maryland?” was the ads’ theme.
According to some reports, Maryland voters were even mailed copies of the 90-page New Jersey investigative report with highlighted passages.
MGM Resorts Chairman Jim Murren tried to stay above the fray, although he commented a week ago that his company “focused on developing and managing luxury resorts, not political campaigns.”
A decade ago, MGM Resorts would have conducted a leveraged buyout of Penn National to give Murren the pleasure of firing Carlino. Those days have long since passed.
On Tuesday, Maryland voters approved Question 7, 52 percent to 48 percent.
Penn National may have lost the battle, but the war continues.
The company is reportedly behind a lawsuit challenging the constitutionality of the ballot question. An attorney representing eight plaintiffs contends the Maryland constitution requires at least 60 percent of registered voters approve a gaming proposal, not a simple majority.
The gaming industry had its share of political embarrassment this election.
Adelson and Wynn turned out to be major-league hypocrites. They railed against the Obama administration’s policies toward China. Yet, Las Vegas Sands and Wynn Resorts collect almost three-quarters of their annual gaming revenues from casinos in Macau.
Trump didn’t just embarrass his brand, he imploded it.
In a smart gesture after the election, Trump sent a semi-truck loaded with supplies to areas of the East Coast ravaged by Superstorm Sandy. But it’s going to take a Hurricane Katrina-style relief effort to repair his demolished reputation.
Maybe Trump should join forces with Carlino. Penn National certainly needs some damage control.
Contact reporter Howard Stutz at email@example.com or 702-477-3871. Follow @howardstutz on Twitter.
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