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Money hunger is raging in Albany, trumping all other policy concerns. The greed is so bad that the state risks turning legalized pot and online-betting into money losers.
Amid falling tax revenues and a growing projected budget deficit, Gov. Andrew Cuomo has embraced legal weed and online sports gaming and the Democratic-controlled Senate and Assembly seem to agree.
The state’s cash crunch makes pot and online betting appealing. Indeed, Cuomo saw the handwriting on the wall as far back as last November. “I think this year is ripe [for legalization] because this state is going to be desperate for funding,” he told Albany radio host Alan Chartock.
It was only three years ago that he called marijuana a “gateway drug,” while key lawmakers have long been loath to feed gambling by OKing online betting. Needs must when the devil drives?
To be clear, we’re not opposed to sensible legalization on both fronts, with an eye to avoiding or at least mitigating the worst side effects. But it’s clear that Albany’s eyes are now only on the Benjamins — so much so that it may wind up with the worst of both worlds.
Note that the real fight now is over control of the windfalls.
On pot, Cuomo wants the dough to go into the general fund where he can control where funds go. The Legislature hopes to earmark the weed bucks for lawmakers’ pet causes. Some plans would also have the state micromanage such things as just who can open a pot shop (in the name of social justice) — which would surely crimp the tax windfall.
Similarly, Cuomo wants to use the State Lottery to run online sports betting; he doesn’t want casinos or other private interests to profit. “I’m not here to make casinos money. I’m here to raise funds for the state,” the gov said Wednesday.
Is he nuts? Playing bookie is a lot more complicated than running a lottery, and it’s ridiculous to think the state can handle it: Remember, New York City managed to lose money for years on end with its Off Track Betting operation. Rather than regulate private companies and make a bundle for tax coffers, Cuomo’s scheme would likely strangle the online-betting industry.
Robert Mujica, Cuomo’s budget director, claims the state can rake in up to $500 million a year if the Lottery runs sports betting, instead of $50 million if the private sector does so. And he projects the same $500 million windfall from legal cannabis, though New Jersey assumes it will profit just $210 million. Is Mujica doing real math, or giving the boss the numbers he wants?
If Albany gets this wrong, these legalizations will prove to be “gateways” to even bigger budget crises down the line.
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