America’s Gambling Addiction

The massive Foxwoods Resort Casino in Mashantucket, Conn., is trying to weather the financial storms and it’s little help that neighboring states are considering legalizing gambling.

The New York Times recently took a look at the casino built by the Mashantucket Pequots and the state of gambling in general. Foxwoods opened its $700 million MGM Grand resort and casino in 2008, just when business began to sour. About 700 employees were laid off within the year.

In all, the Pequots have $2 billion in at-risk debt, according to the Times. And because they are a sovereign nation, the Pequots cannot use bankruptcy laws or sell off gambling assets. Instead, lenders have to restructure debts and hope for a financial uptick.

“It’s kind of uncharted territory,” Tom Foley, an attorney specializing in Indian gambling, told the Times. “Many of the banks and bondholders should have been aware of these kind of risk factors, but when everything is good, nobody is really looking at the downsides.”

Meanwhile, Massachusetts, which provides 40 percent of the gamblers who visit Foxwoods, will approve gambling this year, the Times said. New York is also close to approving slot machines for either the Aqueduct racetrack or a Shinnecock Indians casino.

The Times talked to one Massachusetts customer at Foxwoods who was looking forward to not having to drive to Connecticut for his gambling fix. However, his friend had a more sobering view.

“You know and I know that every inch of this place is a shell game to get people’s money,” the gambler told the Times. “I’d rather that we invest in something that provides real jobs and productivity, not more casinos. You just get the feeling that somewhere along the way, we took a wrong turn in this country.”