What will be left after taxes?

June 17, 2014

The primary purpose of the new casinos to be built in New York is to raise revenue for the State and its subdivisions.  The mechanism for doing so is by taxing revenue.  While it is very difficult to get “apples-to-apples” figures on state tax rates on casinos, the sketchy information available suggests that New York’s tax will — not surprisingly — be among the nation’s highest, at least on slot machines in the capital district, at 45%. (for rates in other states, see the compilation  at http://www.americangaming.org/sites/default/files/uploads/docs/aga_sos2013_fnl.pdf) .

The rate of tax (as well as other costs of doing business) will determine what the casinos have left to work with to offer players comps and games that are competitive with other gaming venues.  I see the primary opportunity afforded to casinos in New York the repatriation of dollars that New Yorkers presently are spending elsewhere, particularly Atlantic City and southeastern Connecticut, as well as, more recently, Pennsylvania.  If a confiscatory tax rate precludes casinos in New York from offering reasonable comps and good games, will gamblers who play in other states return?

While there certainly are many innumerate gamblers who will play anything, particularly if it is convenient (how else can you explain Quick Draw?), inferior casinos will eventually appear unpalatable to most gamblers who, even if unable to analyze the return of the games, will realize that their money is disappearing faster — and they are getting less in the form of comps — than at the casino at which they used to gamble.  The idea that New York casinos can flourish under a high tax rate ignores the competitive environment in which casinos operate today.  While it once may have been true that you could make a living offering a lousy game if it was the only game in town, I’m not sure there are enough suckers with enough money to sustain a place offering lousy games when better ones are a reasonably short drive away.

And speaking of taxes, has the state attempted to project how much gambling money the casinos will divert from existing gambling venues in the state, such as the lottery and horse racing?  Any proceeds the State expects to realize from taxes on casino revenue should be netted against the projected decrease in tax revenue from those other gambling sources before the state starts making spending promises based on the projected gross casino tax revenues.

 

 

 

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Modern medicine

June 7, 2014

Like almost everything else, the quality of medical care in this country — even for those who, like me, are fortunate to have the best insurance and to live in an area that is not under-served by physicians — is far from satisfactory. In the past year or so, I have been subject to one egregious error (when facing surgery for a kidney stone, my urologist’s office communicated to the hospital that the operation was to be performed on the wrong side), to the virtual unavailability of my general practitioner, and to unreasonably long waits after I appeared on time for routine appointments with nurse practitioners. If Obama care succeeds in its mission of expanding availability of medical care to those who now cannot afford it (a goal I wholeheartedly support), these problems are likely to become worse.

Why has this happened? Have doctors suddenly become more greedy? I may be naive, but I doubt it; though most go into medicine to enjoy a high standard of living, I believe most also do so in part for altruistic reasons, not to squeeze their patients as tightly as they can. One knowledgeable person suggests to me that the problem is due to the artificial limit on medical school seats, which are far fewer than the number of qualified applicants. I have no doubt that this does contribute significantly to the problem, but the shifting of many routine tasks to physicians’ assistants, nurse practitioners and the like probably mitigates the impact. Another person whose opinion I respect blames defensive medicine necessitated by the plaintiffs’ malpractice bar, but in my experience, malpractice suits are rarely successful, and recent public relations campaigns have turned public opinion away from errant doctors and toward the need for cost containment, though I think unnecessary procedures are still a factor.

My nomination for the bad guy is the insurance companies, which divert significant resources from medical practitioners to comply with their paperwork requirements, and which fund their enormous profits (including often excessive executive compensation) by keeping reimbursement rates as low as possible. I’d rather see my money go to the providers of my medical care than to a company that makes its money by trying to deny me care and to pay the least it can for the care that it allows.

Footnote — opponents of Obama care claim it will come between patients and their physicians. How is that different from the present situation, where non-doctors employed by insurance companies often overrule doctors on what care a patient needs?

My parents in Florida, like me blessed by having good insurance and living in an area well-served by doctors, found their situation so unsatisfactory that they enrolled in a program in which they pay a large annual fee to a general practitioner who has agreed to limit his practice to a lower number of patients than those who do not charge such a fee.  An unintended consequence of the expansion of the availability of medical care will no doubt be a concomitant expansion of such programs, and the perpetuation of two classes of medical care in this country.