Chicago Tribune | Casinos bet on D.C. clout

Tribes, private operators pour tons of cash into influencing lawmakers

By Mike Dorning
Washington Bureau
Published February 20, 2006


WASHINGTON -- Along with tawdry tales of bribery, money laundering and sham charities, the corruption scandal surrounding former lobbyist Jack Abramoff has thrown new light on the rising tide of gambling money pouring into the nation's capital.

As more states have moved to legalize gambling in one form or another and Indian tribes have turned to casinos as a lucrative source of income, the gambling industry's annual revenues have swelled to more than $78 billion. And with that wealth has come a determination to deploy larger sums to influence decisions made in Washington that can affect the bottom line.

Federal campaign contributions from the gambling industry have jumped more than 27-fold, from $478,000 in 1990 to more than $13 million in 2004, according to the Center for Responsive Politics, a non-partisan watchdog group. Washington lobbying expenses disclosed by the industry have nearly doubled in six years, from $6.1 million in 1998 to $11.4 million in 2004, according to the Center for Public Integrity, another monitoring group.

One California tribe, the Morongo Band of Mission Indians, rents a $1,500-a-night luxury suite at Washington's MCI Center that it lends out for fundraisers benefiting members of Congress friendly to their casino interests, including at least once to Rep. Jerry Weller (R-Ill.).

During the 2004 Republican National Convention, casino tribes helped foot the bill for an after-hours Wild Wild West Saloon party for a congressional committee chairman, Rep. Richard Pombo (R-Calif.), at a New York nightclub. The party featured a mechanical bull and music by big-name bands including the Charlie Daniels Band, .38 Special and Otis Day.

At least three of President Bush's premier Pioneer fundraisers were gambling industry chief executives. For years, the industry paid to fete senior congressional staff with annual three-day trips to Las Vegas, where casino operators made their case on legislative issues.

In Washington, the commercial casinos' trade group is headed by a former head of the GOP, Frank Fahrenkopf Jr., who has a $5.5 million budget at his disposal. Indian casinos have their own trade association with a similar budget.

"Twenty years ago, a member of Congress or a governor wouldn't want to be connected with the gambling industry. Now, they fly out to Vegas for a fundraiser," said Rep. Frank Wolf (R-Va.), a 25-year veteran of Capitol Hill who has tangled with gambling interests.

Fahrenkopf, executive director of the American Gaming Association, makes no apologies.

"There's no question that, like every other industry, the gaming industry wants to make sure it is heard," Fahrenkopf said. "Fundamentally, it's to make sure that the federal government doesn't, fairly or unfairly, intentionally or unintentionally, do anything that damages the industry."

While casinos, Indian tribes and other gambling interests once heavily favored Democrats with their campaign contributions, they have gradually shifted money toward Republicans as first Congress and then the White House came under GOP control. Now gambling donations are about evenly divided between the two parties.

That has created conflict among Republicans, some of whom are social conservatives morally opposed to gambling. The Republican National Committee in 1999 rebuffed a resolution that would have barred the party from accepting gambling money, despite vigorous backing from prominent Christian radio host James Dobson, founder of the group Focus on the Family.

`Deaf ear . . . . on this issue'

"It is troubling that Republicans have really turned a deaf ear to social conservatives on this issue by and large. And I think it's tied to the vast amounts of money gambling interests are pouring into the party," said Tony Perkins, president of the Family Research Council, an influential Washington advocacy group for conservative social values.

The gambling industry can muster political arguments that are in tune with the anti-regulatory philosophy espoused by business interests and libertarians in the Republican Party. And the effect of the conflicts with social conservatives over gambling has been diminished because that movement has emphasized issues such as abortion, gay rights and judicial appointments, where it is in sync with the party.

"This splits the Republican coalition," said Marshall Wittman, a senior fellow at the centrist Democratic Leadership Council who once lobbied for the Christian Coalition. "It's only because social conservatives view other issues as more important that they have been able to overlook this transgression."

The spread of legalized gambling also means that more influential members of Congress represent districts with an economic interest in the industry. Former Senate Majority Leader Trent Lott (R-Miss.) and Senate Appropriations Chairman Thad Cochran (R-Miss.) hail from a state where Gulf Coast casinos have had a major economic effect. Senate Democratic Leader Harry Reid of Nevada represents the mecca of legalized gambling. The Senate's second-ranking Republican, Mitch McConnell, represents Kentucky, where the prosperity of the horse-breeding industry is tied to racetrack betting.

In the House, Speaker Dennis Hastert (R-Ill.) has two riverboat casinos in his district, in Aurora and Elgin. House Appropriations Chairman Jerry Lewis (R-Calif.) represents a district with two Indian-operated casinos, one of them the largest private employer in the city of San Bernardino.

Building on such pillars, the industry has amassed considerable clout in Washington. For more than five years, gambling interests have stymied bills to clamp down on Internet betting, even though the Justice Department has determined that the fast-growing, multibillion-dollar business is illegal.

Casino interests also stopped cold a NCAA-backed effort to ban betting on college sports following a series of point-shaving scandals. Attempts to revisit the 1988 law regulating Indian casinos have foundered. And when the 1997 tax package was being put together, even Rep. Bill Archer (R-Texas), who was then chairman of the tax-writing House Ways and Means Committee, was rebuffed when he tried to include a tax on Indian casino income.

Meanwhile, casino allies led by Illinois' Weller managed to get a tax break for the purchase of new slot machines included in the post-Sept. 11 economic stimulus package passed by Congress. The Mississippi Choctaws, a casino operator with a well-funded lobbying operation, prevailed on Cochran to exempt their tribe from oversight by the National Indian Gaming Commission, the agency set up by Congress to regulate gambling on reservations. The provision was tucked away in a 40,000-word appropriations bill passed in 1997.

The Abramoff scandal illustrates how much money that gambling interests are willing to expend to influence public policy, and why. Indian tribes--and sometimes outside investors in Indian casinos or the management companies they employ--can have a large stake in decisions the Interior Department makes about recognition of a tribe and other matters.

Abramoff and his partners received more than $80 million from six Indian tribes with casino interests over four years, most of that channeled through activities such as public relations fees and "grass-roots" lobbying that would never have been disclosed to the public but for the criminal investigation.

`Payoffs are enormous'

The amount of money at stake for individual tribes' casino operations were far larger. Abramoff and his partner, Michael Scanlon, reaped more than $30 million from one tribe, the Louisiana Coushatta Indians. But the tribe was protecting a $300-million-a-year casino business from competition, employing Abramoff to work against federal approval of an agreement that another tribe had reached with the state to open a casino.

Even a delay in federal approval would have provided the Coushattas a return on their investment. And the approval was in fact delayed, though it remains unclear how significant a role Abramoff played.

"The payoffs are enormous," said Ross Baker, a political science professor at Rutgers. "If you pay a lobbyist a few hundred thousand dollars, or even millions of dollars, it's pocket change compared to what you can make with a casino."