Will Donald Trump be good for gaming?
That question has been raised repeatedly in recent weeks. Usually, it has been raised by the general business press, with stories premised on the fact that Trump is a former casino owner, so gaming now has one of its own in power.
Others attempting to answer the question are equity analysts. They also have been positively biased citing what they expect to be an investor and business friendly administration.
Thus it might have come as a bit of a shock when attorney general nominee Jeff Sessions suggested he might pull the rug out from under online gaming.
Specifically, Sessions opposed the decision by the Obama administration’s Department of Justice that the 1961 Wire Act only bans sports betting over telephone lines, and that he intends to review that decision.
It might be hard to put the online genie back in the bottle. After all, there are numerous congressional delegations representing states that now offer online gambling, including state lotteries. That is a political reality the Trump administration will have to face.
But Sessions might try to do it. And, even if he doesn’t, it shows that government risk continues for the gaming industry.
One of the fallacies underlying the general business press assumptions about Trump is that he’s a gaming guy.
Trump never was a gaming guy. He was what he still is in the nature of his business, his temperament, and even his political outlook—a real estate developer.
One only has to look at the failure of his Atlantic City casino business, his Gary, Indiana, riverboat, or his effort at casino management at 29 Palms in California to see that Trump wasn’t a gaming guy.
If there is a bias that could positively affect gaming, it more likely will come from personal associations than from political philosophy or policy.
Trump is a mogul who can identify with other moguls.
Among fellow moguls Trump can connect with one-on-one are Steve Wynn, Sheldon Adelson and Carl Icahn, all casino owners.
One suspects that if Trump supports an anti-gaming policy, he’ll get a phone call from one or more of that trio and will respect their viewpoints.
Of course, that might not help online gaming with Adelson the nation’s highest-profile opponent of Internet gaming and Wynn biased against it. That’s where congressional delegations defending their states come in.
In speculating about Trump there is one possible concern that isn’t mentioned—Macau.
If Trump alienates the national Chinese government, the boys in Beijing might decide to send the message to the compliant government of Macau that American billionaires, especially Trump allies, shouldn’t make so much money from Chinese gamblers.
And with casino concessions expiring in 2020 and 2022, the heat could be on.
Of course, bulls might dismiss that possibility. But, as we correctly warned in this space before, the Communist creed is anti-gambling and Macau casino operators always are at risk. Those warnings proved true in recent years when the national government’s corruption campaign smashed the sky’s-the-limit illusions of casino investors.
For now, we don’t know how Trump will handle gaming issues, or issues that affect gaming.
We do know that the modern casino industry is influenced by the overall economy. Today, that economy is healthy. But there’s a caveat—the recovery is getting long in the tooth, and no one yet has repealed the business cycle. And that is a reality Trump will have to deal with, too.
