June 16th 2001

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COVER: How the Sun Causes Global Warming

Tokyo debt threatens global economy

Victoria - Battleground State

Army Behind moves to oust Wahid

The Media

Straws in the Wind


Behind the morning after pill

Wanted - a genuine British opposition

Eminem's contribution to culture

Nevada - the US model at its worst?

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Nevada - the US model at its worst?

by Bob Browning

News Weekly, June 16, 2001
People outside the USA know of Nevada, if at all, for its gambling cities. Las Vegas is the de facto casino capital of the world.

But Nevada has a wider symbolic significance, one that is not confined to its legendary gambling. It has a long history of low-taxing, laissez-faire government. Its public policy has operated mainly to maximise economic development. Its devil's brew of corporation-run gambling and economic rationalist policy illustrates in the extreme the sort of social outcomes that US-led neo-liberal globalisation is producing to various degrees elsewhere around the world.

Nevada is America's fastest-growing state. Its population has leapt by more than 60 percent in the last decade. It ranks among America's top 12 States in terms of personal wealth. Nevadans pay no state income tax and relatively low property taxes. Eighty per cent of the state budget derives from fees and taxes on gambling and associated activities.

The Mafia provided the original entrepreneurs that launched Nevadan-style capitalism. But now those running its Babylonian-scale gambling houses, hotels and nightclubs include some of America's leading corporations.

The politico-corporate elite running Nevada claims it has a steely tradition of self-reliance and small government. Nevada's current social structure and cultural values derive more from a combination of Wild West mythology, neo-liberal ideology and the kind of entertainment that corporations have developed around gambling.

There are other facts about Nevada that belie its wealth, its glitter, and its dream factory hype. These are the facts that apologists for neo-liberal and casino economies prefer not to hear. The New York Times recently reported (May 19, 2001), for example, that although it ranks near the top in personal wealth:

"Pick almost any index of social well-being, and Nevada ranks at, or near the very bottom of the 50 US states."

Nevada has the highest suicide rate in the USA - almost twice the national average. It has the highest percentage of teenagers who are high-school dropouts. It has the highest teenage pregnancy rate, and the highest rate of firearm deaths. It ranks 45th among the 50 states for overall health status.

Bob Fulkerson, spokesman for a Nevada umbrella group of non-government civil rights and labour organisations, argues that the mind-set of the gambling state's corporate management and associated political ┼Żlite is: "If you can't pull yourself up by your bootstraps, then it's your own damn fault."

The result, he says, is a rich state that believes itself morally justified, if not morally obliged, not to provide the social infrastructure and social services the state obviously needs. Ideology and special interest stop Nevada's booming wealth from translating into public expenditure other than on corporate welfare.

For example, Nevada was recently rated 50th out of America's 50 states for investment in public health prevention. "There's very little tradition of investment in public health or prevention," says Dr Mary Guinan, Nevada's state health officer. "People don't want big government, so this is what you get."

One of Nevada's outstanding statistics is that it has a prolific tobacco death rate. It has the nation's highest adult smoking rate, the highest female smoking rate, and the highest overall death rate from smoking.

Public health advocates argue convincingly that these statistics cannot be separated from the fact that Nevada has the strictest tobacco "pre-emption" laws in the nation. Nevada's tobacco laws bar any local authority from enacting any anti-smoking regulations stricter than the minimalist state-wide standard the state sets.

Obviously, the aim is not to serve the public interest but to favour the corporations running the casinos, hotels and restaurants in which gambling stress intensifies smoking. Businesses are not even required to provide no-smoking areas, as are those in most other parts of the country.

It has been shown that smoking and related death rates have fallen dramatically in places like California where strong anti-smoking policies apply. Dr Guinan admits:

"We have no comprehensive tobacco prevention program in our state. Even our share of the national tobacco settlement money didn't go into prevention per se, but into scholarships."

Reformers like Fulkerson who want government action to improve community infrastructure and social cohesion emphasise that the need is especially urgent in Nevada:

"We have 10,000 people moving into Las Vegas a month, and roughly 5,000 moving out. So lack of community and lack of connection to one another is a huge factor."

As expected, however, neo-liberal lobbyists argue that Nevada's problems including social pathologies like suicide and tobacco-related diseases are not caused by low taxing, deregulating, anti-welfarist government. Moreover, they say, the ability of government to solve such problems is limited.

Washington's Cato Institute was one of the think tanks recently warning that there were "very strong political moves afoot to increase [social] spending in the state of Nevada".

Cato's fiscal policy analyst said it was concerned that those behind the moves were "not looking for more innovative solutions". What they should be looking for was a "less government-centered approach". There is a limit to what government can do, he said, and "it may very well be magnified by the fact that some of these pathologies go well beyond bureaucratic ability to effect change".

Many of the undesirable aspects of neo-liberal ideology flow from the mindset that wants to separate economics from social outcomes. Not only is economic development measured in abstract statistical concepts like GDP, and by distribution-disguising averages like per capita income, but it is seen as an end in itself.

Neo-liberals like to claim classical economists like Adam Smith as their own. But he never made the mistake of seeing an expanding economy as a good in itself. For him, the economy was an instrument to serve society. The proof of the economic pudding was always in the social eating.

The economy exists for man, not man for the economy. The link between the economic and the social cannot be sundered.

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