Success Of Foxwoods Resort Casino example essay topic

There are many reasons why people gamble and what the advantages and disadvantages are of risking your bank account on the roll of the dice or the luck of the draw. I originally set out to try and explain why people gamble, but I realized that gambling is just as much of a business or industry as anything else. I researched Foxwoods casino, in CT, and the business behind that. From there I will attempt to explain the "cause and effect" of gambling. Gambling has made much more sense to me now, and I hope it will do the same for you. Foxwoods resort casino, the largest of its kind in North America and most profitable casino in the world, got its start with the advent of a bingo hall in 1987.

At this time the Mashantucket Pequots secured a $4 million loan from the Arab American Bank. The bingo hall netted $13 million in gross sales and yielded $2.6 million in profits in its first year of operation. Today, the Pequots are one of the most respected Indian Nations in Native America because of the way they have used the success of Foxwoods Resort Casino to reconstruct their infrastructure and tribal homeland. Currently, the casino is still expanding. The Pequots are building a 17- story hotel and a $200 million museum. The tribe also plans to build an Asian theme park, with a monorail and replica of China's Great Wall, golf courses and a campground.

Already, the tribe has built a community center, a child development center and new housing for their tribal members. Their staggering profits have removed the Tribes worries about paying college tuition and health insurance. In addition, all tribal members receive a yearly bonus if they stick to a strict education and work incentive plan that basically consists of "no school, no money". Members are guaranteed casino or reservation employment, and all their health care, child care and educational expenses are paid for from kindergarten through graduate school.

Foxwoods president and CEO G. Michael "Mickey" Brown has been quoted as saying, "Gaming is the economic engine that is going to take Native American tribes into the 21st century". Foxwoods employs 11,000 workers in a region hit hard by defense industry cutbacks. They hired 2,000 workers the same week that the Electric Boat Co., a submarine maker, laid off 2,300 workers in 1992. These defense cutbacks have led to the emergence of the Pequots as a major economic player with jobs and money generated by Foxwoods Resort Casino.

In 1995, Mickey Brown stated that the tribe had given the state of Connecticut $307 million since 1991 and since 1992, Foxwoods spent $319 million on goods and services. All of the success the Pequots have experienced has occurred due to the signing of the Indian Gaming Regulatory Act (IGRA) on October 17, 1988. This act permitted class gaming establishments by American Indian Tribes. The Act stated that Tribal governments were the primary regulators on Indian Gaming but that the Tribes were required to negotiate with their specific states to conduct a Class gambling establishment.

This is called the state regulatory layer to state-tribal compact agreements. After the IGRA was passed the Pequots pursued a Malaysian rubber company of Genting International requesting a loan, which they eventually secured. It was paid off in just seven months. Genting International also lent the tribe an additional $142 million for expansion and a 610 - room hotel and formed a partnership to build a second 330 - room hotel nearby. The pact between the State of Connecticut and The Mashantucket Pequots gave the Pequots the exclusive right to operate slot machines.

This was amended on April 25, 1994, when the State, the Mohegan Tribe, and the Mashantucket Pequot Tribe singed an agreement that allowed the Mohegan tribe to operate slot machines. Part of the allure of the pact for the State of Connecticut stemmed from the Pentagon cutbacks on defense contractors. The defense contractors did not take the offers of direct aid to help with diversity and to save jobs, so there was a need for diversification. As part of the agreement, the tribe gives the state 25% of the annual slot revenues. It was determined that the state police are the primary law enforcement jurisdiction over the gaming facility. The tribe will reimburse the state for regulatory expenses required to fulfill duties as stated in the compact.

Since the casino opened in 1992, the Pequots have become a major contributor to the state of Connecticut's economy. It has also become a major success regarding tourism, jobs and entertainment in Connecticut. On a good weekend, Foxwoods resort Casino brings approximately 80,000 people to the area. As a whole, American Indian tribes that run gaming establishments are able to economic and social improvements on their reservations. The Pequots have done this with great success but they are also aware that they cannot live forever on the success of their gaming. They are seeking other ways to diversify.

At the present time they have built industrial parks in Groton, CT, contributed $15 million to downtown Norwich, and hired former EB workers to build high speed ferries. In addition they are considering the creation of a loan fund for business start ups and expansions, and may even open their healthcare plan to small employers. Presently, the latter of the two have not occurred. The state of Connecticut receives through its Treasury Department 25% of all the slot revenues that Foxwoods generates. Foxwoods took in an estimated $1 billion in its first year of operation. In July 1996 the Pequots reported a record taking month in slot revenues.

Over $846 million was gambled on slot machines, resulting in a record one month net win for the casino of $64.4 million. From January 1993 to December 1996, Foxwoods gave $504 million to the state in slot revenue. However, its New England "monopoly" came to an end in October 1996 with the Mohegan Indians opening their own casino, Mohegan Sun. The new casino, however, does not hurt the Pequots profits or the amount of money it pays the state.

In fact, Foxwoods still brings in an incredible amount of money each month. For example, in the month of March, 1996 Foxwoods brought in $35,720,745.00. That breaks down to 13.00 a second!! Foxwoods has proven itself to be one of the leaders in the electronic gaming industry.

The Pequots have created a virtual playground for adults, with everything they need right there. You can go to the Pequots land and gamble, play golf, eat at an assortment of fine dining establishments, and stay in a first rate hotel, all without the glamour and glitz of a place like Las Vegas or Atlantic City. Foxwoods is just like every other casino in the country. It is full of people not keeping track of anything except their winnings.

Casinos have their way of sucking people in and making them never want to leave. The psychology of all this is actually mind boggling. To keep people from leaving and spending more money, casinos give away free alcohol which impairs peoples judgement and sense of reality. It is assumed that the more drinks someone has, the more likely it is that they will stay and spend more money.

The money spent by the casino on alcohol is more than made up by profits. Another tactic of casinos is the lack of windows or clocks. The idea is to have gamblers not look at the outside world and concentrate on what is going on inside the casino. Without clocks, and with alcohol, how can someone who doesn't have a watch know what time it is? Casinos are very tricky when it comes to "customer relations". They allow their customers to forget about the world around them and concentrate on winning, when the whole time they are robbing them blind.

In most cases, people walk out of casinos with empty pockets and a stomach full of booze. In the course of writing this paper I learned about the way the human mind can be manipulated by very simple things, and when it is discovered it is often too late. There are smart gamblers who do win, but the majority don't think and wind up spending incredible amounts of money.