Caesars CEO dismisses concerns about casinos
The onetime Harvard Business School professor who now runs the largest casino company in the world glibly presented himself yesterday as one of the "wolves'' of the gambling industry.
"The wolves are here,'' deadpanned Gary Loveman, the chief executive of Caesars Entertainment Corp., in remarks to an audience of business leaders and powerbrokers, including Mayor Thomas M. Menino, at Boston College's Chief Executives' Club of Boston.
Loveman offered an upbeat defense of his industry, which he acknowledged remains a contentious issue in Massachusetts three months after Governor Deval Patrick signed legislation to legalize casinos.
"Across the world'' casino gambling is "becoming increasingly mundane,'' said Loveman, who wants to build a gambling resort at Suffolk Downs in East Boston. "Pick your favorite cosmopolitan destination or your vision of a very conservative US jurisdiction, and in every instance casinos have been around, they've operated for a long time, and they have become entirely noncontroversial in the context of people's lives and their communities.''
Loveman, who holds a doctorate in economics from the Massachusetts Institute of Technology and lives in Wellesley, offered no new details on his company's plans for Suffolk Downs and declined to answer reporters' questions about the workings of the company, including a media report that Caesars was looking to sell casino properties in the Midwest to raise money to invest in new locations, such as Suffolk Downs. Loveman repeatedly said federal securities laws require he stay quiet on company business following Caesars' stock offering last week.
In his speech, Loveman dismissed many of the public concerns about casinos, such as the charge they are predatory businesses that take from those who can least afford it. He said casino patrons tend to be older and better off financially than most. He also claimed crime goes down near casinos, and that property values go up - exactly the opposite of what casino opponents say.
The only downside Loveman acknowledged is the problem of addiction, which he said affects about 1 percent of people where gambling is available.
"That 1 percent absolutely deserves our foremost attention, research, therapeutic interventions - all the things we can do to address this very damaging problem,'' said Loveman. "But we have to recognize at the same time that the vast majority of participants are in a very different position.''
State casino licenses will be awarded through competitive bidding within three zones across the state. Caesars' Suffolk Downs proposal is in the same zone as a Foxborough project pitched by Las Vegas mogul Steve Wynn. Loveman did not address the competition with Wynn directly, but said urban locations "offer the most commanding opportunities'' for casinos, due to city attractions that draw more potential customers to the area.
He praised one of Wynn's creations, the Bellagio in Las Vegas, as "the sort of place God would build if he had the money.''
Loveman estimated that the Massachusetts casino resorts may get 40 percent of their business by taking customers from the Foxwoods and Mohegan Sun casinos in Connecticut and the Twin River slot parlor in Rhode Island.
"The Connecticut and Rhode Island facilities will certainly feel the effects of new competition,'' he said.
Loveman, an entertaining speaker with a deep, clear voice, faced only one sharp audience question - from Attorney General Martha Coakley, who will choose one of the five members of the Massachusetts Gaming Commission, a powerful board that will decide which casino projects win coveted state licenses to operate.
"You try to convince us that you're a sheep in sheep's clothing,'' said Coakley, sending a twitter through the polite business crowd of several hundred people.
"I'm sure that once you read my tax return and fingerprint my children, and all that, we'll know each other very well,'' Loveman joked, to great laughter in the room. "So we'll look forward to that.''
Responding to Coakley's question on regulation in other states, Loveman offered a brief history of casino law, which was established to get mobsters out of the business, he said.
"The regulators in the 1940s . . . their job was to keep the bad guys out and I think they did a spectacular job at that,'' said Loveman. "Now the challenge is how do you strike a balance to keep the industry in a fashion that you and your colleagues would be proud of, and at the same time foster innovation and encourage the good guys to get in?''
He said regulations in Nevada and Mississippi strike a fair balance. "I would encourage you to look at those two.''