Why Australia is addicted to gambling?

You know the old saying: Australians will bet on just about anything, even two flies crawling up a wall.

Maybe it’s due in part to our intensely competitive national spirit, a willingness to back yourself, if you’ll excuse the punting parlance.

Unfortunately, as a nation, the end result is that we now lead the world when it comes to gambling.

Incredible as it may seem, Australians lose more than $25 billion a year on legal forms of gambling, representing the largest per capita losses in the world.

That’s according to the official government research. And it’s leading to shocking health and social problems.

We may not have invented the poker machine but we dominate the industry.

Local outfit Aristocrat is now the global design and production leader.

The only area of gaming and gambling where we appear to be lacking is in the area of legislation and oversight.

Governments of all persuasions and across all jurisdictions appear reluctant to bring the “industry” to heel, even as new online gaming operators seek to penetrate deep into household finances with ever more invasive technologies.

The reason? Our governments across state, territory and federal jurisdictions are every bit as addicted to gambling and the revenue spin-off it provides.

Total taxes from gambling run towards $7 billion a year.

So too are our biggest sporting bodies and the commercial media companies that count sport as their bread and butter, both in terms of audience and the advertising revenue it provides.

So much money is involved, that these powerful entities routinely penetrate the upper echelons of power and pull the strings every time a threat emerges.

It may even partly explain why decades of openly corrupt activity from our two biggest casino operators, Crown and Star, were ignored.

Even in the aftermath of royal commissions and government inquiries, which unearthed blatant examples of money laundering and partnering with foreign organised crime figures, not one criminal charge has ever been laid.

Both groups, despite being found unsuitable to hold a casino licence, have been allowed to continue operating.

A threat to a free media?

Sometime in the next few weeks, the federal government will impose restrictions on gambling advertising that will fall far short of the blanket ban for which many are calling.

Free-to-air television is chock full of ads for online gambling, especially for sport, a key component of the free-to-air program mix, thereby creating a powerful alliance of interests.

Traditional media is in the final stage of a pitched battle for survival after the tech giants muscled in and mopped up their revenue with razor-sharp technology tailored to directly tap into an individual’s needs and desires.

Losing another stream of cash wouldn’t be fatal, but it would be a serious blow. Not surprisingly, the online gambling industry, which is still trying to build a profile, has pulled out all stops to thwart the changes in a strategy dressed up as maintaining an independent media industry.

The symbiotic links between commercial media and gambling occasionally have been blurred, most recently with News Corp’s creation of The Code, a sports website that cross-referenced gambling odds.

The Murdoch family media company also briefly joined forces with Matt Tripp’s BETR gambling agency, an alliance which now has been unwound.

But it was an illustration of just how close the industries have become and the potential for wielding political influence.

NSW, the gambling state

When it comes to gambling and regulatory capture, you need look no further than NSW.

Back in the mid-1980s, Las Vegas emissaries arrived in Sydney en masse, frothing at the prospect of a government-sanctioned monopoly casino in what appeared to be gambling heaven.

When they arrived, most were stunned to find the city and the entire state riddled with “clubs” — non-profit ventures filled with poker machines.

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“There are casinos on every corner,” one American operator then complained to your correspondent.

At that stage, with pokies banned in Victoria and Queensland, Albury was a magnet for Victorians, while Tweed Heads played host to one of the biggest recreational establishments catering for returned military servicemen in the world.

Attempting any kind of restraint on gaming and gambling ever since has met fierce opposition from the clubs

Until recently, ClubsNSW would sign a memorandum of understanding with any incoming government.

The Minns government last year wound back the previous Perrottet government’s commitment to have cashless gaming by 2028 — which would more easily identify problem gamblers and money-laundering activities — and instead decided upon a “trial”.

The top 20 clubs in NSW have almost 11,000 machines that contribute to the $7 billion in losses from punters across the state.

In all, the state has more than 85,000 poker machines in clubs, pubs and casinos, a situation that has sparked an uproar from even the union movement which earlier this year called for an urgent reduction in pokie numbers.

Betting on the future

There’s no way you can ban gambling.

Back in the 1970s, those frequenting the Forbes Club in Sydney, an illegal casino in Woolloomooloo, could occasionally rub shoulders with a police chief and perhaps even a premier.

These days, stopping predatory gambling operations is even more difficult.

Just as the tech giants stole the advertising dollar by focusing in on every individual’s needs and wants, online gambling outfits can identify the most vulnerable via their algorithms and through data mining.

Gaming industry revenues are losses for consumers. With the rise of artificial intelligence, it will become easier for them to identify and exploit problem gamblers or those with a predilection for a punt.

The chance to run endless games, either fantasy or real, across sporting events on a range of potential outcomes and tailor-made punts represents a huge revenue opportunity at huge cost to the community.

Hence, the reason the major online gamblers are focused on sport and, with sport tied to broadcasters, the frantic advertising spend.

The main sporting bodies are entangled in this web. The reason broadcasters can pay such huge amounts for rights is, in addition to the huge audience, the betting operators are a large source of income to enable the widescale distribution of the product.

Despite the huge sums of money running through online gambling operators, some have overseen a slump in their reported profits, which has raised eyebrows.

Sportsbet, for example, which has an ownership lineage stretching from Australia to the Netherlands and through to Ireland, managed to win almost $2.2 billion from Australian punters in its most recent accounts.

But the profit from its local entity almost halved to $369 million over two years, reportedly due to higher taxes, tighter regulation and a marginal drop in revenue.

Like some tech giants, however, Sportsbet parent Flutter is domiciled in Ireland, which has a tax rate of just 12.5 per cent for trading income.

When it comes to betting, the house always wins.

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