Nelson Johnson - Boardwalk Empire - The Birth, High Times, and Corruption of Atlantic City

The numbers speak for themselves—casino gambling is a success. The annual gross win by Atlantic City’s 12 casinos compares well with that of the more than 50 casinos in Las Vegas, with the Atlantic City take exceeding $4.3 billion annually. Since the coming of casinos, nearly 50,000 new jobs have been created in a county with a total workforce of just over 80,000 in 1977. The casinos have spurred nearly $7 billion in new construction, increasing the property tax base from $295 million in 1976 to nearly $8 billion in 2002. More than 11,000 new first-class hotel rooms have been constructed. The property taxes paid by the casinos to Atlantic City’s government now total approximately $165 million per year, representing nearly 80 percent of local tax revenues. Additionally, the casinos provide funding of approximately $340 million annually for seniors and, to date, more than $700 million has been paid into a fund for public improvement loans administered by the Casino Reinvestment Development Authority. Finally, more than 30 million people will visit Atlantic City this year. Not even Sanford Weiner would have dared to predict those kinds of numbers.

What does the future hold? In one critical way, today mirrors the past. Atlantic City remains a town with a singular purpose for its existence—to provide leisure time activities for tourists. As ever, the economy is totally dependent on money spent by out-of-towners. Visitors must leave happy. If they don’t, they won’t return. And getting them to return frequently requires a lot of effort and imagination.

The attractions available to lure leisure-time dollars generally, and gambling in particular, have increased dramatically during the past 25 years. From Native American Reservations (Foxwoods Resort Casino in Connecticut is now the largest casino in the world) to riverboat operations, casino gambling has swept across the country. When state-run lotteries are thrown into the mix, competition for the gambling dollar is everywhere. But, the public is fickle, and the history of gambling reveals an ebb and flow in its popularity. There’s good reason to believe that Atlantic City and Las Vegas will have the greatest staying power as gambling resorts. Nevertheless, if Atlantic City’s growth is to continue and the local economy remain vital, it must become more than a gambling resort.

Atlantic City must transform itself into a destination for more than day-trippers by bus and car. And that is a large task. Surveys show that few people consider Atlantic City as a place to “vacation” but, rather, merely a place to gamble, have dinner, see a show, and return home. If they stay overnight, it’s usually a single evening. Major changes are needed to shatter that image. The new Convention Center is an important building block in broadening the resort’s economic base, but many more hotel rooms are needed to attract the large national conventions and trade shows. Equally important to the convention trade and new hotel rooms is air transportation.

The resort will never be more than Philadelphia’s Playground, dependent on the northeast region, until it is able to support an airline providing regularly scheduled national air service. To date, the most striking failure of Atlantic City’s casino operators has been their inability to cooperate with one another in either attracting a major airline or sewing the seed money and financial guarantees for a start-up to provide service to the major metropolitan regions of the country. The casino operators seem more intent on competing with one another for day-trippers and bus patrons than joining together to expand their base nationally. It’s difficult to understand why, after 20-plus years of success, the major casino players have been unable to work together to establish air transportation service. If they continue to wait for a solution to come from government, the resort will never have dependable airline service and this town’s horizons will remain limited.

Admittedly, the airline industry is no place for amateurs, especially since the events of September 11, 2001. The costs and perils are enormous, but they aren’t insurmountable. Their success on other issues demonstrates that if Atlantic City’s 12 casinos join together and make a concerted effort, the resort would, in short order, have an airline providing service nationwide. Whether by means of the formation of a financial consortium to underwrite an air carrier’s initial losses or pledges to purchase a given number of seats, filled or not, regularly scheduled air service is within the resort’s grasp. The only ingredient missing is the collective will of the gaming industry to make it happen.

The political will needed to propel Atlantic City forward can only come by means of a consensus among casino executives, political leaders, and the community, generally. But achieving a broad consensus to provide continuing direction and an enlightened plan for the future is difficult in this town because of its past.

Atlantic City has yet to adjust fully to life without political corruption. Hap Farley’s defeat was more than the collapse of a political machine—it was the end of an era. Under Farley and his predecessors, the political ward system was Atlantic City’s dominant institution. For nearly a century, it was the prime means for distributing constituent services and political power and operated more by consensus than bossism. Ward politics was akin to a social compact, and its actions were respected by the entire community. It was the thread that united the city. The passing of the political ward system marked the end of effective government in Atlantic City. The Republican machine was corrupt, ruthless, and greedy, but it got the job done. At its worst, it extorted money from anyone who came into contact with city hall and obstructed needed reforms. At its best, the Kuehnle-Johnson-Farley regimes were responsive to individual needs of their constituents and, surprisingly, more often than not, provided able leadership on issues important to the city.

If constructed properly, Atlantic City would be served well by a new partnership comparable to the one forged at the beginning of the 20th century by Louis Kuehnle with the hoteliers and the local vice industry. This time around, it could be a structured dialogue between city, county, and state officials with representatives of the gaming industry. If it is to work, the initiative must come from the casinos. The reality is that the casino industry is the dominant institution in the new Atlantic City. It is obliged to assume a greater leadership role and must make the affairs of government, and the community generally, a priority. There are many bright, informed, and energetic people employed by the casinos. Because upward of three-fourths of them reside outside of Atlantic City, they believe they have no real say in the city’s affairs. But that doesn’t mean they can’t or shouldn’t.

The casinos must work together not only to further their own agendas but that of the greater Atlantic City community as well. They must make their voices heard in Atlantic City’s neighborhoods and the region’s schools, as well as city hall and the State House. Each casino could select representatives who would educate themselves on city, county, and state government and, correspondingly, begin educating public officials on the peculiarities and needs of their business. These delegates can’t be upper echelon executives—they change too often—rather, they should be chosen from among mid-level managers and ordinary employees whose positions aren’t subject to corporate takeovers and palace coups.

These casino delegates could meet regularly among themselves and designate agencies of government and local organizations to whom they would serve as liaisons. By becoming informed on the full range of government and community issues and meeting regularly with local decision makers, the casino delegates could, with much effort, but in a short time, begin the dialogue and create the partnership that Atlantic City needs if it is to flourish.