A Dangerous Gamble?

Anyone who has been to Russia will have noticed that the newest, smartest, and often most substantial buildings in the country tend to be casinos.  I used to wonder where people got the money to gamble enough to support half a dozen casinos in a town, before I realised that by skipping on things like meals and other luxuries, it is quite possible to throw most of your wages down a slot.  Yuzhno-Sakhalinsk is no different from the rest of Russia in this regard, and probably features more casinos than other cities because of the large Korean population, who seem to have inherited their love of gambling from their brethren back in the old country.  I had visited a few casinos, not to gamble so much as a rouble, but because some of them operate 24-hours with a restaurant attached – perfect for getting a load of Korean food at 7:00am when you’ve just staggered from a nightclub into blinding daylight. 

Anyway, word on the street, or rather, what my wife heard in a club last night, was that Putin has brought in a new law which will outlaw casinos across Russia, limiting them to only a few cities.  I have no idea whether this is true or not, and if you are interested I suggest you keep an eye on blogs which are much better at covering political announcements eminating from the Kremlin than mine.  But one thing is certain, or so my wife tells me, and that is several of the casinos across the town have been shut down recently.  In yet more unsubstantiated, heard-at-the-smoking-area developments, the only casinos which will be allowed to remain open are those owned by the governor of Sakhalin, thus forcing all business into his arms.

I must stress, I have no idea if this is true or not, and I am idly speculating here without bothering to do any proper research.  But the casinos have closed for some reason, and others remain open for business.  I this is indeed what is going on, I cannot think this will be without consequences.  Russia’s rulers throughout history have reliably complained about the disobedience of the provinces, usually in reference to parts of Siberia, and the remoteness which allows them to ignore many of Moscow’s directives.  In some ways, Sakhalin Island is the same.  Hopelessly remote from Moscow, the residents have an island mentality, resistant to outside interference, especially from spoiled Muscovites who seek to lord it over those toughing it out in the far east.  Okay, I might be exaggerating the extent of this mentality, but it does exist.  Now the type of people who own and operate casinos in Yuzhno-Sakhalinsk are the type of people who own and operate casinos everywhere: not the type of people you’d want to be on the wrong side of.  They have grown pretty rich over the last few years as the island has been booming, and I can’t see them being very impressed with their source of income being shut off and directed elsewhere: be it to favoured cities in mainland Russia, or into the governor’s pockets.

Knocking out one or two of the most shady, wealthy businessmen in a strategicaly important yet remote town in far-eastern Russia might be done without too much noise.  But taking on a dozen of them at once might prove to be a dangerous gamble.  Assuming any of this is true, of course.

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6 Responses to A Dangerous Gamble?

  1. Russophile says:

    Shutting down the casinos has been in the works for some time now. I think that it was announced summer 2006 and was the talk of Moscow at the time. I thought execution of this would be well underway by now. However, I have not been in Russia for about 11 months (on my way back in a few weeks) and as you mention enforcement outside Moscow may be difficult.

    I found a few articles from about a year ago, where the casino ban is mentioned: ONE , TWO, and THREE.

    The issue with shutting down the casinos forgets that it is not pure economic loss due to gambling. There are dealers, waitresses, etc who earn money by working at casinos. However, casinos seem to breed corruption regardless of the country so it must have been causing more problems in Russia than most places.

  2. Russophile says:

    I must have coded the first link incorrectly. Anyway, here is another link to an RIA Novosti article on the topic.

    Also, I noticed that the The author of Freakanomics blogged about it asking why shut them down because he assumes that the government and others must have been receiving their cut of the $6 Billion market.

  3. Timothy Post says:

    Russophile is correct. The announcement was made in 2006.

    As of July 1st, 2007 the only casinos allowed to still operate were those with assets of $20 million. A few regions got rid of casinos completely. Many “mom and pop” casinos unable to meet the size threshold became “branches” of some Moscow casinos with the requisite size.

    On January 1st, 2009, there will only be 4 “zones” (like Las Vegas and Atlantic City many years ago) where casino gambling will be legal.

    I am not sure of the 4 locations although I do know for sure that a couple thousands hectares of cow country along the Azov Sea in Krasnodar Krai near Rostov will be one of the 4 zones. Why they picked a region with zero infrastructure nobody really knows.

    Most people here in Krasnodar Krai seem to feel that Sochi would have been the natural choice or at least a resort like Anapa or Gilendzhik.

    Anyhow, the date for the final closure of the non-zone casinos was purposely set to occur after the 2008 Presidential elections so it shall be interesting to see what happens. Not to mention the fact that those cow fields near the Azov are still cow fields with no building cranes in sight.

  4. L.S says:

    Actually in Saint Petersburg all gambling machines close to any Metro station have been shut down, and this is only the beginning; they were given a year I guess till the complete removal of such casinos. The long line of people waiting to use those street machines simply shocked me. People from all ages, kinds, looks.
    The saddest part is that beside the “quit-alcohol” and “quit-cigarettes” Ads of specialized expensive courses and centers; the 3rd Ad has become “quit-gambling” !
    They even broadcast such Ads on TV. I think this business needs to be regularized and controlled. I see very young people playing sometimes; although they theoretically have age rules. Knowing this country well enough; i dare to say “control” them is a joke; so maybe shutting down most of them is the solution!

  5. JJ says:

    You’ve been a bit quiet since the Casino bashing, and have you lost your camera? What about some lovely snow or Christmas decoration pictures from around town.

    I enjoyed your Istanbul pics.

    Christmas cheer to you anyway, from
    a sight-seeer

  6. Russophile says:

    I stopped by Moscow in December/January and found that the Casinos are still in most of the places that I remember them. My brother-in-law told me that some of the small-time one arm bandit operators near the metro had been shut down for a while, but now they are all back in business. I wonder if some less well-connected people were forced out under the pretext of this law and someone else allowed to operate them until the real ban goes into effect.

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