Columnist Jeff German: Merger may create a monster

Tuesday, June 8, 2004 | 11:42 a.m.

Jeff German's column appears Tuesdays, Wednesdays, Fridays and Sundays in the Sun. Reach him at german@lasvegassun.com or (702) 259-4067.

If you think MGM MIRAGE's takeover of Mandalay Resort Group would have a profound financial impact on the casino industry, consider the ramifications of the shift in political power it would create on the Las Vegas Strip.

In an instant a super MGM MIRAGE would have the ability to dominate the industry's political agenda in the state in a way that no single company has ever been able to do.

The biggest loser of the proposed merger would be the Nevada Resort Association (NRA), the industry's chief lobbying organization here.

Nearly a year ago, after gaming suffered one of its poorest legislative sessions (it lost a concerted push to broaden the state's tax base), MGM MIRAGE Chairman Terry Lanni pulled his company out of the NRA and decided to put together his own political organization.

The abrupt withdrawal cost the NRA $500,000 in annual dues and the clout of the state's largest private employer, a multibillion-dollar company with 10 casinos and some 35,000 local employees.

Once the Mandalay Resort Group was safely under MGM MIRAGE's wing, the odds are it also would cancel its NRA membership. That would cost the NRA another half-million dollars and the loss of another 10 casinos, leaving it with 45.

NRA President Bill Bible said Monday the merger, which must be approved by state and federal regulators, is too far down the road to speculate on what impact it might have on his organization.

MGM MIRAGE, however, would have the kind of unparalleled political power that comes with acquiring most of the prime casinos and half of the hotel rooms on the Strip.

Not only would the new conglomerate have a whole lot more cash to contribute to its favorite candidates, but it also would have the ability to harness the political muscle of 60,000 casino workers. Mandalay would add 25,000 employees to MGM Mirage's power base.

At the moment MGM MIRAGE is in the middle of a massive voter registration drive among its employees. The company has set up registration kiosks at all of its resorts and, with the help of the Clark County Election Department, it plans to provide early voting booths for those employees at locations away from the Strip prior to the September primary and the November general election.

The immediate goal of the voter registration campaign is to alert the employees to MGM MIRAGE's preferred legislative candidates -- those who enthusiastically back a broad-based business tax.

Once those workers are registered, they could be mobilized in future elections, as well.

Employees don't always follow the wishes of their employers when they get behind the curtains of the voting booth, but just getting large numbers of casino workers to the polls could turn the tide in more than a few races.

It is awesome -- and maybe ominous -- to think that one company could wield so much power over the political process.

It is an uncharted path fraught with potential for abuse.