Monday, Nov. 2, 2009 | 2 a.m.
Steve Wynn on Fox News
- Obama’s way means ‘lights out’ for Vegas, Wynn says (10-26-2009)
- Government doesn’t do much for Wynn, or does it? (10-26-09)
- Gaming execs credit stimulus with saving Nevada jobs (10-22-2009)
- Wynn still critical of Obama administration (7-30-2009)
- Wynn: Stimulus plan won’t solve city’s woes (4-10-2009)
- Wynn: Obama’s remarks bad for convention business (2-26-2009)
Steve Wynn, one of the most charismatic figures in American business and the man largely credited with launching the modern building boom in Las Vegas, is also fiery-tempered, with mercurial moods and politically incorrect outbursts.
His contribution to a Fox News Sunday round table last month began with this zinger against the Obama administration’s handling of the federal stimulus and health care: “Government has never increased the standard of living of one single human being in civilization’s history.”
Though many of Wynn’s peers agree with his thesis — the nation should focus on private-sector job creation rather than an all-consuming reform of health care — they understandably cringed at his delivery of it.
“That’s so simplistic,” round-table participant and Michigan Gov. Jennifer Granholm replied.
“There’s nothing simplistic about my approach to this problem,” Wynn shot back, his indignation palpable. “I’m saying the source of government revenue, the source of well-being in this country, is employment. That allows companies to pay taxes, employees to pay taxes. I’ve got 20,000 employees. I’ve had as many as 150,000 families that I’ve been self-insuring.”
Though blaming Obama for the poor job outlook sounded like a typical partisan attack, it comes with a history of self-preservation that has little to do with politics.
When opening his Encore resort, planned and executed before the recession, in December, Wynn spent most of his time with reporters discussing the need for the Obama administration to focus on job creation. Consumer spending begins with jobs, he said, adding that his luxurious resort would charge only $129 a night for rooms.
Wynn has often referred to his resorts as the impetus for broad economic development and well-being. In years past, Wynn has said that his employees should feel lucky to work at his resorts, which he boasts are more luxurious and make more money than the competition. In a controversial move to give a share of casino dealers’ tips to their front-line supervisors in 2006, Wynn told his dealers that they were able to earn big tips only because he had built lavish resorts in the first place. And yet, to the industry’s surprise and dismay, even cheaply priced luxury is too much for this economy.
Casino executives have played politics for a few decades because the industry has needed political support to expand nationwide, and they have hedged their bets by giving money to both parties. Casino bosses ascribe to a form of controlled libertarianism that doesn’t readily fall into either party’s belief system. Executives and their political action committees have tended to court moderates who are less apt to push for federal regulation.
So while the Las Vegas tourism industry has been among the most hammered by a recession that has slashed discretionary spending, casinos would probably be the last big businesses in America to receive any kind of government assistance. Unlike other businesses, casinos exist at the behest of state governments for the purpose of generating tax revenue for those states.
Though the industry wields considerable state influence as the source of half of Nevada’s budget and a significant chunk of other states’ budgets, it plays defense at the federal level, lacking the clout or credibility of old-line industries with deeper political ties.
“We’ve had the experience of watching people fall all over themselves to put cash in the hands of banks and car companies — companies that have historically produced lower-quality products than other places or products people didn’t want, or that were impervious to criticism and calls for change,” said one casino executive, who spoke on the condition of anonymity.
The stimulus hasn’t helped restore consumer confidence, which underpins the tourism business. Last week Wynn’s company reported that third-quarter earnings were two-thirds those of the previous year, when the stock market tanked and the recession worsened. Though some indicators have bottomed or moved upward since then, the jobs outlook remains grim. Wynn says he’s done more than his share of hiring, though the timing of Encore turned out to be a boon for employees at neighboring Wynn Las Vegas who might otherwise have been trimmed but were needed next door.
Wynn led the casino industry’s record political contributions in the mid-1990s, when Las Vegas casino interests ranked among the top sources of political contributions to 1996 presidential candidate Bob Dole. Industry bosses liked Dole’s moderate approach to casino regulation at a time when Congress was setting out to review gambling’s social costs and industry critics were blocking expansion efforts. Wynn, a registered Democrat who has also supported former President Bill Clinton, had publicly attacked a short-lived plan by the Clinton administration in 1994 to levy a federal tax on casinos as a way to pay for welfare reform. (That triggered the formation of the American Gaming Association in 1995 to represent casino interests in Washington.)
At a time when most casino executives kept out of harm’s way, Wynn was an outspoken industry advocate at an unfriendly time for casinos. The mid-1990s were dark times for casino bosses, who thought that both conservatives and liberals were out to destroy — or at least cripple — the source of their livelihood.
The casino industry, with $33 billion in gambling revenue, a 47 percent increase from 1999, is on stronger political footing these days. And though Wynn’s criticism of a president who has been in office for less than a year may upset potential customers and political allies, he is nothing if not consistent in his outspokenness.