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Source link: http://archive.mises.org/17004/is-sin-city-turning-into-the-motor-city/

Is Sin City turning into the Motor City?

May 18, 2011 by

Howard Gold takes a look at two, one-horse towns–Detroit and Las Vegas. Both fell down in the financial meltdown and can’t get up. Not yet, at least.

Home prices have fallen over 58% in Las Vegas from the peak in 2006, more than any other major city.  More than 70% of homeowners are underwater.   Unemployment was 13.3% in March and last year the state reported a population decline for the first time in 90 years.

As Gold points out, Las Vegas Sands and Wynn Resorts are making their numbers half a world away in Macau.  Macau’s gaming revenue is now four times that of the Las Vegas Strip, reaching $23 billion last year.

Ironically, the “new Detroit” title Gold uses, was a favorite phrase of the Culinary Workers Union Local 226.  It was always the belief that D. Taylor’s maids, bartenders and cocktail waitresses could not be moved offshore.  So pile on the work rules and demands because gamblers aren’t going anywhere else, the union brass figured.

The Union picketed the Frontier for six and half years before Margaret Elardi finally sold the place to out-of-towner Phil Ruffin, who remarkably was granted a gaming license in 15 minutes when he said he would approve the Culinary contract.  The rest of the corporate Strip hotel owners buckled and the Las Vegas Sands is the only major Strip property to remain non-union.

Surly employees and geriatric cocktail waitresses are the equivalent of Monday Morning Cars, vehicles made on days when absences are high and too few workers show up sober.

Legacy costs and poor quality products took GM to the abyss.   It’s no different for Las Vegas.

The Las Vegas area population peaked at around two million.  Detroit’s population peaked in 1950 at just short of 1.9 million. The Motor City last year was just over 700,000.

There are many more cars on the road today than there were in 1950.  People in Detroit just aren’t making them.

The number of gamblers will continue to grow.  But they will take their wagers elsewhere.

{ 9 comments }

x May 18, 2011 at 1:09 pm

I enjoyed this article. Just yesterday my aunt was telling us about her recent weekend in Las Vegas, her major complaint was the customer service at every establishment. The staff at every major establishment were terribly rude.

Tony Fernandez May 18, 2011 at 2:22 pm

I didn’t know those people were unionized. Shame about the Sands though as it’s going out of business. Union leaders have proven remarkably adept at getting in bed with politicians, hence getting a license now seems to be tied to unionizing.

HL May 18, 2011 at 2:51 pm

Hey, baby, you are signing my song! Sadly, it’s not just Vegas that’s going the way of Detroit. The rest of the USA ain’t lookin’ much better.

Ink Cartridge Sam May 18, 2011 at 6:45 pm

I wouldn’t be surprised if Vegas’ best days are behind it, but I think unionization of the strip is only a very small part of that. Vegas only existed because of lack of regulations and laws that most other states have. Other than the fact that you can do pretty much anything you want there, it’s a pretty god awful place to live.

HL May 18, 2011 at 9:26 pm

“Awful” if you are a low-time-preference Bah Humbug sort of chap. If you are a high time preference fun lover who likes to live fast and loose, Vegas is grand! The do-gooders are working hard to undermine that, but a chap can still get pretty much anything naughty he desires at 2 a.m.

For me, it’s kind of liberating to be able to buy a bottle of Jack and a box of diapers at the Super Market at 2 a.m. and then gamble the change at a slot machine before heading home.

To each his own.

Dan May 19, 2011 at 10:09 am

LOL. To each his own indeed. There is opportunity in other parts of the state though, I should know, I’m traveling 2600 miles to Nevada for a job at a mine. It should be fun! Plus, no state-wide vehicle emissions reg’s! Hooray!

Ned Netterville May 19, 2011 at 3:35 pm

Vegas couldn’t survive ten minutes without Lake Mead behind Hoover’s @@##$% dam. And Lake Mead along with Lake Powell upstream on the Collyraddy are running out of water. A couple of quotes from websites that monitor such things:

“Boats that could once float next to the fishing pier in the old Lake Mead Marina are left high and dry by an 11 year drought that dropped lake levels by 115 feet.”–http://www.ktnv.com/story/14434753/falling-water-levels-at-lake-mead-to-rise

“Lake Mead is currently about 42 percent full, and its surface area has shrunk drastically. Lake Powell currently stands about 57 percent full.”–http://www.ksl.com/?nid=148&sid=14224491

Although the level of Lake Mead is forecast to rise by 20′ this year, part of the reason is that more water is currently being sent downstream from Lake Powell to replenish it. The long-term outlook is so dismal that there are proposals to save Mead by draining Powell. Because of population growth and other water demands in areas watered by the Colorado River, it is all but certain that the river will never be able to fulfill the demands currently placed upon it.

Emptying Lake Powell and restoring Glen Canyon to it incomparable, pristine, pre-dam beauty would be the best thing to happen to the Four Corners region since the white man arrived.http://www.glencanyon.org/aboutgci/faq.php

John May 19, 2011 at 6:14 pm

This article says The Las Vegas Sands is non union but it closed in 1996. The Venetian now stands on that property. How old was the resource used for this post?

Vanmind May 25, 2011 at 2:02 pm

Maybe people can go to the casino in Detroit, or the one across the river in Windsor.

Competition, indeed, and boo hoo for “get government to divert water here” Vegas.

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