The Potawatomi have spent millions to lobby against a Kenosha casino. Is Gov. Walker their latest ally?
For those who doubt the political shrewdness of Scott Walker, consider how the governor has handled the application of the Menominee Tribe to create a casino in Kenosha. The proposal had languished for years without getting federal approval and suddenly received it on August 20. Now it was up to the governor, and the governor only (the legislature has no say), to determine whether the casino should be approved.
The proposal is bitterly opposed by the Potawatomi Tribe, which runs the state’s biggest casino in Milwaukee’s Menomonee Valley, whose annual revenue in the most recent year reported was more than $380 million. And so Walker seemed to throw down an olive branch, declaring that he should not have “to play King Solomon” and “pick and choose between two well-respected entities here in the state of Wisconsin.” Instead he called on the 11 tribes in Wisconsin to reach an agreement among themselves and he would support that.
His decision sounded wonderfully idealistic and yet practical, and will likely play well across the state. But anyone close to the issue knew immediately that Walker was actually siding with the Potawatomi, because the tribe has done everything possible to kill the Kenosha casino and would prevent any unanimous decision by the tribes. For that matter, the Ho-Chunk Nation (which would like to build a casino in Beloit) is also opposed, though they might consider some kind of partnership with the Menominee. Finally, Walker added another condition: the Kenosha casino must result in “no new net gaming” in the state. Given that what’s proposed is an $800 million entertainment center at the old Dairyland Greyhound Park, there’s no way it would result in no additional gaming in Wisconsin.
Menominee Chairman Craig Corn reacted by accusing Walker of protecting the Potawatomi casino, whose officials have said they would lose as much as $150 million in annual revenue from a competing casino in Kenosha. “If he’s going to give veto power to the Forest County Potawatomi, then make sure he says that to all the Menominee people and the people in Kenosha, Racine and surrounding communities,” Corn declared.
The Potawatomi has also helped Walker, notably as a major sponsor of the National Governors Association’s annual meeting in Milwaukee. Neither Walker nor the Potawatomi have disclosed how much they contributed. Walker would undoubtedly love to gain the tribe’s support for his reelection effort in 2014. “In a political environment in which some tribal governments remain marginalized,” Kevin K. Washburn, Assistant Secretary of Indian Affairs for the federal Department of Interior, has observed, “it is heartwarming to see that the Forest County Potawatomi have developed such strong influence in state and local politics in Wisconsin.”
The Potawatomi have also flexed plenty of political muscle in Washington D.C.: since 2001 the tribe has spent $1.3 million on contributions to federal politicians and $6.1 million on lobbying Congress, according to opensecrets.org. Most of the lobbying paid for well-connected heavy breathers like the BRG group, led by longtime Republican Haley Barbour (who would be an important ally for any Republican, including Walker, hoping to run for president in 2016) and Quinn Gillespie & Associates. But the Potawatomi’s lobbying bill also paid for prominent law firms with expertise in Indian and gaming law, like the Rothstein Law Firm as well as Sonosky, Chambers, Sachse, Endreson & Perry, LLP. For a decade or so all these combined forces helped prevent the Menomonee application for a casino from being approved by the federal government.
Beyond the issue of political clout, which will probably kill the Kenosha casino proposal yet again, what would be the best policy decision here? I’ve never been a big fan of legalized gambling: it seems a poor way to build an economy, it preys more on low-income people and leads to an increase in compulsive gamblers. But gaming is by now so established in Wisconsin and other states that these arguments seem quaint and antiquated, and were certainly not advanced by Walker.
From the perspective of Milwaukee, the Kenosha casino would be a loss, but precisely how much is open to question. The Potawatomi claim they will lose about one-third of their casino’s annual take. But Washburn predicted the Kenosha casino would have a “modest impact” on the Milwaukee casino, with “much of the revenue” coming from customers in northern Illinois. “We are confident that the Potawatomi will continue to thrive,” he added.
And Frank Fantini, chief executive officer of the Fantini Gaming Report told the Milwaukee Journal Sentinel the loss was likely to be considerably smaller than $150 million annually.
The City of Milwaukee opposes the casino and claims Milwaukee would lose 3,000 jobs as a result, but if the impact on the Potawatomi is modest, as Washburn claims, will the number really be that high?
From the perspective of what’s best for the tribes, it’s hard not to be sympathetic to the Menominee proposal. For all of the social ills it causes, gambling has transformed tribes in Wisconsin that were once so poor. And no tribe is more destitute than the Menominee, largely due to misguided federal policies of the past.
In 1954, Congress passed a termination law, which singled out a small number of Indian tribes to have their status as sovereign nations removed. That included the Menominee. Prior to its termination as a tribe, the Menominee ran a successful sawmill business that made it self-sufficient: it provided its own law enforcement, telephone services, electricity, health care (including a hospital and clinic) and schools, all of this primarily funded by its sawmill business, which also helped fund fire protection and old age pension programs.
UW-Madison law prof Stephen J Herzberg, an expert on this issue, has argued that the Menominee’s success contributed to its being chosen for termination. This law brought “immediate, rapid decline” for the Menominee, Herzberg has written: the tribe was forced to close its hospital and other health care services, its three electric power plants and educational services. Its logging business gradually declined because it now had to pay county and state taxes. Unemployment soared, and many went on welfare.
In later years, Congress recognized the problems caused by termination, and the Menominee’s tribal status was restored in 1973, but as Washburne noted, the tribe “has never fully recovered from the devastating effects of Federal Termination.” Today, Menominee County, where 90 percent of residents are members of the tribe, is far and away the poorest in the state. The unemployment rate in 2012 was 22 percent, more than double that of the county with the second highest level. Menominee County ranked the worst in the state for health care indicators, with the highest rate of tobacco use, binge drinking, teen births and premature deaths.
The Menominee did open a small casino in Keshena in 1992, but it mostly serves customers in Menominee County and nearby, and doesn’t earn much revenue. The proposed Kenosha casino would be located 162 miles from the Menominee Tribe’s reservation headquarters, but the Potawatomi Casino is located 200 miles from its reservation in Forest County.
The very success of the Potawatomi, Washburne wrote, provides “a strong argument for approving the Menominee proposal and creating similar opportunities for an even larger tribe… As the Federal trustee for the Indian nations, our hearts would sing to see more than 8,700 Menominee Indians follow in the successful footsteps of 1,400 Potawatomi.”
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