Russia shutting down its casinos

The worldwide recession has hit Russia’s economy harder than most. The World Bank expects the economy to contract by almost 8 percent this year, its stock market has the dubious honor of being the first bear market since a worldwide stock rally in March. Now, the number of places to escape the doom and gloom ...

584303_090629_casino5.jpg
584303_090629_casino5.jpg

The worldwide recession has hit Russia's economy harder than most. The World Bank expects the economy to contract by almost 8 percent this year, its stock market has the dubious honor of being the first bear market since a worldwide stock rally in March. Now, the number of places to escape the doom and gloom is about to shrink significantly, as Russia plans to effectively shut down the entire casino industry on July 1.

The government is shutting down every last legal casino and slot-machine parlor across the land, under an antivice plan promoted by Vladimir V. Putin that just a few months ago was widely perceived as far-fetched. But the result will be hundreds of thousands of people thrown out of work.

The worldwide recession has hit Russia’s economy harder than most. The World Bank expects the economy to contract by almost 8 percent this year, its stock market has the dubious honor of being the first bear market since a worldwide stock rally in March. Now, the number of places to escape the doom and gloom is about to shrink significantly, as Russia plans to effectively shut down the entire casino industry on July 1.

The government is shutting down every last legal casino and slot-machine parlor across the land, under an antivice plan promoted by Vladimir V. Putin that just a few months ago was widely perceived as far-fetched. But the result will be hundreds of thousands of people thrown out of work.

And in a move that at times seems to have taken on almost farcical overtones, the Kremlin has offered the gambling industry only one option for survival: relocate to four regions in remote areas of Russia, as many as 4,000 miles from the capital. The potential marketing slogans — Come to the Las Vegas of Siberia! Have a Ball near the North Korean Border! — may not sound inviting, but that is in part what the government envisions.

All the same, none of the four regions are prepared for the transfer, and no casino is expected to reopen for several years. As of July 1, not even two decades after casinos began proliferating here in the free-for-all post-Soviet era, the industry’s workers will be out on the street.

“This is shaking my life to the core — such a blow for me and my family,” said Irina Mysachka, 32, a single mother who is a supervisor at the Shangri-La Casino in Moscow, which appears as orderly and preened (if your tastes run to fire-breathing neon dragons and other Oriental kitsch) as any similar luxury attraction in the United States.

“The authorities are taking this step without thinking at all,” she said. “They have not considered what this decision means for the workers. With the crisis, it is going to be very difficult for us.”

The law behind the restrictions was introduced in late 2006, and there appear to be reasons both honest and not-so-honest behind it.

The gambling industry here does not have the loftiest of reputations, and many Russians will not grieve for it. Still, many of the 40 or so casinos in Moscow sought in recent years to behave more respectably, even as hundreds of slot-machine parlors retained a seedy, enter-at-your-own-risk feel[…]

The industry has been largely unregulated, and especially in recent years, almost anyone could get a license, for as little as $50. Russia is not a strait-laced place – rates of smoking and drinking are high – but an outcry about gambling ensued. “It is not only young people, but also retirees who lose their last kopecks and pensions through gambling,” Mr. Putin said in 2006.

His plan was announced during a spy scandal between Russia and its neighbor Georgia, and the timing suggested that Mr. Putin was in part seeking to wound the Georgian diaspora here, which is said to have an influential role in the industry.

Shorter Russia: what happens in Moscow is Georgia’s fault.

ALEXANDER NEMENOV/AFP/Getty Images

James Downie is an editorial researcher at FP.

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