It would so appear. We noted not too long ago that Atlantic City was on its way down, what with casino/hotels closing and things nowhere like the rosy predictions of yore, when we were assured by our betters that its redevelopment — using the tired old condemn-and-bulldoze method — would turn things around and as the glittering casinos went up prosperity would rise with them. But it didn’t. See http://gideonstrumpet.info/?p=6829
Oh sure, for a while it glittered but as the proverb teaches, all that glitters isn’t gold. It appeared good as long as long as Atlantic city enjoyed Las Vegas style gambling as a municipal monopoly. But it didn’t last. The gambling biz eventually became a government supported oligopoly, and then it had to face reality as other places on the East Coast also went into the gaming business and gambling-minded members of the hoi polloi discovered that it wasn’t necessary for them to travel to a far-off place like Atlantic City for a spot of blackjack, or whatever visions of getting rich quick floated their boat, because casinos started sprouting all over the place — Indian casinos in particular.
So here is the Times dispatch (Patrick McGeehan, Christie Uses Executive Order to Appoint an Emergency Manager in Atlantic City, Jan. 23, 2015, at p. A20); http://www.nytimes.com/2015/01/23/nyregion/christie-uses-executive-order-to-appoint-an-emergency-manager-in-atlantic-city.html?ref=nyregion. It brings the news that “Moving to take greater control over Atlantic City, which is struggling financially as its casino industry shrinks, Gov. Chris Christie on Thursday appointed a corporate finance lawyer to be the city’s emergency manager.”
And to make things really interesting, “along with the lawyer, Kevin Lavin, Mr. Christie brought in Kevyn Orr — the lawyer who led Detroit through the bankruptcy it emerged from last month — as a consultant.”
That, it seems to us, does not bode well for Atlantic City’s future. When in addition to a municipal finance maven you also retain a municipal bankruptcy maven, things are not looking good, and you won’t catch us rushing out to buy a fistful of Atlantic City municipal bonds, their tax-free interest status notwithstanding.
So stay tuned. We are convinced that we haven’t heard the last of this, and that more misadventures of redevelopment projects are in store for us.
Our own observation is mostly moral: if indeed gambling is considered a vice by the new Jersey Legislature, as evidenced by the state’s enactments of statutes that criminalize it, then how come gambling becomes a municipal virtue when it is sponsored by the state and conducted for private profit on land forcibly taken from faultless individuals who are undercompensated in the process?
Follow up. If the fate of Atlantic City is of interest to you, also read Stephen Eide, Debts No Honest Man Can Pay, City Journal, Feb. 12, 2015; go to http://www.city-journal.org/2015/eon0212se.html for a detailed description of Atlantic City’s financial predicament.