‘Rent control lite’ on the ropes | No need to hype bad inflation news | What in the world were lottery officials thinking? | About Contrarian Boston
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Predatory sales practices? As the lottery lobbies for online games, questions emerge about sales at check-cashing stores
The Massachusetts Lottery has long wanted to join the online gambling revolution and it may soon get its wish after a big legislative win on Thursday.
But before they let the lottery roam free in the Wild West of online betting, state lawmakers should take a close look at this disturbing story, which raises serious questions about who’s minding the shop at the multibillion-dollar state gambling enterprise.
The lottery took in nearly $36 million through the sale of Keno and other products at dozens of check-cashing stores in low-income and mainly Hispanic neighborhoods across the state from 2017 to 2020, according to a story by a group of enterprising BU journalism students. The piece was part of a larger, national story on state lottery systems aggressively marketing to low-income minority communities that ran on the Associated Press national wire and was picked up by The Washington Post.
Check-cashing stores have long had an unsavory reputation, charging steep fees to cash the checks of customers who often don’t have traditional bank accounts. And the combination of check-cashing stores taking a cut out of the meager pay of their customers, and then turning around and selling them scratch tickets and other lottery games, doesn’t sit well with some critics, according to the piece by BU graduate student Henry Kuczynski and fellow students Ethan Biddle, Isabel Tehan and Melissa Ellin.
Working under the supervision of Maggie Mulvihill, associate professor of the practice in computational journalism at BU’s College of Communication, the students pounded the pavement to drum up interviews with check-cashing store customers and pushed state regulators and lottery officials for answers.
In addition, the BU students compiled Excel spreadsheets that combined data on check cashing stores with U.S. Census data, showing that check cashing outfits are selling scratch tickets and other lottery products in low-income, Hispanic communities.
“Check-cashing stores are the quintessential example of a magnet to low-income people … people who are on their last dollars and they need money now to pay the rent, buy food,” Greg Sullivan, former state inspector general and now director of research at the Pioneer Institute, told Kuczynski and his fellow reporters. “They are at the end of the financial line.”
It gets worse. Several check-cashing stores that sold lottery tickets during the three-year period the story looks at weren’t licensed to cash checks and, in a couple cases, were sent cease and desist letters by state banking regulators ordering them to stop.
The story raises a whole series of questions. Where were lottery officials in all this? Given the well-known critique of state lotteries taking advantage of the poor, why did anyone think allowing check cashing stores to sell scratch tickets and Keno games was a good idea?
And if you are going to go down that path, wouldn’t you want to be extra sure the check cashing businesses were actually licensed?
Now the lottery wants to take its act online, a far trickier task when it comes to oversight. The revelations about the lottery’s willingness to place its products in check-cashing stores, and what seems to be lax monitoring of them as well, should raise some red flags for lawmakers.
Better luck next year? Controversial ‘rent control lite’ bill hits snag
Time is running out for a State House bill that housing advocates believe could help temper an out-of-control rental market, but which landlords have gone all-out to defeat.
A bid by supporters to push the Tenant Opportunity to Purchase Act towards the legislative finish line fell short this week on Beacon Hill.
Two state reps from Boston, Jay Livingstone and Rob Consalvo, tried and failed to attach TOPA to a multibillion-dollar economic development bill as it cleared the House.
We guess it’s possible the Senate could add the amendment, or the bill could pass separately on its own, but with two weeks left before legislators break for the year, the odds are lengthening by the day.
The name of the bill, while not quite misleading, also doesn’t tell the full story when it comes to its potential impact on Boston’s overheated rental market – and the furious, behind the scenes lobbying by landlords that it has triggered.
While, yes, tenants would get a chance to buy their buildings when they hit the market, they would also be able to team up with nonprofit housing developers, which, arguably, is the real play here.
Community development corporations and similar groups have found themselves outgunned in a hyper-inflated housing market where cash is king and flipping is the order of the day.
But opponents have labeled the proposal the ‘silent threat,’ with some landlords fearful the bill could tie up potential apartment building sales, drive off cash-rich buyers, and force them to sell to nonprofit groups and CDCs.
Still, if it doesn’t pass this year, you can definitely expect TOPA will be back in 2023.
Then supporters will most likely be able to count on help from a newly elected Democratic governor by the name Maura Healey.
Much ado about a stale inflation report
The media is full of doom and gloom about the latest inflation report.
And it’s frustrating, for the coverage, while not intentionally so, is misleading.
As anyone who has gone to the gas station recently knows, gas prices, while still high, have come down significantly in the last few weeks. And energy costs, as we all know by now, are a prime driver of inflation.
So, the latest federal report on inflation, which found a 9.1 percent jump in June, while certainly bad, is also a lagging indicator, failing to pick up the more hopeful signs that have emerged over the last few weeks.
Typical is this Washington Post piece which ran Wednesday. You have to wade through 10 very long paragraphs before you get to one throwaway line mentioning that, oh yes, gas prices have come down in recent weeks.
And that is well after you are hit with this remark by the director of a conservative think tank that, while technically accurate, skips completely the more recent developments of the past two to three weeks.
“There was not a drop of good news in this report,” Michael Strain, director of economic policy studies at the conservative American Enterprise Institute, told the WP. “I had an emotional reaction to this report, and I was trying to think about the last time I had an emotional reaction to an economic data release, and I think you have to go to back to the financial crisis. Dismay. Frustration.”
The New York Times did far better, pairing a story on the inflation report with another on the recent decline in gas prices.
Given inflation has become a hot button political issue – and may even play a decisive role in the midterms – stories that hype dated bad news without including any nuance or context are not just bad reporting, but truly irresponsible as well.
Quick hits:
A growing weak spot for Dems in a demographic that is more socially conservative than they would like to think: “GOP basks in growing Latino outreach success” The Hill
Reality check - Manchin has no interest in cutting a wider deal on energy, taxes: “Manchin's offer to Dems: Take a health care deal or try again later” Politico
Sluggish construction and scarce inventory could keep Boston area prices from any major tumble: “Boom times are over for US housing market. But don’t expect Boston to bust.” Boston Globe
Will a Gov. Healey roll back school testing requirements - apparently, she’s no fan: “Could looming MCAS change be last gasp for ed reform era?” CommonWealth Magazine
What is Contrarian Boston?
I have fielded emails over the past couple of months asking what Contrarian Boston is about.
Here’s a link to our mission statement – you can find it in the “about” section.
For a more prosaic, nuts-and-bolts description, read on.
An online newsletter, Contrarian Boston publishes every Monday, Wednesday and Friday. In Contrarian Boston you’ll find analysis of the day’s news, and original reporting as well.
Our focus is:
· Politics and all levels of governance, good and bad, with an emphasis on state and local, with some national mixed in;
· Economic growth and business, especially real estate, housing and new development projects;
· The media and why it does what it does;
· Education, from school board spats to the doings of multibillion-dollar university endowments;
· And whatever else catches our fancy.