For the state to sponsor gambling is untoward enough. To sublease itself to a private gambling operator, however, is something else entirely.
Consider the most likely private operator: GTECH. This company already partners with the state in its online lottery operations, and provides self-service vending machines. GTECH lobbies in Olympia and contributes handsomely to politicians — a little too handsomely in some places.
After its lobbyist, former Texas lieutenant governor Ben Barnes, became infamous for receiving 4% of annual Texas Lottery proceeds — more than $3 million annually – GTECH bought him out in 1997 (Barnes, incidentally, claimed to have gotten George W. Bush out of service in Vietnam).
The first executive director of the Texas Lottery, Nora Linares, was also fired in 1997 amidst allegations of impropriety. She threatened to sue GTECH for her dismissal, saying she was unaware her boyfriend was working for GTECH for $6,000 a month. She’s now married to him.
When Arizona’s John McCain was a big player in the U.S. Senate on gambling issues, GTECH was at his beck-and-call and hired his closest associates to lobby him. McCain’s 2000 presidential bid was even run by an active GTECH lobbyist.
Williams does express some ambivalence about the state being in the lottery business in the first place, saying, "It’s hard to be a gambling relativist and draw a moral distinction between a scratch ticket and a slot machine." That's a point we made in our recent interview with Gov. Gregoire, who supports lottery privatization but adamantly opposed privatizing liquor sales. Her odd explanation for the seeming contradiction:
I think the state should not be in gambling, to be perfectly honest with you. I’ve said that all the way along. I don’t know why the state is in the business of gambling. That’s why I wanted to get out of it a few years ago, but the US Justice Department said, no, you can’t. And I think frankly the concern is there’ll be too much vulnerability to corruption and the only way you can avoid that is to keep oversight by the states. Illinois came up with a new construct and the Justice Department and the courts approved that. But notice what I said today. If [the private sector] can do a better job [with the lottery, then let them.].I think the state should not be in gambling, to be perfectly honest with you. I’ve said that all the way along.
We noted the irony in Gregoire's reasoning: The standard talking point for liquor privatization was that the state shouldn't be in the business of selling liquor.