I have strong mixed emotions on tribal economic development, especially how it relates to gaming. I am so excited about all the money that gaming is bringing to Indian country, but I am usually disappointed in how it is being used. Those gaming dollars are Indian country’s one big chance to set us up for decades of growth and prosperity. But despite the rhetoric I hear from tribal political leaders, the average gaming tribe is not focused on the future. Most tribes are using gaming dollars to create make-work type jobs, pay out per capita payments, dabble in economic diversification and pump up old social programs designed in another era.
If I had to predict what economic development in Indian country would look like in 10 years, I would guess that competition or severe restrictions are coming in the areas of gaming and taxation. Gaming has historically never been a stable economic industry. Combine that instability with a growing backlash against tribal gaming and you have a recipe for a real decline. I can assure you the state and federal politicians are thinking of ways to restrict gaming or to increase our taxes. I challenge you to name an industry or resource that the non-Indians have valued that they didn’t try to limit or take for themselves. Any other conclusion is just wishful thinking.
I believe in the near future Indian country will be divided into the “Have’s,” the “Used-to-Have’s” and the “Never-Had’s.” The “Have’s” are where you will want to be in the future. The “Have’s” will have likely have become state political players by buying influence or protecting their gaming monopolies by cutting a revenue sharing deal with the state. This is already happening.
Economically, if you want to be one of the “Have’s,” your tribe should exploit some of the huge advantages a government has in a business environment. They should systemize their economic development by separating their business entities from the political body. They should maximize their unique tax status. They should expand their perspective economic scope and think beyond their reservation borders. They should also do everything to ensure a stable political environment, hopefully by staggering their political terms.
Most of all tribes shouldn’t try and do anything too difficult. Business is easy. It requires really only a working knowledge of junior high math. (Revenue – Expenses = Profit) Tribal leaders love the big deal, the innovative start-up company, the big groundbreaking, and trying to succeed where others have failed. It rarely works and such deals risk sabotaging all future investments. I always advise tribes to work with experienced business people and companies with established track records. Almost everything else is a not worth the risk.
You don’t want to be a member of a tribe that will be a “Used-to-Have” in the future. Getting a taste of the good life and having it taken away is probably worse than never having it at all. These tribes will have not diversified their economic interests, and lost their competitive advantage in gaming in some way. Most likely they will have lost it due to a change in the state political environment that allowed gaming competition or shut gaming down completely.
If the “Used-to-Have’s” also had made large per capita payments their situation will be much worse because their new generation of leaders will be plagued by the hidden costs of per capita payments: drug and alcohol abuse, a declining work ethic and a why bother attitude to education. Tribal economies and lifestyles built on per capita payments have almost no chance of long-term sustainability. This new form of welfare is just the latest in a cycle of dependency that Indian country has been trying to break out of for over 100 years. These new members of the “Very Welfare” are not going to be prepared for the intensity of the next generation’s fight for tribal rights.
I actually know a bright 25-year-old Native woman who had her $2,600 monthly per capita payment ended recently. She drives a $30,000 car and has never really had a job and dropped out of several colleges. This person is not the young, eager, and educated tribal member ready to take on the next generation’s issues. Nope, without the per capita money she is now working the night shift at a casino. However, she is better off than a lot of other younger members of her tribe because she doesn’t have a substance abuse problem brought on by boredom, easy cash, and no pressure to work or get educated.
The “Never-Had’s” will continue to struggle and find ways to get by and continue to try and improve their lot. If your tribe hasn’t been able to tap into the gaming dollars significantly and hasn’t been able to develop its economy, then you should likely step back and assess why it hasn’t happened. I submit that it might be your tribe’s system of government.
The United States likes to think of itself as having a great form of government, but I would say that what the United States really has is the greatest economic development system in the world. It has a relatively stable political environment, it has easy access to capital, it has a well-developed system of laws, and its government is very business friendly. We will fight a war over an economic issue, much faster than a moral one.
All tribes, but especially the “Never-Had’s,” need to emulate the greatest economic example in the history of the planet, the United States. I am not talking about losing our culture and selling out to the man. I am talking about being smart about creating an environment where success is at least a possibility.
Anyone who knows me also knows that I can’t shut-up about political stability. I am constantly talking about staggering political terms of tribal government leaders. I believe that it is the one structural device that has the most chance of creating an economic, political, and legal environment where success is gradual, sustainable, and tribally oriented. This one common sense initiative, is really the first step, but if you don’t take it every other effort risks being a waste of time and resources because it will be forgotten with the next tribal election.
Nothing is easy and nothing is a given in our new reality, but I can’t wait to see how it all turns out.
Lance Morgan is CEO of Ho-Chunk, Inc., of the Winnebago Tribe of Nebraska.