Campaign '98

The Gambling Gamble

South Carolina’s Democrats Bet the Farm

ROCK HILL, S.C.–Halfway through the ostensible activity of the day–trailing South Carolina Gov. David Beasley from hustings to hustings–I take a break from the campaign to visit members of the gubernatorial election’s most important political faction. I find them at the back of a ratty convenience store outside Spartanburg, as I would find them in the back of a ratty convenience store anywhere in the state: video poker machines.
In five minutes, I have dropped a couple of bucks into one of the machines, losing a rapid-fire succession of 10 cent hands. These machines have all the glamour of a fleabag motel, but they are the only gambling South Carolina allows. There are 28,000 of them here, they rake in an estimated $2 billion a year, and they have turned the South Carolina governor’s race into one of the most compelling and depressing contests in the nation.

I cannot state this too emphatically: This should not be a race at all. Republicans dominate South Carolina politics demographically, and do so even more today than when Beasley was elected in 1994. A Christian conservative in a state where that helps (and a Bruce Willis look-alike in a state where that can’t hurt), Beasley seems to have everything going for him. South Carolina is booming. Under him, as he declares in his stump speech, “South Carolina is No. 1 in the nation in job creation. It is No. 1 in the nation in personal income growth. And its unemployment rate is the lowest in its history.” Poverty is down, welfare rolls have shrunk by 75 percent, and violent crime has dropped. And Beasley’s Democratic opponent, former state legislator Jim Hodges, is little known statewide.
       But two weeks out from the election, Beasley and Hodges are running even, and local Democrats are gloating about the revival of the party. If this is a revival, it has a very dubious messiah.

Beasley says he is morally opposed to gambling, and last winter he enraged gambling interests by calling video poker a “cancer” and trying unsuccessfully to ban it. He also resisted calls for a statewide referendum on whether South Carolina should have a lottery, despite having promised in 1994 to hold such a vote. Hodges, meanwhile, reversed his own former opposition to a lottery and made it the centerpiece of his campaign, claiming that lottery revenues would revive South Carolina’s lagging schools. He also declared that while he personally disapproves of video poker, he would let voters decide whether to keep it, not try to ban it himself.
       Beasley has been besieged, and Hodges has reaped the benefit. Gambling interests have poured money into the race. Hodges has raised $3.4 million, a vast amount for a South Carolina challenger. While Hodges’ money has not been completely traced, early surveys of his disclosure forms suggest that at least 20 percent, and perhaps more than 70 percent, of his funding comes from people connected to video gaming. “If we got 77 percent of our money from the chemical industry, don’t you think it would be a scandal?” asks Beasley spokesman Tucker Eskew.

The state Democratic Party, too, is awash in money from the gambling industry. (Party Chairman Dick Harpootlian, known as “Lucifer” on the Beasley campaign, is a top lawyer for the video poker industry.) A South Carolina gambling tycoon named Freddie Collins has spent anywhere from $500,000 to more than $1 million (he has not filed disclosure forms) on his own independent “Ban Beasley” crusade. He has run radio ads, established an anti-Beasley Web site, and blanketed the state with billboards savaging the governor. (A typical billboard at the state line reads, “Gov. David Beasley welkums you to South Carolina. We be gots de wrstest skools in the United State.”)
       Video gambling money is also the driving force behind an “independent” organization called “Republicans for Hodges.” The industry is even underwriting South Carolina’s so-called “heritage” groups, which hate Beasley because he briefly tried to remove the Confederate flag from the South Carolina Capitol. So the gamblers are paying to keep the Confederate flag flying.
       “The Democrat Party was in as bad shape here as the Republicans were 30 years ago, but organized gambling has come in and totally propped it up,” Beasley tells me at a campaign stop in Greenville. “The Democrat Party and Jim Hodges have sold their soul to organized gambling.”

Hodges, a smart and extremely genial man, has many counterarguments, a few of them quite persuasive. He insists that gambling interests have not bought him: He has only agreed to put video poker to a referendum, and he has promised that if that referendum passes he will regulate and tax the industry much more heavily than Beasley has.
       As for the lottery, Hodges has three answers. First, the lottery is immensely popular: Two-thirds of South Carolinians favor it, and elected officials should bend to the democratic will. Second, as Hodges tells me after tonight’s Rock Hill debate, “This election is a referendum on education, not the lottery.” Hodges favors the lottery only as a guaranteed revenue stream for his education plan: smaller classes, preschools, and merit scholarships to college. Hodges notes that Georgia has made huge educational improvements since it earmarked its lottery revenue for schools.
       And third, Hodges says, not having a lottery is robbing South Carolina. Georgia’s lottery siphons $90 million a year from South Carolinians. Hodges’ most celebrated ad shows a Georgian thanking Beasley for all the money he’s given to Georgia. Half a dozen South Carolinians cited that ad to me when they told me they were going to vote for Hodges.

The governor seems defensive and slightly stunned by the pro-lottery, anti-Beasley onslaught. Hodges and other Democrats, who have been in a funk for a full generation, are euphoric. But if I were a South Carolina Democrat, I don’t think I would be so sanguine. If Hodges and Hollings lose, of course, the state Democratic Party will be kaput. “It will be over, for a long, long time,” says one veteran Democratic operative.
       But if Hodges wins, it may be worse. The Democratic Party will be alive but mortgaged, indebted to the worst special interest group this side of Big Tobacco. The gambling industry, having proved it can depose a popular governor, will be untouchable. Is this what the South Carolina Democratic Party really wants to stand for? That the accumulated gambling losses of the poor are the best way to fund needed government services? Democrats say this is “entrepreneurship,” using innovative new methods and funding sources to revive government. It sounds to me like desperation.

News Flash: Strom to Survive!
       Gambling is not the only issue in the governor’s race. Sen. Strom Thurmond is another. The 95-year-old Thurmond and the 76-year-old Hollings make up the oldest senatorial delegation around, perhaps even in American history. The issue has been raised, delicately of course, as to what each gubernatorial candidate would do if he had a vacant Senate seat to fill. (The governor appoints a replacement to serve the balance of a deceased senator’s term.) Hodges has said he would appoint a caretaker. Beasley has scored big points by promising to ask former Gov. Carroll Campbell, still the most popular politician in the state, to take an empty Senate seat.
       Thurmond refuses to cooperate. His spokesman announced that “Sen. Thurmond intends to live out the balance of his term.” Usually politicians vow to serve out the balance of their term. In Thurmond’s case, I suppose, just surviving it would be accomplishment enough.

Recent “Campaign ‘98” Dispatches
       “Foghorn Leghorn Meets and Owl“: Sen. Fritz Hollings vs. Rep. Bob Inglis. (posted Tuesday, Oct. 20, 1998)