Casino execs disagree over whether federal stimulus has helped Vegas

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Insight logoIt's been an interesting last few days on the casino-moguls-as-political-pundits front. In interviews with Fox News, Wynn Resorts CEO Steve Wynn and MGM Mirage CEO Jim Murren took swipes at the Obama administration for not focusing enough on job creation in the U.S. economy.

The barbs drew an immediate response from a trio of casino executives who credit the American Recovery and Reinvestment Act, also known as the federal stimulus package, with saving tens of thousands of jobs in Las Vegas and keeping the city from the brink of financial ruin. Stimulus supporters say federal aid, the cancellation of indebtedness provision and the Travel Promotion Act have helped save nearly 38,000 jobs.

"State government in Nevada would not be operating if it weren't for the money that came into the state budget from the stimulus," former Las Vegas mayor Jan Jones, a senior vice president for Harrah's Entertainment, the world's largest casino company, told the Las Vegas Sun newspaper. "The number of jobs that have been protected because the government can still operate, that is a direct result of the stimulus."

Scott Neilson, Station Casinos chief development officer, told the Sun: "Even though a lot of the companies in the Nevada economy trying to work through this [bankruptcy] process right now might not have been able to take advantage of this provision yet, I think that they will, and I think you'll see a lot of companies benefit greatly." Stations is undergoing a bankruptcy restructuring.

Chris Najbicz, vice president of West Coast operations for Hilton Hotels, agreed, telling the Sun, "We really do endorse the importance of the American Recovery and Reinvestment Act in saving a multitude of jobs throughout the state of Nevada and believe it's been very helpful to the Las Vegas business community in general."

The competing storylines represent a new twist for casino operators, who generally let their money do the talking when it comes to their political activity. The gaming industry has generally hedged its bets by donating to both Democrats and Republicans. However, the most vocal (and well-known) of casino moguls have generally aligned themselves with Republicans and conservative causes.

Through his Freedom Watch organization, Las Vegas Sands Corp. CEO Sheldon Adelson has aggressively pushed a conservative agenda. His archrival in the casino business, Wynn, is a fellow conservative. Whereas Adelson is active behind the scenes, Wynn has been on TV several times this year to lambaste the Obama administration. Earlier this month in a roundtable discussion on Fox News Sunday, he said, "Consumer confidence will return when the unemployment rate goes down. Soaring speeches, with or without a teleprompter, are not the issue. Government has never created a job or their standard of living."

On Neil Cavuto's "Your World" business show on Fox, Murren said he would've preferred the president focus more on job creation. "We didn't get any TARP money," he said, referring to the federal Troubled Asset Relief Program used to bail out the financial and banking industries. The global recession forced MGM Mirage, the world's second-largest casino company, to lay off 9,000 people. It annually spends $400 million on health care for its 50,000 employees, Murren said. As the gaming industry begins its slow rebound, he said, those 9,000 jobs won't be coming back. "Talk about a jobless recovery."

Murren said Obama was wrong when, in February, he discouraged companies that received federal bailout funds from hosting lavish meetings in Las Vegas. "I think he misspoke," he told Cavuto. But he also criticized Nevada Gov. Jim Gibbons for not wanting to meet with Obama after he spurned an initial meeting with the governor to discuss the fallout from the president's comments. You meet with him, Murren said, "because it's the president of the United States." If you disagree with Obama, Murren said, "talk to him and argue with him about it and don't run away."

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