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| Addled horses may be the least of horse racing's worries if the sport's subsidies take a hit. |
As a casual follower of horse racing, I was intrigued by the legendary horse trainer Bob Baffert being barred from participating in the third leg of the Triple Crown, the Belmont Stakes, due to doping. Baffert has already been cited for doping a number of times, but this time is the most noteworthy, just coming off a Kentucky Derby victory in the sport's most prestigious event. As it turns out, horse racing--in the United States at least--is a dying sport. if the pot of money being contested over keeps shrinking, well, that would help explain why even the most prominent trainers are tempted to turn the odds in their favor through underhanded means.
Unbeknownst to me, and I suspect most everybody else outside the industry, American horse racing circa 2021 cannot stand on its own... four legs. Probably by invoking nostalgia and tradition, the industry has managed to wangle massive state government subsidies:
It’s a story rarely told outside the racing industry, and understandably so: Horse racing is propped up by tax dollars from casinos that have nothing to do with what happens on the track or at the betting windows. Although the sport loses public interest with each passing year, at least 24 states, almost three-quarters of those with racing, directly subsidize it with public funds. Based on publicly available information and statistical analysis, the total is likely close to $1 billion annually.
New York and Pennsylvania alone account for half of that amount; over the last 15 years, they’ve distributed around $6 billion. Both states also forgo countless millions each year in sales taxes they don’t charge on racehorse purchases, an exemption that doesn’t apply to other kinds of horses.
Throughout the country, horse racing has become so heavily subsidized that it resembles a public enterprise. In Pennsylvania, for instance, the Race Horse Development Fund is the state’s single largest economic development program, and it funds nearly every aspect of horse racing, from purses to support for breeders, health and pension benefits for horsemen, drug testing of the horses, and even racetracks’ advertising costs.
Is horse racing too big to fail, in financial parlance? The emerging backlash is that these taxpayer dollars are going to an increasingly marginal pastime whose patrons are mostly the rich who can spare cash to gamble with when there are so many urgent social concerns:
But the issue isn’t going away, especially not as the pandemic has dynamited state finances, leaving lawmakers with tough decisions. This February, [Pennsylvania governor] Wolf again included a cut to racing’s subsidy in his proposed 2021 budget. And last week, the editorial board of The Philadelphia Inquirer called for the industry to be “put out of its misery.”
“It’s like a giant party on the Titanic,” Ward said, “except the guests know what is coming.” For racing’s dependence on public money, Pennsylvania might be just the tip of the iceberg.
The doping scandal will probably only raise more questions the industry would rather the general public be unaware of. Make no mistake: American horse racing, a pastime for the wealthy, is on the dole in a big way.