Although Indian reservations are their own sovereign nations--essentially tiny countries within America--these patches of "free land" are still under the watchful eye and sway of the U.S. federal government. As long as they don't allow illegal activity, the reservations are allowed to set up their own rules. In 1987, using this wide latitude and conditional permission, the 25-member Cabazons tribe of California argued they should be allowed to host gambling on their reservation. Motivated in part by guilt, the Supreme Court accepted this tenuous argument.
With their Supreme Court victory, the tiny tribe did what thousands of fearless warriors couldn't: They won the battle--and potentially the war--against the American government, economy, and people.
A year after the Supreme Court victory, Congress drafted the Indian Gaming Regulatory Act (IGRA) and cemented this legal loophole into federal law. Under the law, tribes may bargain a "compact" with a state's governor to set up bingo halls, card games, and slots. But, even if the governor doesn't approve, tribes can easily maneuver past his objections. For the first time since Columbus set foot in the Americas, the original occupants have gained a definitive upper hand.
In the decade following 1988, annual gambling proceeds on reservations grew from $100 million to $8.26 billion. Various tribes operate casinos in 14 states, including eight states like Oregon that host no other casinos.
The rationale for allowing gambling on reservations is that the revenue should go to better the plight of Native Americans: Money is to be put back into schools, hospitals, and roads on the reservation. For example, according to a 1997 Harvard study, in Scott County, Minnesota, unemployment on reservations plummeted from 70% in 1991 when the tribe first opened a casino, to just 4%. A 1999 Associated Press study found that reservations without gambling held a 17.7% poverty rate; those with casinos, slot machines, and card games dropped to 15.5% over the first seven years of operation.
Few barriers stand in the way for massive future growth. In Oregon, nine tribes are currently vying for the prime position of a casino near Portland. There are only two real barriers to continued growth: the Bureau of Indian Affairs (BIA) and individual state governors. The BIA, however, has taken an unofficial policy to encourage casinos.
Meanwhile, state governors have proven to be little more than speed bumps in the race to build casinos. During the '90s, the Bush brothers--George W. in Texas and Jeb in Florida--refused to negotiate over casinos with tribes. Regardless, Florida is home to the Seminole Tribe's Hollywood Gaming Center on Miami's Gold Coast; a facility that generates $100 million annually from slots.
When Democratic governor John Kitzhaber took office in 1995, there were two casinos in Oregon. A year later, in spite of his objections, six casinos were operating around the state, even though Kitzhaber only gave official permission to one.
Along with economic growth, political power has also grown within the tribes. In California, for example, during the 2000 elections, 41 of the state's 65 tribes contributed $65 million into democratic candidate Gray Davis' campaign and into the campaign for Proposition 5, a voter initiative intended to allow for the expansion of tribal casinos. Both Davis and Prop. 5 succeeded. Since then, several $20 million-plus casinos have been planned for California.
Moreover, various states permit tribes to purchase land trusts outside the reservations. On these land trusts, tribes may operate casinos--meaning after decades of being shoved onto small patches of land, tribes may soon begin to build land holdings back up.
Like most gold rushes, the beginning stages are always wild upswings of uncontrolled growth. In the past few years, this honeymoon period has ebbed. Las Vegas casinos were slow to object to the mushrooming growth of Indian casinos. There was an attitude that these upstarts couldn't compete; they couldn't offer the same level of entertainment or marquee attractions like Britney Spears and Mike Tyson bouts. But, with tribal casinos recently offering big-name acts, owners from Vegas casinos are now diligently lobbying Congress in order to slow down the growth of these casinos--that are looking more and more like a sure bet.