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Gambling a major threat to poverty reduction

Gambling is addictive. Once someone is hooked, there is no easy way out. Although it started in Kenya in 1966, it has never been the problem that it is today.

The advent of technology and globalisation has resulted in Kenyans taking to gambling like ducks to water. Kenyans, especially the poor, have taken to spending virtually all their income on gambling.

Recently, a Kenyatta University student was found hanging behind his mother’s house in Ondome, Uriri. The note he left behind revealed that he had lost Sh80,000 to betting. Numerous people have committed suicide after losing money in bets. The problem seems to have been magnified by the entry of the state in lottery activities.

State-sponsored lottery programmes are nothing but an unfair taxation of the poor.

A study by Cornell University on lottery conducted in the US state of Maine at the request of the Maine Centre for Public Interest Reporting came up with startling findings that mirror what is happening in Kenya today.

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The study shows that across the state, lottery ticket sales go up when people lose their jobs.

Dr. David Just, a behavioural economist and professor who conducted the study, concluded that “by promoting the lottery, the state is, in some way, complicit in selling lottery to people who are already desperate, or in tough financial circumstances.”

Further, the study established that the poorest towns spend as much as 200 times more per person than those in wealthier areas.

The lottery investment pattern in Kenya is not any different from the Maine study. In addition to national lottery programs, cheap Chinese lottery machines are being deployed in very poor neighbourhoods, adding fuel to the already raging fire of selling hope.

Target poor and desperate persons

Use of technology has made it possible to target poor and desperate persons. Several online lottery sites have sprung up in addition to local SMS-based betting systems. It is like an army with sophisticated weaponry declaring war on wretched poor people.

Add that to an increasingly globalised world. With the ubiquity of the mobile technology, there is very little hope of ever understanding the impact of cross border betting that is not within the national regulatory framework.

The promoters of online betting services are a sophisticated lot who include cyber criminals that have taken advantage of vulnerable and next to ignorant lot of people in far flung countries.

I dare say that Kenya’s Betting Control and Licensing Board may not be even aware of lucrative cross border bets. The country lost this battle long time ago and we survive only by God’s grace.

It will require a multi-agency approach to create a sophisticated regulatory mechanism to counter the emergent problems posed by technology and globalisation.

This in my view requires deliberate effort to build human resource capacity in data science to regularly audit big data out of online transactions as well as the mobile providers. Transactional data on the mobile platform and online services must be of great interest to regulators.

Additionally, there should be regular research activity on the impact of new technologies in the hands of citizens, establishing addiction rates and the relationship between crime and gambling.

More often than not, Africa has relied on research from elsewhere to make policy decisions without any contextual inputs. Although some religious groups have spoken against gambling, there is need for education on responsible gambling.

Just as gambling services have introduced innovative ways for gambling, there must be efforts to introduce innovative awareness and information programmes to reduce gambling risks. Perhaps the greatest risk the country faces is the fact that in as much as the law prohibits minors from gambling, there is blatant breach of the law in many gambling dens.

Gambling is a serious problem that is undermining the poverty reduction war. It may have been started with good intentions but today it has gone beyond acceptable levels to the extent that many people are taking their lives after losing money. Due to increased sophistication of betting, it may be prudent to develop equally sophisticated audit mechanisms and educate people on responsible gambling.

US President Barack Obama once said: ‘We didn’t become the most prosperous country in the world just by rewarding greed and recklessness. We didn’t come this far by letting the special interests run wild. We didn’t do it just by gambling and chasing paper profits on Wall Street. We built this country by making things, by producing goods we could sell.’

Let’s build our Kenya.

The writer is an associate professor at University of Nairobi’s School of Business

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