Further to McCain’s Gambling Problem

Matthew Yglesias has hit the nail dead on on the implications of McCain’s gambling problem — the conflict of interest, the poor judgment, and certainly the degree to which someone who can bang away thousands a session is divorced from the experience of ordinary folk.

What neither he nor I in this post conveyed was one other aspect of McCain’s game of choice that has to make  you wonder about the capacity for judgment for anyone who truly has the craps bug.

Remember — McCain doesn’t just go hit the craps table in passing.  This is the kind of gambling he likes, so much so that he would be willing to risk his presidential campaign to get a table hauled up to his (free) room.  He’s got a jones, not a casual interest.

And that pits him against the relentless mathematics of craps.  A quick look at the odds of craps is enough to give you the overview, but just to make sure that my basic quantitative intuition was backed up by the facts, I sought a quick expert reality check.  Here is what  the seemingly inexhaustible Brad DeLong told me would serve as synoptic view:

In craps, you lose 1.5% of your bet with each roll. At a ten-chip bet
rolling once a minute, your expected loss is $15.0 a minute–$900/hour, or $3600 for a four-hour evening at the table.

Think on the implications of this rate of expected losses.  There is little doubt that over an extended session a persistent player will hit a few happy rolls, with all the hedonic reward of a big win.  But the reality over any even moderately long run is steady erosion.  Drip, drip, drip — a few bucks here, a few bucks next roll, maybe a pop, then another twenty down the tubes and so on.

Last summer, Time reported that McCain’s “goal, say several people familiar with his habit, is never financial” — which is a very good thing, for to see the tables as a earning proposition would reveal an even greater degree of financial ignorance than has been on display recently.  Instead, say these sources, “He loves the thrill of winning and the camaraderie at the table.”

The thrill of winning?  He’s playing for that momentary glow that comes only against the background of that 1.5 % toll, grinding away over the hours, until, unless something very fishy is going on over weeks and months, McCain like every other craps fool, walks away with lighter pockets than those with which he began.

Is your model of a president a man who values momentary thrills more than long term consequences?  Mine isn’t.

Explore posts in the same categories: McCain, Politics, Recklessness

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3 Comments on “Further to McCain’s Gambling Problem”

  1. Spiv Says:

    wow, I never knew that about either of them. Not that I needed more convincing from some money games, but being a poker player myself this actually does say a fair amount about the two. You’re absolutely right about craps, the only game in the house with worse odds is roulette. Poker, at least, I feel like I have real control over. I can measure the odds, pick my places to make a stand, and read out. It can be as intellectual or as ridiculous as you want to make it, but someone who plays to win is almost always the analytical type. It’s less gambling, and more market playing to be certain.

    That said, despite my last run of bad games I could keep playing these low money tournaments from now to 90 and I’d still be up from the first $5 I ever ‘invested.’ My last half dozen games have been cut down in the last few people, really for my inability to shift strategy as the tables thin out. I have to wonder if our good senator has had some of the same problem, given the close end primaries against Senator Clinton.

  2. Chris Says:

    Again, I’m going to disagree with the painting of craps as some kind of mega house edge, uber-gamblers only type of game. For starters, the above analysis claims that rolling once a minute, you’d lose $15 per minute. However, if the house edge is 1.5% as claimed, that means that the author is claiming that the player is betting $1000 per roll! A previous article stated that McCain was “tossing $100 chips around”, but that doesn’t necessarily mean that he was making individual $100 bets at a 1.5% disadvantage. Any serious craps player, as we can assume McCain is, will almost certainly take max free odds on all their bets, which reduces the house edge considerably, and can easily require a $100 odds bet on a comparable small wager.

    Taking just 5x odds decreases house edge to 0.32%. Even if the original pass line bet was $100, 5x odds would require “throwing around” an extra $500 bet, putting a total of $600 on the line at approximately 0.32% odds, giving an expected loss for that roll of “only” about 2 dollars, making a four-hour evening cost of around $500, not the 3600 claimed. Of course, the math is more complicated than this, since we can’t always place 5x odds, and in fact sometimes one is given the chance to place much much greater odds, reducing the house edge to near zero.

    In direct contrast to the above comment, craps is quite definitively NOT the second-worst game in the house. In many, many situations, it is the “best” game in the house, expected-value wise. Also, a lot of poker players think that they beat these mathematics because it is a game of skill, but the reality is that the huge majority of them are losing players, often with an expected loss far greater than they would have at a craps table. Indeed, since people are extremely likely to overestimate their own skill, bad poker players are likely to play at higher stakes games than they _ought_ to be playing, resulting in even greater losses. A typical winning player at a 20-40 poker game will make about $40-80 per hour. If we assume that winning players make up about 20% of the table, and 30% of players are break-even, this means that the losing players each lose about $16-32 per hour, the equivalent of betting about $20 per roll at a craps table!

  3. Tom Allyn Says:

    Thanks for the information. Good stuff.

    Regards
    Tom


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