Posted tagged ‘Gambling’

Yet Further To McCain’s Gambling Problem

September 29, 2008

We’ve seen today what can happen when you go all in on a risky bet.

What McCain can now do, after having inserted himself into the bailout, urged his caucus to support it, and seen the dice roll hard against both his stated views and his claim to lead his own party, much less the nation, I have no idea — and neither, apparently, does he.

So I can’t say I’ve seen anything over the last few days to make me revise my impression that McCain’s likely behaviour as President would be any different from that of any other craps player betting against the house.

But I’ve turned up some new resources to help put McCain and what we know of his gambling habits in context.

Here’s the invaluable Jen-Luc Picard, learning calculus from craps.

And here, via David Munger, is a nice piece from the Times two years ago on research into impulsive behavior.

And here’s David’s own take on trying to assess the personalities of the candidates, using a classic psychological experiment to measure tolerance for risk.

Image:  Released under the GNU Free Documentation License.  Source:  Wikimedia Commons.

Further to McCain’s Gambling Problem

September 28, 2008

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.

McCain’s Gambling Problem — And Ours

September 28, 2008

It’s already getting its fair share of play, but the enormous NY Times take out on McCain and the gambling industry is must reading for any voter, leaning any which way.

Most of the article is a meticulous, and to my eye devastating account of McCain’s deep-inside-Washington maneouverings on behalf of favored friends and allies in the gambling world.  While the article is meticulous in avoiding charges that Senator McCain violated laws, its account is a powerful, blow-by-blow description of the practical corruption and DC business-as-usual life of a powerful Senator.

But while I’m sure that this story of the corrupted false messiah will get its share of play, the article touches on — but does not delve into — what is to me much the more important issue.

There are hints.  Here is the lede paragraph to the piece:

Senator John McCain was on a roll. In a room reserved for high-stakes gamblers at the Foxwoods Resort Casino in Connecticut, he tossed $100 chips around a hot craps table. When the marathon session ended around 2:30 a.m., the Arizona senator and his entourage emerged with thousands of dollars in winnings.

An aside here:  Mathematically literate readers will wince at the phrase “a hot craps table.”  The notion of a hot table is nonsense: in Wikipedia’s version, “since there is no correlation between die rolls, there is no possible long-term winning strategy in craps.”  Rather, the odds in craps are set to ensure that the house always wins over time — and rather modest increments of time at that.

There are thus only two possible explanations for McCain’s success at the table that night.  He could have  benefited from the fact that randomized processes can produce’ patchy outputs.  Alternatively the casino bosses for whom he was the lead Senator on gambling matters decided to improve their odds in the bigger game of Washington lobbying, and juice McCain’s chances with a little mechanical help.

There is no way of knowing of course what occurred that day – and all casino games are set up to ensure that there are enough winners to persuade the losers (ultimately, everyone) to keep coming back.

So without knowing McCain’s results over a much longer series of his gambling weekends, I wouldn’t  accuse him or anyone of impropriety or worse.

Rather, the deeper issue here is what McCain’s gaming habits tell us about the kind of mind he has.

First, you have to know that McCain has a well documented love of gambling — and specifically for craps with its high reward-higher risk profile and its significant house edge.*  (Which is another way of saying that if over his years as a Senator with oversight over the gambling industry he shows a notable net positive return on his wagers, he is most likely being bribed.  Anyone check his tax records on this?)

This pleasure in the game can take on the color of urgency.  When, during the campaign, his advisors blocked him from heading to a casino floor in Las Vegas to play, he proposed bringing a craps table to his room.

His aides blocked that idea too, but that it even occured to a man in the middle of a Presidential campaign illustrates the depth of McCain’s gambling jones.

Now, what does this love of high risk, immediate reward, and long-term inevitable loss say about McCain’s emotional and intellectual fitness for the Presidency?  Does an affinity for a gambling rush imply anything about the rest of McCain’s capacity for judgment and decision making ability?

The answer, according to both empirical observation and recent neurobiological research, is at least a provisional yes.

Anecdotes (which I know are not data) first:

Just take the last week of the campaign to see what happens when an impulsive risk taker gets on the loose.  McCain’s sudden decision to call for a delay on the debate and assert a (false) suspension of his campaign were widely seen as on-the-spot impulse decisions.  They do not appear to have benefitted him.  His decision to demand a role in the bailout negotiations has been widely described as a disaster…and so on. Going a little further the selection of Gov. Palin looks like another impulse acceptance of great risk for potentially great reward.

Such examples of  McCain’s behavior under pressure does not prove that he is an erratic, risk addicted menace, of course.  But they do provide a portrait that is consistent with that view.

Now, enter neuroscience.  The study of the brain chemistry of gambling is a young one, and anyone looking for a deterministic answer to the question of whether regular but not ruinous risk taking is an indicator for a broader collection of mental attributes is not going to find it there, at least not yet.

But the current focus of the research on dopamine metabolism and the way centers of your brain respond to the stimulus winning and losing, do show the connection between emotion and brain states.

At the same time, studies of problem gambling suggest (and I emphasize suggest) that the brain states that correlate with behaviors like chasing losses, in the words of one such investigation, “might underlie the loss-of-control over appetitive behaviors in other impulse control disorders.”

Other types of studies —  suggest, for example, that gamblers can’t take the long view as well as non gamblers.  (Again, suggest, because no one small sample study can be said to mean very much at all.  Just reminding everyone of what I’m sure y’all know very well).

John McCain the candidate is a gambler — that’s on the record.

He likes to roll the dice. The metaphor is exact. Both his own history and the accumulating evidence of psychological and neurobiological work make it impossible to assume that his love of the game can be confined to a craps table in the basement of the White House.

This is not a comforting thought to attach to someone whose hands could hold the nuclear codes.

*Obama’s gambling as profiled in the same article linked above, has centered on low-stakes poker.  Describing his regular game at the Illinois State Legislature, the article reports:

He always had his head in the game. The stakes were low enough — $1 ante and $3 top raise — to afford a long shot. Not Obama. He studied the cards as closely as he would an eleventh-hour amendment to a bill. The odds were religion to him. Only rarely did he bluff. “He had a pretty good idea about what his chances were,” says Denny Jacobs, a former state senator from East Moline.

It seems to me worth noting the obvious:  where craps is a game of chance with the inevitability of long-term losses, poker is a game of strategy, rewarding an understanding of probability and a capacity for psychological assessment of your opponents.  Hand by hand results may vary, but over time, the more skilled player wins.  So the question in the upcoming election becomes:  would you rather have a craps player or a poker player staring down Putin next time around?

As our French friends would say: the question answers itself.

Image:  William Hogarth “The Gaming Table” from A Rake’s Progress, 1732-35.  Source:  Wikimedia Commons.