Junkets and high-rollers are out. Mass-market is definitely in. The six current concessionaires, including the American companies MGM, Wynn, and Las Vegas Sands, are, rightly, mostly concerned about whether they will be allowed to continue to operate casinos. But they should also be concerned about what those casinos will look like.
Macau is the only casino market in the world where the regulation of patrons is more important than restrictions on the casinos themselves. And the leaders of the Peoples Republic of China are now trying to force the largest casino jurisdiction in the world into a Marxist model.
I once asked the U.S. government’s top China economist, “In what way is the PRC still communist?” He answered, “It’s no longer communist. It’s Marxist.” The difference is significant. A communist government would never allow an unrestrained free-market economy. It would also require true socialism, with the government owning everything, including casinos.
But Marxism believes that the root cause of all social problems is not private ownership of property, but rather conflicts between classes. The goal is to eliminate class differences: The poor should become middle class, and the rich are to be shunned, not admired. Beijing has always disliked junkets, which help wealthy Mainlanders take money, often illegally, to Macau to be lost at casinos owned by Westerners. So, the proposed amendments to Macau’s laws are openly anti-junket.
According to GGRAsia, even before the new laws have been adopted, Melco, Wynn, and Galaxy announced that all junkets had stopped operations at their casinos. Of course, Covid is a factor. And Alvin Chau Cheok Wa, the head of the largest junket operator, Suncity Group, was arrested and charged with money laundering and organizing illegal online gambling for Chinese customers. Macau ordered all Suncity VIP rooms closed.