Odds are that gambling ads affect culture

Gai Waterhouse destroyed a straw man this week, but that was after she had dined on a red herring. She did so to defend her son Tom, the 30-year-old bookmaker who has been criticised for relentlessly promoting his gaming company during televised rugby league games.

If you have not had time to follow the story, here is a synopsis.

Tom Waterhouse has been appearing as a "commentator" during Channel Nine's rugby league coverage this season. The arrangement is part of a multimillion-dollar advertising deal he has with the network.

He has been standing on the sidelines of games with his microphone and he has been mixing his match "analysis" with talk of tips and betting odds (if you want to place a bet, just get on his website).

The public has lashed back and some of the criticism has been nasty.

In the past few weeks a parliamentary committee on gambling reform has suggested Tom has "blurred the line" between gambling advertising and commentating. Greens Senator Richard Di Natale, a committee member, has been particularly critical of Tom's behaviour.

And it was in this context that high-profile horse trainer Gai Waterhouse, when asked what she thought of the criticism, had this to say last weekend:

"They should stop criticising. All they can ever do, the Greenies and all the rest of them," she said.

"Bugger the criticism. They want to kill every industry in Australia and then they wonder why they are going belly up.

"He is out there working his butt off. If everyone worked as hard as my son Tom we'd have a much better society in Australia."

It was senseless stuff.

Just because Senator Di Natale does not like Tom appearing on TV as a "pseudo-commentator" - in the Senator's words - that does not mean he wants to kill every industry in the country.

(Ms Waterhouse has used a "red herring" here, a logically flawed argument that diverts one's attention from the original point.) And no one has been questioning Tom's work ethic. (That's her "straw man" argument. It works by attacking a position your opponent never held.)

The real issue, of course, and the one Ms Waterhouse referred to only in an oblique way, is the problem of her son saturating our TV screens with gambling ads, betting odds, tips and predictions, and the effect such a strategy could have on society.

But her attitude on this point is dispiriting, too. "They have the freedom of choice of turning their television off," she said. "They don't have to pick up the phone to have a bet. They don't have to pick up a cigarette and smoke it. They don't have to do anything."

One of the assumptions Ms Waterhouse is making here is that people are rational. It is up to us if we want to be influenced by gambling ads, the thinking goes.

But decades of evidence, from the advertising industry through to economic research, has shown myriad circumstances in which we do not act rationally.

In the economics departments of our universities, for example, behavioural economists like to show how humans are susceptible to a thing called "loss aversion". Loss aversion refers to the steps we will take to avoid losing something in our possession.

Apparently the feeling we have when we lose something can be more powerful than the feeling we get when we gain something, though we are often unaware of it.

And a simple experiment has shown that when a student is given a coffee mug and another student is given a chocolate bar, both are unlikely to want to swap with each other. But if those items are then swapped before the experiment is repeated at a later date, again the students are unlikely to want to swap with each other.

Who knows why? It is completely irrational. But it is something economists have discovered about us.

And advertising influences us precisely because we are irrational like that. How else could so many of us be convinced that the way to prove our love for someone is to buy them an expensive but worthless rock (that is, a diamond) from a market that has been deliberately manipulated to keep prices artificially high?

But that brings us to another of Ms Waterhouse's assumptions: that we can endure a lot of gambling advertisements without being affected in an adverse way.

Heather Gridley, of the Australian Psychological Society, told senators last month at the gambling reform committee that she was concerned about the links in sport between sponsorship and advertising and gambling.

She said she was concerned that gambling was becoming "normalised" in Australia, and wondered what effect it was having on our children. "We are concerned about ... child wellbeing," she said.

"We have got rid of tobacco advertising, and there has been talk about advertising of junk food and sugared drinks and all such things, and there is limited action on that. Gambling is another area where the advertising is probably not targeted at children but certainly children are watching and they are vulnerable."

But Ms Gridley also acknowledged that part of the problem with the current "saturation levels" of gambling advertising in Australia is that it is such a new phenomenon that there has been little time to research it.

Economists have known for centuries that if an economic system is to survive it must reproduce elements of itself.

A capitalist system, for example, needs to reproduce wage labourers, judges to enforce contracts and consumers to buy its products.

Large parts of what we call our national "culture" also depend on our economic system. The way we produce things, the time we spend working and resting, how many holidays we take each year, all influence our "culture".

So if some family time in Australia is spent watching sport on TV, and if that coverage is saturated with betting and gambling talk, one assumes it will affect our culture in the long run, particularly as that level of advertising is reproduced over time.

The question is: will the effect be a harmful one?

One would like to hear Ms Waterhouse address the issue directly, rather than shooting figments.

But Madsen Pirie, a British professor of logic, might sympathise with her on that score. As he has written in his book on the use and abuse of logic:

"Everyone needs a victory or two for purposes of morale. If real ones are nowhere to be had, then walloping the occasional straw man can be most invigorating."

Ross Gittins is on leave