Casino Talk with UNLV's Dr. David Schwartz "A Brief History of Las Vegas"
In the early twentieth century in order to build a casino of
any size you needed money from people in the gaming business. This was both
illegal and highly organized making it by definition organized crime. It
basically became impossible to get involved with the casino business without
getting involved with the mob. This allowed the mob to come to power and start
running underground casinos all over the country.
Mob monopoly over Las Vegas casinos lasted until the mid 1950’s.
The federal government started cracking down on the shady businesses being run
in sin city, and the state of Nevada started to take regulation and licensing
more seriously. No one wanted to be connected to the mob anymore, which opened
up room for mainstream investment. Perry Thomas, a famous Mormon banker, was
overall responsible for bringing mainstream investment to Las Vegas. He was the
first person to get out the idea that a change in the law was needed to allow
publically traded companies to build casinos. After this casinos start getting
really big and becoming more expensive. Stardust, the first mass market casino,
had 800 rooms. In 1969 the International (now the Westgate) opened up with 1,500
rooms. By the time the 1980’s came around all of the big casinos had upwards of
3,000 rooms. Another big influence in the Las Vegas gaming industry was Howard
Hughes. In the late 1960’s he started buying a bunch of casinos as a way to
shield his money from taxation. Despite only being in Vegas for four years he
acquired a pretty big casino empire (which his company later went on to sell
after his death). As one of the most well-known, wealthy people at the time,
his involvement in Vegas essentially validated the legal gaming business. Overall
he legitimized the industry.
Later the Teamsters union came in to further help build up
the city of Las Vegas by loaning a lot of money to casinos.
Eventually major corporations like Aetna started to get
involved allowing Vegas to grow and modernize into what it is today.
