In the taxation chess game, the teachers union has just hit the timer, stared at the gamers and declared: "Your move."
And the casinos, once the grand-masters of this competition, must feel they are in danger of being checkmated by a former teammate, one they have taken for granted and ignored for years.
But almost two decades after the gamers and the teachers conspired to defeat the latter's proposal for a corporate income tax after a wink and a nod promise from soon-to-be Gov. Bob Miller that he would raise business taxes, the friendship officially dissolved this week.
After years of being the gamers' pawn in trying to raise business taxes, defeated by ineptitude, the teachers, feeling like kings and queens, may finally have gotten it right at the wrong time for the casinos.
You could feel this coming for a few years now, especially after the gamers were unable to achieve their dream of a gross receipts tax in 2003 and were soundly thrashed by the Las Vegas Chamber of Commerce and its allies.
That was a sign of weakness and then, when Gov. Jim Gibbons managed to pilfer room tax money in 2007, angering everyone but shadow governor Sheldon Adelson, the teachers' gambit began to take a different shape.
No longer would the teachers join the gamers and try to find a proverbial third leg to the tax stool — the corporate income tax they had long sought. The casinos had done little to help them in recent years so it has come time for the teachers to break the oldest taboo in Nevada politics with what was about to become a union crusade: raising the gaming tax.
The Nevada School Funding Initiative is the kind of scheme that Bobby Fischer or Boris Spassky couldn't have concocted in their best days. It has all the earmarks of a masterful chess strategy — far-sighted, timely and devastating.
By proposing to tax only the wealthiest casinos — those making $1 million a month in gross revenue — to raise $250 million to fund education, they are putting the gamers in check and in serious danger of losing the game. And, truth be told, to the big casinos this is no game — with hundreds of millions at stake and, in the long run, the prospect that they can be defeated at the ballot box.
This week, when they punched that clock with their announcement of this constitutional amendment that would have to pass the electorate's muster twice, the teachers started a ticking that will not stop. The gamers can only halt the clock temporarily on their way to defeat — the only questions are the size of the loss, how much they are willing to pay and whether the teachers and the public will be satisfied with the result once the king falls.
The old strategies may not work here for the gamers. The teachers will be expecting the countermoves: Have the Culinary and other labor types front for the gamers and fret about lost jobs. Get someone like numbers maven Jeremy Aguero to paint a doomsday scenario if the gaming tax is raised to 9.75 percent. Threaten the teachers behind the scenes with retaliation come Session '09.
But what the gamers must know is that these tactics are easily parried. Nevada's putrid education funding, stories of kids not getting the proper tools and the gamers' sudden vulnerability make all these usual maneuvers useless in this situation.
The casinos really have only one choice: They have to topple their king, looking ahead to the next match and hoping for a different opponent. Propose some kind of alternative tax plan and, perhaps, cajole the teachers to then go after Big Business. Again. And maybe actually get the third leg this time.
The chamberites have proven to be formidable tax chess players in the past — they have never really lost one of these matches to the gamers, unless you count that relatively small business tax passed by Miller in 1991 or the payroll tax of 2003. Those were the kinds of briar patch taxes the gamers need to find before they really get clubbed by the teachers or, worse, by rabble-rouser Kermitt Waters, who wants much more than a 45 percent increase in taxes.
It also will be interesting to watch what the governor's role is in this chess game. He was channeling Adelson when he took room taxes to pay for transportation during the session. But he recently told Reuters he is against raising the gaming tax:
"When I look out there and see $20 billion to $40 billion worth of investment, most of which is coming out of the gaming industry and expanding not only the tourism market but expanding the number of jobs in this state by 50,000 over the next two years, I am loath to think we should cut off the hand that's feeding us. This is killing the goose that laid the golden egg. I think they pay a tremendous amount of tax already."
The gamers, minus Adelson, were ready to kill Gibbons a few months ago. Now, in this strange, turned-around game, he may be their best friend.
If only he were more popular, he might be able to pull the gamers out of their imminent checkmate.
In Business commentator Jon Ralston also hosts the news discussion program "Face to Face With Jon Ralston" on Las Vegas ONE, publishes the daily e-mail newsletter "RalstonFlash.com" and writes columns and a political notebook for the Las Vegas Sun. To subscribe to Flash, go to www.RalstonFlash.com, or call 990-2550. Ralston can be reached at 870-7997 or by e-mail at ralston@vegas.com.