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A contrite Barack Obama declared his love for Las Vegas on Friday, part of an attempted reconciliation with local business and political leaders furious at comments he made recently warning savers not to visit the city.

Mr Obama was on a whistle-stop fundraising tour of Colorado and Nevada – two states that supported him in his 2008 election win. But he had bridges to build in Las Vegas after telling a New Hampshire town hall meeting: “You don’t blow a bunch of cash on Vegas when you’re trying to save for college.”

Those comments provoked a furious response from Oscar Goodman, the city’s mayor and one-time Democrat. He refused to meet Mr Obama on his visit and said the president had a “real psychological hang-up about the entertainment capital of the world…I don’t know where his vendetta comes from but we won’t allow him to make his bones by lambasting Las Vegas.”

Mr Obama tried to make amends at the start of a speech to the city’s chamber of commerce at Aria, a new hotel that is part of the recently opened $8.5bn CityCenter development.

“Let me set the record straight: I love Vegas,” he said. There was more applause – and laughter – when he said he had cut the budget deficit in half after a good night on the poker table in the nearby Bellagio casino. He also revealed that his mother-in-law was a regular visitor to Las Vegas.

But behind the jokes there is deep concern in Las Vegas at the city’s economic plight. For most of the past decade it was the fastest growing metropolitan area in the US: people poured in from across the country in search of work, new casinos sprang up and real estate prices soared, fuelled by cheap credit and subprime mortgage products.

But when the bubble burst in 2007, the property market crashed and has fallen 50 per cent from its peak. Las Vegas became the country’s mortgage foreclosure capital while unemployment soared above the national average and recently hit 13 per cent.

Mr Obama said Las Vegas had been in the “eye of the storm” of the foreclosure crisis. “When folks are hurting and don’t have the money to spend on a weekend Las Vegas gets hurt, and that hurts the broader economy as well.”

He also promised to give the city a boost with a new tourism bill that will set aside money for promoting the US in international markets. “I don’t just want Vegas to go back to the way it was, I want it to be thriving.”

His speech was well received by some of those in the crowd. “The fact that he addressed tourism issues was critical for us,” said Rossi Ralenkotter, chief executive of the Las Vegas Convention and Visitors Authority. “Tourism and the strength and health of the economy are related and linked.”

He added that convention bookings had turned a corner, with the popular Consumer Electronics Show attracting more visitors this year than in 2008.

However, there continues to be plenty of evidence of the damage the recession has wreaked. Mr Obama pointed to the legacy of the foreclosure crisis, saying there were “too many blocks littered with brown lawns and for sale signs”. On the Las Vegas Strip expensive casino projects costing billions of dollars have been shelved: developers of the $2bn Fontainebleu filed for bankruptcy protection last year while plans to build the $4.8bn Echelon at the north end of the city’s fabled gaming Strip were also postponed.

Las Vegas generates most of Nevada’s taxes and the casino and tourism sector is the dominant employer in the state. “We have everything in place to be the world’s great city but the economy is killing us,” Mr Goodman said this week. People were still visiting Las Vegas, he added, “but they aren’t coming with money . . . that’s the difference between now and three years ago”.

Copyright The Financial Times Limited 2017. All rights reserved.

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