The far-reaching effects of the coronavirus outbreak could reach the worlds of Jewish philanthropy and U.S. politics, with Sheldon Adelson’s casino empire the latest to be impacted by the contagion.
‘There may be points in which he says, “I can only give $100 million this time instead of $200 million,”’ says one Vegas expert.
On Tuesday, Ho Iat Seng, the chief executive for the Chinese territory of Macau – the world’s biggest gambling hub – asked all casinos there to suspend their operations for two weeks, in an effort to curb the spread of the virus.
The decision came following a huge drop in the number of tourists visiting the special administrative region, and caused the stocks of companies with casinos in Macau to slip on Tuesday. This included an 11 percent drop for Sands China, co-owned by Adelson’s Las Vegas Sands company.
There have been 10 confirmed cases of the pneumonia-like illness in Macau, which is a popular destination for tourists from both the Chinese mainland and around the world.
Adelson played a key role in creating the gambling empire in the territory, which, until 1999, had transitioned from being a Portuguese colony to Chinese. He is currently the largest investor in the peninsula.
After winning one of the first coveted gambling licenses in China for his Las Vegas Sands corporation nearly 20 years ago, he opened Sands Macau in 2004 – the same year the stock in his Las Vegas-based firm went public. This was followed by other resort hotels that helped turn Macau into the new gambling capital of the world.
A 2008 profile in the New Yorker estimated that Adelson’s transformation of Macau and the region multiplied his wealth 14 times over. It meant he went from being “merely rich” into a multibillionaire who was earning up to $1 million an hour. It also gave him the means to play “a significant role in U.S. foreign policy” and “Israel’s strategic decisions,” the profile wrote.
Forbes Magazine estimates Adelson’s fortune today at $37.7 billion, making him the 24th-richest person in the world. He is also the largest U.S. donor to the Republican Party and a key donor to American-Jewish and Israeli philanthropic causes. He has also heavily bankrolled Israeli politicians – most notably Prime Minister Benjamin Netanyahu. Israel Hayom, the free newspaper he launched in 2007 to help boost Netanyahu, has proven an effective tool for the Israeli right over the years.
In addition to Macau, where his company is in the midst of investing an additional $2.2 billion in building hotel and convention space, Adelson is also facing potential trouble in Singapore – where he owns the highly profitable Marina Bay Sands gambling resort.
Like Macau, Singapore’s customer base is dominated by Chinese tourists traveling to visit its casinos. And while it has yet to close, it is suffering a severe slump in visitor numbers.
Last week, the company distributed a letter revealing that a case of the virus in Singapore was “tracked to a guest who previously stayed at Marina Bay Sands 23-24 January 2020.” The room where the guest stayed was subsequently closed off, and hotel staff who had been in contact with him were placed on a leave of absence.
In an attempt to prevent the virus spreading, Sands properties in Singapore and Macau stepped up hygiene measures: They placed machines that measured gamblers’ temperatures at the casino entrances, to prevent players with early stage symptoms from hitting the tables.
Speaking with analysts last week, Sands President Rob Goldstein worked to put a positive spin on the situation, saying that after the crisis abates, there will be “pent-up demand” by casino-goers that will help repair any damage. He predicted that “when the situation does resolve, Macau’s going to be very, very, very busy, because … these folks like to gamble. … They will come back in force.”
Billionaire with money
The coronavirus crisis won’t be turning Adelson into a poor man strapped for resources. However, a depletion of his seemingly endless funds and greater scrutiny by his stockholders could have an impact on the 2020 elections if the situation worsens, said Michael Green, a professor of political history at the University of Nevada, Las Vegas.
“He is still going to be a billionaire with money, and one who has gone all-in with the Republican Party,” Green said. “But the current situation means there may be points in which he says, ‘I can only give $100 million this time instead of $200 million.’ In a tight race, that can make a difference to the Republicans.”
Adelson has also poured hundreds of millions of dollars into Jewish and Israeli causes, and several organizations – notably Birthright Israel – have become heavily reliant on his largesse. The Israeli American Council (an umbrella organization for the Israeli-American community), American Friends of Ariel University, and numerous educational and medical research facilities have also benefited. He also supports Christians United for Israel, a pro-Israel U.S. organization.
Concern by political causes and philanthropic institutions endowed by Adelson were raised last year following reports that the billionaire was being treated for cancer and the situation was “dire.” He has since recovered and been seen at various events, most recently U.S. President Donald Trump’s unveiling of his Mideast peace plan at the White House last week.
Prof. Lila Corwin Berman, director of the Feinstein Center for American Jewish History at Temple University, said that several Jewish institutions are “reliant” on Adelson as their primary funder. They surely have their fingers crossed that the coronavirus crisis will not extend long enough to have a real impact on his wealth, she said.
However, she added, “If he reduced his giving, it wouldn’t have the same scale of impact as it did when people across the board were affected by the financial crisis of 2008.”
Coming hot on the heels of questions concerning alleged misconduct by Adelson’s fellow megadonors Michael Steinhardt and Leslie Wexner, Corwin Berman said that the moment should make Jewish organizations perform an “assessment” of the problematic nature of being “wholly dependent” on a single, ultra-wealthy backer.
The events of the past year “seem to be suggesting the deep peril of the model of relying so heavily on so few people,” she said. “When an organization gets fully identified with one person,” she added, they are held hostage to that person’s personal and financial “ups and downs.”