by Martin Koughan

To many people, talk of the "gambling industry" still conjures up visions of Bugsy Siegel and the wise guys who turned a remote oasis in the Nevada desert into a mecca of forbidden pleasures. But Las Vegas' founding fathers are long gone, and so, to a large extent, is the stigma that used to be attached to their business. Today, gambling is setting up shop on Main Street. Thanks to its phenomenal profitability, the corporate establishment, along with a number of state and local governments, has welcomed it with open arms.

Over the last five years, gambling has quietly become one of the nation's favorite forms of entertainment, generating more revenue than movies, spectator sports, theme parks, cruise ships, and recorded music combined. Last year, Americans sank more than $550 billion in legal wagers into casinos, racetracks, lotteries, and other gambling operations.

The most visible sign of gambling's rocketing popularity is the rapid expansion of casino gambling. In 1978, only two states had casinos; now 27 states do, though some have been mired in legal disputes. In the past five years, the number of Americans visiting casinos has doubled.

As a result of casino gambling, Las Vegas is now the fastest-growing city in America, boasting 11 of the 12 largest hotels in the world. Another $6 billion worth of facilities are slated to open within the next two years -- including a $1.3 billion Italianate casino, Bellagio, that will feature $50 million in original paintings by masters such as Picasso, Manet, and Renoir.

These casino palaces are run by mainstream corporations such as Hilton, ITT, and MGM Grand and are financed by top Wall Street investment banks. Institutional investors as savvy as Harvard University and the California public employees' pension fund have bet heavily on gambling industry stocks.

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