Beacon Hill is poised to drop the ball once again on casino gambling, and sighs of relief can be heard from illegal gambling dens across the state to Foxwoods and Mohegan Sun in Connecticut.

As yet another casino bill moves closer to fizzling out, the biggest fallacy in the now years-long gambling debate here in Massachusetts is in assuming the Legislature is being asked to legalize an industry that is not yet here.

But nothing could be farther from the truth. Gambling is big business here in Massachusetts, which, with our massive spending on lottery tickets, among other things, has earned us a reputation as one of the most betting-crazed states in the country.

Really, the only difference between Massachusetts and Connecticut, which has two of the world’s largest casinos, is where our gambling dollars go. In Massachusetts, too many of those dollars wind up in the wrong hands, from illegal gambling operators with seemingly obvious mob ties, to the tax coffers of other states.

At a time when construction on a casino or two could provide thousands of badly needed jobs, we are instead apparently content to subsidize taxpayers in other states and help fatten the profits of various underworld gambling kingpins.

“There is no one more opposed to legal gambling than people who sponsor illegal gambling operations,” said Clyde Barrow, a professor and gaming industry expert at the University of Nevada Las Vegas.

A Losing Bet

Gambling opponents like to argue they are saving our beloved Bay State from the evils of “casino culture.”

But this is one of the biggest delusions out there. By running legal gambling operators out of town, these self-righteous few are simply protecting the profits of illegal gambling operators and fat cat out-of-state casino operators.

For starters, it’s pretty clear the amount of gambling that goes on here in Massachusetts already rivals that of states with full-fledged casinos.

Massachusetts is hardly the largest state in the union, but we have one of the biggest lotteries, with billions in ticket sales and the largest spent per capita in the country.

Some even argue that lottery gambling is not the best alternative, tending to draw more heavily from lower-income players. But at least the money goes to pay for local teachers, police and firefighters.

The same can’t be said for the more than a billion dollars Bay State gamblers blow each year at casinos in other states and on all sorts of illegal gambling activities in bars and backrooms from Boston to Springfield.

The amount of money lost at Connecticut’s two casinos and racinos in Rhode Island and Maine is mindboggling – $968 million in 2009 alone, the University of Massachusetts Dartmouth has estimated.

Of that, more than $230 million found its way into the coffers of our fellow New England states, sparing social service programs from painful cuts and building roads from Hartford to Bangor.

But, again, at least we know where that money is going.

Unsavory, Unsettling

There are as many as 2,000 illegal poker and slot machines in bars across the state, with establishments able to bring in as much as $10,000 per week, state investigators told WBZ-TV’s old I-Team last year.

That’s about $500,000 per year. Given most of these bars are likely to have five or ten machines, we are talking about a $100 million to $200 million-a-year business.

State Treasurer Tim Cahill, now running for governor, made clear that more than just a few, over-entrepreneurial bar owners are at work here.

Asked if organized crime was behind these backroom betting rings, Cahill had this to say: “We don’t know that, but it appears to be, and there usually historically has been.”

I think we all know what he’s saying there – these machines are not controlled by Goodwill or the Salvation Army.

It’s somewhat paradoxical, but states like Massachusetts that have traditionally tried to draw the line against casino gambling may simply end up with lots of unsavory illegal betting instead.

Bible-thumping Alabama has a governor determined to keep video slot machines out, but the state is overrun with quasi-legal machines, rigged to meet the letter, if not the intent, of the law.

North Carolina is another state that does not want casinos, only to find itself fighting a losing battle against thousands of video poker machines at bars, supermarkets and convenience stores across the state.

Prohibition didn’t work against booze and it’s certainly not going to work with gambling, where all you need is a pack of cards, a pair of dice and a lively imagination.

When it comes to gambling, Beacon Hill is once again being dumb about it all.

Instead of putting some of these illegal gambling operations out of business and putting people to work building new casino developments, our lawmakers are apparently OK with subsidizing the lifestyles and business activities of mobsters.

Before he was convicted last year in federal court, reputed Mafia associate Arthur Gianelli ran a gambling and loan-sharking empire out of his North Shore home.

Armed with millions in illegal gambling profits, he allegedly used cash and mobster muscle to seize bars from their rightful owners, from Boston to the North Shore. Just call it economic development, mobster style.

And with casino gambling likely to remain illegal here in Massachusetts, don’t be surprised to see more of the same in years to come.