If there is one reason this is a bad a idea it is that people will be losing their jobs in an already tough economy.  Again, there needs to be a better solution to that than "casinos."

Prohibition?  Uhm, they aren't banning drinking, or even gambling.  They are shutting down casinos and told them they can relocate in Siberia.  Really - I can't even believe I am having this conversation.  


"Pretending that you already know the answer when you don't is not actually very helpful." ~Migeru.

Could serious gamblers find places to go and gamble?  Yes, they could.  Were they seriously shady and dangerous?  Yes.  Then again, real gambling is seriously shady no matter where it is.  What you didn't find was low-level gambling by the poor and the desperate on every street corner, which is what the spread of casinos enables.  A good number of those people were probably wasting their money and their lives elsewhere, but it wasn't in underground casinos, and if those places were closed, they wouldn't be seeking out underground casinos.  The elderly may love wasting their time and money on slot machines, but they're among the most law-abiding demographic in existence.

Japan is thoroughly screwed on this front.  Public, legal gambling parlors are everywhere.  Everyone knows the games are rigged, and everyone knows the odds are horribly against you, and everyone knows the parlors are owned either by the mob or by North Korea, and everyone goes.  Were they all closed down overnight, I seriously doubt most of those people would start seeking out underground pachinko parlors - they're not there for the danger, or even to win money, but just because it's something to do to waste time, and there are lots of different ways to do that.