A few hundred million people in the United States spend upward of $100 billion on lottery tickets every year, making it by far the country’s most popular form of gambling. And yet, for all its popularity, the lottery isn’t without serious problems. It is a major contributor to inequality, and it also has a significant impact on the lives of low-income people, who are more likely to play and more likely to lose. In this article, we examine some of the most troubling aspects of the lottery and offer some recommendations for how it might be improved.
State governments that establish lotteries make many decisions about how to operate them piecemeal and incrementally, with little or no overall policy vision in mind. As a result, they often develop a set of policies that are neither optimal nor desirable for the general public. But once those policies are established, they’re difficult to change.
For example, many of the ways that state lottery officials promote their products are misleading, notably by overstating the likelihood of winning and the amount that can be won (lottery jackpots are typically paid in equal annual installments over 20 years, with inflation dramatically eroding the current value); and by inflating the benefits of playing the lottery to the point that it detracts from more productive activities. In addition, the marketing of the lottery as an instant source of wealth is a potent lure for compulsive gamblers.
But a broader, more fundamental problem is that the lottery draws upon people’s innate love of chance. The practice dates back centuries, with the Old Testament commanding Moses to take a census of Israel and divide its land by lot, and Roman emperors using lotteries to give away property and slaves during Saturnalian feasts. In the modern era, it has become a popular dinner entertainment in many countries.
In America, the lottery is often promoted to voters as a way to raise money for the state, in particular to benefit education. Despite the fact that it is a form of taxation, this argument has been effective at gaining and maintaining broad public approval for the lottery, even when the state’s objective fiscal circumstances are strong.
The problem is that there is a cost to this widespread acceptance of the lottery, which is that it obscures the ways that it is contributing to inequality and that it is, in effect, a form of regressive taxation. In order to improve the lot of the American people, it is crucial that lottery policy be reconsidered and that states look beyond traditional revenue sources for their funding needs. Until that happens, the lottery is an example of government by lottery, in which the lottery industry shapes policy on its own terms and with little regard for the interests of the public. This is not how democracy should work. And it is certainly not how we should fund education.