Lottery is a process of allocating prizes among participants by drawing lots. The word “lottery” derives from Middle Dutch loot and Old English lot, which means “fall of the hat.” The first state lottery was held in 1739 in New York, and by the mid-1820s most states had adopted them. Today, there are more than a dozen national and state lotteries.
The lottery has become a major source of revenue for many state governments. In addition to direct state spending on prizes, it generates billions in federal tax receipts that states can spend on other things. But, like all government spending, it should be carefully weighed against the alternatives. Many people see purchasing lottery tickets as a low-risk investment, and it can be a fun way to fantasize about a big win. But, the risk-to-reward ratio is far from foolproof, and, even if you never win, there are hidden costs that can accumulate over time.
For instance, lottery players as a group contribute billions in federal tax receipts that they could be saving for retirement or college tuition. And, the odds of winning are surprisingly slight.
In addition, the way most lotteries are run—as a business with a focus on maximizing revenues—increases the likelihood of negative consequences for poor people and problem gamblers. And, there are serious questions about whether or not promoting gambling is an appropriate function for the state to undertake.
State lotteries typically begin operations with a legislative monopoly; set up a public corporation to manage them; start with a small number of relatively simple games; and, under continuous pressure for more revenues, progressively expand the size and complexity of their operations. This expansion is inherently at cross-purposes with the state’s general policy to promote the well-being of its residents.
As a result, it’s not surprising that critics of the lottery often focus on the specific problems with compulsive gambling and its regressive impact on lower-income groups. But, these criticisms are both reactions to and drivers of the continuing evolution of state lotteries.
The big message that state lotteries rely on is the idea that it’s just a little bit of a fun thing, and that you don’t have to take it seriously. And, they try to make this a wholesome thing by emphasizing that the money they raise is for education or children’s health or some other worthy purpose. But, this argument obscures the regressivity of state lotteries and also makes it harder to understand why so many people play. Because, while it’s true that a lot of people play for fun, many others—particularly those with lower incomes—play because they feel that it is their civic duty. This is a dangerous idea. It will lead to more poverty and less social mobility, not the kind of progress we want to see in this country. It’s time to change that. We need a better way to fund public services. And, that starts with a more honest discussion of the role of the lottery.