Lottery is a major source of revenue for state governments. People in the US spent upward of $100 billion on tickets in 2021, and that figure is only rising. But what are the real costs of this popular form of gambling? And is it worth it for states to promote it as a way to raise revenue?
The answer is complex. On the one hand, many people play lottery games because they simply enjoy them. The prospect of winning a big prize is exciting, and even small wins can be satisfying. And while lottery profits are often used for charitable causes, there is also a sense of public good that comes with winning a jackpot.
But there is also a more serious problem at play here: Lotteries encourage people to gamble on an unwinnable proposition. They dangle the promise of instant riches in an age of inequality and limited social mobility, and they know it. In fact, they’re quite adept at it, and they use everything from slick marketing campaigns to the math behind the odds to keep players coming back for more. This is not much different from how tobacco companies or video game manufacturers make their money, except it’s done under the auspices of state government.
It’s no wonder that the ad for the Powerball or Mega Millions jackpot is on nearly every billboard in America. And it’s no surprise that a lot of people are addicted to this type of gambling. In fact, most people don’t even realize how much they spend on lottery tickets—the average American who plays the lottery spends only a tenth of their annual income on tickets, compared to more than a quarter for those who don’t.
In the old days, lottery profits were often used to pay for infrastructure and public goods. They were also a staple at dinner parties, where hosts would pass out pieces of wood with symbols on them to their guests, and then hold a drawing at the end of the night for prizes that might include fancy dinnerware or, in the case of the Roman Emperor Augustus, property and slaves. And in the early American colonies, they were tangled up with the slave trade in unpredictable ways. George Washington managed a lottery that offered human beings as prizes, for example, and a formerly enslaved man named Denmark Vesey won a Virginia lottery before going on to foment the slave rebellion in Charleston.
In the nineteenth century, though, the popularity of the lottery began to wane as people became more aware of all the money that could be made in the gambling business and as states faced increasing pressure to balance their budgets. Eventually, it became impossible for many states to fund their generous social safety nets without raising taxes or cutting services. And this is where the lottery really started to become an evil.