The Public Benefits of the Lottery
The lottery is a fixture of American life. Last year, people spent upward of $100 billion on it, making it the country’s most popular form of gambling. But state lotteries aren’t just a harmless way to pass the time; they also help fund public services and programs. States promote them as a way to raise revenue without provoking a tax revolt among voters. And, in a way, they’re right: The proceeds from lottery games have been crucial to state budgets for the past fifty years. But how meaningful that money is in a larger context, and whether the trade-offs are worth it for those who lose, is debatable.
A lottery is a game in which participants purchase tickets and then win prizes by drawing numbers, either by hand or by machine. Prizes can range from cash to goods, but often involve a combination of elements. The term derives from the Latin word “lat” (“thin”), a diminutive of the Greek word for ‘casting lots’ (e.g., to determine who gets a slave or a piece of land). The practice dates back at least as far as the Old Testament and even earlier, when the casting of lots was used to distribute property or other resources. Lotteries became particularly common in the Roman Empire, with Nero among its enthusiastic fans. They were frequently used at Saturnalian feasts and as entertainment during dinner parties. A favorite dinner entertainment was the apophoreta, in which guests were given pieces of wood with symbols on them and then drawn for prizes to take home at the end of the evening.
In colonial America, lotteries were used to finance a wide variety of public projects, from paving streets to building churches. Several colonies held lotteries in 1776, and Benjamin Franklin sponsored an unsuccessful attempt to hold one to raise funds for cannons to defend Philadelphia against the British invasion. Private lotteries were also popular.
State-sponsored lotteries became more prevalent in the mid-twentieth century as states searched for ways to pay for a growing array of social services without enraging an anti-tax electorate. In 1964, New Hampshire approved the first modern lottery, and thirteen states followed in quick succession. These states were primarily in the Northeast and Rust Belt, which had historically been more reluctant to increase taxes than other regions of the country.
Early critics of state lotteries argued that they could not be a sustainable source of funding for the expanding welfare states, and they feared that they would breed corruption and other bad behavior. These concerns are still valid today, but they have been diminished somewhat by the fact that lottery revenues typically increase dramatically after a lottery’s introduction and then level off or even decline. To maintain or increase their popularity, lotteries introduce new games frequently to avoid boredom. This has resulted in the introduction of instant-win scratch-off tickets, with lower prize amounts and relatively high odds of winning. These games are designed to appeal to the same group of people that bought into the older, long-term draws.
