With Americans spending upwards of $100 billion a year on lottery tickets, it is clear that the game is here to stay. State lotteries have become a central part of our modern economy. They have given people a chance to splurge in an era of austerity and diminished social safety nets. But just how meaningful that revenue is to broader state budgets and whether it is worth the trade-offs to people losing their hard-earned money is the subject of debate.
The casting of lots to make decisions and determine fates has a long record in human history, with several instances recorded in the Bible, although the practice of using a lottery for material gain is more recent, dating only from the first few centuries after the emergence of written records. Despite the improbability of winning, there is an allure to participating in the lottery that appeals to the deepest instincts of the gambler. The promise of substantial wealth is an irresistible lure.
In the early years of state-run lotteries, proponents emphasized the advantages of the games as a source of “painless” revenue, a way for states to raise significant amounts of cash without having to ask voters to pay higher taxes. The evolution of the industry, however, has brought with it new and more serious questions about its societal impact. These range from concerns about the role of the state in promoting gambling to alleged negative impacts on poorer individuals, compulsive players and other societal issues.
These issues stem in large part from the fact that lotteries are run as businesses, with a heavy emphasis on marketing and advertising to generate revenues. To succeed, they must convince people to spend their hard-earned money on a risky venture with a low probability of success. They are not only asking people to risk their hard-earned dollars, but also their pride and sense of entitlement.
The fact that state-run lotteries are inherently self-promoting has created a situation where the public is being misled about their value as a legitimate tax alternative. While it is true that some states, particularly those with relatively weak social safety nets, need additional revenue sources, lotteries are not an appropriate substitute for raising the cost of living or cutting essential programs. The problems associated with state-run lotteries — including an increased likelihood of crime among compulsive gamblers, the regressive impact on lower-income groups and a failure to help problem gamblers — underscore the need for government to take a more holistic approach to public policy.
