The Ugly Underbelly of the Lottery

The lottery is a peculiar form of gambling: participants pay a nominal amount to purchase tickets, which are then spun into machines that randomly spit out numbers. Then a prize, normally cash or goods, is awarded if enough of those numbers match up. It’s a game that has been played throughout history, as evidenced by the fact that the casting of lots is found in scripture and in the daily lives of people as diverse as Nero (who ran lotteries during Roman Saturnalia festivities) and Denmark Vesey, a formerly enslaved man who won a lottery and went on to foment a slave rebellion.

But the lottery, like any gambling enterprise, also carries with it some ugly underbelly. As a form of speculative risk taking, it encourages people to spend money that they might otherwise have saved or put into investments with a much higher return on investment. And for many states, it’s a crucial source of revenue.

Cohen writes that when the first state lotteries were introduced, their advocates promised that proceeds would fill state coffers without raising taxes on average citizens. That, of course, wasn’t true, as the following graph shows:

Nowadays, 44 states and the District of Columbia run lotteries. The six that don’t are Alabama, Arkansas, Hawaii, Mississippi, Utah, and Nevada—and for good reason. In Alabama, religion holds a grudge against gambling; in Arkansas and Mississippi, lawmakers already get a large share of gambling revenue; and in Utah and Nevada, there’s little sense of fiscal urgency.