Lottery Profits – How State Lotteries Are Affecting Our Lives

The casting of lots for material gains has a long history in human culture. Benjamin Franklin used lotteries to raise money for the construction of cannons to defend Philadelphia and George Washington ran a lottery that advertised land and slaves as prizes in the Virginia Gazette.

Today state lotteries are largely run as businesses that strive to maximize revenue. Their marketing campaigns rely on two messages primarily. One is that if you buy a ticket, even if you lose, you’re doing your civic duty to the state because the proceeds go to benefit children or some other cause. The other message, more subtle and regressive, is that the improbable chance to win may offer your only hope at a better life.

Both of these messages are based on the illusion of control, an overestimation of the ability to influence outcomes when those outcomes are entirely dependent on luck. Anyone who’s purchased a lottery ticket and been just a hair’s breadth from the winning number has experienced this delusion.

The main argument that state governments make for adopting lotteries is that they are a painless source of revenue. Often, this argument is made in times of economic stress when states are seeking ways to expand their array of services without increasing taxes. But it’s a false argument. Lottery revenues are often far lower than state governments think, and they erode over time through inflation. Moreover, state governments have long had the option of raising their taxes and still providing many more services than they can afford through the lottery.