It’s Time to End the Lottery

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In 2014, the roughly 70 billion dollars that Americans spent on various forms of the lottery nearly topped the entire budget of the state of Ohio. To put that figure in context, that 70 billion dollars is more money than the revenues from the sports tickets, music, books, movies and video games industries combined.

At first glance, the lottery seems like an ingenious way for the government to raise unimaginable amounts of money voluntarily. However, while the premise of the lottery is noble, the effects are devastating for low-income households. For example, in Rhode Island, more than $800 per person in the state is spent on the lottery. That number, spread among a family of four, totals $3,200. Now, assume that a family’s income is $25,100—the poverty line for a family of 4. If the family participates in the lottery according to state average figures, they would be spending almost 13% of their income on the lottery. Thus, it stands that the lottery mathematically hurts those who are less well off.

Make no mistake: The lottery is a regressive tax on hope.

Even if one does not consider the lottery itself to be an immoral practice, its treatment by the government is nearly indisputably wrong. State governments often advertise the lottery throughout the state, seeking new customers to exploit. The first and most obvious issue with advertising the lottery is that in almost every state, non-state gambling is restricted or illegal. If gambling is such a risk or sin that it needs to be banned, then it should not be advertised, let alone by the states themselves. Secondly, when the states advertise, they often target low-income communities with potentially damning results. According to NC Policy Watch, out of the 24 most impoverished counties in North Carolina, all but two counties have higher per person lottery sales than the state average of $200.11. There is perhaps no evidence more convincing that the lottery is shameful than a state-sponsored attack on the finances of the impoverished.

It is certainly true that the lottery provides enormous benefits for the states. After all, 40% of the lottery revenues in most states goes to funding education. But if education needs more funding, it should be acquired in ways that do not disproportionately hurt poor people more than the wealthy. For instance, states could raise taxes on everyone if additional funding is necessary but make the taxes progressive so that the impoverished are not unduly burdened. Regardless, research has shown that while states that earmark lottery funds for education do spend more on education up front, in the years following the establishment of the lotteries these states will reduce their general expenditures. The effect of doing so from an accounting perspective is the appearance of steady education funding. Instead, the earmarked money from the lottery is used to compensate for lower general expenditures, freeing money up elsewhere in the budget. Additionally, states like Florida have used money from the lottery designated for education for other purposes. In other words, the lottery does not help education.

Of course, the elephant in the room is choice. Supporters of the lottery say that it is a way for the government to raise funds without taxation and with a potential benefit for consumers. It is true that the lottery is a way around taxation, but avoiding taxation is a weak argument simply because we can do better. There exists a great deal of evidence to suggest that the lottery hurts the people who need the most help. The government should not tell people how to spend their money, but they also should not lure the needy into making poor investments with little to no chance of a return. Moreover, while conservatives may take issue with eliminating choice, they should instead be concerned about the massive scope of the government-created industry.

My goal is not to say that the concept of a lottery is dishonorable practice; rather, I am attempting to show that how the lottery currently operates is morally reprehensible. After all, the lottery began in the United States as decent way of obtaining funds for the government. In the era of the 13 Colonies, the weak federal and state governments could not levy taxes. Instead, the governments decided to raise funds via lotteries. Later, both public and private entities would use lotteries to raise funds for various projects ranging from Harvard University to the Continental Army of the Revolutionary War. Since the 13 colonies, however, the United States has formed strong state governments and a centralized federal government eliminating the need for lotteries. The lottery was a great policy proposal in the 18th and early 19th centuries, but it should remain there.




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