The Official Lottery

The official lottery preys on poor people who believe it’s a fast path to wealth. But they’re paying into a system that is mathematically stacked against them.

There’s an inextricable human urge to gamble, and lottery ads dangle the promise of quick riches. But that’s only part of the story. Lotteries are designed to keep people hooked, and they aren’t any different than tobacco companies or video game manufacturers. And because they are state-run, they can skirt some of the regulations that govern other businesses.

Early America was short on revenue and long on need for public works, so it embraced lotteries. But the moral and religious sensibilities that later fueled prohibition also worked against them, starting around 1800, Cohen says. That’s when Denmark Vesey, an enslaved man, won a Charleston lottery and used the prize money to buy his freedom—and foment a slave revolt.

In the end, lottery revenues end up being a drop in the bucket for state governments, Cohen says. For every $502 billion collected by lotteries between 1964 and 2019, they bring in just over two percent of a state’s total revenue. And that’s even after factoring in the taxes paid by lottery players. That’s because a substantial portion of the proceeds goes to subsidize other states’ lotteries, he says. That’s a form of subsidizing gambling, and it shouldn’t be legal.