Does the lottery do more harm than good?

“The 360” shows you diverse perspectives on the major stories and debates of the day.

What is happening

A Winning Powerball ticket a record $2.04 billion worth was purchased in Altadena, Calif., lottery officials said Tuesday.

The jackpot has reached such a staggering amount – more than $400 million more than the previous record – in several months after 40 consecutive draws went without a winning ticket. The winner, who has not yet been named, will have the option of choosing to receive the full $2 billion as an annuity paid annually over 29 years or as a lump sum valued at just under $1 billion. dollars. Either way, they will have to pay a huge tax bill on the winnings.

The probability of a ticket winning the Powerball is estimated to be approximately 1 in 292 million. But those long odds don’t stop Americans in the 45 states who participate in the lottery from spending huge amounts of money in hopes of getting rich. In 2019, for example, more than $83 billion was spent on lottery tickets across the United States, according to the association that represents state lottery organizations.

A significant portion of this money is for prizes, while a portion is used to fund lottery management operations. Each state also allocates a portion of its lottery revenue to government spending projects. In many states, the money goes primarily to education. But it is also used to fund support for the elderly, environmental protection, construction projects and to bolster state budgets.

Lotteries existed in America since the first colonies, as has the controversy surrounding them. In fact, they were banned in all but a handful of states in the mid-1800s due to corruption issues, and there were no legally operating lotteries in the United States for the entire first half. of the 20th century.

Why there is debate

The modern version of the lottery is also the source of heated debate, with many experts claiming it does more harm than good.

Proponents of the lottery say it benefits many more people than individuals lucky enough to have a winning ticket. They argue that lottery proceeds allow states to support essential public programs that strengthen entire communities without having to raise taxes. The California lottery, for example, gave away more than $39 billion to public schools since its launch in 1985. Others argue that lotteries are harmless fun, giving players a chance to fantasize about what they might do with their wealth even though they understand that the odds of winning are essentially null. This experience alone, they say, is well worth the cost of a ticket.

But critics of the lottery, many of whom want to see it eliminated, often argue that it operates as a tax on the poor due to research that shows low-income Americans tend to gamble more and spend a greater share of their income on tickets than other groups. Others argue that lotteries exploit the desperation of people who have been left behind by a system that has given them little real opportunity for economic mobility.

There is also a lot of skepticism about the good that lottery funds do for the public. Research suggests that educational funds from lotteries often go to schools in wealthy or bourgeois neighborhoods rather than the poorer communities who contribute a disproportionate amount to lottery revenue. There’s also evidence that lawmakers frequently use lottery funds to cover spending cuts, meaning budgets for things like education and environmental projects aren’t really growing.

And after

Despite these objections, lotteries are still very popular with the American public. There have been recent efforts to extend the lottery to five states that currently do not allow it – Alaska, Hawaii, Alabama, Utah and Nevada – but local political opposition has stood in the way so far.

Perspectives

supporters

The pleasure of playing is its own reward

“For the average buyer, the obvious folly of hoping for a 1 in 300 million gain is outweighed by the ‘psychic income’ you get with your $2. What is psychic income? Merriam-Webster the defines as follows: “Rewards (as in prestige, leisure, or pleasant surroundings) not measurable in terms of money or goods.” … In the case of a lottery ticket, psychic income is in the form two or three days of richly rewarding fantasy.—Jeff Greenfield, Policy

Since people will be playing anyway, it better happen in state-sanctioned lotteries

“The impulse to gamble seems to be hard-wired into the human brain. … If people are determined to invest their money in the addictive jerk of gambling, isn’t it better for governments to run the games and skim the profits, rather than , shall we say, organized crime?—David Von Drehle, Washington Post

There is nothing improper about funding government projects through the lottery

“Governments have long imposed sin taxes on vices in an effort to increase revenue, with the added rationale that the resulting increase in the costs of such activities may discourage them. And while gambling can turn into a socially harmful addiction, its ill effects are nowhere near as costly overall as those of alcohol or tobacco, two other vices that governments use to generate revenue. —Lewis R. Humphries, Investopedia

The lottery is harmless compared to some of the other financial systems the United States allows

“Is it a mistake to play Powerball? Overall, it’s far less harmful than many of the other self-destructive things that people living on the brink often do, like racking up credit card debt, going over their bank overdraft limit, or taking out loans from payday lenders. If you don’t buy too many tickets, and it makes you happy, it seems harmless enough. —George Loewenstein, CNN

Reviews

Education budgets don’t really increase because of the lottery

“Although states generally claim that lottery revenue will be spent on education, the money is fungible: such income can simply replace general revenue that is used to plug holes elsewhere – in pensions, for example. A significant body of evidence suggests that educational benefits are generally small or illusory. — Editorial, Bloomberg

The greediest lottery players suffer the most

“Dreaming of how you might spend the wealth after the tax man takes his millions can be confusing, but this state-sponsored and promoted game encourages many Americans to throw away the money they can’t afford. to lose. The profile of regular lottery buyers leans towards low-income households. Is this how we want to fund our government? — Editorial, New York Daily News

The false promise of lottery earnings makes it harder to set up programs that would actually help people

“The lotteries have made it harder than ever to pass much-needed tax increases because, through years of vocal campaigning followed by decades of intensive promotion, the public mistakenly believes that schools and other vital services are generously funded by game funds.” —Catherine Schulz the new yorker

The lottery transfers wealth from poor communities to the suburbs

“A disturbing percentage of tickets, including daily number games and scratch tickets, are sold in low-income neighborhoods, where the terrible odds turn the lottery into a huge transfer of wealth in the wrong direction. Think of it as a sort of reverse Robin Hood mechanism, taking from the poor to give to the rich (or at least the middle class). — Editorial, Baltimore Sun

The lottery helps cover up how our society has failed its most vulnerable communities

“Perhaps most disturbingly, the lottery presents a false idea that people can gamble their way out of poverty. This economic mobility happens by chance. … This is totally counterproductive to the goal we all should sharing: expanding economic mobility for all —Matt Rexroad, Sacramento bee

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Photo illustration: Yahoo News; photos: Getty Images

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