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The Lottery and Government

The Lottery and Government

Lottery is a form of gambling in which people pay money to enter a draw for a prize. The prizes are usually cash, cars, and vacations, but in some states lottery winnings can be used to purchase a home or a college education. The game is popular in the United States and many other countries. People play for a variety of reasons, including the desire to improve their financial situation, the inextricable human impulse to gamble, and the lure of instant riches. The game is regulated by state governments and has been found to be addictive for some players. There are also societal costs associated with the game.

While making decisions and determining fates by the casting of lots has an ancient history (the Bible contains several instances), the first recorded public lottery to distribute prize money was held in 1466 at Bruges, in what is now Belgium, for town fortifications and charity for the poor. The practice became more widespread in the fifteenth century as European cities and towns adopted it to raise money for a variety of purposes, from building town fortifications to funding wars and relief for the poor.

In the modern era, as Cohen explains, state governments began to face a crisis of funding in the nineteen sixties as they faced ballooning population growth and inflation, increasing costs for wars and the Vietnam War, and a general decline in prosperity. To balance their budgets they had to either increase taxes or cut services. Both options were unpopular with voters. As a result, many state governments turned to the lottery, starting with New Hampshire in 1964.

As more states legalized the lottery, public opinion shifted in favor of it. In the early years, advocates of legalization argued that a state lottery would float most, if not all, of a state’s budget. The public bought this argument, as did legislators and government agencies.

However, as time went on, studies showed that the popularity of lottery games was not tied to a state’s actual budget health and that the revenue they brought in did not cover all government expenses. In order to retain support, legalization advocates shifted their pitch and shifted the focus of the lottery’s proceeds to a single line item in the state budget – invariably education, but sometimes elder care or public parks or aid for veterans.

Lottery advocates hoped that the shifting of emphasis to a specific line item would make it easier to sell their cause. They figured that it was not so much a vote against gambling as a vote for a particular service that the public viewed as important. This approach worked. Lottery revenues have climbed steadily, while other sources of revenue have declined. As a result, most state governments now have substantial dependence on the lottery. This is a classic example of how a piecemeal approach to public policy can create dependency and eventual reliance that is difficult, if not impossible, to dismantle.