A state lottery is a type of government-run gambling game. It involves selling tickets for a prize, such as cash or goods, and using the proceeds to fund a public service or public education. Some states have multiple lotteries, and the funds they raise are used for different purposes. Americans spend almost $100 billion on lotteries every year — more than they do on books, sports tickets, video games and music. On this week’s edition of On Point, we explore whether this state-sponsored gambling is appropriate for a modern democracy.
In the 1970s, many states began to introduce state lotteries. Supporters tout them as easy revenue-raisers and a painless alternative to higher taxes. But critics say they are unseemly, dishonest, and unfair. They say that by skipping the normal taxation process, state lotteries are regressive taxes on poor people and promote gambling addictions. They also complain that the social and administrative costs of the games are hidden from consumers.
Despite these criticisms, the majority of state lotteries continue to grow and thrive. Some states use their earnings to benefit a specific group of people, such as veterans, or to educate the public about a particular issue, such as HIV/AIDS awareness and prevention. Others, like Illinois, use the money to fund K-12 schools. But for the most part, states use lottery profits for their general budgets. Some, like Pennsylvania, even use the funds to give rent rebates and property tax reductions to the elderly.