A state lottery capitalizes on the public’s love of games of chance. Its prizes are modest, but the revenue that state governments derive from lottery sales can be enormous. The money is usually earmarked to fund a specific line item in a state’s budget, invariably education. Proponents argue that it’s a painless way to raise funds without the stigma of raising taxes. Opponents call it dishonest, unseemly, and regressive.
State lotteries are largely self-regulated by their state legislatures, which set the rules for their operations. That includes regulating advertising to ensure that it isn’t misleading. The federal government does not regulate lotteries because they are a form of gambling, and the agency that oversees interstate commerce does not have authority over them.
As a result, lottery officials are free to exploit the psychology of addiction to keep people coming back for more. That’s not all that’s wrong with their approach, of course, but it should be a concern to anyone who cares about the lottery as a social institution.
In most states, winning lottery prizes can be garnished to pay off debts owed by the winner, or for child support obligations. Some states also allow winnings to be taken to offset state income taxes.