In the US, state governments run lotteries to raise money for education and other public services. They also raise money for other things, like building bridges, roads, and police forces. Between 1964 and 2019, lottery revenues have totaled $502 billion. That sounds like a lot, but it’s really a drop in the bucket for state governments, amounting to just 1 to 2 percent of total state revenue.
What’s more, the chances of winning a lottery prize are not very high. You’re actually much more likely to be struck by lightning or become a billionaire than you are to win the Powerball. And if you do win, there’s a good chance you’ll spend most of your windfall paying taxes.
The word “lottery” comes from the Dutch verb lot, which means to draw lots or to be determined by chance. Its modern meaning stems from the practice of awarding prizes to participants in games of chance, such as horse races or the distribution of land by lot. The first modern European lotteries took place in 15th-century Burgundy and Flanders with towns attempting to raise money for civic purposes, such as fortification or aiding the poor.
Today, state-sponsored lotteries usually feature a number of different games, including scratch-off tickets; daily numbers games, such as Mega Millions and Powerball; and multi-state games, such as Megabucks. They also offer online gambling and video lottery terminals. In addition, they often fund community organizations that provide gambling addiction and recovery support to their players. Moreover, some states have even started using lottery proceeds to help fund higher education.
Most of the money outside your winnings ends up going back to the state in which you play, and individual states have full control over how they use it. Some states put it into special accounts for programs such as gambling addiction or recovery, while others use it to fund general state funds that are used to address budget shortfalls, do roadwork and other infrastructure projects, or invest in social services like housing and education.
However, there’s one message that lottery marketers are relying on to get their money: you should feel good about playing the lottery because you’re supporting your state, and if you lose, well at least you did your civic duty. This skewed messaging obscures the regressivity of lottery profits and makes playing feel more meritocratic than it is.
There’s a real problem with this type of messaging, and it’s not limited to lottery ads. It’s pervasive in our culture, from congratulatory e-mails after someone wins the lottery to a prevailing attitude that if we work hard enough, we can all make it rich someday. But if we don’t think about the social justice costs of this form of speculative gambling, it can undermine our ability to take action on important issues. That’s why it’s crucial to understand the true cost of lottery money and how we can use it responsibly.