Is the Lottery Really a Public Good?


The lottery is a popular pastime and, in many states, a significant source of state revenues. But it is also a highly controversial practice. Critics point out that it is a form of gambling, and they argue that its revenue growth has resulted in a proliferation of other forms of gaming such as video poker and keno, and in increased advertising spending. Others argue that the state should not be in the business of encouraging gambling.

In the early nineteen-seventies, as the income gap between rich and poor widened and job security vanished, the idea of winning the jackpot became an obsession, and lottery revenues soared. The lottery’s popularity accelerated as state governments sought ways to balance their budgets without angering the anti-tax electorate.

Lottery proponents argued that the proceeds would be used to finance only one line item, invariably education but sometimes elder care or public parks or aid for veterans. That approach allowed them to run campaigns that emphasized that voting for the lottery was not a vote against government services.

But the state lottery monopoly itself is a political institution, and state governments are always looking for ways to increase its profits. So when the growth of traditional game play began to plateau, it was natural to try to generate new sources of revenue, and that led to the expansion of the lottery into a wider variety of games and to a greater emphasis on advertising.

As these changes took place, some observers feared that the lottery was shifting from a public service to a private enterprise. In a society with growing income disparity, critics pointed out that the lottery could be seen as an unfair way to distribute wealth and could have negative social consequences.

Some state legislatures pushed back, requiring that the profits be dedicated to public service. But in the end, most of these attempts were defeated. In fact, in a few years’ time, more than half of the states had adopted the lottery.

State officials argue that the lottery is a way to raise money for the state and its residents, while avoiding costly tax increases or cuts in other services. They also point out that the lottery is a low-cost way to increase revenue for programs such as education, social services and health care.

But is the lottery really a good thing? And is it really fair to use its profits to distribute wealth?