Lotteries have always been popular in America, but now they seem to be everywhere. They’re on the radio, on TV, and in the newspaper, and they’re the subject of countless billboards along the highway. You might think that if people are spending $50 or $100 a week on these tickets, they’re crazy. Or at least, you might think that they are being duped by lottery companies and that, implicitly, you’re smarter because you don’t buy a ticket. But there’s a lot more going on here than just a bunch of people who are irrational and have been duped into buying lots of tickets.
Historically, many people have enjoyed playing the lottery because it provides them with an opportunity to gain a positive return on their money. This return could come in the form of entertainment value, or it could be as simple as a chance to improve their social status by getting rid of some debt or buying a new car. In either case, the return on their money makes playing the lottery a rational decision for them.
But in a society where inequality is on the rise, this logic may be breaking down. Americans spend over $80 Billion on the lottery every year, and that’s more than a lot of people make. And even if someone wins the jackpot, it’s unlikely to change their life for the better because winning often comes with huge tax consequences. And it’s not just the wealthy who play the lottery: a recent study found that Americans on all income levels spend about one percent of their annual income on lottery tickets.
In the past, states would use lotteries to raise money for everything from building town fortifications to helping the poor. The first recorded lotteries in the Low Countries were held in the 15th century, and they quickly spread throughout Europe. In America, lotteries were embraced by politicians looking for budgetary miracles that wouldn’t enrage an antitax electorate. For them, as Cohen writes, “lotteries were essentially budgetary magic, the chance to make revenue appear out of thin air.”
During this time, lotteries became entangled with slavery in unpredictable ways. For example, George Washington managed a lottery in Virginia that included human beings as prizes, and Denmark Vesey won a South Carolina lottery and went on to foment a slave rebellion. But the broader appeal of lotteries was clear: they allowed legislators to avoid addressing the problem of raising taxes by claiming that lottery revenues would cover a single line item, invariably a government service that was popular and nonpartisan.
But in the late twentieth-century, as the nation’s tax revolt intensified, lottery advocates retrenched. Instead of arguing that a lottery would float the entire state’s budget, they began to claim that it would support just one thing: often education, but sometimes elder care or public parks. This strategy sounded more plausible, and it made campaigns for legalization easy to run. The result was that, in a few short years, the lottery’s popularity surged even faster than its odds of winning did.