The History of the Lottery
The lottery is a popular source of public funds, in which people buy tickets in a raffle-like game for a chance to win a prize. The prizes may be cash, goods or services. Many states have state-run lotteries, and they are also common in other countries. The first public lotteries were held in the Low Countries in the 15th century, to raise money for town fortifications and other purposes. Since then, lottery popularity has risen steadily around the world, and it is now widely used for many different purposes, including public works projects and education. Lottery advocates have argued that it is a painless form of taxation, with players voluntarily spending their money to help others. But critics point to problems such as compulsive gambling and a regressive impact on lower-income groups.
The first step in establishing a lottery involves legislating a monopoly for the enterprise, and forming a government agency or public corporation to run it (as opposed to licensing a private firm for a share of the profits). The state often begins operations with a modest number of relatively simple games, and then, due to pressure for additional revenues, expands the program in both size and complexity by introducing new games. This expansion is the primary source of controversy, and it also explains why the lottery industry is constantly changing in order to keep up with consumer demand.
Early supporters of lotteries in America emphasized that they could fund a single line item of the state budget without upsetting an antitax electorate, usually education, but also elder care or public parks. This narrow approach to legalization was useful, because it made the argument that a vote against the lottery was a vote against education, and thus easy for voters to understand.
But when state government budgets began to shrink, lottery advocates had to change their strategy. Instead of arguing that the lottery would float most of the state’s budget, they shifted to a single line item, which was always something popular and nonpartisan, such as education or veterans’ care. This approach made it easier for the public to understand why a lottery was necessary, and it also made it easy for proponents to rally support for their cause.
The success of the modern lottery is testament to the power of this appeal, and it continues to have broad public support. In fact, as Clotfelter and Cook have found, the level of public support does not depend on a state’s objective fiscal condition: lotteries can be adopted even when governments are in sound financial health. But the way that lottery promoters attract and retain support is not entirely benign, and it should be subject to greater scrutiny. They are not above exploiting the psychology of addiction, and using advertising techniques that might be more appropriate for cigarette companies or video-game producers. That is not to say that the lottery does not do some good work, but it is important to recognize that its main function is to keep people coming back for more.