Why the Lottery Is a Bad Choice For People in Financial Difficulties


Lottery is a gamble where winning requires guessing a certain number of numbers from a range. In modern America, for example, a New York or North Carolina lottery demands six numbers from one to fifty-nine. The odds are absurdly low, but the games have become wildly popular. The reason is simple: unlike most gambling, lotteries don’t discriminate. They don’t care if you are black, white, Mexican, skinny, fat, Republican or Democratic; your current situation matters 0% to the game. You can win if you have the right numbers and, more importantly, a good strategy.

The first recorded lotteries offering tickets with prizes in the form of money were probably held in the Low Countries in the 15th century, when towns used them to raise funds for town fortifications and the poor. The Dutch state-owned Staatsloterij, founded in 1726, is the world’s oldest running lottery. In America, lotteries became common during the colonial era, despite strict Protestant proscriptions against gambling. They were a quick and relatively painless way to fund everything from churches to public works. Harvard, Yale, and Princeton were all financed partly by lottery money, and the Continental Congress even attempted to use a lottery to help pay for the Revolutionary War.

But it was not until the nineteen-sixties that a perfect storm of demographic changes, economic volatility, and government budget crises made legalizing lotteries a necessity for many states. As Cohen explains, it was at this point that the popularity of the lottery as an alternative to taxation emerged, and it was then that, as with all commercial products, lottery marketing became responsive to economic fluctuations. Lottery sales increase when incomes fall, unemployment rises, or poverty rates surge, and they are most heavily promoted in neighborhoods that are disproportionately poor, black, or Latino.

In addition to the low odds of winning, there are other things that make the lottery a bad choice for those in financial difficulty. As Richard goes over in his video, people tend to lose much of their winnings shortly after they get them. That’s why it is important to understand finances and how to manage your money if you want to avoid this trap.

Lottery advocates no longer argued that a statewide lottery would float the state’s entire budget, and instead marketed it as an affordable line item that could cover a particular service, invariably education or veterans’ services but sometimes elder care or parks. This approach was also useful for fending off critics who complained that, in effect, a vote for the lottery was a vote against education or social services. But, as Cohen notes, this did not necessarily eliminate the moral objection to gambling, and in the end it was still not a particularly persuasive argument.

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