An official lottery is a state-run game in which numbers are drawn for prizes ranging from modest to grand. The games are regulated by state laws that specify ticket prices, sales procedures, prize payments and time limits for claims. In addition to regulating the lottery, states may also impose additional restrictions on participation. For example, in some states, minors are not allowed to participate. In other cases, players must be at least 21 years old to purchase tickets.
Lotteries were once common in the United States, where early America was rich in resources but short on money. To raise it, the country turned to lotteries, which had already been used for everything from building churches to funding Harvard and Yale. In a country with an intense aversion to taxation, lotteries proved popular, with people willing to pay small sums for the chance of becoming wealthy.
Cohen’s book explains how the lottery became an integral part of American life. In the nineteen-seventies and eighties, he writes, this obsession with unimaginable wealth coincided with a decline in the financial security of most Americans. The gap between rich and poor grew, pensions and job security diminished, health-care costs increased, inflation rose, and the national promise that education and hard work would make people better off than their parents was increasingly out of reach.
Advocates of legalized lotteries promised that proceeds from the games would fill state coffers without raising taxes, keeping money in the pockets of average citizens and allowing governments to maintain services. Evidence soon put paid to this fantasy. Lottery proponents in New Jersey, for instance, imagined proceeds of hundreds of millions, but the first year’s revenues were only thirty-three million dollars. This was barely enough to cover one per cent of the state budget.
In some states, the winnings from lottery tickets are rolled into other funds, which are then used for public services. But in most cases, the profits from lotteries are largely used for promotional purposes. As a result, many of the same arguments against legalizing the game are still heard today. For example, some opponents argue that it’s a “tax on the stupid,” and others complain that advertising for lottery products is heavily promoted in neighborhoods that are disproportionately poor, black or Latino. In fact, as Cohen argues, lottery spending is responsive to economic fluctuations and increases when incomes fall, unemployment rises, and poverty rates increase.