The Official Lottery – Why It’s a Tax on the Stinky
Lotteries are an ancient pastime: they were common at the Roman Saturnalia parties, and can be found in the Bible, where they’re used for everything from divining God’s will to choosing a wife. Today, though, the majority of state-run lotteries are primarily an instrument of taxation. They raise money by charging players a small fee to participate in the chance of winning a big prize. But while defenders of the practice argue that this is just a “tax on the stupid,” Cohen argues that it’s really about a more fundamental political dynamic.
The modern lottery is a result of the “imperfect equilibrium” between states’ growing awareness of all the money that can be made in gambling and their need for revenue. In the immediate post-World War II period, a growing population and rising inflation combined with the cost of the Vietnam war led to a budget crisis in many states. Balancing the books meant either raising taxes or cutting services, and both options were unpopular with voters.
Cohen explains how the solution came to be: Lotteries. They’re cheap to run, and “provide a steady stream of cash.” Plus, they allow politicians to avoid having to tell voters that they need to raise taxes or cut services because the lottery isn’t raising enough money.
Despite this, there are some problems with the argument that states need lotteries to pay for their services, and Cohen isn’t shy about pointing them out. First, he points out that the money raised by lotteries isn’t nearly enough to cover even half of what many states spend on education. And second, he notes that the lottery has also helped to create an extremely large group of people who are addicted to gambling, making addiction a much bigger problem than it would be otherwise.
In addition, there are some serious ethical issues with the way that lotteries are currently run. The biggest is the tendency for the lottery to be promoted by corrupt state officials. In his article, Cohen discusses the notorious Louisiana State Lottery Company, which was so powerful that it was able to market and sell tickets nationwide, despite federal laws against interstate lotteries. It took a massive public outcry and congressional intervention to put an end to this practice. But a new era of corruption is on the horizon: the rise of online casinos. It’s important for readers to be aware of these issues, as they may impact their ability to gamble responsibly. And that’s why it’s essential to read the full piece here: Official Lottery.