In the 1970s, thirty-nine states capitalized on the public’s fascination with high-odds gambling by launching state lotteries. These statewide games quickly grew in popularity and earned states serious income. Supporters tout them as a painless alternative to higher taxes and a way to fund important social causes. But critics argue that lotteries are dishonest, regressive and undependable.
The question is not just whether lottery revenues are a good source of funds for the state, but how well they serve the public. A growing number of states allocate a portion of their revenue to different programs, such as education, infrastructure and recreation. Others use a significant portion for advertising. In a time of shrinking public funds, these revenues are increasingly appealing to state legislators, but there is a debate about their effectiveness.
One concern is that state lotteries promote gambling addiction among low-income individuals, who spend a significant portion of their money on tickets, thereby increasing the demand for mental health services and other social welfare services. State lotteries are also criticized as regressive because they raise large sums of money from people with limited incomes and then redistribute them to those with greater incomes.
Another concern is that, because the lottery is run as a business and seeks to maximize its profits, advertising focuses on persuading people to spend more money. This can lead to negative consequences for the poor and problem gamblers, and it can interfere with other state goals like infrastructure development.