Lotteries
Lotteries are a form of gambling that elicits diverse opinions across political and social spectrums. Conservatives often view lotteries as morally questionable due to their gambling nature, while many liberals argue that participating in such games reflects personal freedom. In the United States, the legal landscape of lotteries is shaped by individual state laws, as citizens vote on whether to legalize or prohibit them. This decentralized approach contrasts with many other countries, where lotteries are more universally accepted and regulated. For example, Spain has a national lottery that supports charitable initiatives, including employment for the blind. Although the Communications Act of 1934 initially imposed strict regulations on lotteries, subsequent amendments have diminished these restrictions over time. Proponents of lotteries often highlight their popularity and potential for generating revenue, particularly for educational programs. However, critics, including civic leaders and religious organizations, argue that lotteries can promote addictive behaviors and undermine ethical governance.
Subject Terms
Lotteries
Definition: Form of legalized gambling in which people buy chances to win money on randomly drawn numbers
Significance: Questions about whether gambling should be legalized, and if legalized, whether it should be promoted through advertising, have promoted considerable public debate
Conservatives often consider lotteries a form of gambling, and therefore immoral; most liberals consider participation in games of chance an exercise of individual freedom. The Communications Act of 1934 included prohibitions on the importing and transporting of lottery tickets, post office employees becoming de facto lottery agents, broadcasting lottery information, financial institutions participating in lotteries, and states conducting lotteries. Since 1948, however, amendments to the prohibitions of the 1934 Communications Act have all but ended the original law’s effectiveness.
On a worldwide scale, laws regulating lotteries vary from country to country. The United States, despite frequent discussion of the concept, had no national lottery in 1996. This is not true of other countries, in which lottery tickets have long been sold on street corners. In Spain, for example, a major national lottery organization provides charity and employment for the blind. In the United States, the citizens of each state decide by referendum and the passing of state laws whether to legalize or prohibit lotteries in that state.
Arguments in favor of lotteries include their widespread popularity—referendums on state lotteries almost always pass. States frequently emphasize their need for revenue—lotteries are called the “painless tax,” which is usually earmarked for education. Lobbying by firms that market computer systems and other lottery paraphernalia has been instrumental in advancing lottery legislation.
Opposition to lotteries has come from civic leaders who see lotteries as inconsistent with the principles of good government and who have cited the inappropriateness of a government’s encouraging addictive behavior such as gambling. Religious groups that view gambling as immoral have also strongly opposed lotteries.
History of Lotteries in the United States
Examples of lotteries have been recorded as far back as 100 BCE, when keno was developed during China's Han Dynasty and lotteries were played in ancient Rome. Various lotteries and raffles are also known to have existed in Europe from the fifteenth century on, often being used to collect funds for construction projects. A number lottery held in Florence, Italy, in 1530 used cash prizes, and official state lotteries were formed by King Francis I of France in 1539 and Queen Elizabeth I of England in 1567. The proceeds of a lottery established by England's James I went toward the creation of the Jamestown colony in Virginia.
Lotteries were soon common in the American colonies, although gambling rules varied from state to state. Notable operators of lotteries included George Washington, Thomas Jefferson, Benjamin Franklin, and John Hancock. The Continental Congress used lotteries to fund the Colonial Army for the American Revolution, and many states relied on lotteries as a form of taxation before the US Constitution improved the tax system. However, the widespread popularity of lotteries led to rampant corruption and fraud, especially in private games that states found difficult to regulate. The mid-1800s saw a backlash against many forms of gambling and many antilottery reform laws were passed. By 1878 Louisiana was the only state without a lottery ban; in 1890 Congress prohibited lotteries from using the mail and banned them from all interstate commerce five years later.
Though illegal gambling flourished, official lotteries were essentially absent in the United States in the early twentieth century. Then in 1964 New Hampshire established a state sweepstakes, avoiding federal bans by tying into horse racing. This first modern lottery was successful enough to inspire New York to follow suit in 1967; New Jersey followed in 1970 and by 1975 ten other states had created lotteries. A key argument in the adoption of state lotteries was the concept of a voluntary tax benefiting a public cause such as education.
Lottery sales grew quickly and innovations such as automated ticketing and scratch tickets were introduced. In 1975 the federal government allowed radio and television ads for state lotteries and in 1976 US lottery sales first hit the $1 billion mark. In 1985 the first lottery joining multiple states was introduced with the Tri-State Lottery between New Hampshire, Maine, and Vermont, and the Multi-State Lottery Association, operator of the Powerball lottery, followed in 1988. These successes also led to ever-increasing record payouts. 1998 saw a then-record jackpot of $295.7 million in the Powerball, while 1999 saw a lump-sum individual payout record of $104 million. These were soon eclipsed by a $363 million shared jackpot in the Big Game lottery in 2000, an individual jackpot of $314 million in the Powerball in 2002, and a shared $365 million Powerball payout in 2006. While some European lotteries traditionally had larger jackpots than those in the US, this changed in January 2016 when the Powerball exceeded $1 billion, finally reaching a jackpot of over $1.58 billion.
Despite the huge popularity of lotteries, many experts caution against them for various reasons. While the chances of winning range considerably depending on the type of game, the odds are always against the player. In the case of the largest jackpots the odds against winning stretch well into the millions. Smaller prizes may be used to entice players to continue purchasing tickets, but as with any form of gambling a player may easily become obsessed with winning, overestimate their chances, and spend far more than they win back. Additionally, lotteries are open to many forms of abuse, including fraud and scams. Many email and Internet scams begin with claims of a lottery victory in order to fool victims into providing financial information.
Bibliography
Flynn, Kevin. American Sweepstakes: How One Small State Bucked the Church, the Feds, and the Mob to Usher in the Lottery Age. Lebanon: ForeEdge, 2015. Print.
Lane, Mark. Gambling in America. Farmington Hills: Cengage Learning, 2015. Print.
"Lotteries." National Gambling Impact Study Commission. NGISC, 3 Aug. 1999. Web. 2 Feb. 2016.
"Lottery History." North American Association of State and Provincial Lotteries. NASPL, 2016. Web. 2 Feb. 2016.
Williams, Diana. "Lottery Fever: A Brief History of American Lotteries." BackStory. Backstory Radio, Virginia Foundation for the Humanities, 12 Jan. 2016. Web. 2 Feb. 2016.