Lottery Legislation

When people buy lottery tickets they go in clear-eyed about the odds. Yes, they have this irrational hope that a ticket is the one to change their life, but there’s also a sense of resigned desperation: They’ve been down for so long that this improbable shot is their last chance.

When states set up lotteries, they typically legislate a monopoly for themselves; establish a public corporation to run the lottery (rather than licensing private companies in return for profits); and begin operations with a modest number of relatively simple games. Over time, however, they are subjected to constant pressure for additional revenues and progressively expand the scope of their offerings.

Moreover, many state lotteries develop extensive and specific constituencies. These include convenience store operators; lottery suppliers (heavy contributions by these entities to state political campaigns are regularly reported); teachers in those states where a portion of the proceeds is earmarked for education; and, most of all, legislators who become accustomed to a steady flow of funds they can rely on.

In the early days of state lotteries, they were widely seen as a way to provide for public goods without especially onerous taxes on the middle class and working class. This view has faded over time, but the fact remains that a state’s objective fiscal circumstances appear to have little bearing on whether or when it adopts a lottery. Lotteries retain broad popular support regardless of the size or nature of a state’s social safety net and even when public services face budget cuts.