The official lottery is a fixture of American life, with Americans spending upwards of $100 billion each year on tickets. But state lotteries aren’t just a way to win money, they’re also a powerful force in our economy. Lottery games raise a significant amount of revenue for states, and that money is often used to help children’s education or social services. But a closer look at how those proceeds are distributed shows that their benefits come with a price.
In the 14th century, the practice of putting numbers into a pot for a chance to win became popular in the Low Countries. By the 16th century, it was common in England. In fact, the Virginia Company of London chartered a lottery in 1612 to help finance ships to the Jamestown colony in the New World.
Even so, in the 1800s, religious and moral sensibilities turned against gambling of all kinds. And corruption was a major factor, too. “Lottery organizers were able to sell tickets and abscond with the proceeds, without paying out prizes,” Matheson says.
But by the 1960s, there was a new argument for state-run lotteries. The gist was that people were going to gamble anyway, so government might as well pocket the profits. That logic was flawed, but it gave political cover to people who wanted to approve of the lottery for other reasons. For example, some white voters believed that legalizing lotteries would attract black players, and then those African-Americans might pay taxes that helped fund public goods such as better schools in the urban areas they had fled from.