An official lottery is a state-sanctioned gambling game that generates revenue for a specific purpose, such as education, public works projects, and/or veterans’ benefits. State laws regulate lottery operations and accounting; the distribution of prize money; time limits for claiming prizes; activities that are considered illegal (such as selling tickets to minors); and other aspects of the game.
For states facing fiscal crises in the immediate post-World War II period, the lottery seemed like a godsend. It allowed them to maintain existing services without raising taxes, and it promised them a steady stream of cash for decades to come. “Lottery advocates sold the idea as a budgetary miracle,” writes Cohen, one that would allow politicians to avoid the unpleasantness of tax increases for years to come.
Lottery proceeds are a drop in the bucket of actual state revenues, however. And the amount that is collected is inefficiently distributed and regressive, since it draws disproportionately from poor communities.
As a result, lottery profits tend to be spent on things that don’t improve average citizens’ lives. They’re often used to pay off debt, or for programs that benefit a relatively small number of people. This leaves the middle class and working class feeling that lottery revenues are a subsidy for the rich. It’s also a sign of the growing inequality in American society.