Issues and Risks of a New Lottery


A lottery is a game in which numbers are drawn to win a prize. It is a form of gambling that is operated by governments, and is often used to raise money for public projects such as schools, roads and hospitals. In the United States, there are several state-run lotteries and some private ones, too. In Europe, some countries have national lotteries, while others operate their own local ones. The word “lottery” comes from the Dutch verb “lot” meaning fate or choice, and the casting of lots to determine destiny has a long history in many cultures. The modern lottery evolved in the 17th century. In colonial America, lotteries financed private and public ventures, including canals, churches, colleges and roads. Benjamin Franklin even held a lottery to raise funds for cannons to defend Philadelphia against the British.

When a new lottery is established, a number of different issues quickly emerge. First, it becomes necessary to define the boundaries of the lottery’s authority and jurisdiction. This is often done by establishing a governmental agency or corporation to run it, which often creates conflicts with other government agencies and departments. The resulting fragmentation of authority and accountability leaves lottery officials vulnerable to outside pressures, and the general public’s welfare is only intermittently taken into account.

The lottery is also vulnerable to the same kinds of corruption that plague all forms of gambling, including illegal and regulated activities. Lottery advertising can be misleading, often presenting unrealistic odds of winning and inflating the value of the money that can be won (a large jackpot is typically paid in equal annual installments over 20 years, with inflation dramatically eroding its current value). In addition, the lottery is a magnet for crooks, and it has spawned an entire industry of companies and organizations that provide services to players, including ticket sellers, consultants, and legal and financial advice.

Lottery advertising is particularly blatant in its promotion of super-sized jackpots. These huge amounts attract attention from the media and spur increased sales. But they can be a double-edged sword, because they also encourage people to buy tickets by promoting the notion that they can become rich instantly.

In the end, the biggest issue for lottery officials is how to manage a system that relies on revenues from a form of gambling that is inherently addictive and subject to constant external pressures. Ultimately, most state lotteries will continue to evolve in ways that are unsustainable, because they are based on a flawed model of social policy that can only be managed piecemeal and incrementally. This is a classic case of an institution becoming so dependent on its own revenue sources that it can no longer make rational decisions about how to grow or shrink them. The only way to prevent this is for governments at every level to develop a coherent public policy about gambling. This is a daunting task, but one that must be pursued if the lottery is to survive and thrive.