The Lottery: Who Wins, Who Loses?

By WGBH News


April 17, 2012
BOSTON — $4.5 billion dollars. With a B. That's how much money Massachusetts residents spent on lottery games last year. In fact, it's among the most successful lotteries in the country — and, according to the state, has provided more than $18 billion to cities and towns. But as the lottery turns 40 on April 18, not everyone is celebrating.
If you play the lottery in the Bay State, you have a better chance of winning. "There's a greater payout per capita" in Massachusetts than in other states, said former state Treasurer Shannon O'Brien, and that leads to a chain reaction: People win more, so they play more, so they win more, so they play.
And whereas some states have responded to budget problems by increasing the percentage of lottery funds that go to cities and towns, Geoff Beckwith, executive director of the Massachusetts Municipal Association, said that won't happen here. "Massachusetts … is vigilant about making sure there's a good payout," he said. "The public would know if there were a public policy change to reduce the payout."
O'Brien noted that the lottery has an odd double status: It's both "a voluntary tax" and part of people's entertainment budget.
Les Bernal of Stop Predatory Gambling agreed that the comparatively good odds kept the lottery in business. But the idea that it makes people richer is an illusion, he said: "People take that money [they win], they plough it right back in. So having such a high payout rate, you're juicing the ticket. You're getting people to play more."

Beckwith argued that the interest in gambling was eternal: "There will always be there out in the public a thirst for games of chance."

However, Bernal considered that a red herring. His organization obtained the state's lottery marketing plans and market research for 2009-10. "We filed that request specifically to show that this isn't about taking existing gamblers and giving them a game," he said. "The state lottery for 40 years has been actively creating and luring new gamblers to lose more money than they ever have before." Worse, he said, they've been creating ever-spendier scratch tickets.
And what's the larger impact? Bernal thought the lottery has undermined American values. "We turned America's working class … into a nation of habitual bettors," he said, pointing to a 2006 study by the Consumer Federation of America that found "21 percent of Americans think the most practical way to wealth is to play the lottery." The belief was even more prevalent among people with incomes under $25,000.
O'Brien was concerned about the impact on municipalities, especially now that Massachusetts has authorized casino gambling. Lotteries are more popular than taxes. 

"The bigger issue, it's the dishonesty in terms of how we fund government," she said. "Things like lottery, things like casinos, those are in essence almost gimmicks, if you will, to find a way to underwrite the needs that we have."

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