18 Signs That The Lottery Is Preying On America's Poor

lottery ticket

Photo: birdvoyeur on flickr

A week after America went crazy over the record Mega Millions jackpot, we want to reiterate the cruel truth about lotteries.They are (1) regressive taxes on poor people, in that a ticket costs relatively more for a poor person than a rich person, and (2) punitive taxes on the poor and uneducated people who are the most avid buyers.

The people who can least afford it are throwing away on average 47 cents on the dollar every time they buy a ticket. And the government, which relies increasingly on the lottery for funding, goes out of its way to tell them it is a good idea.

Obviously we have an opinion here, but it is an opinion grounded in numerous studies.

Per capita lottery sales are highest in North Carolina's poorest counties

People in households earning under $40,000 accounted for 28 per cent of South Carolina's population but made up 54 per cent of frequent players. Uneducated people also made up a disproportionate share.

Poor people were 25 per cent more likely to play for money, rather than fun, compared to average in one survey. In other words, they play for the wrong reason.

49 per cent of Californians with less than a high school education participated during one week in 1986, compared to 30 per cent of those with a college degree. Lottery play was most popular among laborers and least among advanced professionals.

Texas instant tickets were more likely to be purchased by a person who was out of work than someone who was employed or retired.

The highest concentration of Connecticut lottery players was in the poorest cities—New Haven, Hartford and Bridgeport.

Of six counties studied on the west side of Chicago in 2008, the two with the highest unemployment — Bellwood and Maywood — also generated the highest per capita sales.

A 1994 study from Indiana University found that from 1983 to 1991 lottery sales tended to rise with unemployment rates.

Source: John Mikesell in National Tax Journal

Source: Garrick Blalock, a Cornell University economist who co-authored a 2005 study on lottery revenues, in an interview with ABC News

In 2008, during the height of the recession, at least 22 of the 42 states with lotteries — including New York, New Jersey and Connecticut — set sales records.

In Massachusetts, the state with the most popular lottery, annual ticket sales amount to a staggering $663 per citizen in 2003.

On those rare super jackpots where the lottery has a positive expected value, rich people swoop in to buy tickets

Source: Oster (2002)

Source: Bertrand (2004)

Studies show that lottery winners are no happier than people who did not win and often lose pleasure in everyday activities. Winning the jackpot has also been shown to cause negative life events.

Source: Brickman, Coates, & Janoff-Bulman (1978) and Nissle & Bschor, 2002 in Couglin (2006)

20 per cent of callers to the 1-800-GAMBLER national hotline had trouble controlling spending on state lottery tickets.

This isn't the only industry that takes advantage of the poor

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