While I don’t object to lotteries existing, I still don’t think governments should be running them, but they’re involved in most states and provinces:
State lotteries amount to a hidden tax on the poor. They eat up about 9 percent of take-home incomes from households making less than $13,000 a year. They siphon $50 billion a year away from local businesses — besides stores where they’re sold. And they are encouraged by state-sponsored ads suggesting everyone can win, win, win!
State lotteries, which once were illegal, now exist in most states. What many people don’t know about lotteries is that they prey on those who can least afford it; most people never win anything big; and 11 states raise more money from lotteries than from corporate taxes. Beyond the moral, mental health or religious debates over gambling, lotteries are another example of how society preys on the poor and the working-class.
Let’s look at why state lotteries do far more harm than good — especially at the bottom of the economic ladder.
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4. They hit the poorest the hardest. “Simply put, lotteries take the most from those who can least afford it,” wrote economist Richard Wolff. “Instead of taking those most able to pay (the principle of federal income tax in the U.S.), state leaders use lotteries to disguise a regressive tax that falls on the middle and even more on the poor.” A 2010 study found that households with take-home incomes of less than $13,000 spent on average $645 a year on lottery tickets, which is about 9 percent of their income. The reason people play lotteries varies, but it mixes hopes and dreams with desperation: poorer people see it as a slim chance to radically improve their standard of living.
5. Communities of color, less-educated spend the most. Numerous academic studies have found that non-whites spend much more on lotteries than whites, with one study putting the figure at $998 for African Americans and $210 for whites. Household with incomes under $25,000 spent an average of about $600 a year, while $100,000-plus earners spent about $300 year. People who never graduated from college spent the most, about $700 a year, while graduates spent under $200.
Of course, being Alternet, we have to have at least one of our traditional straw men to knock down:
7. They give the wrong message about solving poverty. Lotteries reinforce libertarian political messages, suggesting that everyone needs to take individual action in response to society’s inequities, even though the government has helped well-connected individuals, businesses and industries become rich for decades. This easy money for states diverts political debate away from society-wide analyses and solutions to what prevents people from moving up the economic ladder. Instead, it pushes individuals in marginal circumstances toward gambling as their hope for gain.
I’m not sure what is “libertarian” about corporate welfare, crony capitalism, and other economic distortions on the part of government to favour certain people over others, but setting aside the slur, this is otherwise a valid point. Encouraging people to take individual action? I don’t see buying a lottery ticket as falling into that category.