In his book on the history of lottery, Jeremy Cohen traces its development from early games to modern state-run lotteries. He describes how state governments began to adopt them in the postwar era, as a way to finance public services without raising taxes or cutting programs, and how they evolved into more sophisticated forms of gambling. This evolution was driven by the need to maintain a competitive edge, and to attract players who would spend more money. Lotteries grew in popularity because they provided states with an income stream that could grow over time. Unlike most other state revenues, which are subject to fluctuations in the economy, lottery incomes remain relatively stable.
The earliest recorded instances of lotteries date back to the 15th century, when a series of towns in the Low Countries held them to raise funds for town fortifications and poor relief. They are believed to be the first lotteries that sold tickets with prizes based on the chance of drawing particular numbers. Despite Protestant proscriptions against gambling, they became common in England and America, where they helped to fund everything from civil defense to colleges like Harvard, Dartmouth, Yale, and King’s College (now Columbia).
But the heyday of lotteries came when a fiscal crisis arose. In the nineteen-sixties, exploding inflation and the cost of the Vietnam War threatened to cripple state budgets. Politicians looked for solutions that wouldn’t enrage an increasingly anti-tax electorate and found one in the lottery. The first state to establish a lottery was New Hampshire, and 13 others followed in the next decade.
Government officials promoted lotteries by framing them as “budgetary miracles,” claiming that they could solve the problems of inflation and a growing population without having to increase tax rates or cut services. The truth, however, was more complicated than that. Lotteries do provide a valuable source of revenue, but they are also costly and addictive to the participants, and they can even undermine the moral fiber of society.
The argument that lotteries promote morality is flawed, and it overlooks the fact that state governments are profiting from a form of gambling that they themselves have legalized. This creates a conflict of interest that puts the lottery at cross-purposes with other state government functions, and it makes criticisms of the program – such as its regressive impact on lower-income populations – all the more legitimate.
The real question is not whether a lottery is ethical, but how it can be changed so that it does not become a substitute for other forms of government spending. A lottery should be a tool for achieving specific public goals, not an end in itself. To do that, it must be made less regressive and more transparent. It must also stop promoting itself as a magical instrument that can solve all of society’s problems, including those related to poverty and addiction. Only then will it earn the respect that it deserves. Many state lotteries now publish detailed demand information after each lottery cycle, and a few are beginning to experiment with new ways of reaching low-income communities.