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Alexander: The state-sponsored lotto scam

Alexander: The state-sponsored lotto scam

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It's a state-sponsored swindle. It's a tax on the poor. It's a levy on hopelessness. 

For God's sake, don't play the lottery. 

Americans spent a massive $70.5 billion in 2014 on the various "games" operated and shamelessly promoted in the 43 states where lotto is legal, reports the North American Association of State and Provincial Lotteries. That's $233 for ever man, woman and child in the country. Just $17.8 billion was spent on sports tickets in the U.S. Spending on basically all entertainment -- including sports, games, books and music -- totaled just $63 billion that year.

Take that, NFL.

The Powerball jackpot is expected to break $1.3 billion by Wednesday's drawing. And, the collective media does its best to pimp this regressive tax on statistical ignorance.

"Ticket to Paradise," reads the headline on USA Today's website. 

"Powerball jackpot world's largest at $1.3 billion," trumpeted the Quad-City Times' website Monday morning.

The odds of winning, mind you, are 1 in 292 million. The probability is almost always buried in lottery stories. And it's basically meaningless if you aren't well versed in statistics. A "player" has a better shot at scoring a private audience with the Pope sandwiched between getting twice struck by lightning. But that's not how it's reported. 

Study after study has shown that the poorest households are the most ravenous players. The middle class has real options, after all. Maybe that promotion will come through. Keep pumping cash into that 401(k). You'll get there. Hell, take a chance and dump a couple grand into that high-yield, high-risk IPO. Who knows?

That's how Americans with agency, options and disposable income "gamble," betting on predictable outcomes after consuming information. 

A 2010 study concluded that the poorest households, those annually earning less than $13,000, spend 9 percent of total income on lottery tickets. It's a huge economic drain, particularly within a population that's most heavily reliant on social services. 

"A dollar and a dream," say state-contracted marketing firms. "Hey, you never know," is another frequent slogan.

Yes, you do know. Just stop and think. 

State marketers play the "hope" card heavy and often. In fact, lottery is a tax on hopelessness levied on those with the fewest options. 

Lotteries' biggest patrons are the same people who, in some states, are drug tested before getting food stamps. Politicians blast them as "takers." Generations of liberals and conservatives have rhetorically sparred about lifting them out of poverty. Nowhere is lottery spending, perhaps the worst investment of the lot, lumped in with the poor's bad spending practices. That's because government itself is the dealer. 

Some might -- and occasionally do -- argue that such a tax on the poorest households is appropriate, since they're most reliant on welfare. It's essentially the state recapturing the cash doled out. For instance, Iowa's lottery reports that it has pumped $1.4 billion into the state general fund since 1986. And, in perhaps the most halfhearted attempt to appear caring, a paltry $16 million has gone toward the state's Gambling Treatment Fund. 

But, after decades of plunging top-tier tax rates and a greater dependence on the already regressive sales tax, it's simply bad policy that helps keep people in poverty. The states could instead market tax-free savings accounts, a safe place where that $25 a week could grow and, eventually, make its way back into the economy.

Big, bright marketing campaigns could laud said program's merits. But that would be too hard, wouldn't it?

Instead, the states continue to bilk society's most vulnerable because they're easy targets. And we in the media remain their loyal marketing lap dogs. 

Jon Alexander is editorial page editor at the Quad-City Times. He can be reached at


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