What is the Lottery?

The lottery is the name given to a form of gambling in which numbers are drawn for prizes. In the United States, lotteries are regulated by state governments and, with the exception of the District of Columbia, are popular in all fifty states. Many people have quote-unquote “systems” for playing, including irrational beliefs about lucky numbers and stores and times of day to buy tickets, but in general they go into lottery play clear-eyed, knowing the odds of winning.

Historically, lottery revenues have allowed states to expand their array of government services without particularly onerous taxes on the middle class and working classes. But the national tax revolt in the late twentieth century forced many states to look for other sources of revenue. Lottery proponents seized on the idea that the lottery would be a silver bullet for state finances, providing sufficient revenue to eliminate taxes altogether.

As the popularity of the lottery grew, ticket sales swelled and, eventually, public concerns over gambling diminished. In the early American colonies, for example, it was common for towns to hold lotteries to raise money for street paving and wharves, even in the face of strict Protestant proscription against dice and cards.

Ultimately, though, lottery revenues have proven to be fickle and unreliable. After dramatic initial expansion, they often level off or decline, and lottery officials must constantly introduce new games to maintain interest. And, when the winners do hit it big, they are often shocked to learn that their winnings are not paid in a lump sum and will be subject to income taxes.

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