The History of American Lottery


In the United States, lottery revenues contribute billions to public coffers each year. The money is used for everything from schools to prisons to the construction of highways. Some people play just for the fun of it, and others believe that winning a big jackpot is their ticket to a better life. The odds of winning are low, but that doesn’t stop many people from spending a sizable portion of their incomes on tickets.

In his new book, The Lottery, David Cohen takes a close look at the genesis of this peculiar form of gambling and its role in shaping American society. While he nods to the early history of the game, his central story starts in the nineteen-sixties, when a growing awareness of all the money to be made in lottery prizes and a crisis in state funding collided. Faced with a booming population and rising inflation, public services were being stretched thinner than ever before. It was impossible to balance the budget without raising taxes or cutting programs that were popular with voters.

As a result, states turned to lotteries. In the beginning, they were viewed as a painless way to raise money for a variety of public uses. They were also popular with people who didn’t want to be subjected to the unpleasantness of paying direct taxes, especially those in affluent urban areas. Lotteries were also a rare point of agreement between Thomas Jefferson, who considered them not much riskier than farming, and Alexander Hamilton, who grasped that “everybody will be willing to hazard a trifling sum for the chance of considerable gain.”

During the era of early American lotteries, prize money was often in the form of goods and services, such as dinnerware or land. But by the 1700s, some were offering cash or human beings as the main prizes. One of the most famous examples was when Denmark Vesey, a enslaved man, won a South Carolina lottery and then bought his freedom.

Today, the vast majority of lottery prizes are cash and/or goods and services. The big money games are the Powerball and Mega Millions, which draw large audiences and earn lottery sponsors a ton of free publicity on news sites and on TV. Those games are the bread and butter of the industry, but they’re pretty regressive overall. Scratch-off games, which make up about 65 percent of total sales, are even more so.

So why do people keep playing? Besides the inextricable impulse to gamble, there’s the fact that lots of people do just plain like it. They buy tickets and follow all sorts of quote-unquote systems that aren’t borne out by statistical reasoning, and they find comfort in the fact that everyone else is doing it too. Those are the kinds of things that you hear from lottery defenders, who argue that the odds are so low that they really don’t matter and that most players just enjoy themselves. But that’s not really true.