State Lotteries Are Lying To You

 

Lottery advertising is everywhere. It’s on every subway train, radio station and daytime TV show pushing a singular message: Part with your hard-earned money in the hope – the chance – that you will win big and change your life forever. And oh by the way, even if you lose, you’ll be helping some poor kids get an education.

It’s compelling! It’s a lie.

State lotteries can – quite literally – lie because, as a state agency, they are exempt from Truth In Advertising laws. What is Truth in Advertising? The Federal Truth In Advertising laws say that advertisements “must be truthful, not misleading, and, when appropriate, backed by scientific evidence.”

This does not describe lottery marketing. Here’s some examples:

  • The Louisiana Lottery’s Tic Tac 2s instant win game has stated odds of 1 in 4.82. Sounds great, but these odds include the winning of another ticket. The true odds of winning a cash prize are 1 in 10.1.
  • A 1986 billboard from the Illinois Lottery said, “How to go from Washington Boulevard to Easy Street­­ — Play the Illinois State Lottery.” Really?
  • Another iconic New York State Lottery slogan used to say, “All you need is a dollar and a dream.”

Last I checked most people need far more than a dollar and a dream to move to easy street.

The problem is not just these lies about your chances to win but the scale of the lying. New York spent a staggering $90 million on advertising its lottery in 2014. California spent $64 million in the same year. Whuck?

The lying about lotteries doesn’t stop with your chances of winning. Lotteries also lie about how States use the lottery revenues. Most lotteries are promoted as helping to secure education, with many commercials exploiting depicting young children and their families. The California lottery website’s 2015 banner shows a child with books, along with the phrase “together we create possibilities for students.”

Sounds great, right!? Is it true? No.

Ashlynn Goerz, one of my RAs, spent a month pulling data on how lottery revenue is actually spent. Not surprisingly, most of it goes to things that are unrelated to education; like advertising, overhead, and general funds (see graph below).

screenshot-2016-11-04-16-38-02

Not convinced yet? A National Bureau of Economic Research paper showed that State lotteries drove a $5.18 reduction in money used for a low-income child’s education per month. That’s right: The great “funder of education” results – when you add in the losses from poor families – in a net loss in education dollars for poor children.

Still not convinced? In the 1990s, the National Gambling Impact Study Commission found that, “lottery advertising often exploits themes that conflict with the state’s obligation to promote the public good, such as emphasizing luck over hard work, instant gratification over prudent investment, and entertainment over savings.”

Enough lies; here’s some truth: Lotteries, in aggregate, harm poor people. They are a short-term policy fix for short-term politicians looking to fill budget gaps by taking advantage of some of the most vulnerable people in our country. There has to be another way… and that better way is specifically what we’re building at Long Game.

~ Ashby