State Lotteries and the War on Work

State lotteries amount to a regressive tax, luring those of low-income to a game of low odds.

Javon Swaby via pexels.com
Some gamblers turn away from the tables and bet on political outcomes. Javon Swaby via pexels.com

It’s good to see the New Yorker magazine waking up to the fact that state lotteries amount to a regressive tax, luring those of low-income to a game of low odds.

In her review of Jonathan Cohen’s useful new book, “For a Dollar and a Dream: State Lotteries in Modern America,” Kathryn Schulz correctly emphasizes that lottery participation rises as income falls, that the odds of winning have gotten worse, and that supposed budget beneficiaries such as schools get shortchanged.

All as 33 million Americans buy scratch-off and Powerball chances every week.

But the magazine chooses to amplify the most suspect of Mr. Cohen’s claims about the phenomenon of lottery growth since it began with their legalization in 1964: that lottery participation is just one more aspect of income inequality, or, as Mr. Cohen himself writes, a reflection of the fact that “rates of intergenerational mobility have stagnated.”

He blames the usual culprits, including the “demise of high-paying manufacturing jobs and the rise of a low-wage service sector.” They add up to a desperate, chance-taking proletariat, skewered, by capitalism and, yes, by Reaganomics.

But in reality it has been blue state big governments, led by New York, which have taken the lead in promoting lottery participation — especially through slick television advertising. It has been hungry for dollars not to protect a safety net for the poor, as per Schulz, but to support increasingly generous pensions and benefits for unionized public employees.

The regressive burden here — poor ticket-buyers supporting middle class public employees — is bad enough. But to keep the revenue coming in, states are willing to send a pernicious message: working is for chumps. Put another way, lottery advertising — unregulated by the Federal Trade Commission — is part of the war on work.

New York’s $74 million in annual marketing—which props up some $10 billion in annual ticket sales — has included ads such as “How Would You Spend It?” — which features a winning father finally able to spend time with his kids. A current advertisement shows a winning group of dogs cavorting in a stretch limo. They presumably don’t have to walk anymore.

In reality, as the Harvard Review of Psychiatry has noted, gambling promotes “devastating personal, familial, and social consequences.” Those who value the historic American work ethic understand that work is itself a reward, that it provides purpose, that “work-life” balance doesn’t mean work stands in the way of happiness.

Get-rich-quick schemes should not be the province of the government. And all for what amounts to just 2 percent of state revenues, on average (2.9 in New York, historically).

Ultimately, the author, Mr. Cohen, calls for an abolition of state lotteries — an example of getting something right for the wrong reasons. It’s a prospect he concedes is unlikely. 

But the idea of banning or at least regulating the claims of lottery advertising should not be. How about this consumer warning: money doesn’t guarantee happiness.

The sharp fall-off in participation that will likely result may not actually lead to a decline in state revenues. The many working-age adults now on the labor force sidelines might rejoin the workforce as taxpayers, absent the discouraging words from the state Lottery Commission.

The social norms that built America have been under attack and not surprisingly, have eroded. Whether through lotteries, easing work requirements for public assistance, or looking to profit from marijuana taxes, government has become part of the forces arrayed against them. 

Memo to the New Yorker: evangelical ministers opposed to lotteries and gambling were right.


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