Why I hate the lottery

A week and a half ago, the two Alabama gubernatorial candidates, Republican candidate Dr. Robert Bentley and Democratic candidate Ron Sparks, debated on many issues spanning BP, taxes and infrastructure. Some of the answers given by both sides were good, and some were so lackluster that they could put an insomniac to sleep.

Yet, there was a recurring theme in the answers by Sparks — the dream for every recent Democratic candidate for governor. Yes, the lottery debate is back.

Throughout the discussion, Sparks continually hammered Bentley for opposing a lottery — a statement for which clarification is needed, since Bentley is personally against a lottery, but would allow a statewide vote to take place to settle the issue. Sparks also offered the lottery as a panacea to all the state’s woes. According to him, the lottery could fund infrastructure, education and healthcare all at the same time, and never go broke.

But I am not writing to skewer Sparks’ statements; rather, my issue is with the concept of a lottery itself. Unlike many Alabamians who despise the lottery based on amorphous Biblical arguments, my disgust for the lottery stems from simple economics.

The first issue with any lottery is the amount of benefits students will receive due to such a system. While proponents say this will fund scholarships galore, it is almost universally true that real payouts go down as a lottery ages. This can be seen in Georgia, whose HOPE scholarship is the oft-cited example in this state’s lottery debate.

After its startup in 1993, advocates of the HOPE scholarship have pointed to the number of grants issued, but just by looking at the numbers from the Georgia Student Finance Commission, scholarship awards have flat-lined since 2002 despite massive population increases.

Furthermore, lottery proponents will not tell you that many of these students lose their scholarships after the first year due to academics, or that many students choose cushy majors to grade-inflate their way into renewal. So due to the law of unintended consequences, there is now an imbalance of specialties since everyone is afraid of losing their ability to go to college.

What students get the awards in Georgia?

In the beginning, the standard was a B average, equivalent to a numerical average of 80. Over time, the standards were raised to a GPA of 3.0, or an 85 average, since the program was going broke. This means that the yard stick is a moving one, representing a slight renege on Georgia’s original agreement with students and parents.

Also, the standards increase has an additional effect on the demographics of HOPE recipients. As we all know, higher family incomes mean a higher probability of exceptional academic performance, which means people who the lottery was originally designed for — the poor — are being shut out.

While Sparks and his fellow advocates vow this would never happen in Alabama, numbers do not lie, and in the end Mountain Brook students would be getting more grants per capita than students from Greene and Dallas Counties.

The largest conflict I have with a lottery, though, is from whom the money is raised: the poor. The Tax Foundation, a nonpartisan think-tank, has published several memos showing that while the amount spent on a lottery may be flat, the poor spend a greater share of income in hopes of getting out of their dire situation.

Zip code analyses for both the Texas and Illinois lotteries have constantly shown the highest ticket sales are in impoverished regions, while the more affluent areas spend the least as a share of income. Add this to the fact that about 35 percent of ticket revenue goes to the general treasury, making it a highly regressive “sales tax.”

The counter-argument is that it is a voluntary tax in the sense that the state cannot force you to purchase a lottery ticket. But then again, the state cannot force you to buy a television either, which has sales tax, albeit much lower, attached to that item. The result is the poor pay for the education of the middle and upper class while their own children get left high and dry.

It is remarkable that people say Alabama is committing a social sin by having a poor-burdening sales tax system while at the same time sneaking in an even more regressive tax via the lottery.

It would be better to raise sales taxes or property taxes than to charge such a usurious lottery tax and rob the most vulnerable of our society completely blind while giving them a false hope for the future. Nevertheless, I have hope that Alabama will soundly defeat the lottery if and when it comes up to a vote.

It’s time to defeat this menace once and for all, and begin looking for our own unique solution to guarantee an adequate post-secondary education for all Alabama students. Only then will saying, “Thank God for Mississippi!” when it comes to our education system become a thing of the past.

Gregory Poole is a graduate student in metallurgical engineering. His column runs biweekly on Wednesday.

  • HERMAN

    That’s The Whole Truth And Nothing But The Truth.

  • Jeb

    I’ve never understood why the lottery is such a big deal to opponents in Alabama. No offense to your article, but I still don’t get it. Personally I think opposition is motivated by religion and fairly weak supporting arguments are just thrown on top to provide some cover. I also don’t get how the Republicans can argue that the lottery disproportionately affects the poor and then demand a fair tax or a more even playing field in which the top earners do not pay so much of the country’s burden of taxes (both ideas I support by the way). To me, that is the perfect example of religious-based opposition using political spin. I am not a fan.

    The website that you link to may show a leveling out of the amount of awards, but lets be real Greg… are you saying that the state is better off without the additional $640 million?

    “In the beginning, the standard was a B average, equivalent to a numerical average of 80. Over time, the standards were raised to a GPA of 3.0, or an 85 average, since the program was going broke.”

    So what? Do you know how easy it is to get an 85 average in a public high school? If the amount of awards has steadily increased throughout the 90′s (as your referenced website indicates) to top out around $640 million, then it isn’t like they are giving FEWER scholarships. They are simply raising the bar so not just anybody can apply and receive the money. Why would you want to reward low achievement? I thought we were all about rewarding hard work in this country? Those that work hard have EARNED the reward. Those that sit on their ass and make bad choices must either live with their consequences or work twice as hard to get themselves out of that hole they dug themselves into. Anything else is just furthering the cultural problems of America in which we reward those that make poor choices and tell them we will take care of their every need. No need for them to work hard because they can do just enough to get by and we will make sure to give them plenty of entitlements (paid for by those filthy rich people that you apparently despise for working hard and going to college).

    Maybe I’ve got things backwards. Maybe this is a Democrat issue. To be honest, I don’t pay much attention to Alabama politics. The few attempts I made already just showed me that the politics in this state is more corrupt than our federal government. Regardless of who is pushing the issue, I don’t see the big deal. So what if the poor end up playing the lottery more? I’m not poor and I’d play just for fun. I’d probably pay more money than the poor too which would make all your statistics look pretty weak if you took into account that wealthier people spend more money per person on the lottery than the poor, so the location of lottery sales isn’t that big of a deal when not combined with amount of sales. Personally, I think a “tax” that may or may not impact the poor disproportionately isn’t the worst idea in the world anyway since our tax code is so lopsided as it is.

  • Chris

    While I am glad to see that someone is making non-Biblical arguments against the lottery, I still have to disagree with you.

    I good friend of mine, who is in a low-income family, took advantage of his HOPE scholarship and is on his way to graduate school at Georgia Southern. He would not have been able to even go to undergraduate school without this scholarship. There will always be people who will not take advantage of their opportunities, but the fact that we are giving people who deserve it a chance is a good enough reason to support this.

    Also, we cannot do anything about people spending what little money they have on lottery tickets. We have two options, let Alabama benefit from lottery sales or let other states benefit. Writing an article against the lottery system and then saying we need to find a unique solution does not support your arguement. The lottery system is a hell of a lot more unique than what Alabama has. Maybe if you actually had a method in mind that could work better, in theory, then you might be on to something.

  • Jonesty McStabass

    As others have pointed out, leveling off at $640 million is still $640 million. Just because the amount isn’t increasing doesn’t mean the amount isn’t helping people by giving them scholarships.

    Of course you would trot out the tired old argument of protecting the poor. We’re told by many people that they want the gov’t out of our lives and out of our checkbooks, until it comes to something they’re morally opposed to. It’s their money, they can buy what they will with it. Besides, I’m not poor and I buy them.

    Make no mistake about it, Alabamians participate in the lottery already, just in three of our surrounding states. Heck, they even pile into church buses to go buy tickets.

  • Don Sieg

    The bible hugging doctor Bentley will more than likely win this election unless the evidence of him being a biggot and an extreme racist actually comes out. And the lottery will for the next 4 years become an unresolved issue (assuming it doesn’t have enough backing to be passed in the legislature).

    I am tired of GA being the only state that is used for comparison in the lottery debate. Many other states have fully functional, economically beneficial lotteries such as Louisiana. The article is a watered down version of one written a few weeks ago with a few big words inserted to make it sound like his argument holds more weight. What does an engineering major know about economics anyway? Sparks has never said the lottery will benefit anything but education.

    I am sure this dumb ass’ argument for an alternative would be something close to the good ole boy Robert Bentley’s which is create more jobs somehow with no plan in sight. Hopefully the other 4.6 million people that live in this great state will give the lottery a chance and we can establish a college scholarship program that is long overdue.

  • http://www.imperialstructuredsettlements.com Jenny Funding

    Although this is an informative article, I’m still not grasping why so many would be opposed to the lottery? It generates funds for state programs and gives hope to people who participate. I understand your point about the taxation of lottery. However, your main argument against the lottery is that it takes money from the poor? No one is forcing anyone to buy a lottery ticket. And it makes sense that poor and middle class people would participate in the lottery to better their financial situation…do you expect wealthy people to?