The Truth About Lottery Advertising


Across America, people spent upwards of $100 billion on lottery tickets in 2021, rendering it the most popular form of gambling in our country. States promote these games as ways to raise revenue, but just how meaningful that money is in broader state budgets and whether it’s worth the trade-offs to people losing their hard-earned money are questions that deserve serious scrutiny.

Lotteries are a form of gambling in which tokens (called “tickets”) are sold and the winning ticket or tickets are selected by lot. The prizes are usually cash, but can also be goods or services. A lottery may be run by a government, a private company, or a non-profit organization. It may be conducted as a one-time event or as an ongoing activity.

The first recorded lotteries were held in the 15th century as a means of raising funds for town fortifications and to help the poor. In the modern era, state lotteries have been adopted by nearly every state and are now one of the largest sources of public funds.

To be fair, most states have carefully vetted the benefits of their own lotteries and have marketed them to a wide range of specific constituencies, including convenience store owners (who sell most of the tickets); lottery suppliers (who make heavy contributions to state political campaigns); teachers (in those states where lottery revenues are earmarked for education); and state legislators (who quickly become used to receiving lottery money).

Yet, even with all this caution, critics of the lottery still charge that the advertising is misleading, often presenting inflated odds of winning a jackpot; inflating the amount that could actually be won (lottery prize amounts are paid out in annual installments over 20 years, with inflation dramatically eating away at the value of any lump sum); inflating the value of lottery prizes in general (lottery advertisements tout the fact that people can win millions of dollars — but they fail to tell you that much of the time, the winners aren’t even close to that amount).

Despite all this, state lotteries continue to prosper. In a society where income inequality is pervasive and social mobility is limited, there’s no question that many people feel a desire to gamble, and lottery ads are playing on this basic human impulse. And even though most people know that the chances of winning are slim, they’re willing to risk their hard-earned money for that sliver of hope that they’ll be the next big winner. This is a dangerous dynamic, and it deserves serious public discussion.