The Lottery

The lottery generates over $70 billion in revenue each year. Today on Civics 101 we explore how we got here; from failed lotteries in the Revolutionary War to the Golden Octopus to the Numbers Game to a Mega Millions ticket from your neighborhood shop. Where does all of that money GO? And why are states so dependent on them in the first place?

Taking us on this madcap journey are two experts on the lottery in the US; Kevin Flynn (author of American Sweepstakes) and Matthew Vaz (author of Running the Numbers).

Also, we're in a friendly competition with our friends at Outside/In as to who can raise the most sugar during our year-end fund drive. Push us over the edge with a small donation today and you'll get a really cool sticker!

lottery FINAL FINAL.mp3: Audio automatically transcribed by Sonix

lottery FINAL FINAL.mp3: this mp3 audio file was automatically transcribed by Sonix with the best speech-to-text algorithms. This transcript may contain errors.

Nick Capodice:
And a quick note before this episode on the lottery, which is one of those things you think isn't really a civics topic, but then it ends up being very much a civics topic. Uh, I want to jump in and share with you all that we have done over two hundred and fifty episodes of Civics 101. And it feels like we haven't even scratched the surface. There are dozens of departments Supreme Court decisions, cabinet positions, legislative powers that need to be explored. This show was created to address your questions about our government, how it works, but we need listener support to answer those questions. Make your year end tax deductible donation at Civics101podcast.org and you'll receive a very snazzy civic sticker, as well as our eternal thanks. Help us at Civics 101 Demonstrate and HPR that a show like ours with a cause like ours is a worthy investment. All right, onto the episode.

Kevin Flynn:
There's always been a lottery.Do we agree with old man Warner thatThe lottery should be continued simply because there's always

Nick Capodice:
Been one as Oklahomans try to strike it rich? They also invest in Oklahoma's future? Or do we

Speaker3:
Object with Tessie that the whole thing just isn't fair,

Hannah McCarthy:
Isn't right? And so people who buy tickets thinking, Hey, I'm helping education, do you think they're really doing as much as they think they are? They they believe they

Kevin Flynn:
Are, but they're absolutely not benefiting education.

Speaker3:
Whatever else Shirley Jackson has done in her story, she has certainly given us a memorable image.

Hannah McCarthy:
We're not talking about that lottery, are we, Nick?

Nick Capodice:
Well, as every English teacher in America knows Hannah. The morning of June 27 was clear and sunny with the fresh warmth of a full summer day.

Hannah McCarthy:
All right, I'm going to put the kibosh on Shirley Jackson from the outset, although I will say that short story is all about hyper local government. But I do want to ask you with all seriousness, what does buying a ticket and maybe winning millions of dollars have to do with U.S. governmental systems? Why are we doing a civics episode on the lottery?

Kevin Flynn:
Because I'm an awesome guy. No, that isn't the right answer.

Hannah McCarthy:
Wait is that Kevin?

Nick Capodice:
It is. I'll let him introduce himself here.

Kevin Flynn:
My name's Kevin Flynn. I'm a former journalist and author, and I wrote the book American Sweepstakes; How One Small State Bucked the Church, The Feds and the Mob to usher in the lottery age.

Nick Capodice:
So we've got to do a whole mess of full disclosure here. Kevin Flynn is indeed a writer, podcast host, TV and radio journalist

Hannah McCarthy:
And dear friend.

Nick Capodice:
And.

Hannah McCarthy:
And he's married to our executive producer, Rebecca Lavoie.

Nick Capodice:
He sure is. But we were in a civics one one production meeting, talking about the lottery and its intersection with the government, and we learned that Kevin had written a book on it. And so we had to have him on the show.

Hannah McCarthy:
All right now, we got that out of the way. Did he give a reason on why civics listeners should be interested in the lottery?

Kevin Flynn:
It's a great question. The lottery is just a big part of state government these days.

Hannah McCarthy:
How big?

Nick Capodice:
Big, real big. You're listening to Civics 101. I'm Nick Capodice,

Hannah McCarthy:
I'm Hannah McCarthy

Nick Capodice:
and today we are talking about the U.S. lottery. How it started, ended, started again. How much money it makes and where that money goes.

Hannah McCarthy:
Now, Kevin said lottery is a big part of state government, but does every state in the U.S. have one?

Nick Capodice:
Almost almost. Mississippi was the most recent state to adopt a lottery. They started selling tickets in 2020.

archival:
Scratch off tickets for the very first time, And Mississippians can take a shot at winning without Having to leave the state.

Nick Capodice:
Five states do not have a lottery. Alaska, Hawaii, Utah, Alabama and Nevada.

Hannah McCarthy:
So when did this all start? Like, what was the first lottery?

Kevin Flynn:
Oh, we have always had lotteries in civilization, right? Lotteries go back to the Bible, right? In the Old Testament. It was, you know, casting lots was the way that a lot of times the the will of God was divined. King Saul was selected because of a drawing of lots. Do you remember when the apostles were down a man where they were down to 11 guys for some reason?

Hannah McCarthy:
Down a man, as in after Judas Iscariot died?

Nick Capodice:
Yeah.

Nick Capodice:
There were two candidates to become the new Twelfth Apostle, and they cast lots, it means they threw sticks of different lengths on the ground to see who it would be, and it ended up being Mathias. And OK. That's more Bible than civics 101 has ever had. And maybe it's just so I could use clips from Jesus Christ Superstar.

You want me to do it!

Nick Capodice:
But let's move on.

Kevin Flynn:
The Great Wall of China was financed some repairs that were financed by the Chinese for an early version of Keno. I think they called it the the white pigeon game.

Nick Capodice:
The roads to Rome, Hannah, were paid for by raffles. And to finally wend our way towards America. The Jamestown settlement in Virginia, the first permanent English settlement in the Americas, was financed with a lottery.

Hannah McCarthy:
You're kidding me

Kevin Flynn:
So you could say America really is, you know, the the child of a lottery. Part of the Continental Army was financed through a lottery. George Washington wanted to raise $10 million to pay for the Revolutionary War in the Continental Army through a lottery. So, you know, it was always it's something that's been around, you know, since since people had money.

Nick Capodice:
I want to add, by the way, that lottery in 1776 to help pay for the Revolutionary War failed utterly. They didn't come even close to raising enough money. Congress printed a hundred thousand tickets, but they only sold around 30000. So to pay for the war, they just printed a bunch of money instead and borrowed a lot from France. But what's important is that it set a precedent for other lotteries in our new country to help pay for infrastructure like roads and bridges.

Hannah McCarthy:
All right now, this is where it starts to become a civics conversation, right? Armies, roads and general infrastructure costs usually fall into the purview of government expenses. So why is a lottery involved at all?

Nick Capodice:
A lottery is a way to get money for something when you don't have the power or the political interest to tax people. If you want to build a covered bridge and you don't have the money in your state budget to do it. Having a lottery to build that bridge where the winner gets some of the money from the lottery tickets and the rest goes to building the bridge; that might get you reelected, whereas raising taxes might not. So from our nation's founding up to the eighteen forties over the whole United States, hundreds and hundreds of lotteries were springing up to pay for stuff. And when you have a lot of lotteries, you start to also get a lot of rigging of lotteries to pick winners.

Kevin Flynn:
So it's just, you know, when you deal with a lot of cash like that, you know, sharpies are going to come in and do what they do. That's a lot of sugar. Nick, there's a lot of sugar there. It's funny because, you know, let's go to like the the mid eighteen hundreds. Lotteries ended up getting kind of a stink on them in in public, not illegal, but in a nation where cockfighting and duels and poker games are considered gentlemanly. It was lotteries that, you know, started to get a bad name, in part because no, no poor person ever died in a duel. Right? That was that was the lotteries ended up democratizing gambling.

Hannah McCarthy:
So rich folks are gambling left and right. But the one form of gambling that working class Americans can participate in gets a bit of stigma.

Nick Capodice:
Yeah, and is often the case. In these instances, somebody just went a little too far. The biggest lottery in America in the 19th century was called the Louisiana Lottery Company, and it was huge. It was nicknamed the Golden Octopus. Its hands were everywhere. People all over the country played it. Over half of the mail in New Orleans was lottery tickets. And what the company did is they paid 40 grand each year to a charity hospital, and they got to keep the rest of their profits tax free. There was a staggering amount of corruption. Bribes got paid to reps in state and federal legislatures all over the country. So in response, the federal government passed a bill banning the sale of lottery tickets in the mail. So the Louisiana lottery company moved to Honduras. And finally, in eighteen ninety five, all lotteries in the United States were banned. And that's it.

Hannah McCarthy:
This is making me think of prohibition. Ok, right? You've got something that's legal. Highly profitable. Very popular, very prevalent. And then it's made illegal. And I would say that just with booze, but with a lot of things in history, what history has shown us is that when you then make it illegal, it rarely, if ever actually goes away.

Nick Capodice:
Naturally.

Hannah McCarthy:
And I know that the lottery didn't go away because I grew up in Massachusetts, and I know that I can walk outside and I can buy a ticket. So how did we get from the banning of the golden octopus to lotteries being run in most states?

Nick Capodice:
We get there via something called the numbers.

Matthew Vaz:
OK. You know, once upon a time, it's not a good way to start, right?

Nick Capodice:
I counter that once upon a time is always a good way to start. And this is Matthew Vaz. He's a professor at City College of New York, and he wrote a fascinating book called Running the Numbers, Race Police and the History of Urban Gambling. So once upon a time, there was a popular illegal game called policy,

Matthew Vaz:
And it involved betting on several two digit numbers between one and seventy two. The odds are a little complicated, but it offered a way to make a small bet on a number of guess and come out with a decent amount of money. If you win, you could bet a dollar, and maybe in some situations you could win two hundred dollars. But the winning numbers were generated by the spinning of a wheel, so to speak, and maybe sort of draw out almost like a pulling a ping pong ball out of a barrel kind of a thing.

Nick Capodice:
But the problem with policy was that like all lotteries beforehand, they could be rigged. The person picking out the ping pong ball could cheat and grab one with their friend's number on it. And they did. But a new system was born in Harlem in the 1920s,

Matthew Vaz:
And most people believe that it was a man named Caspar Holstein, who was an immigrant to New York from the West Indies, developed a new method for arriving at winning numbers. He came up with a game that is typically called the numbers that involves placing a bet or on a guess of what the last three digits before the decimal point will be in a massive number generated by some far off uncontrollable institution. And so what they initially use was was an institution called the New York Clearinghouse, right? It's a financial institution that sort of clears money from different banks, and millions of dollars would pass through it every day.

Nick Capodice:
And at the end of the day, they'd publish how much money went through that clearinghouse. And the last three digits of that number were the winning numbers.

Matthew Vaz:
So we could say today 12 million four hundred and eighty three thousand two hundred and twenty one dollars and sixty nine cents pass through here. And the last three digits before the decimal point were two one two two one, right? And that's a number that no man on the street can manipulate or control it. And it is in essence, almost a random number, right?

Nick Capodice:
You'd make your bet with a numbers runner and this is important. You would pick what your numbers were. People chose lucky birthdays, favorite numbers, holidays, whatever, the odds are one in a thousand that you'll win, and the payout was usually 600 bucks for a dollar bet.

Matthew Vaz:
And it becomes a very, very popular form of gambling first in the Black communities of New York. It displaces that older policy game. People basically abandoned playing that because this game is simpler. The payouts are better and it in effect cannot be rigged, right? It cannot be manipulated. And it becomes popular in most of the major cities along the East Coast, Philadelphia, Washington, D.C., Baltimore. And eventually it spreads well beyond the Black communities of those cities and becomes popular among working class whites. Organized crime figures start to muscle in on the game, particularly after prohibition is over, and there's a kind of violent contestation over who's going to control the game. Is it going to be the mafia or is it going to be Black gamblers that had set up this game initially?

Hannah McCarthy:
Well, this I remember from our episode on Mapp v Ohio Right that somebody bombed Don King's home in Cleveland, Ohio, over a fight to control the numbers racket. But I also remember and we talked about this when we were making that episode that the numbers were about community institutions.

Nick Capodice:
Right, right. The people who ran the numbers, they lived there in those neighborhoods, in that community, and the payout, it wasn't a million dollars and it wasn't two dollars, it was six hundred dollars. And the reason I bring that up is Matthew asked me if I'd ever won two bucks on a scratch ticket, which I have

Matthew Vaz:
If you win that four dollars or that $2 prize. What are you going to do with it?

Nick Capodice:
What are you going to do with it?

Hannah McCarthy:
Probably buy more scratch tickets.

Matthew Vaz:
You're going to buy two more. Exactly right. It's like, Oh, nice, I want give me two more of those, right? But if you're playing with old fashioned numbers game and you win six hundred dollars, what are you going to do with that, right? Something, you know, something better. It's something... You're going to catch up on your bills or whatever it is. You know, it's going to move you along a little bit.

Hannah McCarthy:
I imagine that state legislatures which had this history of using gambling to fund projects, we're taking a good hard look at the numbers, games and asking, how can we get some of that?

Nick Capodice:
How can we get some of that, as Kevin would say, how can we get some of that sugar, which they certainly did, but it wasn't going to be an easy road to that pot of municipal gold. We'll get to the legalization of lottery and where the money goes right after the break.

Hannah McCarthy:
But first, if you want a lotto fun extra civics tidbits in your life, subscribe to our newsletter Extra credit. It's every two weeks, and since it's free, it's not even a gamble. Just click the newsletter button at our website civics101podcast.org.

Hannah McCarthy:
We're back and you're listening to civics one on one now, just a quick reminder that our show depends on the generosity of our listeners to keep running and instead of us having a lottery, we just ask that you donate whatever you feel is fair at civics101podcast.org. The odds are not the same that you will win a mega million jackpot, but they're almost the same. And speaking of a mega million jackpot, Nick, how did we get from a federally banned activity to a pastime in which millions of Americans participate?

Nick Capodice:
The shift to a legal lotto starts in nineteen sixty three in a state famously opposed to taxes, none other than the home state of Civics 101, New Hampshire. Here's Kevin Flynn again.

Kevin Flynn:
Well, in New Hampshire, there was a there was a state representative named Larry Pickett who thought that a great way to raise money for state causes was would be to hold a sweepstakes, and it was finally signed into law by Governor John King. And this immediately set off a whole bunch of reaction in the state and across the country.

Hannah McCarthy:
Wait, so the lottery was illegal federally?

Nick Capodice:
Yes, it was.

Hannah McCarthy:
So is this kind of akin to states across the country decriminalizing marijuana, even though at the federal level it's still a Schedule one drug and totally illegal?

Nick Capodice:
Hannah, that analogy to marijuana legalization is more apt than you can possibly imagine because and I'm going to try to make this quick You and I can't really understand just how scandalous it was for a state to legalize the lottery in the U.S., the FBI was involved. It was considered a national moral outrage. And to jump to the present, the path towards marijuana legalization, from the blatant racial disparity of who got arrested for it to the national outcry against it and states discovering how much money can be made from it, taxing it to it, becoming legal in many states to purchase. But in some of them, you've got to pay for it in cash. Every bit of it is note for note out of the lottery legalization playbook. But back to New Hampshire in the nineteen sixties, one way they got around it is that it wasn't a lottery per say. Even though we're going to call it one, it was technically a sweepstakes.

archival:
The race is incidental to the sweeps excitement that has raised two and a half million dollars for New Hampshire's educational system.

Nick Capodice:
So instead of drawing a number on a ping pong ball and winning some money, a sweepstakes ticket holder was paired to one of two hundred and thirty two racehorses. And if that horse was picked to run in a race and then that horse won that race, you won a bunch of cash. And people across the country freaked out.

Kevin Flynn:
Well, the lottery ended up being a big scandal, and almost every newspaper in the state was against it. They had like some really great quotes, and this is where I hope the folks from Civics 101 get a montage together of people reading these headlines like old timey newspaper people like now. Be a good time to start playing that music, Nick. I'm just I'm just like setting you up to spike this ball. Ok?

archival:
As either New Hampshire Uncle Sam so hard up that this shabby dodge is the only way out. What's happening in New Hampshire at the hands of politicians shouldn't happen to a dog. Scandalous experiment. Moral bankruptcy.

Nick Capodice:
There was one quote that was in favor of the lottery in New Hampshire. It's by the newspaper publisher Bill Loeb, who said, "No one has to go to the track and bet, no one has to smoke tobacco. No one has to drink. But how do those who oppose the sweepstakes propose to raise the money, either a sales tax or property tax or some other kind of levy that people will have to pay?" And New Hampshire did it. They sold lottery tickets, and people from all over the country came to New Hampshire to buy them.

Hannah McCarthy:
That's how much the country wanted a lottery.

Nick Capodice:
But the thing was it was against the law to take lottery tickets across state lines back to where they lived. So New Hampshire found a workaround.

Kevin Flynn:
So what New Hampshire did in order to sort of get around the Gambling Paraphernalia Act was that the tickets would stay in New Hampshire. People would get a carbon copy like a receipt. They called it an acknowledgment, so it would prove to somebody that, yes, they had purchased the ticket and you couldn't have put somebody else's name. You couldn't resell the ticket. But the actual ticket, the one that would be drawn, would stay in New Hampshire.

Nick Capodice:
And this actually ended up in the United States Supreme Court in a case called U.S. V. Fabrizio. Anthony L. Fabrizio, the appellee, knowingly carried in interstate commerce from Keene, New Hampshire, to Elmira, New York. Seventy five acknowledgments of purchase on a sweepstakes race of the state of New Hampshire, and he lost that Supreme Court appeal.

Kevin Flynn:
I found out later on that it was common knowledge that there was at least one U.S. Supreme Court justice who had purchased a sweepstakes ticket at the time that they heard the case.

Hannah McCarthy:
Seriously.

Nick Capodice:
Yeah.

Hannah McCarthy:
Do you know which one.

Nick Capodice:
I can't say, Hannah.

Kevin Flynn:
I can't tell you which one. I can't tell you which one, but you'll know him when you see him. If you're picking up what I'm putting down.

Hannah McCarthy:
All right, so once New Hampshire has the ball rolling, what is the next state to follow suit?

Nick Capodice:
The New Hampshire sweepstakes was a bit of a strange one-off. The Empire State came next. Here's Matthew Vaz again.

Matthew Vaz:
But in New York, which is the second lottery and becomes much more of a kind of national template, right? Because when New York does something, the rest of the country pays close attention. That that debate in New York, which happens over the course of nineteen sixty five and sixty six, is much more centered around the problem of illegal gambling.

Nick Capodice:
New York legalizes the lottery in nineteen sixty six and then a bunch of other states do the same, but they can't compete with these illegal numbers games that we talked about earlier. And one of the reasons is is that unlike the numbers game in the lottery, you couldn't pick your own numbers. That was it. You couldn't pick birthdays or holidays or your kids age.

Hannah McCarthy:
We're such a superstitious bunch.

Matthew Vaz:
Essentially, these state lotteries don't rest until they figure out how to get to that numbers clientele, and it takes them a number of years as New Jersey that first figures out the technology, right? Like, how do we set up something that will allow people a network that allows people to guess the number rather than just receive the number? That first New Jersey game was called pick-it

archival:
until then. This is Dick LaRosa saying Thanks for watching and playing Pickit

Nick Capodice:
And Matthew told me the lottery was a pretty sleepy thing for 13 years until they indeed did figure out a way to let people pick numbers after which sales quadrupled in four years. And here we are.

archival:
In the United States, tens of millions of people are clinging to a little piece of paper and a lot of hope. That's because tonight someone could become hundreds of millions of dollars richer.

Hannah McCarthy:
Are there still local numbers games, albeit underground in cities?

Nick Capodice:
There are not much, honestly. And part of that is due to the astronomical payout of the big lotteries. How can six hundred dollars compared to 600 million?

Hannah McCarthy:
Ok, I've always wondered this, and I'm going to guess that the answer is fairly straightforward, but in terms of those massive payouts? How is that possible? Like, how much money does the lottery itself actually make? Because you have to staff this operation, right?

Nick Capodice:
I have some stats from 2015. So first, as a comparison, corporate income taxes in 2015 generated forty nine billion dollars. State lotteries generated $67 billion dollars.

Hannah McCarthy:
And did all of that money go back into the states?

Nick Capodice:
No, not all of it. And this answers your question. Forty two billion went into prizes. That's how they have such big jackpots. Three billion went to advertising and administration of the lottery, leaving about $21 billion that went back into the states.

Hannah McCarthy:
Now where does that money go? I've heard that the lottery supports, for example, education in a lot of states.

Nick Capodice:
Did you ever see The Simpsons where there's like, it's like a massive lottery?

archival:
One big winner. Our state school system, which gets fully half the profits from the lottery. Just think what we can buy with that money. History books that know how the Korean War came out. Math books that don't have that basic 6 crap in them.

Matthew Vaz:
Oh yeah, it can be argued both ways, right? And you know, I would say to you that that it varies state to state. Ok. Different states have a different arrangement for where that money goes in New York. There is a fallacy that it goes to education. Well, only in the most only and the most sort of symbolic sense does it go to education. Which is to say the state education budget in New York is determined by a formula. Right?

Nick Capodice:
As a hypothetical Hannah with wildly inaccurate numbers, let's say New York set its education budget at a million dollars and the lottery has a great year and has $750000 left over.

Matthew Vaz:
That doesn't mean that the state is now going to give one million seven hundred and fifty thousand dollars towards education. The state is still just going to give a million dollars to education, but the lottery had a big, huge year, and that means that if we take now, we can take that seven hundred fifty thousand dollars that came in for the lottery and we're moving from education and just spend it elsewhere in the budget, right? The phrasing is it's a substitute, not a supplement

Kevin Flynn:
In nineteen sixty four. New Hampshire made five point seven million dollars, selling three dollar sweepstakes tickets. Right before the sweepstakes, New Hampshire was the forty fifth state as far as money that the state put towards education. And then, after the sweepstakes, New Hampshire was forty fifth among 50 states as to what it put towards local education.

Matthew Vaz:
Furthermore, once something becomes a kind of structural element of the budget, then it cannot be reduced, right? The only way to reduce it is to cut the good itself, the schools or the hospitals or whatever it's supporting, which nobody wants right or to continue to support schools and hospitals where there's only one way to do that and that is taxes, right? And you see how literally impossible it is. Raising taxes is is a blood sport in American politics, so you are in effect, committing yourself.

Hannah McCarthy:
I know the odds of winning a big jackpot are slim, but just for curiosity's sake, how slim are we talking? How far am I from becoming a multibillionaire?

Nick Capodice:
There was a Big Mega Millions jackpot in Florida in January of twenty twenty one. It was $750 million. The odds of winning it are one in three hundred and two million. Statistically, you are ten times more likely to become the president of the United States than that. But that sum, that number, that staggering sum, you can't ignore that kind of a payout.

Matthew Vaz:
I'm drawn in by the magnetism of this vast, obscene sum of money that has attracted me to this game. And so I'll play my dollar right. And lottery executives used to use the joke is like most, most players think, there's really the odds are 50 50. Either I win or I don't write, you know? You know, and in some ways, that is a kind of true feeling of, Hey, let me try, you know, either I win or I don't write. And you know it, it speaks to a kind of mentality for how we organize our society. Like, are we all just sort of slowly kind of taking our turn, winning a modest sum of money? Or are we willing to sort of assume that we're never going to win on the infinitesimal chance that if we do, we're going to be hyper rich?

Nick Capodice:
There is an expression that lotteries are quote a tax on the poor, and I don't want to go too much into that expression, but I want to make two points related to it. First, yes, Americans and lower income brackets spend more money on lottery tickets. But second, these games are marketed towards people with less money. The ads for lotteries are not aimed at wealthy Americans, and their slogans are things like New York Lotto. All you need is a dollar and a dream. A survey from 2006 found that one in three Americans who make less than twenty five thousand a year think the lottery represents the most practical way for them to accumulate significant savings.

Matthew Vaz:
You know, it speaks to like our ideas about distribution of of of wealth and inequality. It's like, Look, I'd rather have. I'll skip having a decent chance of winning a modest sum in favor of having an infinitesimally small chance of having a grossly outrageously large sum of know six hundred and seventy million dollars, right? And it tracks very closely with the with the time period of like where inequality becomes a disaster in American life since the late nineteen seventies.

Hannah McCarthy:
That fantasy that you won't win enough money to just pay off your student loans or put a down payment on a car, but you'll win enough to buy an island and a helicopter to get you to that island and all of that because you spent a dollar on a lottery ticket. I mean, nonexistent odds are not. That is a tempting dream.

Nick Capodice:
And back to the civics part, for state budgets, this influx of cash from people buying these lottery chances, these fantasies. It is a dream come true. You know what, if I could just add one more tidbit that I find fascinating? I'd forgotten completely about this. The people who win those massive jackpots, they end up having to pay about 37 percent of their winnings back to state and federal government for income tax.

Kevin Flynn:
If you want to say gambling is bad for individuals, can't necessarily argue that, but the people really addicted to lotteries are the states that run them that rely on the revenue. They're the ones who are really addicted to the lottery.

Old Man Warner:
There's always been a lottery.

Nick Capodice:
That's it. Did any of you out there get Kevin's sly hint as to which Supreme Court Justice bought a ticket? Brag at us on Twitter at Civics 101 Pod? I'm going to put the answer in this week's newsletter, which you can subscribe to at civics101podcast.org. Today's episode was produced by me Nick Capodice with You Hannah McCarthy. Thank you.

Hannah McCarthy:
Thank you. Our staff includes Christina Phillips and Jacqui Fulton. Rebecca Lavoie is our executive producer and NHPR's very own Golden Octopus Music.

Nick Capodice:
Music in this episode by Blue Dot Sessions, Sir Cubworth, Tracky Birthday, ProleteR, Moore and Gardner, Metre, Ari Di Nero, and the Soni Venetum Wind Quintet.

Hannah McCarthy:
Civic's 101 is a production of NHPR New Hampshire Public Radio.

Nick Capodice:
Lottery!

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Transcript

Nick Capodice: And a quick note before this episode on the lottery, which is one of those things you think isn't really a civics topic, but then it ends up being very much a civics topic. Uh, I want to jump in and share with you all that we have done over two hundred and fifty episodes of Civics 101. And it feels like we haven't even scratched the surface. There are dozens of departments Supreme Court decisions, cabinet positions, legislative powers that need to be explored. [00:00:30] This show was created to address your questions about our government, how it works, but we need listener support to answer those questions. Make your year end tax deductible donation at Civics101podcast.org and you'll receive a very snazzy civic sticker, as well as our eternal thanks. Help us at Civics 101 Demonstrate and HPR that a show like ours with a cause like ours is a worthy investment. All right, onto the episode.

OPEN: There's [00:01:00] always been a lottery.Do we agree with old man Warner that The lottery should be continued simply because there's always been one? As Oklahomans try to strike it rich? They also invest in Oklahoma's future? Or do we object with Tessie that the whole thing just isn't fair, Isn't right? And so people who buy tickets thinking, Hey, I'm helping education, do you think they're really doing as much as they think they are? They they believe they are, but they're absolutely not benefiting education. Whatever [00:01:30] else Shirley Jackson has done in her story, she has certainly given us a memorable image…

Hannah McCarthy: We're not talking about that lottery, are we, Nick?

Nick Capodice: Well, as every English teacher in America knows Hannah. The morning of June 27 was clear and sunny with the fresh warmth of a full summer day.

Hannah McCarthy: All right, I'm going to put the kibosh on Shirley Jackson from the outset, although I will say that short story is all about hyper local government. But I do want to ask you with all seriousness, what does buying [00:02:00] a ticket and maybe winning millions of dollars have to do with U.S. governmental systems? Why are we doing a civics episode on the lottery?

Kevin Flynn: Because I'm an awesome guy. No, that isn't the right answer.

Hannah McCarthy: Wait is that Kevin?

Nick Capodice: It is. I'll let him introduce himself here.

Kevin Flynn: My name's Kevin Flynn. I'm a former journalist and author, and I wrote the book American Sweepstakes; How One Small State Bucked the Church, The Feds and the Mob to usher in the lottery [00:02:30] age.

Nick Capodice: So we've got to do a whole mess of full disclosure here. Kevin Flynn is indeed a writer, podcast host, TV and radio journalist

Hannah McCarthy: And dear friend.

Nick Capodice: And.

Hannah McCarthy: And he's married to our executive producer, Rebecca Lavoie.

Nick Capodice: He sure is. But we were in a civics one one production meeting, talking about the lottery and its intersection with the government, and we learned that Kevin had written a book on it. And so we had to have him on the show.

Hannah McCarthy: All right now, we got that out of the way. Did he give a reason on why civics [00:03:00] listeners should be interested in the lottery?

Kevin Flynn: It's a great question. The lottery is just a big part of state government these days.

Hannah McCarthy: How big?

Nick Capodice: Big, real big. You're listening to Civics 101. I'm Nick Capodice,

Hannah McCarthy: I'm Hannah McCarthy

Nick Capodice: and today we are talking about the U.S. lottery. How it started, ended, started again. How much money it makes and where that money goes.

Hannah McCarthy: Now, Kevin said lottery is a big part of state government, [00:03:30] but does every state in the U.S. have one?

Nick Capodice: Almost almost. Mississippi was the most recent state to adopt a lottery. They started selling tickets in 2020.

archival: Scratch off tickets for the very first time, And Mississippians can take a shot at winning without Having to leave the state.

Nick Capodice: Five states do not have a lottery. Alaska, Hawaii, Utah, Alabama and Nevada.

Hannah McCarthy: So when did this all start? Like, what was the first lottery?

Kevin Flynn: Oh, we have always had lotteries [00:04:00] in civilization, right? Lotteries go back to the Bible, right? In the Old Testament. It was, you know, casting lots was the way that a lot of times the the will of God was divined. King Saul was selected because of a drawing of lots. Do you remember when the apostles were down a man where they were down to 11 guys for some reason?

Hannah McCarthy: Down a man, [00:04:30] as in after Judas Iscariot died?

Nick Capodice: Yeah.

Nick Capodice: There were two candidates to become the new Twelfth Apostle, and they cast lots, it means they threw sticks of different lengths on the ground to see who it would be, and it ended up being Mathias. And OK. That's more Bible than civics 101 has ever had. And maybe it's just so I could use clips from Jesus Christ Superstar.

You want me to do it!

Nick Capodice: But let's move on.

Kevin Flynn: The Great Wall of China was [00:05:00] financed some repairs that were financed by the Chinese for an early version of Keno. I think they called it the the white pigeon game.

Nick Capodice: The roads to Rome, Hannah, were paid for by raffles. And to finally wend our way towards America. The Jamestown settlement in Virginia, the first permanent English settlement in the Americas, was financed with a lottery.

Hannah McCarthy: You're kidding me

Kevin Flynn: So you could say America really is, you know, the the child of a lottery. Part of the Continental [00:05:30] Army was financed through a lottery. George Washington wanted to raise $10 million to pay for the Revolutionary War in the Continental Army through a lottery. So, you know, it was always it's something that's been around, you know, since since people had money.

Nick Capodice: I want to add, by the way, that lottery in 1776 to help pay for the Revolutionary War failed utterly. They didn't come even close to raising enough money. [00:06:00] Congress printed a hundred thousand tickets, but they only sold around 30000. So to pay for the war, they just printed a bunch of money instead and borrowed a lot from France. But what's important is that it set a precedent for other lotteries in our new country to help pay for infrastructure like roads and bridges.

Hannah McCarthy: All right now, this is where it starts to become a civics conversation, right? Armies, roads and general infrastructure costs usually fall into the purview of government expenses. [00:06:30] So why is a lottery involved at all?

Nick Capodice: A lottery is a way to get money for something when you don't have the power or the political interest to tax people. If you want to build a covered bridge and you don't have the money in your state budget to do it. Having a lottery to build that bridge where the winner gets some of the money from the lottery tickets and the rest goes to building the bridge; that might get you reelected, whereas raising taxes might not. So [00:07:00] from our nation's founding up to the eighteen forties over the whole United States, hundreds and hundreds of lotteries were springing up to pay for stuff. And when you have a lot of lotteries, you start to also get a lot of rigging of lotteries to pick winners.

Kevin Flynn: So it's just, you know, when you deal with a lot of cash like that, you know, sharpies are going to come in and do what they do. That's a lot of sugar. Nick, there's a lot of sugar there. It's funny because, you know, let's go to like the the mid eighteen hundreds. [00:07:30] Lotteries ended up getting kind of a stink on them in in public, not illegal, but in a nation where cockfighting and duels and poker games are considered gentlemanly. It was lotteries that, you know, started to get a bad name, in part because no, no poor person ever died in a duel. Right? That was that was the lotteries ended up democratizing gambling.

Hannah McCarthy: So [00:08:00] rich folks are gambling left and right. But the one form of gambling that working class Americans can participate in gets a bit of stigma.

Nick Capodice: Yeah, and is often the case. In these instances, somebody just went a little too far. The biggest lottery in America in the 19th century was called the Louisiana Lottery Company, and it was huge. It was nicknamed the Golden Octopus. Its hands were everywhere. People all over [00:08:30] the country played it. Over half of the mail in New Orleans was lottery tickets. And what the company did is they paid 40 grand each year to a charity hospital, and they got to keep the rest of their profits tax free. There was a staggering amount of corruption. Bribes got paid to reps in state and federal legislatures all over the country. So in response, the federal government passed a bill banning the sale of lottery tickets in the mail. So the Louisiana lottery company moved to Honduras. And finally, in eighteen ninety five, all [00:09:00] lotteries in the United States were banned. And that's it.

Hannah McCarthy: This is making me think of prohibition. Ok, right? You've got something that's legal. Highly profitable. Very popular, very prevalent. And then it's made illegal. And I would say that just with booze, but with a lot of things in history, what history has shown us is that when you then make it illegal, it rarely, if ever actually goes away.

Nick Capodice: Naturally.

Hannah McCarthy: And I know that [00:09:30] the lottery didn't go away because I grew up in Massachusetts, and I know that I can walk outside and I can buy a ticket. So how did we get from the banning of the golden octopus to lotteries being run in most states?

Nick Capodice: We get there via something called the numbers.

Matthew Vaz: OK. You know, once upon a time, it's not a good way to start, right?

Nick Capodice: I counter that once upon a time is always a good way to start. And this is Matthew [00:10:00] Vaz. He's a professor at City College of New York, and he wrote a fascinating book called Running the Numbers, Race Police and the History of Urban Gambling. So once upon a time, there was a popular illegal game called policy,

Matthew Vaz: And it involved betting on several two digit numbers between one and seventy two. The odds are a little complicated, but it offered a way to make a small bet on a number [00:10:30] of guess and come out with a decent amount of money. If you win, you could bet a dollar, and maybe in some situations you could win two hundred dollars. But the winning numbers were generated by the spinning of a wheel, so to speak, and maybe sort of draw out almost like a pulling a ping pong ball out of a barrel kind of a thing.

Nick Capodice: But the problem with policy was that like all lotteries beforehand, they could be rigged. The person picking out the ping pong ball could cheat and grab one with their friend's number on it. And they did. But [00:11:00] a new system was born in Harlem in the 1920s,

Matthew Vaz: And most people believe that it was a man named Caspar Holstein, who was an immigrant to New York from the West Indies, developed a new method for arriving at winning numbers. He came up with a game that is typically called the numbers that involves placing a bet or on a guess of what the last three digits before the decimal point will be in [00:11:30] a massive number generated by some far off uncontrollable institution. And so what they initially use was was an institution called the New York Clearinghouse, right? It's a financial institution that sort of clears money from different banks, and millions of dollars would pass through it every day.

Nick Capodice: And at the end of the day, they'd publish how much money went through that clearinghouse. And the last three digits of that number were the winning numbers.

Matthew Vaz: So we could say today 12 million four hundred and eighty three thousand two hundred and twenty one dollars and sixty nine cents [00:12:00] pass through here. And the last three digits before the decimal point were two one two two one, right? And that's a number that no man on the street can manipulate or control it. And it is in essence, almost a random number, right?

Nick Capodice: You'd make your bet with a numbers runner and this is important. You would pick what your numbers were. People chose lucky birthdays, favorite numbers, holidays, whatever, the odds are one in a thousand that you'll win, and the payout was usually 600 bucks for a dollar bet.

Matthew Vaz: And it becomes a very, [00:12:30] very popular form of gambling first in the Black communities of New York. It displaces that older policy game. People basically abandoned playing that because this game is simpler. The payouts are better and it in effect cannot be rigged, right? It cannot be manipulated. And it becomes popular in most of the major cities along the East Coast, Philadelphia, Washington, D.C., Baltimore. And eventually it spreads well beyond the Black communities of those cities and becomes popular among working class whites. Organized [00:13:00] crime figures start to muscle in on the game, particularly after prohibition is over, and there's a kind of violent contestation over who's going to control the game. Is it going to be the mafia or is it going to be Black gamblers that had set up this game initially?

Hannah McCarthy: Well, this I remember from our episode on Mapp v Ohio Right that somebody bombed Don King's home in Cleveland, Ohio, over a fight to control the numbers racket. But I also remember and we talked about this when we were making that episode that the numbers were about community [00:13:30] institutions.

Nick Capodice: Right, right. The people who ran the numbers, they lived there in those neighborhoods, in that community, and the payout, it wasn't a million dollars and it wasn't two dollars, it was six hundred dollars. And the reason I bring that up is Matthew asked me if I'd ever won two bucks on a scratch ticket, which I have

Matthew Vaz: If you win that four dollars or that $2 prize. What are you going to do with it?

Nick Capodice: What are you going to do with it?

Hannah McCarthy: Probably buy more scratch tickets.

Matthew Vaz: You're [00:14:00] going to buy two more. Exactly right. It's like, Oh, nice, I want give me two more of those, right? But if you're playing with old fashioned numbers game and you win six hundred dollars, what are you going to do with that, right? Something, you know, something better. It's something... You're going to catch up on your bills or whatever it is. You know, it's going to move you along a little bit.

Hannah McCarthy: I imagine that state legislatures which had this history of using gambling to fund projects, we're taking a good hard look [00:14:30] at the numbers, games and asking, how can we get some of that?

Nick Capodice: How can we get some of that, as Kevin would say, how can we get some of that sugar, which they certainly did, but it wasn't going to be an easy road to that pot of municipal gold. We'll get to the legalization of lottery and where the money goes right after the break.

Hannah McCarthy: But first, if you want a lotto fun extra civics tidbits in your life, subscribe to our newsletter Extra credit. It's every two weeks, and since it's free, it's not even a gamble. [00:15:00] Just click the newsletter button at our website civics101podcast.org.

Hannah McCarthy: We're back and you're listening to civics one on one now, just a quick reminder that our show depends on the generosity of our listeners to keep running and instead of us having a lottery, we just ask that you donate whatever you feel is fair at civics101podcast.org. The odds are not the same that you will win a mega million jackpot, [00:15:30] but they're almost the same. And speaking of a mega million jackpot, Nick, how did we get from a federally banned activity to a pastime in which millions of Americans participate?

Nick Capodice: The shift to a legal lotto starts in nineteen sixty three in a state famously opposed to taxes, none other than the home state of Civics 101, New Hampshire. Here's Kevin Flynn again.

Kevin Flynn: Well, in New Hampshire, there was [00:16:00] a there was a state representative named Larry Pickett who thought that a great way to raise money for state causes was would be to hold a sweepstakes, and it was finally signed into law by Governor John King. And this immediately set off a whole bunch of reaction in the state and across the country.

Hannah McCarthy: Wait, so the lottery was illegal federally?

Nick Capodice: Yes, it was.

Hannah McCarthy: So is this kind of akin to states [00:16:30] across the country decriminalizing marijuana, even though at the federal level it's still a Schedule one drug and totally illegal?

Nick Capodice: Hannah, that analogy to marijuana legalization is more apt than you can possibly imagine because and I'm going to try to make this quick You and I can't really understand just how scandalous it was for a state to legalize the lottery in the U.S., the FBI was involved. It was considered a national moral outrage. And to jump to the present, the path towards [00:17:00] marijuana legalization, from the blatant racial disparity of who got arrested for it to the national outcry against it and states discovering how much money can be made from it, taxing it to it, becoming legal in many states to purchase. But in some of them, you've got to pay for it in cash. Every bit of it is note for note out of the lottery legalization playbook. But back to New Hampshire in the nineteen sixties, one way they got around it is that it wasn't a lottery per say. Even though we're going to call [00:17:30] it one, it was technically a sweepstakes.

archival: The race is incidental to the sweeps excitement that has raised two and a half million dollars for New Hampshire's educational system.

Nick Capodice: So instead of drawing a number on a ping pong ball and winning some money, a sweepstakes ticket holder was paired to one of two hundred and thirty two racehorses. And if that horse was picked to run in a race and then that horse won that race, you won a bunch of cash. And people across the country [00:18:00] freaked out.

Kevin Flynn: Well, the lottery ended up being a big scandal, and almost every newspaper in the state was against it. They had like some really great quotes, and this is where I hope the folks from Civics 101 get a montage together of people reading these headlines like old timey newspaper people like now. Be a good time to start playing that music, Nick. I'm just I'm just like setting you up to spike this ball. Ok?

archival: As either New Hampshire [00:18:30] Uncle Sam so hard up that this shabby dodge is the only way out. What's happening in New Hampshire at the hands of politicians shouldn't happen to a dog. Scandalous experiment. Moral bankruptcy.

Nick Capodice: There was one quote that was in favor of the lottery in New Hampshire. It's by the newspaper publisher Bill Loeb, who said, "No one has to go to the track and bet, no one has to smoke tobacco. No one has to drink. But how do those who oppose the sweepstakes propose to raise the money, either a sales tax [00:19:00] or property tax or some other kind of levy that people will have to pay?" And New Hampshire did it. They sold lottery tickets, and people from all over the country came to New Hampshire to buy them.

Hannah McCarthy: That's how much the country wanted a lottery.

Nick Capodice: But the thing was it was against the law to take lottery tickets across state lines back to where they lived. So New Hampshire found a workaround.

Kevin Flynn: So what New Hampshire did in order to sort of get around the Gambling Paraphernalia Act was [00:19:30] that the tickets would stay in New Hampshire. People would get a carbon copy like a receipt. They called it an acknowledgment, so it would prove to somebody that, yes, they had purchased the ticket and you couldn't have put somebody else's name. You couldn't resell the ticket. But the actual ticket, the one that would be drawn, would stay in New Hampshire.

Nick Capodice: And this actually ended up in the United States Supreme Court in a case called U.S. V. Fabrizio. Anthony L. Fabrizio, the appellee, knowingly [00:20:00] carried in interstate commerce from Keene, New Hampshire, to Elmira, New York. Seventy five acknowledgments of purchase on a sweepstakes race of the state of New Hampshire, and he lost that Supreme Court appeal.

Kevin Flynn: I found out later on that it was common knowledge that there was at least one U.S. Supreme Court justice who had purchased a sweepstakes ticket at the time that they heard the case.

Hannah McCarthy: Seriously.

Nick Capodice: Yeah.

Hannah McCarthy: Do you know which one.

Nick Capodice: I can't say, Hannah.

Kevin Flynn: I can't tell [00:20:30] you which one. I can't tell you which one, but you'll know him when you see him. If you're picking up what I'm putting down.

Hannah McCarthy: All right, so once New Hampshire has the ball rolling, what is the next state to follow suit?

Nick Capodice: The New Hampshire sweepstakes was a bit of a strange one-off. The Empire State came next. Here's Matthew Vaz again.

Matthew Vaz: But in New York, which is the second lottery and becomes much more of a kind of national template, right? Because when New York does something, the rest of the country pays close attention. That that debate [00:21:00] in New York, which happens over the course of nineteen sixty five and sixty six, is much more centered around the problem of illegal gambling.

Nick Capodice: New York legalizes the lottery in nineteen sixty six and then a bunch of other states do the same, but they can't compete with these illegal numbers games that we talked about earlier. And one of the reasons is is that unlike the numbers game in the lottery, you couldn't pick your own numbers. That was it. You couldn't [00:21:30] pick birthdays or holidays or your kids age.

Hannah McCarthy: We're such a superstitious bunch.

Matthew Vaz: Essentially, these state lotteries don't rest until they figure out how to get to that numbers clientele, and it takes them a number of years as New Jersey that first figures out the technology, right? Like, how do we set up something that will allow people a network that allows people to guess the number rather than just receive the number? That first New Jersey game was called pick-it

archival: until then. This is Dick LaRosa saying Thanks for watching [00:22:00] and playing Pickit

Nick Capodice: And Matthew told me the lottery was a pretty sleepy thing for 13 years until they indeed did figure out a way to let people pick numbers after which sales quadrupled in four years. And here we are.

archival: In the United States, tens of millions of people are clinging to a little piece of paper and a lot of hope. That's because tonight someone could become hundreds of millions [00:22:30] of dollars richer.

Hannah McCarthy: Are there still local numbers games, albeit underground in cities?

Nick Capodice: There are not much, honestly. And part of that is due to the astronomical payout of the big lotteries. How can six hundred dollars compared to 600 million?

Hannah McCarthy: Ok, I've always wondered this, and I'm going to guess that the answer is fairly straightforward, but in terms of those massive payouts? How is that possible? Like, how much money does the lottery itself actually make? Because you have to staff this operation, [00:23:00] right?

Nick Capodice: I have some stats from 2015. So first, as a comparison, corporate income taxes in 2015 generated forty nine billion dollars. State lotteries generated $67 billion dollars.

Hannah McCarthy: And did all of that money go back into the states?

Nick Capodice: No, not all of it. And this answers your question. Forty two billion went into prizes. That's how they have such big jackpots. Three billion went to advertising and administration of the lottery, leaving about $21 [00:23:30] billion that went back into the states.

Hannah McCarthy: Now where does that money go? I've heard that the lottery supports, for example, education in a lot of states.

Nick Capodice: Did you ever see The Simpsons where there's like, it's like a massive lottery?

archival: One big winner. Our state school system, which gets fully half the profits from the lottery. Just think what we can buy with that money. History books that know how the Korean War came out. Math books that don't have that basic 6 crap in them.

Matthew Vaz: Oh yeah, it can be argued both ways, right? And you know, I would say to you that that it [00:24:00] varies state to state. Ok. Different states have a different arrangement for where that money goes in New York. There is a fallacy that it goes to education. Well, only in the most only and the most sort of symbolic sense does it go to education. Which is to say the state education budget in New York is determined by a formula. Right?

Nick Capodice: As a hypothetical Hannah with wildly inaccurate numbers, let's say New York set its education [00:24:30] budget at a million dollars and the lottery has a great year and has $750000 left over.

Matthew Vaz: That doesn't mean that the state is now going to give one million seven hundred and fifty thousand dollars towards education. The state is still just going to give a million dollars to education, but the lottery had a big, huge year, and that means that if we take now, we can take that seven hundred fifty thousand dollars that came in for the lottery and we're moving from education and just spend it elsewhere in the budget, right? [00:25:00] The phrasing is it's a substitute, not a supplement

Kevin Flynn: In nineteen sixty four. New Hampshire made five point seven million dollars, selling three dollar sweepstakes tickets. Right before the sweepstakes, New Hampshire was the forty fifth state as far as money that the state put towards education. And then, after the sweepstakes, New Hampshire was forty fifth among 50 states as to what it put towards local education.

Matthew Vaz: Furthermore, [00:25:30] once something becomes a kind of structural element of the budget, then it cannot be reduced, right? The only way to reduce it is to cut the good itself, the schools or the hospitals or whatever it's supporting, which nobody wants right or to continue to support schools and hospitals where there's only one way to do that and that is taxes, right? And you see how literally impossible it is. Raising taxes is is a [00:26:00] blood sport in American politics, so you are in effect, committing yourself.

Hannah McCarthy: I know the odds of winning a big jackpot are slim, but just for curiosity's sake, how slim are we talking? How far am I from becoming a multibillionaire?

Nick Capodice: There was a Big Mega Millions jackpot in Florida in January of twenty twenty one. It was $750 million. The odds of winning it are one in three hundred and two million. Statistically, you are ten times more likely to [00:26:30] become the president of the United States than that. But that sum, that number, that staggering sum, you can't ignore that kind of a payout.

Matthew Vaz: I'm drawn in by the magnetism of this vast, obscene sum of money that has attracted me to this game. And so I'll play my dollar right. And lottery executives used to use the joke is like most, most players think, there's really the odds are 50 50. Either I win or [00:27:00] I don't write, you know? You know, and in some ways, that is a kind of true feeling of, Hey, let me try, you know, either I win or I don't write. And you know it, it speaks to a kind of mentality for how we organize our society. Like, are we all just sort of slowly kind of taking our turn, winning a modest sum of money? Or are we willing to sort of assume that we're never going to win on the infinitesimal chance that if we do, we're going to be hyper rich? [00:27:30]

Nick Capodice: There is an expression that lotteries are quote a tax on the poor, and I don't want to go too much into that expression, but I want to make two points related to it. First, yes, Americans and lower income brackets spend more money on lottery tickets. But second, these games are marketed towards people with less money. The ads for lotteries are not aimed at wealthy Americans, and their slogans are things like New [00:28:00] York Lotto. All you need is a dollar and a dream. A survey from 2006 found that one in three Americans who make less than twenty five thousand a year think the lottery represents the most practical way for them to accumulate significant savings.

Matthew Vaz: You know, it speaks to like our ideas about distribution of of of wealth and inequality. It's like, Look, I'd rather have. I'll skip having a decent chance of winning a modest sum in favor of having an [00:28:30] infinitesimally small chance of having a grossly outrageously large sum of know six hundred and seventy million dollars, right? And it tracks very closely with the with the time period of like where inequality becomes a disaster in American life since the late nineteen seventies.

Hannah McCarthy: That fantasy that you won't win enough money to just pay off your student loans or put a down payment on a car, but you'll win enough to buy an island and a [00:29:00] helicopter to get you to that island and all of that because you spent a dollar on a lottery ticket. I mean, nonexistent odds are not. That is a tempting dream.

Nick Capodice: And back to the civics part, for state budgets, this influx of cash from people buying these lottery chances, these fantasies. It is a dream come true. You know what, if I could just add one more tidbit that I find fascinating? I'd forgotten completely about this. The people who win those massive [00:29:30] jackpots, they end up having to pay about 37 percent of their winnings back to state and federal government for income tax.

Kevin Flynn: If you want to say gambling is bad for individuals, can't necessarily argue that, but the people really addicted to lotteries are the states that run them that rely on the revenue. They're the ones who are really addicted to the lottery.

[00:30:00]

Old Man Warner: There's always been a lottery.

Nick Capodice: That's it. Did any of you out there get Kevin's sly hint as to which Supreme Court Justice bought a ticket? Brag at us on Twitter at Civics 101 Pod? I'm going to put the answer in this week's newsletter, which you can subscribe to at civics101podcast.org. [00:30:30] Today's episode was produced by me Nick Capodice with You Hannah McCarthy. Thank you.

Hannah McCarthy: Thank you. Our staff includes Christina Phillips and Jacqui Fulton. Rebecca Lavoie is our executive producer and NHPR's very own Golden Octopus Music.

Nick Capodice: Music in this episode by Blue Dot Sessions, Sir Cubworth, Tracky Birthday, ProleteR, Moore and Gardner, Metre, Ari Di Nero, and the Soni Venetum Wind Quintet.

Hannah McCarthy: Civic's 101 is a production of NHPR New Hampshire Public Radio.

Nick Capodice: Lottery!


 
 

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