The History of the Official Lottery

The first lotteries were probably run in the Low Countries in the fifteenth century, to raise funds for town fortifications and help the poor. The first recorded lottery to offer tickets for sale with prizes in the form of money was held on 9 May 1445 at L’Ecluse, near Ghent. Lotteries are also reported in the town records of Utrecht, Bruges, and other European cities.

State lotteries, Cohen writes, rose in popularity during the nineteen-sixties, when a ballooning population, rising inflation, and the cost of the Vietnam War led to a fiscal crisis for many states. Balancing the budget required either raising taxes or cutting services—both options unpopular with voters. Lotteries offered the promise of revenue that seemed to materialize out of thin air, freeing politicians from having to face up to unpleasant choices.

But despite their popularity with voters, these campaigns were fundamentally misleading. Lottery revenues were never meant to cover the entire budget of a state, and they have proved to be a far less reliable source of public funding than other sources, especially income taxes and corporate taxes. In the end, Lottery money has provided only about one per cent of a state’s general fund.

Nevertheless, the popularity of lottery games in America continues to rise, as do ticket sales and jackpots. While critics argue that the lottery is nothing more than a “tax on stupid people,” its advocates maintain that it helps pay for everything from roads to libraries to churches. And, as is the case with all commercial products, lottery sales increase in response to economic fluctuations.