99% Invisible - 532- For a Dollar and a Dream

Episode Date: April 12, 2023

From scratchers to the Powerball, the lottery is the most popular form of gambling in the United States, even though the odds of winning a big jackpot is infinitesimally small. Jonathan D. Cohen is a historian and the author of the book  For a Dollar and a Dream; State Lotteries in Modern America and he says it isn’t just the people playing the lottery who irrationally think the game will solve their financial woes, the states running the lotteries suffer from the same delusion.For a Dollar and a Dream

This is 99% invisible. I'm Roman Mars. In 2022, Americans spent more than $100 billion on lottery tickets. Well millions of Americans are dreaming about winning tomorrow's mega-millions jackpot. Now, the largest and world history surrounds the winner of the 2.04 billion-dollar lottery ticket. The largest of the largest of the world's largest of the world's largest of the world's largest of the world's largest of the world's largest of the world's largest of the world's largest of the world's largest of the world's largest of the world's largest of the world's largest of the world's largest of the world's largest of the world's largest of the world's largest of the world's largest of the world's largest of the world's largest of the world's largest of the world's largest of the world's largest of the world's largest of the world's largest of the world's largest of the world's largest of the world's largest of the world's largest of the world's largest of the world's largest of the world's largest of the world's largest of the world's largest of the world's largest of the world's largest of the world's largest of the world's largest of the world's largest of the world's largest of the world's largest of the world's largest of the world's largest of the world's largest of the world's largest of the world's largest of the world's largest of the world's largest of the world's largest of the world's largest of the world's largest of the world's largest of the world's largest of the world's largest of the world's largest of the world's largest of the world's largest of the world's largest of the world's largest of the world's largest of the world's largest of the world's largest of the world's largest of the world's largest of the world's largest of the world's largest of the world's largest of the world's largest of the world's largest of the world's largest of the world's largest of the world's largest of the world's largest of the world's largest of the world's winner of the 2.04 billion dollar lotto ticket the largest of the Magic Powerball excitement going more than what we've seen over the last week but after another rollover we're now seeing a record jackpot leading to another dash for tickets. From scratchers to the power ball the lottery is the most popular form of gambling in the United States but the likelihood that you will

win a lottery like the power ball is about $1.292 million. Statistically, you're more likely to get attacked by a shark, give birth to quintuplets, or even get crushed by a meteorite. You know, the lottery is often called attacks on people who are bad at math. Because this perception that lottery players don't understand the odds against them and have these wishful, hopeful beliefs that a lottery will solve all of their financial problems. That's Jonathan D. Cohen. He's a historian and author of the book for a dollar and a dream, state lottery in modern America. Jonathan says it isn't just that people playing the lottery who irrationally think the game will solve all their

financial woes. The states running the lottery also suffer from the same delusion. That is, of course, how we have lottery in the first place is voters, policymakers, who believed, wishfully, stupidly, hopefully, that a lottery would solve all of their financial problems, and despite mounting evidence, you know, even after other states it failed and failed and failed again, these voters and policymakers reasoned that a lottery would solve all of their financial problems in the exact same way that gamblers are sort of hooked on this belief that it's going to work for them. Today, we're going to talk with Jonathan about how the lottery got to be as big as it is now, and what is next for these games?

If younger people aren't buying into the false promises of a life-changing jackpot. So Jonathan, what sparked your interest in the lottery? Yeah, I have two sort of superhero origin stories, I think, when it comes to the lottery. The first is, I'm a child of the Great Recession. You know, that was sort of the animating political moment for me as a 16, 17-year-old. So the themes of economic inequality, opportunity, and just the day-to-day stuff that people do to try to get by and to make a better life for themselves was sort of, was really salient for me

going into graduate school and thinking about American history. And then of course, the real answer is that I also grew up playing board games and still played board games. And as a result, I think I'm willing to take games and play maybe more seriously than other historians might. Okay. So like, what is it about the association of board games and the lottery that, you know, makes it fascinating to you? Is it because it's a game

that no one could win? What is that about it? Okay. So it's a couple things. So first of all, it's ironic that, you know, as you may know, the more serious of a board gamer you are, the less interested you are in games that are based around luck. Right? So, you know, the games that I play, you'll be shocked to hear, don't have dice, don't have like scratch off ticket or equivalents, right? But there is this old adage that I first heard from the historian Enfabian that gamblers don't read and readers don't gamble. And that there are these are two separate populations.

And she has this amazing anecdote, which she remembered during her own dissertation research in the 1980s, and she would go to the New York Public Library, and she could tell immediately in those old calling card stacks, you know, this sort of by subject, she could tell immediately where gambling started, because they were darker. The cards were darker because people have been thumbing through them, looking for guidebooks to tell them how to pick lottery numbers. So her evidence that gamblers do, in fact, read a lot. I do think the Venn diagram of people I went to graduate school and people who played lottery tickets might not be a perfect circle, but the games, the play, this desire to win.

I think there are certainly some parallels between, you know, dorky board games like the ones I participated in and then the lottery lottery tickets, which as you said, are sort of very different as an activity. But could you talk a little bit about the precursors to the lottery as we know it? What were people doing that was sort of took the place of the lottery, you know, before the 70s when these really took off? Yeah, so, I mean, well, the real precursor

is like the drawing of lots, you know, as described in the Bible, and this sort of acknowledgement that forces of chance can be used for distributing money, for decision making, but the actual answer to your question is they were sort of two major precursors to what we now have as the state run lottery system. The first being illegal numbers games, which were ubiquitous, particularly in urban black communities

in the Northeast and the Rust Belt, but played also by Latino gamblers, by white working class gamblers. You name it, and these are daily lotteries with three or four digits that are designed in this ingenious way that if you know where to look in the newspaper, you can find the winning number. So maybe it's the last three digits of the stock exchange, for example, for the day.

So theoretically, before random.org exists, that's as good as source of any of a random number, right, that's publicly accessible, that can't be rigged. And these again, I can't under-evisise how popular these were in poor black communities in particular, but then all sorts of other communities all over the country too, with some organized crime involvement. Part of the appeal of numbers games, first of all is that you can pick your own numbers, which when the first state run lottery games come in,

you can't do for a long time. And the real appeal is that you can play for as little as like a nickel. And you don't need, and this is sort of where the numbers games have they got started in this precursor game called policy, where it used to be like a lottery ticket in colonial America would be like the equivalent today, I'm like a luxury good. You know, it's just it's just sort of expensive, and especially in a cash pour, a gradient society, right, to put together money for a lottery ticket, you know, not not accessible to everyone. And a numbers game sort of very definitionally, very baked into the game is that you can play for a nickel, you can play for a couple pennies and get a 500, 600 fold

return on your investment. Second part is the fact that you can pick your own numbers, which you can play in a variety of ways, you pick them, and then you have more likely than not a network. Someone you know who comes by your house every day like your milkman or the guy delivering your paper to pick up your numbers bet. Or he knows, hey, Roman plays 432 every Friday. I'm just put this down for him and assume that he's going to play in and if it hits we'll pay him out.

So it sounds quaint if you forget all the organized crime happening behind the service and the turf wars and the, you know, literal murdering that's going on to fight for control of these games in some big cities. The other equivalent for the precursor are these lottery based overseas. It's called the Irish sweepstakes. These are just sort of like basically glorified raffles that you can buy tickets for.

No one knows if anyone else. I would say no one knows if anyone actually won. Except my mom claims that the janitor of her building won and that's what allowed him to buy an apartment next to hers is because he won the Irish sweepstakes. So I guess at least one person in 1960s queens won the Irish sweepstakes at least one time. So the lottery as we know it didn't just happen. There were these few stutter steps to get to the game that we recognize today.

So can you tell me about how the game design changed to get the lottery that we know now. So the New Hampshire lottery, which is the first state lottery born in 1964, comes under these conditions that it has a lot going, running against it. And there's a lot of hurdles that stand in its way. The federal government in the 1960s was not supportive of the New Hampshire lottery legalizing a state run game, and they put all these hurdles in the way. So when the New Hampshire lottery sweepstakes is starting to start up in the 1960s, part of their lottery wheel, the box that they're going to use for

the drawings and for submitting tickets, part of it is manufactured out of state. And they can't get it into New Hampshire because that would require the interstate transportation of gambling paraphernalia. So they have to, I can't remember, they either have to likehernalia. So they have to, I can't remember, either have to build it into Hampshire or they have to drive it through Canada. So it technically isn't violating interstate commerce laws. But just an example of the problems that these early state lottery's face

and the hoops they had to jump through to sort of navigate the problems created for them by the federal government. And then there's also maybe more important for the actual design of the games. There's a federal excise tax on all gambling state revenue with a carve out for horse racing. So horse racing is kosher and doesn't need to be taxed, but everything else is not. So what the New Hampshire lottery does as a result is this absolutely preposterous game design where you buy

a lottery ticket. It's expensive, first of all. And it's not really a lottery ticket. You write your name on it, you write your address on it. So first of all, you have to declare that you're gambling at a time when gambling like isn't totally chilled, like culturally just yet. And then they do a drawing, but the drawing isn't of a name on a ticket.

It's of a horse race. And they do a separate drawing of a number of a horse. And then they draw a name, and they tie each name to a horse in the designated horse race. So then you look up, oh, here in this 1946 race that we randomly drawn the seventh horse, one. Oh, and that, the ticket tying the 1946 race

to the seventh horse, belonged to John Smith of Dover, New Hampshire. Congratulations, you won the lottery, which all of $600,000 at the time. So when talking about pennies. But this is, again, this insane game design that takes many weeks or months to actually have a drawing to get enough money.

They do some live horse racing, like sweepstakes. But as you said, it doesn't work. And it's really only starting in 1970 when the New Jersey lottery starts up and adds a weekly game that the states finally figured out. The New Jersey lottery, which starts in 1970, they really hit on the winning formula for how these early lottery are going to operate. And rather than these expensive tickets with drawings that take weeks or months, they offer

50 cent tickets for weekly games with $50,000 drawings. So pretty good sized jackpots for the time that move really, really quickly. And that will entice a lot more people to play. Cheap tickets, accessible tickets, sold everywhere. You know, the New York lottery, when they start up, they try to sell tickets in banks

because they think it will be secure. And then Congress is like, no f***ing way. Like, you can't do that. You can't sell lottery tickets in banks, that's insane. It's exactly opposite of the sort of ethic of savings that banks are supposed to be about. So, New Jersey is selling them in liquor stores and in bars and in barber shops. Right? Really, they get closer to the modern state lottery sales ethic and ethos that we've come to be familiar with today. So you hit on something that I find really interesting is that inside of the sort of the

design of the game, frequency is really important. Like or immediacy, like you buy a ticket, you want it to like pay out, you know, that day or, you know, like really soon. And that's the only real way for these things to take off. Right. And that's, I mean, the real example of this is scratch tickets, right, which are introduced for the first time in Massachusetts in 1974, and then just spread like wildfire across lottery states. And then eventually to non-lottery states very, very quickly because of that immediacy that they offer. I'm truly fascinated by the way that state lottery's spread like a contact virus.

Like if the state next to you has a lottery and your state doesn't have a lottery, you are going to get the lottery very soon. Can you describe what is going on there and the sort of psychology of that and how it infects state legislators? Yeah, there are a lot of parallels between the spread of state lotteries in this first wave. So from 1963 to 1977. And what we're seeing today with marijuana legalization, with sports betting, lots of other state policies work this way, which is that once a neighboring state legalizes something, anything, invariably people who live outside that state are going to come over and play your

lottery or play your sports betting or buy your weed. Of course, what happens in practice is that by more states legalizing, it just spreads it further, as you said, like a contact virus. So this logic, and I'm going to keep coming back to this because this is, I think, the key point here. This belief that gambling is inevitable, sort of keeps the spread going and going and keeps adding new games and keeps adding new states, but it's not inevitable. It's inevitable because states make it so by assuming

that it is inevitable in the first place. Another thing you talk about in your book is that these August bodies take great pains to justify the lottery and sort of square it with their morals. And one of the ways they do this is by saying, well, if we have a legalized form of this, we can sort of suppress the mafia version of the lottery or the numbers version, all the illegal versions of this.

Can you talk about how the lottery is sold to the public as an effective way to suppress vice and even could be virtuous because buying a lottery ticket then fills the state's coffers so it can buy good things and fund wholesome programs. Yeah, so this is like the lesson that people take away from prohibition is that there's no point in trying to suppress something that people are trying to do anyway. I mean, the prohibition of alcohol. This is happening anyway illegally. It is draining money from our police resources and our state resources. The state might as well legalize it to make money. And as you said, we could even make it a civic good.

We can fund our government. We'll never have to pay taxes again because we'll have all this money that is being raised by illegal games. So that's the other, that's the other like crazy point. Is all these investigations into illegal gambling? All they do is just give people the impression that gambling is really, really lucrative and have this ironic consequence of incentivizing states

to just legalize it because they think it's gonna be super profitable. Rather than turn people off from gambling. Like imagine, every time there was a drug bust, people like, oh man, we should legalize heroin. Look at how much money all the drug dealers are making. But it doesn't happen, but that's like the equivalent of what is happening with lottery in the 60s and 70s.

Yeah. And so describe that when states monitored, lottery's are first being sort of proposed as a solution to the state's financial woes. What are people saying? And then what is this sort of result of it? Like their estimations for for what they're going to get out of this are really outsized and like through the roof. And then in the end, why is it that they're not paying out the way that they think they are? Right.

So this is what I think takes it from just regular politicians sort of overselling the thing that they're doing to why it's a rational, stupid, hopeful, wishful in the way that gamblers behave. In the 1960s and 70s, there's this belief, and I'm not exaggerating, this belief that a lottery is gonna singularly solve states financial problems. A New Jersey Congressman says that we can increase every state service in New Jersey four times over

if we make numbers games legal. The belief that we'll never have to pay taxes ever again because we have a lottery. And even this crazy cognitive dissonance, even after it doesn't work and the states have to raise taxes, this belief, hey, why are we raising taxes? Didn't we have a lottery shunned that have solved all of our financial problems? So that's sort of the panacea, the first version of the panacea. And then you say, okay, it doesn't work in the Northeast and Rust Belt.

Surely these states sort of got wise and limited their expectations. And they did, but in a whole new magic bullety kind of way, where they now go in the 1980s, not thinking that the lottery is going to solve all the problems for the entire state, but oh, it will surely solve all of our education problems or it will solve, it will singly fund public parks or police services. So it's still a panesia, but we've just sort of limited ourselves. And then that panesia doesn't work, and there's still this cognitive dissonance. And then in California, for example, which uses a lottery in 1984 to raise money for education, there's this belief, even afterwards, that it's now hard to raise taxes for education,

because people think that the lottery is funding education, and that we don't need any more money to pay for schools. And of course, that doesn't work. It's like 2% of the California education budget. But then come the 90s, still this cognitive dissonance. Oh, if we have a lottery, it's like that other rest of the development line. Like it fails for everybody else, but surely it'll work for us.

Like, oh, it will still solve all of our problems, but we'll just reduce the problems a little bit more that they're gonna solve. Oh, in Georgia and other states in particular, it's we don't have enough students going to college, specifically in state colleges and universities. So we'll just use our lottery money to pay for that. So that, okay, finally it works.

First of all, finally the lottery actually sort of fulfills its mandate and does what they say it's going to do, but this belief over and over again, it's gonna solve problem X and it doesn't solve problem X. Oh, okay, but belief over and over again, it's going to solve problem X and then it doesn't solve problem X. Oh, okay, but we'll definitely solve problem Y. Oh, it doesn't solve problem Y. Oh, it'll maybe solve this other problem instead.

They can't just say, hey, the lottery will be nice. It'll raise 2% of state revenue. You know, they can't do that. They have to sort of have this wing in a prayer that it's going to be a jackpot, you know, pun intended for the state. Right, and 2% of state revenue isn't nearly enough to fund all the services that they're promising.

That's really interesting. So, could you describe what are the typical state-lotto games and how they work and what customer base each of the games are appealing to? If we're thinking about all 45 lottery states, because there are some games that are only played in some states, some games and others. There are really three big games that lottery is rely on. The first and the one that needs to be mentioned first are scratch tickets, which account of first, about a 60 to 65% of total annual lottery sales. And so there are a couple of different players for this. What we've seen recently in scratch tickets isickets is what I would call the sort of jack podification of the games, where now you're by scratch tickets that can cost as much as $100 in Texas.

And we've gone from, they offered you to sort of distance chance at a big prize, but you're really playing for sort of the medium prize to now there are scratch tickets that offer a $15 million jackpot, sort of meant a rival, the lotto rollover powerball mega-million type games. What's cool about scratch tickets is the prize curve is shaped like a U, if you imagine, the letter U. There are a lot of prizes concentrated at the very, very beginning. So free tickets, $2 back, $5 back, and then there's a big gap, and then there's prizes at the very top, 20,000, 50,000, 100,000 more, on the assumption that no one's getting out of bed

for a thousand dollars, and on the assumption that if you win five, 10, 20 dollars, you'll probably put that back into more tickets. So you can play for your jackpot, and you can sort of keep playing, keep playing, keep playing, because you put 20 dollars in, you get 10 back, you put 10 in, you get seven back, you put seven in, you get, you know, et cetera.

All of a sudden you spent $40 on lottery tickets and you even have $40 to begin with. That's sort of the bread and butter for lottery commissions. As a result, so many types of players for those games, they are one of the most regressive lottery games, meaning the poor players play them more often, they spend a higher percentage of their money on them to relative to other games. The other sort of major regressive game, in particular,

are numbers games, which we've already covered, which remain actually particularly and disproportionately popular among black gamblers. And again, sort of have this historical roots in the black community that sort of carry them forward to today. So the state, just in the mid-1970s, just usurped these illegal games and these are now basically the they haven't changed the design. The design that was created in 1924 by a black immigrant from the Dutch West Indies named Casper Holstein. They don't use like the newspaper anymore to pick the winning number, but it's the same exact game design now just run by your state government. So eventually, rather than having, or provide the numbers, they have that big cage

that they roll in the little balls and they pick out random numbers. I used to watch it on TV. Yes, they have lottery balls in most states. Maryland is now going digital and there's a whole like crisis of faith. People I talked to in my book already think the lottery's rigged, right?

All these people who have lost faith in the system, they play anyway because they don't see any other chance. And now, doing away from lottery balls, I think for more people is just gonna be even one more. Right, all these people who have lost faith in the system, they play anyway because they don't see any other chance. And now, doing away from lottery balls, I think for more people, it's just going to be even one more. Like, all right, they already picked numbers. This is what the gangsters used to do all the time, but when they could get away with it, was pick numbers that they knew no one had played.

They say, oh, tons of people have played 163 today. We shouldn't let that be the winning number. It should be 721, which only a couple of people played, so we're not going to lose as much money if that comes up. So there's all these things that say a lot of we do that. And then what are their jackpots like? These games are not jackpot based games. These are fixed payout games. Describe the difference between a jackpot and a fixed payout. Sure. So there's a term called paramutual betting. So this is this refers to Powerball Megan Millions, which is my last category that I want to get into, which is where the jackpot is

varies depending on the amount of that people bet. Whereas numbers games is fixed payout in that $1, if you win, will net you a $400, $500 payout? Doesn't matter how many other people bet on that number, a winning number pays out at a certain amount every time for every dollar that you spend on it. Got it. Got it. Right. And then the last one, so 13, 15% of total annual lottery sales are Lotto games, L-O-T-T-O. Most familiar are Powerball and Mega Millions, which are the multi-state iterations of Lotto games, but a lot of states, especially populist states

like California, also have their own Lotto games that are, you know, the tickets are only playable in California, don't have as big prizes, but also, as a know, the tickets are only playable in California. Don't have as big prizes, but also as a result, don't have quite as long odds. Right. So the jackpot is determined by the number of people buying in, which is what leads to these huge jackpots. But that wasn't always the case. And this was this innovation that came a little bit later. Can you describe the lotto and how that functions? Sure. Well, a lotto has its roots in 15th century Italy,

but I'm not gonna get into that. But it's exactly as you described, first introduced in Massachusetts in 1978, and then in New York, and New York is the one that really figures out the formula in 1978. The point of the game is there is a predetermined share of every ticket that goes specifically to the top prize.

So for every dollar spent on lot of tickets, I'm making up these numbers. 50% goes to the top prize, 25% goes to the secondary prizes, and then 25% goes to the state or something. So the more people bet, the bigger the jackpot will get. It did not mean to rhyme. But you do importantly have a starting prize. So right now, Powerball Mega Millions started at 20 million, even if no one plays. And the appeal of these games is as weeks, months go on,

and no one wins, but people keep buying tickets, the prize can keep going up. And in the 1980s, states did away with prize caps. So now, theoretically, prizes can go forever. And as we speak, there's a $1.3 billion mega-million strong tonight that I'm probably not going to win. And two months ago, there was a $2.3 billion

powerball jackpot that was the largest in US history. Because basically people didn't get lucky. Like no one got lucky for a couple of months and that's what let the prizes keep growing. And people kept throwing money at it, hoping to win, and the odds are one in 302 million, and you're not going to win, and eventually someone does. And in the case of the Powerball, you've got these growing jackpots that people aren't winning from week to week, and you're choosing from a set of numbers for your chance to win.

But we get the addition of one extra Powerball number, which might not seem like a big deal, but it really changes the odds drastically. Can you describe that from a design perspective? What is that doing? Yeah. So over time, over the last few decades, basically state lottery commissions have realized that people don't care about the odds of winning. They just care about how big the jackpots are.

So they've made the games harder and harder to win. Starting the late 80s, early 90s, with the introduction of, it was then called Laudo America, ultimately called Powerball. This game where in addition to having to pick, I think it was originally five numbers from a field ranging from one through 45, you also had to pick a sixth number.

I think at the time was ranging between one and 26 that doesn't seem that hard, but on paper makes the odds even that much more preposterous and that much harder to hit. What you see a lot, and you see this actually both with scratch tickets and with lot of games is states sort of tricking your brain

and this fostering this belief that, oh, the winning numbers had a 55 and my ticket had a 56. So I was supposed to feel as if I was only one number away. When, of course, that has no bearing on like what lottery ball was randomly drawn in the drawing. The real bad one with this is scratch tickets, where if your winning number, let's say, is a 13 or a three, the numbers that you scratch might be like a two's say, is a 13 or a three, the numbers

that you scratch might be like a two, which is one number away from a three. So you're like, oh, I'm so close. Or might be an eight, which is like when you first scratch it might look like a three. So it's, they're called heart stoppers. Tickets that are meant to make you think for a moment that you won, only to realize that you lost and you want to chase that win with another ticket. How did the advent of random number picking when you buy a ticket change the game? In one really funny way, they made the lines shorter because you didn't have to, you used to like, imagine it's the equivalent of Powerball, but it's only in your state.

So it's New York in 1985. Everyone's waiting in line for this record-breaking $40 million jackpot. It's the largest in American history. And they're lines out the door of every retailer because everyone's waiting in line to buy tickets, but all these people, you know, rich, middle-class people don't know how to fill out the lottery slip and they have to pick their own numbers, but New York State has not yet introduced QuickPick, which is the printing of a random ticket. So that's one sort of weird funny way. An interesting theory I read from an Illinois lottery commissioner from 1990 is that the advent of quick pick

made it less likely that lottery prizes would roll over. When people had to pick their own numbers, guess what numbers they picked, ranging specifically between one and 31 because those are dates, birthdays, etc. Once there's a random printing of tickets, a wider range of numbers is covered for every drawing, because not... It used to be just everyone's playing between numbers between one and 31, and that would make it theoretically less likely that the prize would roll over, because someone now has a ticket with numbers

in the 50s and 60s that they never would have picked before. So it's a cool theory that's very, very, very, presented visible kind of, kind of, kind of fact. I don't know how true it is. I mean, at this point, I think a lot of people play quick, but yeah. And then it also makes it like so that my dad will play because he's not going to like figure out how to fill out the lottery slip, you know what I mean? But he will like just hand two dollars to the guy and expect a lottery ticket

in return. Yeah, it does. Yeah, that's really interesting because it works and sort of, I don't know, it depends from the point of view of trying to raise jackpots or trying to raise money. It makes it more frictionless to have the quick pick, but it also makes it more likely that, you know, people would get a prize because they would pick numbers. That would be so far they've been doing just fine and getting big prizes. Can you talk about how the games are designed in relation to the odds? It seems like the daily smaller jackpot games have odds of winning that you can kind of wrap your head around.

There's like three numbers, one through nine. It seems almost like comparatively easy to pick a winner And that's why you know paying a buck for a small jackpot feels rational But when the jackpot is you know something like the mega-millions it gets so huge Like it doesn't matter if the odds are picking the winning number is Inventessively small like the upside of the big jackpot is so overwhelming That it just kind of short circuits our brains I mean do I have that right? No, no, no, yeah, no, you're hitting on it. You're hitting on a couple things

So these games have very different player bases and you're right folks at the very bottom income quintile Right don't actually play the lottery all that disproportionately because they don't have a lot of disposable income to spend on lottery tickets But when they do play, they're not, to exactly your point, they're not gonna invest $2 in a mega millions ticket with a one in 302 million odds of a giant jackpot. They are playing a numbers game trying to turn $1 into $400, or buying a cheap scratch ticket,

hoping to, they're actually the ones hoping for that $100, $100,000 payout. You know, they're not, they're not playing for a jackpot. They're just playing to get through the day. It's that next level up, that next group up, you know, 21st to 60th roughly of the income distribution who have disposable income to play, maybe perceive that they don't have a lot of opportunities

in their life to get rich or to get out or to for the American dream or whatever you want to call it and they're the ones who are willing to spend two dollars on the distant distant distant odds of 1.3 billion. And then the other you know factor here, people can't tell the difference between one in four million odds of winning, one in 40 million odds of winning or one in 400 million odds of winning, or one in 400 million odds of winning, but they sure as hell can tell the difference between a four million dollar, 40 million or 400 million dollar jackpot. So one in four million odds of winning

already feels so distant that they might as well be one in 400 and then you get to play for a lot more money. Yeah. It's kind of short circuits or brain when the number gets so big, because it's like, why not? You know, I heard the jackpot's up to $130 million. number gets so big because it's like why not? When we come back, we'll talk about what the future of the lottery looks like if people

are no longer buying in. More with Jonathan D. Cohen after this. So in a country like the U.S., which, you know, rightly or wrongly defines itself through, you know, merit, the idea that, you idea that good things come to people who work hard, how does the lot of fit in with that sort of self-mythology? Yeah, so there's this belief that we live in a meritocracy where good things happen to good people and specifically good things happen if you work hard,

working hard always pays off. And that theory, if you think about it, doesn't leave a lot of room for chance. It sort of cuts out, it cuts out probability. It says, no, there's a straight line between hard work and payoff and success. Gambling absolutely spits in the face of that. And really says, hey, you know, the world is totally random and people who get rich through no fault of their own, you know, because they picked the numbers one day. So I think that that that story of a merictitious society is the one we tell ourselves, but there's a lot of evidence that underneath that story, there's a lot of gambling going on and that

a lot of people, particularly people of color, or those who have been excluded from the traditional mainstream economy, have long turned to the luck of the draw for the American dream that they saw, but wasn't available to them through the traditional economy. And what about religion? How does the lottery fit in with that? Yeah, so maybe not coincidentally, around the rise of state lottery in the 1970s, coincides with the rise of the prosperity gospel and this sort of inflection of merititious money or what one scholar calls him a miraculous meritocracy.

This belief that if you're deserving, miracles will happen for you, specifically financial miracles will happen for you if you give to the church, if you pray, if you do XYZ. And lottery fits in with that as a the quintessential vehicle of chance. All of a sudden, we get in the 1970s,

all these lottery players who win the lottery, who rather than see it as a vehicle of chance, oh no, God gave me my money. Oh, I deserve to, I deserve my money. This is, they felt they deserved to be rich, but weren't, and all of a sudden they are, and if you're not willing to ascribe your jackpot to random probability, there's sort of only one explanation in that is

to look, look, have in words to, to, to assume that God is the one who gave you your money. So when your book you mention that younger generations are much less inclined to play the lottery, do you know why that is and, and what that means for the future of lottery and the US? and what that means for the future of lottery and the US. Yeah, well, so there's only sort of anecdotal evidence, but the evidence that exists is that Gen Z and actually millennials too are not as interested in lottery tickets as older generations. My sort of personal pet theory for this is that there are

tons of great ways to get a gambling fix nowadays, crypto, Robinhood, sports betting in some states. And in particular, those games let you feel smart. If you win, it's not just luck of the draw, right? It's not just like totally random chance. It is like if you win, it's because, oh, you saw that that Houston Rockets line was three points too low and you took advantage of it because you're a genius.

And there's just as much sort of frictionless betting, even more so frictionless, you know, because it's so accessible online. So they're doing the same thing and they actually found a great quote from someone on the Wall Street Betts Reddit page during the whole GameStop thing where he's basically, you could just like cut out the word GameStop

and put in the word lottery tickets and it sounds exactly like a lottery player. Like this is my only chance. This is my best way to sort of like get get rich and then put all put all my eggs in a basket and really make something of myself. And I know that the odds might be long and I know that it might be a stupid financial investment on paper but I'm going to do it. And I think again they're really getting the same thing the lottery players get out of it. But they're just finding it in different ways. And this is I'm sure do it. And I think, again, they're really getting the same thing the lottery players get out of it, but they're just finding it in different ways. And this is, I'm sure an issue of much, much consternation for a lot of commissioners

who don't want the games to fade away and who wanna get these younger generations hooked. I mean, do you think that the way that these lottery's controlling younger players is by making the jackpot so big? Yeah. That definitely helps because what that does is it gets people through the door.

And once they're in the door, you have them in a bunch of ways. Maybe you get them hooked on their own numbers and they feel like they have to play. So you play your own numbers. Roman places numbers every day for a month. Okay, now he's like, all right, I've had fun playing the lottery. I'm gonna stop.

But then what you get is something called for a great aversion where Roman wants to stop, but he actually doesn't want to stop because if the lottery hit on his numbers, he would feel so angry that he didn't play. So he avoids not because he wants to play, but because he doesn't want to not play. So that's how the big jackpot games, you know, they seem benign, but it's actually sort of a gateway drug for people to get in the door. So that certainly will help.

And the media attention that Lotteries get during those checkbots is harmful in that way. I think the real way they're going after them is trying to transfer to cashless ticket sales. Some states, Massachusetts, my help state until very recently, you'd only buy tickets and cash. And then online, you know, through apps and stuff is the real targeting. All right. So Jonathan, here's the question. All right. and then online, you know, through apps and stuff is the real targeting. All right, so Jonathan, here's the question.

All right. Knowing everything you know, do you think longaries are bad? Because I think they're kind of bad. I actually think if you had asked me in 1970, like, are lottery's bad, I would've said no. They're actually probably on net good because there's all this gambling.

There really was all this gambling happening anyway. It really is feeding into, in some cases, organized crime. I think Lotteries, you know, at the time were a good innovation. I think now, you know, 2023, they are clearly doing more harm than good and should not exist in their current form and their current iteration in the modern American society.

What is the accumulation of empirical facts over that time that make you think that lotteries are bad now? Yeah. I'll do it in the sort of net, you know, give credit to, you know, give credit where they do. Lotteries have, by my estimation, raise, I think, $252 billion for states over the course of five plus decades, which, you know, great, good for them. The question, of course, is the cost of that money, and there are a couple.

First of all, of course, is the fact that they are regressive. And if someone were to introduce a tax today with the regressivity and the distribution of lotteries, people would roll their eyes, it would never get past just because of knowing who is going to buy into this tax. Of course, it's voluntary, but that's the way they justify it. So that's one major effect. Another is the ways that lotteries have warped Americans

beliefs about social mobility. And they have, I quote, one journalist who calls, she calls it a blinding beacon for people who are sort of see the lottery as their last best only chance for, for a way out. Another one that is really hard to quantify is just the way they've warped Americans' belief in wealth, in opulence in general. And since the 1980s, this 1990s, with the valorization of wealth and the rise of the celebrity CEO, the lotteries have helped people, I think, become okay with inequality on the assumption that maybe they're going to get rich one day too, and they don't want to have to pay

estate taxes either when not if they become a billionaire. Again, really hard to quantify. That first one about the regressivity is the big one. But that's what leads me to believe on that lottery's a bad. I didn't come into the lottery topic with a bone to pick. I didn't, you know, I'm not a lottery winner, loser. I didn't, you know, none of my parents played growing up. But that is sort of what I, my conclusion, looking at the,

the net of evidence about the, about this issue. The book is called For a Dollar and a Dream State Lotteries in Modern America. Thank you so much, Jonathan, for talking with us. Thanks, and good luck. 99% Invisible was produced this week by Jacob Moltenado Medina, edited by Vivian Leigh, original music by Swan Riau, sound mixed by Martin Gonzales. Delaney Hall is her senior editor, Kurt Colstead,

is the digital director. The rest of the team includes Christopher Johnson, Jason Delion, Chris Baroupe, Lashemba Dawn, Emmett Fitzgerald, Kelly Prime, Joe Rosenberg, in turn, Avanti Nambiar, Sophia Klatsker, and me Roman Mars. The 99% of the below goat was created by Stefan Lawrence. We are part of the Stitcher and Sirius XM podcast family, now headquartered six blocks north in the Pandora building. In beautiful, up town, Oakland, California. You can find the show and join discussions about the show on Facebook.

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