4 ms·

Georgia's lottery[1] is overall a pretty decent system, all things considered. > the lottery takes in over US$1 billion yearly. By law, half of the money goes

Georgia's lottery[1] is overall a pretty decent system, all things considered. > the lottery takes in over US$1 billion yearly. By law, half of the money goes to prizes, one-third to education, and the remainder to operating and marketing the lottery It pours massive amounts of money into Georgia's education system. It's not perfect but it has put hundreds of thousands of students through school. If we must transfer wealth out of needy communities I can thing of worse places to put it than into education. [1] https://en.wikipedia.org/wiki/Georgia_Lottery https://en.wikipedia.org/wiki/Georgia_Lottery

dymk 4y ago
Well, they're ranked 26th in education, so at best it's just not the worst it could be
- jlarocco 4y ago
  That seems overly negative, to me. Being 26th makes them average, and they get to use the money that other states use for education on other things, or lower taxes.
  - dymk 4y ago
    They're heavily subsidized by coastal blue states and they're still 50th percentile.
    - mullingitover 4y ago
      Georgia isn't heavily subsidized (unlike most states in the region), they actually rank 36th in federal dependency[1]. Maine, Connecticut, Pennsylvania, and Rhode Island all rank higher on federal dependency. [1] https://www.moneygeek.com/living/states-most-reliant-federal-government/ https://www.moneygeek.com/living/states-most-reliant-federal...
      - jlarocco 4y ago
        I agree with your point, but the numbers on that site are suspicious. New Mexico's GDP isn't $400 billion - it's more like $100 billion. Colorado's is about $380-400 billion, and not $1.5 trillion. https://en.wikipedia.org/wiki/New_Mexico https://en.wikipedia.org/wiki/New_Mexico https://www.deptofnumbers.com/gdp/new-mexico/ https://www.deptofnumbers.com/gdp/new-mexico/ https://en.wikipedia.org/wiki/Economy_of_Colorado https://en.wikipedia.org/wiki/Economy_of_Colorado https://www.deptofnumbers.com/gdp/colorado/ https://www.deptofnumbers.com/gdp/colorado/
ISL 4y ago
Generally when lotteries "fund education", it can enable legislatures to allocate tax money that had previously gone to education to other priorities. This shift can turn lotteries into a de facto tax on being bad at math.
- atwood22 4y ago
  > This shift can turn lotteries into a de facto tax on being bad at math. Would lotteries be ok if the expected value of the players prize equaled the price of the ticket? Being bad at math and lotteries being a regressive tax seem orthogonal.
  - ISL 4y ago
    On average, yeah, I think so. It would then be a way to say that money has non-linear utility, which is probably true. An aggregated million dollars probably does have more utility than a million single dollars. Such an institution would be difficult to administer with zero operating costs, though.
    - fsckboy 4y ago
      > An aggregated million dollars probably does have more utility than a million single dollars. no, it's the exact opposite, there is a declining marginal utility to money. Think of it this way, homeless person gets a dollar, that's some food for the day. A second dollar is better, but it's not as valuable as that first dollar, but the second dollar is worth more than a third dollar; all the way up to Bill Gates, how much does he care about a dollar? It's an important concept because it underlies attitudes about and mathematics of risk: even in a fair lottery, the pain of losing money is greater than the thrill of winning some, as an aggregate across the population. It's fundamental to the stock market, and the insurance industries, which exist because of the asymmetry of up vs down, but operate on the aggregating of millions of single dollars. btw, I'm not meaning this casually, people won Nobel prizes for figuring this stuff out
      - TimPC 4y ago
s17n 4y ago
You don't have to transfer anything, though - just get rid of the marketing, take a couple percent to cover administrative expenses, and spend the rest on payouts. If you need money for education, tax people in a fairer way.
- mullingitover 4y ago
  > If you need money for education, tax people in a fairer way. I don't think anyone is compelled to gamble by the Georgia Department of Revenue. This is essentially Georgia saying, "We know we can't stop you from engaging in this vice, so we're at least going to make it beneficial to society in some way." Colorado and a number of other states are doing the same thing with cannabis revenue. I personally hate gambling, I understand how people get addicted to it, but like illegal drugs it's just a thing that the government can't possibly control. The next least bad thing to do is harness it for good in some fashion.
  - s1artibartfast 4y ago
    There is no reason to advertise and promote it. I wouldn't want the government giving out free samples of heroin because you can't stop people from vice.
    - mullingitover 4y ago
      I can see some merit in advertising it, strictly to drive gambling activity to the above-board option. There are plenty of underground gambling rings, the more people are aware of and use the legitimate option the less underground gambling will thrive.
  - s17n 4y ago
    But you don't have to "harness it for good" - just give the money back to the gamblers instead (by distributing ~100% of revenue as prizes).
analog31 4y ago
Money is fungible. In the state where I grew up, when the lottery was proposed, it was promised that the money would go to "education." Within a few years, the education budget remained neutral, as the contribution from the general fund was reduced by roughly the same amount as the lottery contributed. In other words, we got took.

dymk 4y ago

Well, they're ranked 26th in education, so at best it's just not the worst it could be

jlarocco 4y ago
That seems overly negative, to me. Being 26th makes them average, and they get to use the money that other states use for education on other things, or lower taxes.
- dymk 4y ago
  They're heavily subsidized by coastal blue states and they're still 50th percentile.
  - mullingitover 4y ago
    Georgia isn't heavily subsidized (unlike most states in the region), they actually rank 36th in federal dependency[1]. Maine, Connecticut, Pennsylvania, and Rhode Island all rank higher on federal dependency. [1] https://www.moneygeek.com/living/states-most-reliant-federal-government/ https://www.moneygeek.com/living/states-most-reliant-federal...
    - jlarocco 4y ago
      I agree with your point, but the numbers on that site are suspicious. New Mexico's GDP isn't $400 billion - it's more like $100 billion. Colorado's is about $380-400 billion, and not $1.5 trillion. https://en.wikipedia.org/wiki/New_Mexico https://en.wikipedia.org/wiki/New_Mexico https://www.deptofnumbers.com/gdp/new-mexico/ https://www.deptofnumbers.com/gdp/new-mexico/ https://en.wikipedia.org/wiki/Economy_of_Colorado https://en.wikipedia.org/wiki/Economy_of_Colorado https://www.deptofnumbers.com/gdp/colorado/ https://www.deptofnumbers.com/gdp/colorado/

ISL 4y ago

Generally when lotteries "fund education", it can enable legislatures to allocate tax money that had previously gone to education to other priorities. This shift can turn lotteries into a de facto tax on being bad at math.

atwood22 4y ago
> This shift can turn lotteries into a de facto tax on being bad at math. Would lotteries be ok if the expected value of the players prize equaled the price of the ticket? Being bad at math and lotteries being a regressive tax seem orthogonal.
- ISL 4y ago
  On average, yeah, I think so. It would then be a way to say that money has non-linear utility, which is probably true. An aggregated million dollars probably does have more utility than a million single dollars. Such an institution would be difficult to administer with zero operating costs, though.
  - fsckboy 4y ago
    > An aggregated million dollars probably does have more utility than a million single dollars. no, it's the exact opposite, there is a declining marginal utility to money. Think of it this way, homeless person gets a dollar, that's some food for the day. A second dollar is better, but it's not as valuable as that first dollar, but the second dollar is worth more than a third dollar; all the way up to Bill Gates, how much does he care about a dollar? It's an important concept because it underlies attitudes about and mathematics of risk: even in a fair lottery, the pain of losing money is greater than the thrill of winning some, as an aggregate across the population. It's fundamental to the stock market, and the insurance industries, which exist because of the asymmetry of up vs down, but operate on the aggregating of millions of single dollars. btw, I'm not meaning this casually, people won Nobel prizes for figuring this stuff out
    - TimPC 4y ago

s17n 4y ago

You don't have to transfer anything, though - just get rid of the marketing, take a couple percent to cover administrative expenses, and spend the rest on payouts. If you need money for education, tax people in a fairer way.

mullingitover 4y ago
> If you need money for education, tax people in a fairer way. I don't think anyone is compelled to gamble by the Georgia Department of Revenue. This is essentially Georgia saying, "We know we can't stop you from engaging in this vice, so we're at least going to make it beneficial to society in some way." Colorado and a number of other states are doing the same thing with cannabis revenue. I personally hate gambling, I understand how people get addicted to it, but like illegal drugs it's just a thing that the government can't possibly control. The next least bad thing to do is harness it for good in some fashion.
- s1artibartfast 4y ago
  There is no reason to advertise and promote it. I wouldn't want the government giving out free samples of heroin because you can't stop people from vice.
  - mullingitover 4y ago
    I can see some merit in advertising it, strictly to drive gambling activity to the above-board option. There are plenty of underground gambling rings, the more people are aware of and use the legitimate option the less underground gambling will thrive.
- s17n 4y ago
  But you don't have to "harness it for good" - just give the money back to the gamblers instead (by distributing ~100% of revenue as prizes).

analog31 4y ago

Money is fungible. In the state where I grew up, when the lottery was proposed, it was promised that the money would go to "education." Within a few years, the education budget remained neutral, as the contribution from the general fund was reduced by roughly the same amount as the lottery contributed. In other words, we got took.