How the Lottery Preys on the Poor

Audio Transcript

Good Monday morning, everyone. We start this new week talking about gambling, and not for the first time. Of course, Pastor John, we have a handful of helpful episodes on this theme already in the podcast archive. Elsewhere, you’ve talked about how lotteries prey on the poor. That’s a point you made in a 2016 article titled “Seven Reasons Not to Play the Lottery.” Reason number five was that it preys on the poor. You made the point, but only briefly. I want to dwell on this point here on the podcast. How does the lottery prey on the poor? And why we should care that it does?

Let me begin with a few observations taken from various studies. First, just a quotation from that article that you mentioned that I wrote on this some time ago. I said that the lottery supports and encourages “a corrosive addiction that preys upon the greed and hopeless dreams of those entrapped in poverty.” Then I gave this example: “Those earning $13,000 or less spend an astounding 9 percent of their income on lottery tickets.” Now, that was a statistic from maybe six years ago or so.

Here are a few more recent things. People who make less than $10,000 a year spend on average $597 on lottery tickets — that’s 6 percent of their income. Another observation is that the odds of winning a state Powerball lottery are considerably less than being struck by lightning. For example, the odds of winning the January 21 Powerball drawing in Tennessee was 1 in 292.2 million, while the odds of a lightning strike death hover in the 1-in-2.3-million area.

Pull-Tabs and Scratch Games

So, it’s a pretty weak possibility to say the least, but let’s clarify what we’re talking about. We’re not just talking about Powerball with its million-dollar payout. There are many different kinds of public gambling, lotteries, some far more destructive for the poor than others. Lotto America, Mega Millions, Lucky for Life, Instaplay, pull-tabs, scratch games — all of these created by governments to help pay the bills.

So when we think of how the poor spend money on public lotteries, we must not just think about Powerball. In fact, even poor people recognize that the chances of winning millions are so remote that that’s really not the main draw. That’s not where poor people are spending their money.

The main draw is pull-tabs and scratch games. You buy a ticket — so you can go online and just type in “Scratch Games Minnesota” and find what the offerings are. In Minnesota, the $1 ticket that you can buy online or at the gas station is called Rake It In. That’s the name of the ticket for $1. You scratch it off and you’ll know immediately if you’ve won, and the payouts are like $1, or $10, or $50, or right up to $5,000.

So, in Minnesota, the extent for the scratch-offs are from $1 all the way up to $5,000. These kinds of games are less attractive to middle-class people and upper-class people because adding $10, or $100 dollars even, to your bank account really doesn’t make that much difference to a middle-class person. But to a poor person — $10, $100, or $500 — that’s like a windfall. Therefore, the more frequent payout and the greater the likelihood of winning draws in disproportionately more poor people for these kinds of games than for, say, the big Powerball payout.

53 Cents to the Dollar

The poorest one-third of American households purchase one-half of the lottery tickets. The lowest one-fifth of earners in America have the highest percentage of lottery players. One study showed that the introduction of scratch-offs grew three times faster in poor areas than in others.

“The lottery did not become a million-dollar industry due to its large output of winners.”

But study after study has shown that, across the board, players lose on average 47 cents for every dollar. Or to say it another way, what you purchase, on average, when you spend a dollar on the lottery is 53 cents. And of course, that statistic is highly misleading because, to arrive at that average of millions of people investing, you overlook the fact that millions of those people got exactly nothing. To bring the average up to getting back 53 cents on your dollar, you have to reckon that some people have won a million dollars — a very, very few people. So it’s a truism to say the lottery did not become a million-dollar industry due to its large output of winners. That’s not the way it works.

It’s true that states have created lotteries to help pay for social services that aim at benefiting everyone, but there are ironies. Most states allocate some of the lottery income to providing services for gambling addiction, and some try to provide a good kind of education, which creates, supposedly, habits of mind and heart that are the opposite of the habits they exploit by the lottery itself. Very ironic. Addictive behaviors are more common among the poor, and living by immediate rather than deferred gratification is more common among the poor. Publicly funded gambling feeds these kinds of habits, which are destructive to people’s lives.

Regressive Tax

Now, for all these reasons, the lottery has regularly been called a regressive tax on the poor. Here’s what that means: it’s a way of luring the poor, who pay almost no taxes for social services, to pay a kind of tax in a way that worsens their situation rather than making it better, which is what taxes are supposed to do. They’re supposed to make life better for us, so this is a regressive tax in the sense that it may make life worse for the poor rather than better. Now, it would be easy to sarcastically say, “Well no, actually it’s not a tax on the poor — it’s a tax on the stupid.” I know there are a lot of people who think that way about the poor, as if the only factor in making a person poor is all their bad habits, or they might say stupid habits.

And of course, it’s true. Personal responsibility and the failure to act with righteousness, integrity, and dependence on God through grace, through patience, and through trust in Jesus Christ is a huge factor in why many people are poor. But there are many other factors as to why, say, a widow might be stuck economically — earning $20,000 a year working full time, and spending half her income on her apartment, and unable to afford a car, and facing physical and mental challenges few people know about that make advancement for her, of any kind, unlikely. There are more factors.

“When you already feel hopeless, then arguments against gambling lose most of their force.”

The number-one reason why people in such seemingly hopeless situations purchase scratch-offs is because things already look so hopeless for improvement that the so-called “stupidity” of wasting this dollar won’t really make anything worse. So why not try? That’s, I think, basically the mindset that drives most of the purchases: a sense of hopelessness. It’s not going to make things worse because there’s no hope that they could get better. And when you already feel hopeless, then arguments against gambling lose most of their force.

Consider the Poor

Now, from a biblical and Christian point of view, then, I don’t think we are the least bit encouraged by God’s word to stand aloof and roll our eyes at the stupidity of millions of dollars that roll into the state coffers from people who can barely pay their bills. I don’t think that is basically a Christian standpoint. When I read my Bible, I see a different disposition — a different heart, a different mind. For example,

  • “Blessed is the one and who considers the poor! In the day of trouble the Lord delivers him” (Psalm 41:1).
  • “Whoever mocks the poor insults his Maker; he who is glad at calamity will not go unpunished” (Proverbs 17:5).
  • “Whoever oppresses a poor man insults his Maker, but he who is generous to the needy honors him” (Proverbs 14:31).
  • “Open your mouth, judge righteously, defend the rights of the poor and needy” (Proverbs 31:9).
  • “He raises the poor from the dust and lifts the needy from the ash heap” (Psalm 113:7).

So, I think the upshot of all of this for Christians is that we should disapprove of and resist every form of gambling. I’ve written about that elsewhere. We’ve talked about that on APJ on several occasions. Just gambling itself is a major biblical problem. So, I think we should resist all forms of gambling, all forms of lottery, which fly in the face of how God intends for his creatures to use the resources he has entrusted to us. You don’t gamble with somebody else’s money. It’s all God’s, and we wittingly or unwittingly prey upon the vulnerabilities of the poor, and we should resist that kind of institution.

Instead, we should give our thinking, and praying, and advocating, and investing, and planning toward the removal of unnecessary barriers to productive work and gainful employment among the poor, the removal of incentives and allurements toward waste and squandering and irresponsibility, and instead seek to put in place encouragements toward deferred gratification, and finally, the creation of responsibility and hope, especially through the gospel in people’s lives.

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