Since New Hampshire began its modern era of state lotteries in 1964, revenue has boomed. Whether the prizes are small or large, super-sized jackpots draw attention and attract ticketholders (even those who don’t usually gamble). They also give the games a windfall of free publicity on newscasts and websites. This dynamic makes lottery games a favorite of politicians: voters want states to spend money, and lotteries offer an easy source of painless taxes.
However, lottery revenues have a habit of plateauing and even declining. So, when the jackpots stop growing, the games must find new ways to increase sales and maintain their popularity. That’s why they’ve been expanding their offerings — with instant games and keno, for example — while increasing their advertising efforts.
But even these changes haven’t been enough to sustain the growth rates that lottery officials once promised. The fact is, once a lottery gets established, it’s almost impossible to abolish it. The system has built up specific constituencies, including convenience store operators (who are the usual vendors); suppliers (heavy contributions to state political campaigns are regularly reported); and teachers in those states that use lotteries for education.
Despite their reputation for being addictive, lotteries are not without flaws and vulnerabilities. A few weeks ago, HuffPost’s Highline ran a story about a Michigan couple in their 60s who made more than $27 million over nine years by exploiting a simple loophole in the game’s rules. They bulk-bought tickets, thousands at a time, to ensure that the odds were in their favor. And they had a lot of help from the game’s shockingly lax security measures.