Wednesday, March 13, 2013

Destroy the Lottery

Here's an idea our esteemed legislators and elected officials should consider, as we ponder ways to cut costs in government and make government more accountable to the citizens that it represents.

Let's get rid of the Hoosier Lottery.

No, I do not mean sell it off to a private company.

No, I don't mean give a vendor a long-term lease on running the operations while retaining some control over the overall operations.

I mean, let's just get rid of it altogether.

The Hoosier Lottery has the typical corruption that Hoosiers have come to expect from our state government. WTHR reporter Bob Segall broke the news of the Hoosier Lottery offices being moved into a new, expensive space that could cost more than $2 million in rent a year compared to the old space. Subsequent investigations from Segall revealed that the Lottery Commission didn't even bother reviewing the extravagant purchases being made for the new space. Eventually, the director of the Hoosier Lottery resigned.

An analysis from The Indianapolis Star, backed by academic studies and information requests from state government as well as their own research, revealed that Hoosier Lottery players 67% of those playing have household incomes less than $50,000 a year. Comparing that data with census data, they found that the lower an area's per capita income, the more lottery retailers it has. The analysis also discovered that Lottery revenue is disproportional received by higher income counties based on the value of vehicle registration. So counties with a lot of expensive cars and RVs will get a lot of money, whereas counties with used cars won't get as much. In other words, neighborhoods with a lot of poor (And let's just say it, also a lot of minorities) are subsidizing the rich (mostly white) neighborhoods.

On top of all that, the Hoosier Lottery has launched a new, deceptive ad campaign that sinks even lower than where it has previously gone. A private vendor has been charged with operations in hopes that revenue will increase, so the new ad campaign talks about life goals that can be achieved with lottery winnings, such as paying for a child's college. Indianapolis Star columnist Matthew Tully further critiques the ad campaign, saying it is "preying on emotions in a downright despicable way."

So why not just end the lottery altogether?

People might say that'll create a revenue gap in state budgeting. I don't buy it.

In economics, one's income becomes discretionary income after taxes paid and after all necessary bills are paid. What is left over is discretionary. And, for better or for worse, most people are going to spend their discretionary income rather than save it. Just because they won't be playing the Hoosier Lottery doesn't mean that won't go into the economy somehow. They're going to go out and spend it, and local and state governments will collect the sales tax. And if they choose to invest it again, good for them. I'd be fine with a slight drop in revenue if that means more people are stashing away money in their savings account or 401(k).

Governor Pence has taken a valiant stand against expanding gambling in the state. He should take it one step further and use the bully pulpit to put us on a path so that the state of Indiana will be out of the state-sponsored gambling institution known as the Hoosier Lottery.

1 comment:

  1. The Hoosier Lottery Has Already Been Sold In A Rigged Bidding Process In the Final Days Of The Daniel's Administration.

    The deal is so shady the media can't even find out the "revenue trigger" or management fee amount to determine how bad of a deal this is for taxpayers.

    In fact a lawsuit was filed and foreign bidders claimed the process was rigged and didn't benefit taxpayers responsibly.


Please see the Indy Student Blog Policies page for the full policy on blog comments. Verification of comments by typing in a random word is required to prevent spam. Due to recent blog inactivity, comments are now pre-screened to prevent spam advertisement.