How Mega Millions and Powerball Make You a Loser

Nobody won last Friday’s Mega Millions lottery, so this week’s grand prize has grown to $1.6 billion dollars. That’s Billion, with a “B.” On Saturday, nobody won the Powerball lottery, so this week’s prize will be $620 million. These events are hardly surprising since both of these multi-state, government-sponsored gambling cartels recently tweaked the odds to produce such results.

Since the Mega Millions formula change, players now pick five numbers from 1 to 70 and a Mega number of 1 to 25. The odds of winning the jackpot are 1 in 302,575,350. The odds of winning the Powerball lottery are currently 1 in 292,201,338. The odds of being killed by a falling vending machine: 1 in 12,000,000.

Why did the lotteries ramp up the odds? If more people lose, the lottery prizes grow larger. When prizes grow, more people buy lottery tickets. When prizes are “only” $100 million, many lottery ticket buyers are the poor and desperate, but when prizes are huge, even wealthy people buy lottery tickets.When more people buy lottery tickets, the bigger the corporate profits for Mega Millions and Powerball. But selling more lottery tickets increases state school district budgets, right?

No. education budgets stay about the same. States merely use lottery profits to replace funding they previously got from other sources.

More:

“How Much Do Americans Spend on the Lottery?” Mike Brown, lendedu

“Per capita lottery spending has doubled since 1995,” Christopher Ingraham, Washington Post

“Why all lotteries are based on a lie,” Allison Schrager, Quartz

“Powerball Windfall? Schools Don’t Always Benefit From Lottery Sales,” Elizabeth Chuck, NBC News

“How ’80s excess fueled today’s Mega Millions mania,” Jonathan D. Cohen, Washington Post

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Image by Mike Licht. Download a copy here. Creative Commons license; credit Mike Licht, NotionsCapital.com

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Americans Sell Off Stocks, Buy Lottery Tickets

It’s 2016. Wall Street is down, but lottery ticket sales are up. Wednesday’s Powerball grand prize is expected to be around $1.5 billion.

Powerball includes 44 state lotteries and those in DC, Puerto Rico, and the U.S. Virgin Islands. Odds of winning: 1 in 292 million.

The Tax On People Who Are Bad at Math

Ambrose Bierce defined the lottery as “a tax on people who are bad at math,” but it’s really a tax on the dreams of the poor.

Last year Americans spent $70 billion on state-sponsored lottery tickets, more than on books, video games, movies and sporting events combined. The poorest third of households buy half of all lottery tickets, and state lotteries advertise most aggressively in poor neighborhoods, as Derek Thompson points out in The Atlantic.

Why do the poor play the lottery?

“It’s not that poor people don’t understand that the lottery has a near-zero chance of making them dynastically wealthy. It’s that they think everything else has an actually-zero chance. ….  State lotteries, in other words, don’t just prey on poor people’s dreams—they do that for everyone—but rather on desperate dreams.”

— “Why you should never, ever play the lottery,” Matt O’Brien, Washington Post