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Offie's Blog

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January 18, 2008, 6:44 amAgainst Selling Vermont State Lottery

Dangers of Privatizing the Vermont State Lottery

Offie C. Wortham, PhD


In 1949 George Orwell wrote the great classic Nineteen Eighty-Four (1984). The following is a quote from that book: “The Lottery, with its weekly pay-out of enormous prizes, was the one public event to which the proles (poor people) paid serious attention. For some, the Lottery was the principal if not the only reason for remaining alive. Even people who could barely read and write seemed capable of intricate calculations and staggering feats of memory.”


The Douglas Administration is presently considering a plan to sell the Vermont Lottery to a private company for a period of 30 years. The state would continue to receive roughly $23 million a year from the lottery. In addition, the state would receive a one time, up front payment of 50 million dollars. The Vermont Lottery currently employs 23 people - if the deal goes through these employees will have the choice of working for the new company or taking a different position in state government.

Lower income people want to live the American dream of having luxuries, too, and gambling seems to be the only possible way of achieving that dream in their minds. State-sponsored lotteries are a major source of income that many states have become dependent upon. They are a lucrative source of revenue. And unfortunately, lotteries are extremely popular, particularly among low-income citizens. Meanwhile, state officials laud the benefits of lottery proceeds and promote the fun and excitement of participation. This entertainment value is one explanation for lottery demand by the poor. Research shows that individuals with lower incomes substitute lottery play for other entertainment. Low-income consumers generally view lotteries as a rare opportunity for radically improving their depressing standard of living. When we examine the statistics on the relationship between lottery sales and increased poverty in 39 states over 10 years, we find a strong and positive relationship between sales and poverty rates. In contrast, there is no relationship between movie ticket sales, another inexpensive form of entertainment, and poverty rates.
In 1998, the Vermont Lottery developed advertising guidelines to ensure that Lottery products are always promoted in a responsible manner. These guidelines are reviewed periodically and adjusted to address new circumstances as they arise. The Vermont Lottery strongly supports truthful and responsible product advertising that promotes Lottery games as a form of entertainment while reminding consumers to play Vermont Lottery games responsibly. A private concern would be mainly interested in making profits. There would be massive advertising throughout the state, in an effort to get more poor people to purchase lottery tickets. A private operator would be much more aggressive with advertising, introducing new products that have more addictive potential.  Presently, as a government agency, the Vermont Lottery is bound by the duty of care that a government has to its citizens. A private operator is not bound by any duty of care, just payments to the government. There would no longer be any responsibility on the part of the state to protect its citizens.
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