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Missouri Senate to discuss privatizing state lottery

Topic closed. 37 replies. Last post 6 years ago by mayhem.

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truecritic's avatar - PirateTreasure
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Posted: March 3, 2011, 3:33 pm - IP Logged

Todd

Given: Without any cheating going on, either on the part of the Government or Private corporation. 

Question: How can privatization increase the money going to the States?   Unless the salaries and wages of the State employees are too high? 

============================================================

I am not sure which I trust more with the lotteries, government or corporations.  However, corporations have a desire to make a profit and often do it any way they can.  Enron comes to mind real quick.  It may not be the corporation itself but some of the people within the corporation.

Casinos do not play fair.  You figure out a way to beat them and if they decide you are beating them too much, you get banned.

Ordinarily, I would say that government should not be in a competing business with a private company.  I think I am leaning towards government running this - no profit motive.  Whatever profit left over is money for the "educational system" (which itself is another argument discussion).  Without some manipulation on the part of any corporation, I can't see where extra money would be coming into the government?

Can you point to something specific about where the extra money would come from?

    Todd's avatar - Cylon 2.gif
    Chief Bottle Washer
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    Posted: March 3, 2011, 3:43 pm - IP Logged

    Todd

    Given: Without any cheating going on, either on the part of the Government or Private corporation. 

    Question: How can privatization increase the money going to the States?   Unless the salaries and wages of the State employees are too high? 

    ============================================================

    I am not sure which I trust more with the lotteries, government or corporations.  However, corporations have a desire to make a profit and often do it any way they can.  Enron comes to mind real quick.  It may not be the corporation itself but some of the people within the corporation.

    Casinos do not play fair.  You figure out a way to beat them and if they decide you are beating them too much, you get banned.

    Ordinarily, I would say that government should not be in a competing business with a private company.  I think I am leaning towards government running this - no profit motive.  Whatever profit left over is money for the "educational system" (which itself is another argument discussion).  Without some manipulation on the part of any corporation, I can't see where extra money would be coming into the government?

    Can you point to something specific about where the extra money would come from?

    As I mentioned before, I am not stating a preference for or against privatization.  I was responding to the first comment in this thread that implied that private companies are somehow inherently underhanded and/or corrupt, and that the government could somehow produce better returns to the state.

    I'm sure the private companies vying for the contract will prove to the state how they will produce good/better returns to the state.  After all, that's what they did in Illinois to win the contract there.  I won't argue their case for them, just read the previous news stories I've posted about the Illinois privatization.

    Overall, OF COURSE private companies are in it for the profit for themselves.  That's what makes Capitalism such a great system.  People and companies constantly strive to be their best when the incentive is profit.

    Lottery privatization capitalizes on this, because the state gets a percentage of the profits, and I'm sure they have baked in the proper controls (like the company doesn't get any profit until a minium is met, etc.).

    I don't even know that "extra money" is an appropriate term.  Does Apple get "extra money" from producing the iPad 2?  Or did they build a better product and get more money with better profits?

    When Capitalism is employed without government in the way, good things happen.

    Regarding corruption, that happens with or without Capitalism, so using corruption as a wedge against Capitalism is obfuscation used to mask a weak argument.

     

    Check the State Lottery Report Card
    What grade did your lottery earn?

     

    Sign the Petition for True Lottery Drawings
    Help eliminate computerized drawings!

      joshuacloak's avatar - Money Swim-uncle-scrooge-mcduck-35997717-677-518.jpg

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      Posted: March 3, 2011, 4:15 pm - IP Logged

      am against it for govt backed by force Monopoly ,

      however todd is sadly right about the  profits in reality

      the issue with runned by the govt is its"group think" element,  thats is Govt

      group think , is the must retarded way of doing things when people in the group,are freaking idiots.

       

      take nasa team of say mars rover enginers, Not the higher ups thro that sit on their beeps.......

      or a dev team behind a game,  They all have a job, and can do said job,

      Govt, has a group of idiots, who have no clue as a collective as the general rule about what ever the beep their trying to do

      , if they don't know first hand how get something done, and have experice in it, they SHOULD STAY THE HELL OUT OF IT,    the planning needs to be done By Very Smart people,people with experience in said matters of  whatever their working on

      , govt has a long history of Getting into planning things by people "law makers" who have no freaking Clue, let alone much of any experience in said matters........

      however the gov't does not needto privatizing their state lottery to make more money

      what they need to do, is get rid of them selfs,

      the people who have no clue how to run a lottery before"aka take all the idiotic govt group think law makers out their"

      and hire a greedy ,but committed person -- they must  have a plan, no matter how crazy. They're motivated to do the job, , find me a Person with experice of running a large corporate gambling,

      this is about group of idiots  vs the individual who a evil genius and  can do whatever they want.

       

      and, give them 1% of the profits, and Tell them, Go nuts, any thing you want to do with the lottery, Do it, we don't run the show, you Do now mr new ceo

      they want online lottery website,  its their call, not the state body needing to Okay anything!

      and let see how things Play out for a few years.

       

      however i do have a issue with a private Group of investers, who can "Payoff" the govt law makers, by getting them a ton of upfront cash , to get their out of the hole they digged them selfs in by being idiots in the first place" large debt"    law makers should have to own the debt, and anyone who voted them in, should also be the only ones to pay for whatever their law makers pass

      thats right, we should know ever freaking idiot who voted these beeps in, and whatever "their" law maker voted yes to and got govt into debt, THEY should be the ones to have to pay the tax's for it

      why should i have to pay for things i never wanted and forced upon me, like a 13 plus trillion fed debt,

      however back to my point on group of investers buying a state monopoly

      its giving someone a private State backed monopoly,

      if my fellow man has the right to run a lottery, i do to, no one in united states is above each other.

      the Govt has no power to give a monopoly to anyone, sense they get their powers form The people, and whatever the people  could not do or give, they can't not do or give to anyone else

      i know that sounds crazy to must of you, but thats a fact.   i can't use force and give my "rich" buddy, a monopoly, if you try and get in on hes "market" i come nock down your door, and be like, will he paid me the must, you their for can't also be in this market,

      govt has no rgihts form the people  to give me or you, a monopoly, we all have the same freedom of the market.

      its a moral issue,   then again, am crazy and think govt insane with power they can't have to begin with, like ordering someone to buy something,"rolsl eyes at the feds health care plans"

        Captain Lotto's avatar - CaptLotto
        Jefferson City, MO
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        Posted: March 3, 2011, 4:20 pm - IP Logged

        I'd like to point out that the reason Lotteries were outlawed years ago was due to corruption. When they returned, it was under the guidance of the states, who are accountable to the public. 

        As far as government examples - there are many. A lot of public services are managed by governments - water supplies and road administration come to mind, although certainly not all - for exactly the reason that it saves taxpayer money by removing the profit motive. 

        Governments provide services, and certainly have many more considerations than merely profit.  The well-being of it's citizens, health, happiness, fairness... protecting the interests of the voiceless. Schools are a great example.  If profit were the only motive, a lot more children would "fall through the cracks."  But fortunately, we believe that everyone deserves the opportunity, even if it's not perfect.

        Captain Lotto

        "Every day is a good day!"

          Todd's avatar - Cylon 2.gif
          Chief Bottle Washer
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          Posted: March 3, 2011, 4:27 pm - IP Logged

          I'd like to point out that the reason Lotteries were outlawed years ago was due to corruption. When they returned, it was under the guidance of the states, who are accountable to the public. 

          As far as government examples - there are many. A lot of public services are managed by governments - water supplies and road administration come to mind, although certainly not all - for exactly the reason that it saves taxpayer money by removing the profit motive. 

          Governments provide services, and certainly have many more considerations than merely profit.  The well-being of it's citizens, health, happiness, fairness... protecting the interests of the voiceless. Schools are a great example.  If profit were the only motive, a lot more children would "fall through the cracks."  But fortunately, we believe that everyone deserves the opportunity, even if it's not perfect.

          You bring up some good points Captain Lotto.

          Privatization may or may not be a good thing, I'm not sure.  Last year I came out against it, but now I see good arguments for and against it.

          One thing is for sure.  When the founders used Federalism as the country's guiding principle, they were geniuses.

          Why?

          Because we have 50 little laboratories (called "states") that are each free to try experiments under the guidance of their citizens, and all the other states can observe and learn from the good and bad things that happen in each of the states.

          So it will be interesting to watch and see how this privatization experiment goes, apparently starting with Illinois.  (Although we'll have to see how it goes in the Illinois Supreme Court.)

           

          Check the State Lottery Report Card
          What grade did your lottery earn?

           

          Sign the Petition for True Lottery Drawings
          Help eliminate computerized drawings!

            truecritic's avatar - PirateTreasure
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            Posted: March 3, 2011, 4:53 pm - IP Logged

            As I mentioned before, I am not stating a preference for or against privatization.  I was responding to the first comment in this thread that implied that private companies are somehow inherently underhanded and/or corrupt, and that the government could somehow produce better returns to the state.

            I'm sure the private companies vying for the contract will prove to the state how they will produce good/better returns to the state.  After all, that's what they did in Illinois to win the contract there.  I won't argue their case for them, just read the previous news stories I've posted about the Illinois privatization.

            Overall, OF COURSE private companies are in it for the profit for themselves.  That's what makes Capitalism such a great system.  People and companies constantly strive to be their best when the incentive is profit.

            Lottery privatization capitalizes on this, because the state gets a percentage of the profits, and I'm sure they have baked in the proper controls (like the company doesn't get any profit until a minium is met, etc.).

            I don't even know that "extra money" is an appropriate term.  Does Apple get "extra money" from producing the iPad 2?  Or did they build a better product and get more money with better profits?

            When Capitalism is employed without government in the way, good things happen.

            Regarding corruption, that happens with or without Capitalism, so using corruption as a wedge against Capitalism is obfuscation used to mask a weak argument.

            "that the government could somehow produce better returns to the state."

            I think it is true. 

            "Lottery privatization capitalizes on this, because the state gets a percentage of the profits, and I'm sure they have baked in the proper controls (like the company doesn't get any profit until a minium is met, etc.)."

            (I know, you aren't taking a position - but I have questions about your statements nonetheless).  How can you have any set minimum?  It's a moving target.  You set a minimum of $1,000,000 per month - suddenly the corp comes out with the iPad and is no longer the same corp.  So is it still $1,000,000?  Or the reverse, they get into a mess like the auto companies and can't afford the $1,000,000.  Then will there be bailouts?  Or a Federal Reserve guarantee?

            You don't have to answer those questions.  Will you trust the lottery commissions to make a good deal?  You don't particularly trust government and they are part of it.   Of course, we will never get a say-so in any of the decisions that the lottery commissions make either.

            OK...then next question.

            Why not let private companies compete with the government?  Like the online companies do now.  People would have a choice.  Let the free market decide who stays in business.

            The only drawback for the private companies, they can't keep all the profit like the online companies do now.  That's the kicker and real bummer.  Everyone would want to run a lottery if only they could keep all the profit.

            I'm open to new selling points but based on available information, I think it should stay with the government.

              Todd's avatar - Cylon 2.gif
              Chief Bottle Washer
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              Posted: March 3, 2011, 4:56 pm - IP Logged

              @truecritic:  Remember, they are only talking about privatizing the operation of the lottery.  The lottery itself still belongs to the people (i.e., the government = the people).

              When a state privatizes a lottery, they are hiring an outside company to run the lottery, but the government (the people) still owns the lottery.  It's like a store owner hiring someone else to run the store, and trusting (but verifying) that they do a good job.

               

              Check the State Lottery Report Card
              What grade did your lottery earn?

               

              Sign the Petition for True Lottery Drawings
              Help eliminate computerized drawings!

                joshuacloak's avatar - Money Swim-uncle-scrooge-mcduck-35997717-677-518.jpg

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                Posted: March 3, 2011, 5:36 pm - IP Logged

                am just thinking of ways they could bring in more money if the govt not running the show.....

                 

                1 way ofc is online website where you can buy into their games

                more like maybe what some of them lottery ticket"buying/holding for you" companys do already like the one usamage links via marketplace on their side bar to the right

                ,alone  let you buy a ticket online of say, A raffle ticket,

                sense my tn state has not brothered to make a other raffle game  recently, why not just buy a other states "online" rifle ticket

                 

                 

                tn lottery already has 2nd chance drawings online , where my losing ticket number saved into a random draw of losing tickets

                , and ever one else who entered their losing tickets has a fair shot....

                then we  get a random draw at the end of the game, and a winner is born

                 

                so why not just take it to the next level, we have this vest online market  the state lotterys and their state govts are flat out refuseing to Tap into,   am all for a private group to finally get that ball rolling , even if i hate to death the idea of  them paying people "law makers" off, and getting a monopoly control , backed by the state, the people have no right to give 1 person/group  a monopoly over anyone else, even if you "label it" the people still owns the lottery,

                if it smells like a duck, sounds like a duck, looks like a duck, its a freaking duck.

                and giving lottery monopoly over to a private group of investers, who yes, will make the lottery the same amount of money, or vestly more,   its nonething but a pay off in my eyes , sense the people anyway are to dumb to tap into the lottery earners......

                 

                like i said, give full control over to a evil genius lottery ceo, and let them run the show,  reward them with like 1% of the profits to keep them motived, and see what happens

                no need to give it over to a group of rich investers,  they too will hire a smart ceo/ and let him/her whoever, run the show

                 

                also their a old saying, possession is 9/10ths of the law, meaning if you control it,  it may in title be"the peoples" in bs land, but in reality, its yours for long as you have possession aka control of it

                 

                yes it make the states much  more money if its done right,

                as ever other state  with a lottery don't have the brains or the balls to go for all the untaped profits you could tap into,  if you had FULL control of how to run a lottery,

                thro if a group with full control, who can do whatever they want with how they run it, will be intresting to watch the outcome........

                if state lotterys learn a few things, then good, they need a few good lessons hammered into their freaking thick skulls

                  RJOh's avatar - chipmunk
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                  Posted: March 3, 2011, 5:39 pm - IP Logged

                  @truecritic:  Remember, they are only talking about privatizing the operation of the lottery.  The lottery itself still belongs to the people (i.e., the government = the people).

                  When a state privatizes a lottery, they are hiring an outside company to run the lottery, but the government (the people) still owns the lottery.  It's like a store owner hiring someone else to run the store, and trusting (but verifying) that they do a good job.

                  When a state privatizes a lottery, they are hiring an outside company to run the lottery, but the government (the people) still owns the lottery.

                  From the articles I've read about states privatizing their lotteries they are actually selling their lotteries to a private company in exchange for a large infusion of money now and the companies expect to recoup their investments with a profit on future lottery sales.  Sounds likes they'll not only be running those lotteries but actually own them. 

                  It's like taking the cash option on a lottery jackpot, once they accept the one time big check they won't be getting a yearly check.

                   * you don't need to buy more tickets, just buy a winning ticket * 
                     
                               Evil Looking       

                    Todd's avatar - Cylon 2.gif
                    Chief Bottle Washer
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                    Posted: March 3, 2011, 5:45 pm - IP Logged

                    When a state privatizes a lottery, they are hiring an outside company to run the lottery, but the government (the people) still owns the lottery.

                    From the articles I've read about states privatizing their lotteries they are actually selling their lotteries to a private company in exchange for a large infusion of money now and the companies expect to recoup their investments with a profit on future lottery sales.  Sounds likes they'll not only be running those lotteries but actually own them. 

                    It's like taking the cash option on a lottery jackpot, once they accept the one time big check they won't be getting a yearly check.

                    That's what I thought at first too, because the media always wrote about "selling the lottery", but in fact they're not selling the lottery outright.  In fact, it probably would be against the law to do so.  They are selling a contract for running (operating) the lottery.  The government puts the contract out for bid, and evaluates all the companies to see who does the best job while returning the best profit.

                    That's the process Illinois completed, and they awarded a ten-year contract to three companies -- GTECH, Scientific Games, and an energy company, which formed a partnership for the purpose of operating the lottery.  (Camelot, the company that runs the UK National Lottery, was the big company that lost the bid to the GTECH clan.)

                    Here's a link to the news story: http://www.lotterypost.com/news/226403

                     

                    Check the State Lottery Report Card
                    What grade did your lottery earn?

                     

                    Sign the Petition for True Lottery Drawings
                    Help eliminate computerized drawings!

                      joshuacloak's avatar - Money Swim-uncle-scrooge-mcduck-35997717-677-518.jpg

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                      Posted: March 3, 2011, 6:07 pm - IP Logged

                      i want to Gtech and scientific games websites, o boy now i think i know what their planning

                      just look at websites and what "gaming" products they already offer,  1  even had betting games for smart phones,  ooooo  i can't wait to see what happens when they flat out gain control over a state lottery,  sure they are already The  instant scratch off game and lottery terms super powers, aka  supplyers to mustly ever state

                      but boy do i see them going wild with full control over a state lottery, something tells me their going to turn Illinois lottery into one hell of a guinea pig test subject of ever thing they been wanting to do

                      but states lotterys have been to laid back is a nice way of saying it to TRY it

                       if done right, they make a killing alright...... as they sure as hell got the collective experice to pull it off, record breaking profits that is

                      1 line even said"

                      "Uses a retailer's existing in-lane POS terminal (cash register)to sell online quick-pick lottery tickets."

                      the tech already their, they just need to hold the tickets for you at lottery HQ,  and check your numbers online, show proof of id, and claim your prize/ticket they holding for you

                      it can all done, god do i hope they try something like that thro.....

                        RJOh's avatar - chipmunk
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                        Posted: March 3, 2011, 6:15 pm - IP Logged

                        GTECH recently won a contract with Ohio.  They provide the system (terminals, scratch off tickets and such) to play the games, it will be interesting to see what more they are doing for Illinois to raise that additional one and a half billion dollars.

                         * you don't need to buy more tickets, just buy a winning ticket * 
                           
                                     Evil Looking       

                          Todd's avatar - Cylon 2.gif
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                          Posted: March 3, 2011, 6:21 pm - IP Logged

                          GTECH recently won a contract with Ohio.  They provide the system (terminals, scratch off tickets and such) to play the games, it will be interesting to see what more they are doing for Illinois to raise that additional one and a half billion dollars.

                          That's the idea, but instead of just being the company that supplies systems and tickets, they staff every position at the lottery -- the management, the marketing, the draw staff, etc.  They decide how to run the whole operation (within whatever limits are within their contract).  The state continues to have oversight, probably with some kind of lottery oversight panel in the legislature.

                          I'm sure they create more profit through efficiencies (cost savings) as well as additional marketing of some kind (increased revenues). When the state awards a contract of that magnitude, you can be sure the companies bidding would produce detailed plans for how they will increase the profit.  (That would likely be part of the bid package.)

                          In my career I've had to respond to many different bid requests, and they tend to be very lengthy, detailed documents.  I can only imagine the length and scope of these lottery privatization bids.  They must be massive.

                           

                          Check the State Lottery Report Card
                          What grade did your lottery earn?

                           

                          Sign the Petition for True Lottery Drawings
                          Help eliminate computerized drawings!


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                            Posted: March 3, 2011, 8:15 pm - IP Logged

                            An easier way to look at this is to just pull back, make a couple of observations, and then ask a simple question.

                            (1) Observe that, at the moment, Missouri is making a LOT of money running their lottery.  Perhaps they could be making more, perhaps not.

                            (2) The corporation that ultimately wins the bid, through contractual agreements for future payments to Missouri, and a giant ante of tens or hundreds of millions of dollars up front, is currently making NOTHING from the lottery.

                            (Q) Simply ask yourself why these corporations would be willing to compete with each other to commit themselves to such a high stakes responsibility.

                              ameriken's avatar - 33ojew2
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                              Posted: March 3, 2011, 10:07 pm - IP Logged

                              Corporations can do amazing things with their own money, and do it far better than the government could ever do with taxpayer money. Government should be trying to do things at a profit, if they did we'd be in far less trouble now as a country. When government runs out of money, they just raise the shortfall through taxes. Businesses have to find a way to make it.

                              However I am not quite as trusting of corporations when it comes to public/taxpayer money as  think there is a very high potential for abuse. Bottom line is, I think a corporation would do far better with lottery money than the government would, however as long as I can be assured that there is a tight measure of accountability and very strong government oversight. That is a mix that could work. Without good oversight, I'm not for it.