Editorial: State-run lottery is a bad bet

Wednesday, March 13, 2002 | 8:23 a.m.

Assemblywoman Kathy McClain says she will again introduce a bill in the 2003 Legislature that, if passed, would be the first step in changing the Nevada Constitution to allow a state lottery. In the 2001 Legislature, with the gaming industry -- a traditional foe of a state lottery -- remaining neutral, McClain's bill passed the Assembly but fell short by one vote in the Senate Government Affairs Committee. Opposing senators said state lotteries encourage problem gambling, and that after all administrative costs are factored in, the net revenue would not be enough to justify changing the Constitution. We agree. At this time we do not see any evidence that would persuade us that a lottery would benefit Nevada.

Sheer numbers are superficially impressive. Rhode Island, population 1.05 million, grossed $864 million in the year 2000 from lottery sales. Other states posted impressive numbers as well, but a closer look reveals that lotteries provide considerably less than 3 percent of a state's budget. For Rhode Island to gross that much, the expenditure per person in 2000 worked out to $823.16. Studies show, however, that revenue is not generated that evenly, that, in fact, the majority of revenue is provided by people who spend well above the per capita figure. And over and over studies show that those most apt to chase the lottery dream are those who can least afford it. While opposition to a lottery may sound paradoxical in a state whose leading industry is gaming, we feel that government should stick to its primary role of providing necessary public services and stay out of the gambling business.

Most lotteries are peddled as boons to one public need or another, such as education or public safety. But again, studies show that states tend not to use lottery funds to augment departmental budgets -- with lottery money coming in, they can simply appropriate less from the general fund. This practice over time erodes the fair and time-honored way of raising public funds through an equitable tax system. And what happens when lottery sales fall off, as they have been doing lately all over the country? Consider also the state bureaucracy that would evolve in running and marketing a lottery. Speaking of marketing, state advertising campaigns are universally reviled as the ultimate in deception because lotteries offer only an infinitesimal chance of winning, a sucker bet, if you will.

The people of Nevada are well served by the state government's regulation of gaming. They would not be well served by a state government also running a numbers game on the side.