Issue Number 4 – Lottery Funds Not the Answer for Education

North Carolina Citizens for a Sound Economy today released Issue Number 4 of its ongoing effort to educate elected officials and citizens on why a government-run lottery is bad business and public policy.

Lottery funds do not always go toward education.

Proponents of the lottery are saying that the lottery will fund education. But, the history of state lotteries shows a different reality. In 1996, a Money magazine article, “Lotto Fever: We All Lose!” showed that several states diverted lottery funds originally earmarked for education. In these states the revenue brought in from the lottery was added to the general revenue (making it hard to trace) and then spent to fund other government programs. These programs may have little, or nothing to do with education.

In those states where lottery funds were only used for education, it is a mixed record at best. States such as Georgia, with its HOPE scholarship program, have been criticized for relying too heavily on poorer consumers to fund the program. Since the lottery tends to target the poor communities once the novelty factor wears off and lottery sales decline, it is clearly evident that the lottery is just a scheme to tax the poor to subsidize the education of more affluent citizens.

“On average, states with lotteries spend a smaller proportion of their budgets on education than states that do not have a lottery,” said North Carolina CSE Director Jonathan Hill. “Politicians may try to sell the idea of a lottery saying it will fund education, but the facts prove that the lottery will fund other programs and a bigger government.”