NEW YORK — Georgia’s lottery players are the biggest suckers in a nation buying more than $50 billion a year in tickets for the state-run games, which have the worst odds of any form of legal gambling.
Players in Georgia, whose per capita income is about 10 percent below the U.S. average, are doing the most damage to their personal finances compared with lottery-playing habits in other states, according to the “Sucker Index” created by Bloomberg Rankings.
While the state had the sixth-highest prize payouts, 63 cents for each dollar spent, consumers there spent the second-highest chunk of their income on the lottery, which funds scholarships and pre-kindergarten.
Of the 43 states with lotteries, 26 had higher sales last fiscal year, helping to make up for lower taxes and federal aid. Governors used the revenue for programs from education to environmental protection. The pot comes disproportionately from lower-income residents, who shelled out a larger percentage of their pay on the games than wealthier people, according to a study in the Journal of Behavioral Decision Making.
“It’s a pro-rich wealth-redistribution technique in Georgia,” said Charles Clotfelter, a Duke University economics professor and co-author of ” Selling Hope: State Lotteries in America.”
“To link that tax revenue to a benefit that goes largely to middle-and upper-class citizens is a little stunning,” Clotfelter said. “It might even strike one as cynical: You’re taking from those with few means and helping those with more means.”
In 2010, Georgia residents spent an average $470.73, or 1 percent of their personal income, on the lottery, the Sucker Index shows. Only Massachusetts was higher, with spending of $860.70 per adult, more than three times the U.S. average. Georgia had per capita income of $34,800 in 2010, below the national average of $39,945, while Massachusetts’s was higher at $51,302, according to data compiled by Bloomberg.
Massachusetts players were the biggest lottery winners, getting back almost 72 cents on the dollar, according to Bloomberg data. That state still places second on the Sucker Index because spending as a percentage of personal income is the most, at 1.3 percent.
New York ranked third in the index, followed by Michigan and South Carolina. The lowest scores went to Oklahoma, Washington, South Dakota, Montana and North Dakota.
Bloomberg Rankings created the Sucker Index with 2010 data from the U.S. Census and annual reports from state lottery commissions, which include multi-state games. The total dollar amount of prizes awarded was subtracted from ticket sales, and then the difference was divided by the total personal income of each state’s residents.
Georgia’s lottery law says the state should contribute “as near as practical” to 35 percent of the proceeds to pre- kindergarten and the Helping Outstanding Pupils Educationally (HOPE) scholarships, which pay full tuition for in-state public and private colleges and technical schools. A share that large was last transferred in 1997, according to a state audit.
Last year, with the lottery-funded programs facing a $300 million deficit and “on the brink of bankruptcy,” Gov. Nathan Deal, R, enacted scholarship changes that raised grades and test scores for eligibility, eliminated funding for books and fees and cut payments for remedial classes. He also cut the pre- kindergarten program to 160 days from 180.
In the fiscal year ended June 30, the Georgia lottery gave 25.3 percent of revenue, or $846.1 million, to education. The percentage of proceeds awarded isn’t as important as the dollar amount, which has been growing, said Tandi Reddick, the game’s media-relations manager in Atlanta. In 1997, the lottery gave 35 percent of revenue, or $581 million, she said.
The Georgia lottery had record sales in the week ended Feb. 11, taking in $101.2 million and surpassing a 2007 record by more than $5 million, Reddick said.
“There is a delicate balance that must be achieved between prizes paid and profits returned,” Reddick said. “If we believed for a moment that the lottery could increase the annual dollar amount returned to education by reducing prize payouts, thereby increasing the percentage return to the HOPE scholarship and pre-K programs, we would not hesitate to do it.”
The National Gambling Impact Study Commission, in a 1999 report, found lotteries to be nation’s the most widespread form of gambling, and the type with the longest odds.
Unlike Georgia, with its dedicated stream to education, Massachusetts returns 95 percent of lottery revenue to its municipalities to do with as they wish: $802.2 million for the fiscal year that ended June 30, 2011. The rest goes to gambling- addiction programs, cultural groups and community services, said Paul Sternburg, director of the lottery.
“We paid over $3.1 billion in prizes last year, so there are a lot of winners out there,” Sternburg said. “If we went any higher, we’d be hurting our net profits.”
Following is a list of states ranked on the “Sucker Index” created by Bloomberg Rankings, using data from 2010:
1 Georgia
2 Massachusetts
3 New York
4 Michigan
5 South Carolina
6 New Jersey
7 Maryland
8 Ohio
9 Pennsylvania
10 Florida
11 Kentucky
12 Rhode Island
13 Connecticut
14 Delaware
15 Tennessee
16 North Carolina
17 Maine
18 New Hampshire
19 Virginia
20 Illinois
21 Missouri
22 Texas
23 Vermont
24 Arkansas
25 Indiana
26 West Virginia
27 Idaho
28 Louisiana
29 Arizona
30 Wisconsin
31 New Mexico
32 Kansas
33* Iowa
33* California
35 Colorado
36 Minnesota
37* Nebraska
37* Oregon
39 Oklahoma
40 Washington
41 South Dakota
42 Montana
43 North Dakota
*Indicates tie
The “Sucker Score” is calculated by subtracting the total dollar amount of prizes awarded from the total dollar amount of ticket sales, then dividing the difference by the total personal income of the state’s residents. A higher resulting number, lower prize payout and/or higher per-capita spending on lottery tickets lead to a higher Sucker Score.
Excludes Washington, D.C., and Puerto Rico. Alabama, Alaska, Hawaii, Mississippi, Nevada, Utah and Wyoming do not have state lotteries.
Maybe Mississippi an Alabama are not as dumb as we thought.
“The Lottery, with its weekly pay-out of enormous prizes, was the one public event to which the proles paid serious attention … It was their delight, their folly, their anodyne, their intellectual stimulant … the prizes were largely imaginary. Only small sums were actually paid out, the winners of the big prizes being non-existent persons.”
1984 (Nineteen Eighty-Four)
Part 1, Chapter 8.
BTW, Is anyone else tired of standing in line behind people who purchase scratch tickets at stores…and then scratch them then and there…redeeming any winners…and starting all over again?
That’s like someone pumping gas then going inside to use the bathroom or buy something else, when there is a line of cars waiting to use the pump. Have some common courtesy conduct your business and move off.
1984 could be renamed 2012. so much has come true.
Hope the people know what you are talking about. I do, that’s why I drimk.
A lottery is nothing but a tax on poor people. If a legislator proposed a new $500 per year tax on low income earners, he’d be hung out to dry. But call it a lottery and it’s no problem.
No, it’s a tax on people who are bad at math. No one forces the poor to play the lottery, and when I was making minimum wage I knew it was a waste of $ to buy scratch off tickets.
Obviously no one is forced to buy lottery tickets, but they do, and it is the same effect as a tax – you are paying money to the government. Be my guest!
My point is that this is not a tax on poor people, unless you believe all poor people are dumb.
I know many poor people who don’t regularly play the lottery, and I know many people with higher incomes who play the lottery all the time.
It has more to do with your understanding of statistics than anything.
Your personal knowledge of “many poor people” is irrelevant though. As a whole, lottery players are largely lower-income people — that’s fact.
So what? Correlation does not equal causation.
But it’s not the cause— again, it’s not a tax on poor people, it’s a tax on people with poor judgement and math skills.
Sorry missed this: I concur.
As someone who was once poor, but never dumb, I’m insulted by the suggestion that the poor are somehow too stupid to know better.
This is my point, exactly.
For the same reason, I don’t demonize black youths as more prone to crime, because it’s not the fact that they are black and young that causes this— it is the youths growing up in single parent households in poverty that are more prone to crime, and there is a statistical correlation between that and blacks in our country. Correlation does not equal causation.
In the case of the lottery, it’s not the fact that these people are poor that makes them play, it’s the fact that they have poor judgement on their odds of winning, and therefore they play too much.
Wow, stop it! Most people on this site are a Tom Cruise type…They can’t handle the truth!
State-run lotteries are a special tax for stupid people. It’s quite sad, in reality.
I know plenty of poor people who are not stupid and understand that lottery tickets are a losing bet every time. Your comment suggests you think poor people can’t think for themselves. Insulting, really…
I think you meant this to answer another comment— my point was the exact opposite, because I was once poor, and knew better than to spend my paycheck on scratch-off tickets & quick pick jackpot chances.
Yes, whoops, hit reply in the wrong place…
Actually, it’s a tax on dumb people. Everyone can play the lottery regardless of income level.
there choice
Are you calling poor people dumb? That’s not nice. I am not poor but that tyoe of language is very offensive. So smart people don’t buy lottery tickets. Hmmm.
May I suggest you read through the comments to see who was calling who dumb. BTW you spelled “type” wrong.
No one forces anyone else to buy a scratch ticket. Last time I checked there was NO law forcing people below a certain income to buy scratch or other lottery tickets.
By golly you’re right!
No jobs, Slave wage jobs. A lot of very, very desperate people existing in Maine. They see the lottery as their only hope to escape Maine’s Brutal Poverty.
They see it that way because that’s exactly how the state advertises it. The state sells the hope of life-altering wealth ….. a myth that others forms of gambling (slots, horseracing, bingo) do not stoop to.
Lottery: Voluntary tax. Lottery winning: Voluntary tax refund.
Alas, with this report out, it’ll mean the state will have to come up with other taxes (“fees” in current political PC-terms) to make up for the lack of suckers paying into the voluntary tax.
Not really, no amount of logic will make up for a fundamental ignorance of statistics and math.
I was referring to our low rank on the list rather than the lack of idiots within the state.
States fight against casinos, but push lotteries. Maine spends big $ advertising the lottery and then adds the disclaimer, “please play responsibly”.
The state is in the position of regulator & competitor when it comes to casinos. They should get out of the lottery business.
Ever noticed how ironic the slogan is? “DREAM a little, DREAM a lot” That’s about all you can do is DREAM! lol
How many people who buy lottery tickets can/will read this article? It’s a shame that the people who support the lottery are those that can least afford to.
Oh, but in their mind, it MIGHT be the BIG ONE! Most times, the big one is in the backside…
Isn’t freedom great? What do you suggest, an IQ test or you tax forms before buying a lottery ticket? Then when someone with money wins, you will just say they don’t deserve it.
You are right, everyone is free to buy or not buy lottery tickets and that’s great. It may be perfectly legal to take advantage of low income people by selling them lottery tickets but is that a proper function of government? The Preamble to the US Constitution lists “promote the general welfare” as a reason for having a Constitution. I’m not sure that extracting an average of $500 per person in lottery ticket sales does much to promote the general welfare.
I don’t believe the state should be involved in lotteries, but I don’t understand how it is taking advantage of low income people. You seem to be suggesting that you know how to better spend their money than they do. Under your assumption, Coca Cola, Pepsi, Lays, McDonald’s, Wendy’s, etc are also taking advantage of the poor and not those who are better off. “Extracting” $500 I guess is one way of the poor paying their “fair share” of taxes, right?
Why do you believe the state should not be involved in lotteries?
It seems to me that there is a bit of a conflict of interest. They run the lottery and they make the rules for the lottery. And the legislature did not want the casinos. Maybe they didn’t like the competition. And now they get to write the rules for them as well.
Well, I can and did read this. I buy tickets, too. And I won big, too. Nice annuity for 25 years. I may have been poor once, but I was never dumb. College educated, IQ 142. Ironically my degree is in Agricultural and Resource Economics. Had one very pertinent course titled The Principles of Statistical Inference. I won’t try to explain it, but I enjoyed it very much and found it very useful. Didn’t discourage me from playing the lottery one bit. Didn’t diminish my enjoyment of Vegas either. Entertainment, pure and simple. How I spend my $$ is my choice. Can’t win if you don’t play. Pretty obvious most of the posters here have never won. Jealousy talking?
I play every once in a while. What the heck. a bag of chips or a lottery ticket. Win or lose it’s still fun. Congrats on winning.
Rob from the dumb and give to trust fund babies who inherited their wealth. Some things never really change.
How is someone willfully going into a store and buying a lottery ticket “robbing” them? As far as I know it is their money and they can do what they want with it. And I’m curious how the lottery money is given to the “trust fund babies who inherited their wealth”. Sounds to me like more class envy. What are people suppose to do with their wealth that they have worked hard and accumulated over their lifetime? Give it to you?
I have one in the past. I am certainly no trust fund baby. It’s called freedom of choice.
i think you’re confusing the lottery w/ wall street.
ehh, 2 pigs in a poke.
Freedom of choice is such a hard thing for many people tro grasp. Don’t like the lottery? Don’t play it.
Lotteries financed the Revolutionary War, the construction of Harvard University, and the Great Wall of China.
Ya Harvard thier endowment fund is worth like 40 billion . That seems like an almost evil amount of money to hoard when a lot of people can not afford an education. One little school make more interest on thier endowment fund than the state of Maine is run on. And people talk about uneducated people on welfare.
You can’t buy lottery with EBT cards. Cash only.
That’s what they said, “people buy 20 bucks of powerball with cash”
And people with EBT cards never abuse them by getting 20 cents on the dollar so they can buy their coffee brandy, cigs and weed. Nope it never happens. Oh heck some liberal flaged me because I complimented the intelligence of Oklahoma indians. My God I must be a racist
Where can I get an EBT card for 20 cents on the dollar? I’m paying 50 cents on the dollar
p.s. sorry big brother flagged you. I want to hear what you have to say. Who are the monitors anyway. . .
My step daughter and her convict boyfriend! That’s all they could get from their dealer. As far as monitors, they don’t have the guts to identify themselves
Why don’t you read my comment before you flag me
Ah…the dream of the “soon to be haves”. It is to laugh.
I tend to buy a quick pick ticket for the major games when I think about it, because you can’t win if you’re not in the drawing at all.
But beyond one ticket, you are throwing money away. And scratch-off tickets are fun to bring to a party with friends, but never a good use of money.
A far, far better use of this money would be to take that dollar and put it away; if you’ve been buying scratch-off tickets every week as a habit, you’ll easily have $100-400 over the course of a year, and that can be invested in penny stocks for “rich man’s cash 3” as I’ve heard it called :)
The lottery is a tax on people with poor math skills.
ALL lottery proceeds should be returned to school math departments.
THAT would be a great idea! Plus we need our schools to do a MUCH better job at teaching economic life skills; knowledge of interest rates, how credit cards work (and what to look for for a “good” credit card), etc.
It amazes me that there are ads on our TV for loan sharks these days (talking about “Western Skies”)– the fine print shows that you’ll pay upwards of $30,000 over 7 years for a one time loan of $5,000, an APR of over 100%. No amount of desperation makes that a realistic decision, they are preying on people with poor math skills.
“It’s a pro-rich wealth-redistribution technique in Georgia,”
It’s really more of an “anti-dumb people” wealth-redistribution technique.
Dumb people throw their money away and the rest of us get good schools for our kids. Sounds fine to me.
The Maine State Lottery. A tax for people who can’t do math.
I dont know ! I think in this case its better we arent ranked number 1 ! For a change !
Dollars are to hard to make just to give it back to the state
What a stupid poll. Did Dennis Bailey make this one up by himself?? There is no way to track who is buying lottery tickets. Rich? Poor? How do you really know? This is a complete joke.
I wonder how this list stacks up against welfare benefits. Working in a grocery store I can’t tell you how many times I saw people buy food with foodstamps and head right to the lotto machine and start pumping in the cash they had left over after buying their booze and cigarettes in a seperate order.
While in Maine we have to pay for them EBT cards somehow. So buying the lottery tickets is just helping out the state. Consider me dumb because I buy lottery tickets and do not live on welfare.
When you wish upon a star……
Anyone that is dumb enough to buy a scratch off ticket shouldn’t have children.
I never play the lottery. Its rigged to rip you off. The Govt planned it well.
I am waiting for the Casino to open in Bangor.
Privately run , not rigged to lose.
Imagine.
The house always wins. Private or government run.
powerball et al are also rigged. why else would the cut-off time to buy tickets be 2 hours before the draw? to give the computer time to calculate what sequence of numbers to “”pick”” that will pay out the LEAST amount of money. only when it is mathematically impossible to avoid is a jackpot winner awarded, usually during a blue moon. watch the “live” draw and pay attention, sometimes the announcer slips and announces a number BEFORE it even comes out of the bin, oops!
ahh bloomberg news, headquartered in NYC, noting maine is #17 on sucker list. new york is #3, so, who’s blacker, the pot or the kettle?
The state should not be in the business of exploiting and taking advantage of people’s economic desperation, simply because it generates revenue. Government is supposed to be for the benefit of society, not feed off of it… But it is not surprising that so many people here seem to support the practice. I’m especially amused at the person who claims to have an IQ of 142, who won a major prize some time ago. That’s not something I’d brag about.