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Lotteries are games of chance where players pay a small amount of money in exchange for the opportunity to win a larger sum. The odds of winning are slim, but some people find themselves with millions of dollars that can make their lives better than they had been before. The lottery is addictive, but it can also be dangerous if not played correctly. It is important to understand the odds of winning before you start playing.

The history of lotteries goes back a long way, with records of them appearing in ancient Egypt and the Roman Empire, where they were used for everything from divining God’s will to deciding who got to keep Jesus’ garments after his crucifixion. In colonial America, they played a major role in financing private and public ventures, including roads, canals, churches, and colleges. They were also a popular source of income for militias fighting in the French and Indian War.

In the nineteen-sixties, however, state budgets came under strain. As inflation rose and the cost of the Vietnam War mounted, states struggled to balance their books without raising taxes or cutting services, both of which would have been unpopular with voters. In search of an alternative, lawmakers turned to the lottery.

Lottery advocates argued that, since gambling was already legal in many states, the government might as well take advantage of it. Dismissing ethical objections, they argued that the profits could help fund a service that voters wanted but did not want to pay for. Usually, this meant education, but sometimes it included elder care or public parks.

The problem with this line of reasoning, as Cohen explains, is that the lottery was not actually an effective solution to state financial problems. Even with the proceeds from the game, lottery funds were often less than a quarter of the total annual spending by state governments. The rest was covered by existing tax revenue and the money that working families had saved over the years.

There was an additional problem: As Cohen points out, the obsession with “unimaginable wealth,” which was fueled by the lottery’s advertising and the dream of a big payout, coincided with the collapse of Americans’ financial security. The income gap widened, pensions and job security were cut back, health-care costs increased, and the old promise that hard work and education would make children better off than their parents was no longer true.

In addition, the one-time payment of winnings from a lottery is rarely as high as advertised, because of income-tax withholdings and other deductions. It is much smaller than the annuity payments that many participants expect to receive, and most winners choose lump-sum cash. As a result, the average lottery prize is about half what was advertised on television. Despite these facts, the lottery remains a popular choice for discerning consumers. As the e-book version of this article demonstrates, it is easy to be fooled by these deceptive figures and by lottery advertising.