In the popular imagination, the lottery is a harmless amusement in which people spend a few dollars on a Powerball ticket when the jackpot gets big. Data journalists and reporters from the Howard Center for Investigative Journalism at the University of Maryland and Boston University found this is not the reality.
Increasingly powered by multinational corporations, state lotteries have become the engine of a multi-billion dollar transfer of wealth that relies on spending by less-educated and less-wealthy Black and Hispanic Americans.
Using data and documents, we followed the money from low-income neighborhoods through state coffers to the multinational corporations, none based in the U.S., that are increasingly taking over management of state games.
We interviewed lottery players to illustrate how people play. Many spend hundreds of dollars a week on scratch-off tickets. We reviewed advertising and advertising contracts to illuminate why people play, disclosing that increasingly sophisticated messaging is misleading, is often targeted at minority communities and is unregulated by the Federal Trade Commission. And we dove into state budgets to show where lottery proceeds are going, revealing that promises to support education and problem gambling programs don’t match reality. Poor K-12 schools do not benefit as much as wealthier school districts, despite being in neighborhoods that pour more money into the lottery. And wealthier college students benefit disproportionately from lottery-funded scholarship programs because they are based on merit, not income, in some states.
This first-of-its kind analysis is important, comprehensive and novel. The judges were impressed with the innovative approach to analyzing mobile phone data.