April 02, 2006

North Carolina Hits the Jackpot?

Earlier this week, North Carolina became the 42nd state to implement a lottery; tickets went on sale Thursday morning. The lottery was a contentious issue for years, but what finally seems to have won over lawmakers was the argument that every neighboring state already had one. If NC residents are gonna gamble, the argument goes, it should be NC government that benefits, not Virginia.

Virginia lawmakers are now feeling the other side of this double-edged sword, since the 8 to 10 percent of Virginia lottery revenues that used to come from NC residents will presumably no longer be there. The same story appears to be playing out in South Carolina.

Lottery advocates frequently delude themselves by arguing that lottery revenues won't be paid by state residents, but will come largely from visitors from non-lottery states. This argument was presumably made in Virginia and South Carolina when their lotteries were created. Now that North Carolina has become the last Eastern Seaboard state to enact a lottery, that argument rings pretty hollow. In any region, the goal of saddling neighboring states with the cost of funding education through slots, lotteries or other forms of gambling will not be met. This "race to the bottom" leaves each state funding public services by a "voluntary" tax on its own poorest residents.

One editorial board tells it like it is here.


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