A $20 Scratch-Off Ticket?!?
Feb 12th, 2007 by Alex
I heard a radio commercial for Maryland’s $25 Million Frenzy today and it made me a bit mad. Not only does Maryland plug the things non-stop on every type of media available, they go and offer an even more expensive ticket. Did I miss something… is $20 the new $1? $20 for a scratch-off?!?
So I researched a bit and found the following…
In the 2006 fiscal year, Maryland residents purchased $291M worth of scratch-off tickets. That’s just under 50% of all procedes from ALL Maryland Lottery “games,” or as I’ve heard it referred to: the tax on the mathematically challenged. You pay tax on your income and your property, for starters. For that, we get quasi-reliable trash removal and horrible snow removal in the winter. Why contribute to yet another fund? Don’t we pay enough taxes already?
To borrow from a casino term, let us define “house edge” as the ratio of the average loss to the initial bet. Of the most common casino games, craps and blackjack have the lowest edge (playing the pass line w/ 5X odds @ 0.32% and 0.20% respectively). Keno has the worst at 25-29%, which Maryland amusingly offers as well.
Maryland revenue from the Lottery was $1.56B in FY06. After prizes and expenses the state still banked over $500M. Yet Maryland law prohibits organized gambling. Why? Because there’s less money in it. Do some simple math and we can figure that the “house” edge on Maryland lottery sales as a whole is a whopping 42%.
( ( 1.56B - 0.902B ) / 1.561B ) * 100 = 42%
I imagine that individually this edge is even worse, since the bulk of people who buy tickets don’t win anything. Even if you win something, over time those winnings will barely move the average when compared to all that you’ve betted. The Lottery doesn’t publish their odds, unfortunately.
Gambling is bad. The Lottery is okay, though. Really, because we here at the Maryland Lottery say so! Despite all sorts of warnings on their web site and the scratch-off tickets themselves, people don’t seem to view the lottery as gambling. It’s nickel and dime and chews at you a little bit at a time, but it’s still gambling. People that buy lottery tickets as an investment are fools. How many people do you know that have continuously earned playing the Lottery? retired from their winnings?
I’ve scratched off one ticket in my life. Someone gave me the dollar, said to go buy a ticket and scratch it off. Their money, not mine. I didn’t win. I wouldn’t have expected anything else.
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Hear hear!
I loathe the lottery and gambling. Not for any moral reason; I happen to be a pretty amoral person. However, Gambling just grinds my gears. It’s a poor mans tax and I simply cannot justify spending my money for a “chance” at more.
Call me a hypocrite, but I do enjoy the excitement of the gaming tables once or twice a year. For me, it’s a fixed entertainment expense; I have a fixed amount that I come to AC/Vegas with and when its gone its gone, a few comp drinks to the wind and entertained. But I really don’t understand the scratch-off tickets…
I can see enjoying the excitement of gambling if one understands the system and can use that understanding. I did venture into a casino once only to immediately lose the money I had set aside to give it a go. I was soooo mad at myself. t took less then 20 minutes for me to lose the cash.
Scrath offs and lottery tickets are an idiot tax. I used to feel bad about saying that, but now I don’t. I encourage people who play the lottery to give me their money instead, as they will get the same result either way.