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Teaching Reckless Spending By Example

September 16, 2008

When you go to Las Vegas you enter a surreal world of fake Eiffel Towers and Venetian gondolas that wander through shopping malls. After a couple of days, you walk right past Elvis without bothering to ogle. Vegas is a temple to faux-culture. Yet, there is something distinctly honest about what happens there. When you play black jack at the Rio you know that management is not terribly concerned about your financial well-being. They are out to make a buck on you, as many bucks as they can. Their motives are pure and well understood.

State run lotteries are the real sham. They put Las Vegas to shame. If I feel like I’m ready to “Go for the Gold” Virginia has a lottery ticket for me.  If I’m nostalgic for my old Who albums “Pinball Wizard” might be my ticket that day. But, the lottery cloaks itself in moral goodness. Go to the Virginia Lottery web site and you will see proudly displayed  “More than $3 billion for public education.”  For most people, playing the lottery is an act in financial irresponsibility….in reckless spending. But, more than just allowing this kind of behavior, the State supports it.

Depending on your particular political persuasion you probably believe that:

  1. Financial decisions are strictly personal. Federal and state governments should not seek to influence personal financial decisions by constructing policies aimed at encouraging thrift — or
  2. Federal and state governments should seek to encourage citizens to save more through active policy measures.

Short of deep cynicism, “I think the lottery is a tax on stupidity and stupid people should be taxed,” no reasonable political philosophy would advocate the state encouraging financially reckless behavior. And make no mistake, lotteries are successful not because some of us spend a buck once in awhile to have a good time, but rather because many people who have very little spend a lot of their bucks. If you doubt this for a minute, you can look to the recent uptick in lottery sales driven by the financial downturn to convince yourself. The worse off some people are, the more likely they are to buy lottery tickets. Lottery money is like crack cocaine for the State. It is wrong, and we all know it is wrong, but we just keep on shooting up.

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4 comments

  1. This is very true.


  2. I live in the Detroit Michigan/Windsor Ontario area. These cities have been in recession for some time now, long before it hit the rest of the US and Canada. Many years ago, seeing the outflow of jobs and accompanying hope, local politicians replaced manufacturing jobs with “casino” jobs. A large casino opened in Windsor, followed by 3 in Detroit.

    Taking a walk through these regulated thieving operations is one of the most depressing things any of us can do. They are custom designed centers for feeding off of desperation, false-hope and addiction. They were sold as “new jobs” and a “boost to charities”. What they really do is manipulate those who have little into having even less.

    Your title was “Teaching Reckless Spending by Example”. I heard a report on NPR recently where an “expert” was asked to give advice on teaching thrifneess to our kids. I found the advice utterly laughable. The “expert” recommended sitting down with our kids, and talking to them about money and cutting back on spending. It was given as analogous to “talking” about sex. I don’t think talking to kids about spending and saving is a bad thing, in fact, I think it should be done much more than it is. However, my issue with the story was the complete lack of discussion regarding parents showing their kids by EXAMPLE how to spend/consume less than they earn, so as to save for the future. We can talk to our kids all we want, but what they are most likely to do is that which we do, not that which we say.


  3. The stock market is no less a gamble. The impulse to throw money at various indices with hopes of hitting it big and picking a winner is just as strong at the horse track as it is on Wall Street.

    Our society is addicted to the idea of “something for nothing”, and any “fix” for our economy short of squashing that mentality will fall short of being able to actually fix anything.


  4. Well done! State lotteries are abominable public policy. Not only are they essentially an extrememly regressive tax (how many Jaguars do you see lined up at the convenience mart buying tickets?), but they actually encourage the ‘get rich quick’ philosophy. This is the absolute antithesis of what government should be doing. Unfortunately, I can’t imagine anyone taking on this issue – I have minimal problems with lotteries or gambling as consumers should be free to do as they wish, so long as they face up to the consequences of their actions (see “I bought a house with no money down”). But state-sponsored gambling? I think not! And, not only that, but the odds at the slot machine are much better than on Powerball.



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