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January 23, 2006

Monday Musing: A Moral Degeneracy

One of the few vices I have always had an extreme aversion and almost allergic reaction to is gambling in all its multifarious incarnations. So much so, that I have never even learned to play a single card game, because they are all somehow indissolubly (and probably unfairly) associated with gambling in my mind since an early age. Besides the irrationality of trying to "beat the odds" at a casino, and the elaborately idiotic "systems" that people come up with for doing so, the idea that one is getting some entertainment in exchange for throwing one's money away is, at the least, irritating to me. Since when is sitting in a near-hypnotized state in front of a gaudily festooned refrigerator-with-a-gearshift-lever-attached for hours, feeding small (and not so small) change into it, and occasionally getting some ducats spat out at one, considered entertainment? And why? I'm sorry, it seems much more like a compulsive sickness to me.

Still, if people want to congregate in some monstrously ugly building and drunkenly give their money to casino owners for nothing in exchange, and to find this entertaining, who am I to object? I don't even begrudge the Native-American tribes that have managed to get something back from the people who have taken everything else from them, by taking advantage of their addictions for a change. I do, however, draw the line at state-sponsored gambling. Human minds have a well-known and well-studied weakness in dealing with probabilistic phenomena. (See this earlier 3QD article, for example.) It is one thing for individuals, or even private corporations, to take advantage of this systematic weakness; it is quite another for government itself to be doing so by actively and enthusiastically promoting gambling, rather than protecting people from it by making sure that they are aware of its obsessive dangers and basic irrationality. Yes, I am talking here of all the lotteries.

Lotto_ticketFrom the point of view of rational choice theory, to play a state lottery is undeniably, unarguably, irrefutably irrational. They give out much less than half the money as prizes, than what they receive from the tickets they sell; the rest goes to the cost of administering the lottery, and whatever is left over is used for the benefit of citizens in supporting educational and other governmental programs. It is like someone telling you, "I will flip a coin and you call it. If you lose, you pay me $10. If you win, I will pay you $4." Would you repeatedly keep playing this game? Well, if you play the lottery, this is exactly the game you are playing. The bigger the potential payoff, the more even otherwise-rational people become willing to suspend all reason, even if the odds of losing have grown to astronomical proportions. The government of my home state of New York constantly takes advantage of this very human mental laziness by running ads on TV whenever the total amounts available in the lottery exceed some amount, like 10 million dollars. Whenever the amount is over a 100 million dollars, the glamor-promising promotion is constant, and it seems to work very well in replacing any misgivings people may have about the basic stupidity of buying lottery tickets, with ineluctably seductive visions of nearly unimaginable wealth. People drive miles from Connecticut and New Jersey to come to NYC to buy Lotto tickets when this happens, no doubt planning what they will do with their winnings along the way. Someone once pointed out that for a round trip of more than 14 miles, there is a greater chance of dying in a traffic accident than there is of winning 100 million dollars in the NY State Lotto. Still, there are plenty willing to take their chances.

So what about the supposed benefits to society? A slogan on the website of the NY State Lotto proudly proclaims: "Raising billions to educate millions!" Well, let's take a look at where these billions-for-millions are coming from. As you are no doubt aware, many demographic studies in many different states show that the numbers of lottery players are dramatically skewed toward African Americans and low-income groups, and those with low levels of education, with a significant number of senior citizens added to the mix. It is hardly surprising that those who feel most desperate about their situations in society, and have the least hope or avenue of uplift, would be most likely to risk their precious few dollars on the futile dream of escaping their condition. Look, let's just call this what it is: another tax on the poor, and a racist one at that. What is remarkable in this case is that it is liberals who support such efforts, mistakenly thinking that the monies raised will be spent on the needy, while conservatives, such as George F. Will, vociferously oppose lotteries on the moral grounds that the government should not be in the business of promoting gambling.

I am not sure why otherwise reasonable people are so taken with the idea of lotteries as a great way of raising money for good causes. I was once told by a very distinguished diplomat (whom I respect and admire immensely) that he had suggested the idea of a worldwide lottery administered by the UN to Kofi Annan, as a way of raising money for worthy UN causes. Maybe he was joking. But proposals for new lotteries are everywhere. Look at a sample I just found from today, for instance:

Elmer L. Forbath proposes this in Space.com:

A Space Lottery: An Idea Whose Time Has Come

The National Space Society should promote creation of a National Space Lottery. Ideally, this might become an International Space Lottery, and would offer the possibility of space flight, as a prize, to every man, woman and child on earth...

The problem with funding space efforts with tax dollars is that many say, “What’s in it for me?” To date, space has been reserved for scientists and rich tourists, like Dennis Tito and few imagine themselves as having a chance. A National Space Lottery will offer the possibility of space travel to everyone, rich or poor!

Lotteries generate huge amounts: One multi-state jackpot reached $363 million! The lottery for New York has the motto “A Dollar and a Dream.” The dream offered by a ticket in the “space” lottery could be a ride on an F-16 or the “Zero G” airplane, suborbital flight on SpaceShipOne, a trip to the International Space Station, or eventually to our lunar colony.

Yes, why not have the desperate and the destitute of the world pay for our increasingly controversial plans for space missions? Maybe we can't con our taxpayers, or even their usually easily-bought representatives in Washington in this case, but, hey, we can always exploit the silly dreams of wealth that the extremely poor and illiterate of the world can always be counted on to indulge! I can just imagine the long lines at the pale blue cash-in-dollars-only UN Lottery terminals in Malawi. While we're at it, I have a modest proposal of my own: why doesn't the government also get into the business of hawking Hock? It's legal, after all, and maybe we could raise enough money to start treatment programs for alcoholics. Maybe there would even be enough left over to house the homeless!

Have a good week!

My other Monday Musings:
In the Peace Corps' Shadow
Richard Dawkins, Relativism and Truth
Reexamining Religion
Posthumously Arrested for Assaulting Myself
Be the New Kinsey
General Relativity, Very Plainly
Regarding Regret
Three Dreams, Three Athletes
Rocket Man
Francis Crick's Beautiful Mistake
The Man With Qualities
Special Relativity Turns 100
Vladimir Nabokov, Lepidopterist
Stevinus, Galileo, and Thought Experiments
Cake Theory and Sri Lanka's President

Posted by S. Abbas Raza at 12:00 AM | Permalink

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Listed below are links to weblogs that reference Monday Musing: A Moral Degeneracy:

» Lotteries as regressive taxes from Majikthise
Abbas has an interesting post at 3Quarks about the ethics of gambling. Abbas argues that is gambling is morally problematic because it exploits near-universal human weaknesses in probabilistic reasoning. He thinks its bad enough when private businesses... [Read More]

Tracked on Jan 23, 2006 3:55:05 PM

» The Ethics of State Lotteries from Philosophy, et cetera
Government should not be in the business of exploiting the cognitive deficiencies of its citizens for monetary gain. Right? But state lotteries do just that, as Abbas at 3 Quarks Daily argues... [Read More]

Tracked on Jan 25, 2006 9:15:16 PM

Comments

I saw a documentary on the History channel that suggested that the New York state lottery (the country's first) was created in the 1960s in large part to dismantle organized crime.

The mob had been running 'numbers' for decades, and making billions off of it. The state, realizing it would never end this irrational game, decided to appropriate it for its own ends. In the process, it gutted organized crime and created an important (if inefficient) revenue stream.

Incidentally, I can't fathom why you refer to the lottery as "racist." It may be true that minorities disproportionately buy into the lottery, but I haven't seen any evidence that the state markets the lottery to minorities.

Posted by: Amardeep | Jan 23, 2006 10:35:58 AM

Abbas, in general I'm all for moral degeneracies and gambling is no exception :)

Your bit about rational choice theory triggered a hazy memory from a micro-economics/game theory college course. The decision to play a seemingly less-than-zero expected value game is irrational only for a traditional utility function.

Here's an example. My father-in-law, a well-off corporate type (AND an actuary to boot), plays the state lottery. Not because he seriously expects to win. Or because he's prone to "weakness in dealing with probabilistic phenomena." But because the cost of a ticket is nothing for him. It's an epsilon. The payoff however - hundreds of millions - is serious money.

So the rational choice is: (1) risk an epsilon value and get a potentially huge (but extremely unlikely) payoff, or (2) do nothing and have the certainty of getting nothing.

Posted by: raven | Jan 23, 2006 12:00:17 PM

Vegas, baby!!

vegas.

Posted by: morgan meis | Jan 23, 2006 6:23:05 PM

I have the same aversion to gambling as you do and agree with the evils of Lottery especially for the poor who mostly fund it. Worse is what happens to people who do win a jackpot. Just yesterday the NY Times had a story about the fellow who won a big one and his life is destroyed. Now he says it was the lottery of death he won. I have known nurses and other modest income people at work who are spending thousands of dollars a year on lottery tickets. It is sad. And now in addition we have the Gambling Casinos every where. It is a lose lose for most people. I am glad you raised it as an issue. Thanks.

Posted by: Tasnim | Jan 23, 2006 7:08:53 PM

Your description of the lottery as a game where you pay $10 if you lose and get $4 if you win doesn't seem accurate to me. $10 is that aggregate that all players pay (the many losers and the single winner). When does a single individual risk a total of more than the payoff to the winner in a state lottery?

Posted by: parse | Jan 23, 2006 8:01:30 PM

First of all, "throwing money away" is the essence, the lifeblood, of entertainment. Throwing money away is fun. This is not the same as shopping, or going to see a movie or supporting a football team, all of which take your money and make you think you're getting somethng for it. Sometimes I stand on my windowsill and throw money into the street. It's fun. You should try it sometime. Better still is sharing your money with your friends over a steady, quiet poker game. Let me know when you're ready.

Posted by: Timothy | Jan 26, 2006 11:02:12 PM

The post by raven already partially addresses the part about state lotteries that you weren't quite right about, but in addition to risking an insignificant amount for a possible very significant payoff there is another way that playing a state lottery could be a rational choice. When I occasionally risk a dollar on a jackpot that is at least in the tens of millions of dollars I often get several hours of pleasurable musing about how things might be in the incredibly unlikely event that I were to win. When I compare this with the cup of coffee or whatever else that dollar might have purchased I have to consider it money well spent.
Of course when approaching the lottery this way there is clearly going to be a point at which risking additional dollars does not pay off. For me that point is at about a dollar a month.

Posted by: Stan Giess | Jan 30, 2006 1:46:41 PM

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