Blessed are those who do not buy Powerball tickets. So went the virtuous refrain of much of the media and punditocracy, smugly denouncing Powerballers as morons.
To Stony Brook University's Noah Smith, writing in BloombergView, "lotteries, and lottery stocks, might be more than harmless fantasy. They might also be taking advantage of the cognitive illusions and biases of less-educated, less-well-informed individuals, making money for the government at these vulnerable people's expense."
Explaining the mind of a Powerballer, Tim Harford of the Financial Times tweeted agreement with economist Larry Summers' famous adage that "There are idiots. Look around." Yet Summers, who wrote this in the 1980s, was referring not to those who buy lottery tickets but to wizard hedge fund investors hoodwinked by other financial mavens.
Cognitive illusions and biases loom large in those who slur Powerballers.
Columnist Michelle Malkin wrote that the government-run lottery is a 'stupidity tax.' Meanwhile, recent government-regulated stock markets registered record declines, but I don't recall seeing columns calling Wharton-trained investment bankers stupid.
Contrary to popular myth, Powerball players are, in fact, quite rational and realize that they won't win the jackpot. Everyone's notional value invested in playing a lottery ticket differs. The same can be said for all goods. According to a 2015 PwC study, 41 percent of moviegoers report that movies are less satisfying than they used to be, but they still pay $10 or $15 for a ticket. Are they knuckleheads, too? Is voting in a general election a rational act? After all, one vote, by any statistical measure, will change nothing.
Let's put aside the other litany of arguments against state-run lotteries. Some of these arguments are compelling (the state has no business spending tax dollars glamorizing the benefits of winning the lottery as opposed to, say, buying a Florida timeshare); others are less so (the persistent myth that only low-income earners play the lottery).
Demeaning words are problematic. Whether it's on talk radio or in interviews with serious contenders for US President, the 'stupid' taunt is now common in the modern public square, and its intonation in North America is nastier than in Britain, where 'stupid' is more akin to what we might consider 'silly'. To call the majority of Americans who take small risks in small pleasures 'stupid' is anti-liberty, and emblematic of elitism.
In my own research during the Powerball bonanza in mid-January, I studied quick-action responses among 1,985 random US adults: "What do you think your odds are of winning the $1.5 billion Powerball lottery jackpot if you bought just one ticket?" Our survey platform gave no time for the respondent to look up the answer online. Almost 70 percent of random respondents felt the odds to be more remote (40 percent selected '1 in 383 million' among six options posed) or equal to 1 in 292 million (the correct answer). There were no dramatic statistical differences in lottery literacy between male and female answers or among age groups (although those between 55 and 64 were more savvy in choosing the correct odds) or among geographic regions.
Gambling addiction and unregulated gambling are distinct from regulated lotteries. Gambling addiction is a major disorder of brain dopamine chemistry based on over-activity of Type 3 dopamine receptors. Regulated lotteries seem to appeal to people who are rational. To call Powerballers dumb is, in reality, to dumb down serious addictions.