The Lotto is for Losers, but a Good Bet Anyway

There was a flap recently about the Philippine Charity Sweepstakes Office (PCSO), which runs the state lottery, raising the price of a six-combination lotto ticket from P10.00 to P20.00. All of the arguments against the 100% price increase, and against the lotto in general, are valid.

The lotto is an additional, and insidious, burden against the poor, who make up the vast majority of lotto players. It’s a major source of funds which the Arroyo administration allegedly routinely dips into for questionable purposes. No proper, transparent audit is done of lotto funds. The opposition suspects that the administration is now building its war chest for the 2010 presidential elections through lotto revenues. It’s a form of gambling which sustains institutionalized corruption .

The Catholic Church and various civil society groups have railed and rallied against it, rightfully calling it a morally corruptive influence which reinforces the Filipino penchant for
gambling and the “get-rich-quick, jackpot” mentality.

The government lottery people say they are selling hope. But hope not anchored on some form of spiritual belief or moral values which would transcend simple materialism is an illusion. Lucio Tan got it right when he branded his best-selling cigarette “Hope”. The perfect metaphor for the lotto: hope going up in (cancerous) smoke.

But it persists, and is by far the most popular form of legal gambling in the Philippines, eclipsing the national sweepstakes where the PCSO got its name. The price increase failed to dampen the enthusiasm of bettors, and the jackpot has reached a near-record P120 million, and climbing. Despite all the grumbling and nay-saying, lotto is here to stay.

And we are not alone in this. State lotteries are popular worldwide. In the U.S., approximately 66% or two out of three adult Americans play every year. Why the attraction, some would say obsession, to something which even an idiot knows he has an infinitesimal chance of beating ? It simple. A billion to one chance is better than no chance at all.

Consider a New York Times article in which addiction researchers and some economists struggle to explain this behavior, describing it at best as an irrational fever, and at worst a pathological addiction to a regressive, government-run numbers game.

Dr. Lloyd Cohen, a law professor at George Mason University has an explanation and says

“The people who denigrate lottery players are like 10-year-olds who are disgusted by the idea of sex: they are numb to its pleasures, so they say it’s not rational.”

Dr. Cohen argues that lottery tickets are not an investment but a disposable consumer purchase, which changes the equation radically. Thus, at least in the U.S. and the U.K., lottery tickets are sold everywhere, in convenience stores and street corners and even online. Like a throwaway lifestyle magazine, lottery tickets engage transforming fantasies, Cohen says: a wine cellar, a pool, a vision of tropical blues and white sand. The difference between pure fantasy is that the ticket can deliver, however remote the possibility of winning.

Moreover, playing the lotto is also simple. Its pure luck. The NYT article continues:

“Because it is pure luck, the lottery is easy to grasp and allows for plenty of perfectly loopy – and very enjoyable – number superstitions. Your birthday digits never won you a dime? Try your marriage date; your favorite psalm verse; the day your bullying father-in-law died. Or, perhaps, reverse the order. In studies, psychologists have found that ticket holders are very reluctant to trade their tickets for others, precisely because they have an illusion of control from having picked magical numbers.”

Its thus imbued with an element of magic and even, in many people’s minds, a touch of divine intervention. By destiny or God’s design, some would say, I am fated to win this.

The pleasure is also in the waiting, the anticipation of a huge payoff. There’s a psychological and biological explanation for this. The hope of a huge payoff, however remote, is itself a source of pleasure. In brain-imaging studies of drug users, as well as healthy adults placing bets, neuroscientists have found that the prospect of a reward activates the same circuits in the brain that the payoffs themselves do. In other words, waiting for the jackpot is almost as rewarding as winning it. So, as the Barry Manilow song goes, you want to get that feeling again. And again.

Christine Reilly, executive director of the Institute for Research on Pathological Gambling and Related Disorders, in Medford, Mass. explains:

“It’s not just winning the money but anticipating winning the money that is exciting, and the two experiences are similar neurobiologically.”

And lottery odds are supposedly neutral, fair and not biased toward any social elite. Thus, Philippine lotto punters run the gamut of society, from corporate chief executives to pedicab drivers, from society matrons to cigarette vendors.

Of course, the proportion of safe, disposable income which one can throw away in the lotto favors the haves rather than the have-nots. But I was still astounded to see on T.V. that it’s the poor rather than the more affluent who make multiple bets, to the tune of thousands of pesos monthly, and to the point of pushing their families even closer to starvation. No wonder the PCSO makes a big to-do and widely publicizes instances when the taxi driver or corner lugaw vendor wins the big prize. The people behind it know their market.

Dr. Dan Ariely, a behavioral economist at the Massachusetts Institute of Technology explains:

“The point is that, psychologically, we think of a loss as a loss, big or small. And once you’re into it, you think: Well, why not take a bigger loss, if there’s some chance I can turn it into a gain?”

Similarly, people who feel that the opportunities to succeed in life are narrowing, are more likely to play the lottery, or play more often. Studies show that the proportion of larger bettors is higher among very low-income households. Its tragic, but there it is.

Now for he confession part. I sometimes bet on the lotto. And its true. It’s the waiting and the anticipation of what I think would be a transforming event in my life thats fun. As for the winning itself, well…

A man standing in line to place a bet in New York said it best:

“I don’t know what I’ll do if I win. It’s too much money to think about.”

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