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Comment by gt565k | Hacker News Reader

Which is why in the US at least, most states take about 40-50% of the lottery winnings to fund education programs. In Georgia, we have the HOPE scholarship which is funded by the Georgia Lottery. If you have a good GPA in high school, and you maintain it in college, you basically get a free ride and don't have to pay tuition. While the HOPE scholarship can probably be tailored, more towards the household income, from a distribution perspective, it still works well.

It allowed myself and many of my peers to graduate with significantly less debt than if we had to pay for college ourselves.

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> most states take about 40-50% of the lottery winnings to fund education programs. In Georgia, we have the HOPE scholarship which is funded by the Georgia Lottery.

My father and I once debated the merits of this, and he made a point that stuck with me: the overall funding for education didn't change. It's just that the money that used to come from the government now comes from lotteries instead.

Meaning the burden of that cost has shifted from the collected taxes, which is more proportionally paid by the rich, to the lottery system which is more proportionally paid by the poor.

Did the amount of money the poor invest in gambling change? Or are the gambling losses just being re-targeted to fund education, instead whatever they used to end up in previously.

That's a fun point!

I am 100% going to bring that up with the old man the next time we're allowed in the same room[0]. I think he'll like it.

[0] Covid risks...

In a fair number of states, its funny math. They don't increase the size of the budget, they just shift the money around. So if lottery revenue goes up for the state, more of the education budget may come from lottery money vs taxes, but the overall budget remains the same.

Exactly. "Please vote for our 1% sales tax increase! It's all going to education, we swear! Think of the children!"

Well sure, you're allocating the new dollars to education, then moving the old allocations over to your pet project...

States do this when they pass gambling laws to make it seem less scummy in my opinion.

My state recently made certain slot machine games legal. I found myself overlooking the parking lot of one of the casinos at 8am while waiting for my grocery pickup. The addicts were already arriving. Somehow every car seemed to have been in an accident and not been repaired. The parking lot was covered in oil stains.

When the casinos opened I imagined people going out occasionally for a fun night gambling. This was far from that.

The trouble with earmarking like this is that the legislature takes it into account when distributing funds, so you can easily have a situation where "all proceeds from the lottery go to education" but you don't actually have any more education funding than you did before.

A specific, new, fully funded program like a scholarship is actually possibly a better form of this than just general funding for the school system.

Funding the public education system is a good thing and a similar system exists in California: https://www.calottery.com/who-benefits

However OPs point about mostly lower socioeconomic groups funding the lottery is still relevant as it raises questions about whether this pseudo-regressive “tax” is a fair way to fund a public good like education.

In all fairness, in the US--at least where I live--the bulk of education funding comes from property taxes which is presumably progressive. (There is a different criticism that this leads to wealthier towns having better education. Which is probably true at some level although there isn't a lot of correlation between per pupil spend and educational outcomes in a given area.)

Property taxes aren't progressive: although they're levied on individuals who tend to be well-off, a significant proportion of those costs end up passed on to renters. Additionally, poorer people tend to spend a larger portion of their income on housing (be it rent or otherwise) than the rich.

That's fair enough and probably depends on the housing prices in a location. Wealthier people tend to own more house but it may still be a smaller portion of their income, depending upon where they live.

HOPE scholarships are great PR but awful policy. Basically, the poorest people in Georgia are paying for the children of mostly middle and upper-class residents to go to UGA and Ga Tech for free. Of course the state points out the handful of low-income students who also benefited from a HOPE scholarship, but these are the minority of recipients, and they would almost all have qualified for significant grants and financial aid anyway. The most offensive aspect, I'll state again, is the fact that the poorest residents overwhelmingly purchase lottery tickets while the wealthiest residents overwhelmingly receive the scholarships.

It also makes the state university (UGA) much, much harder to gain admission to, since demand for a free college education is high. Applications (and thus necessary GPA/SAT scores) are through the roof... Ivy-qualified students (again, often from wealthy families) are often encouraged to go to UGA for free instead.

HOPE already vastly exceeded its budget once, leading to cutbacks and reforms about a decade ago, with many students losing scholarships or suddenly not qualifiying. A more recent report says it is likely to run out of funds again in 2028. https://www.11alive.com/article/news/local/new-analysis-show...

True, but it still amounts to a very regressive tax, even if the proceeds are fed back into education.

The cynic in me notes that the stock exchange amounts to where moderate to middle class does all of their gambling. With most of the proceeds just consolidating up the wealth chain. At least in lotteries the programs are progressive. :D

If you buy and hold stocks for a long time it's not the same thing as betting on a horse or buying a lottery ticket.

Which is used to argue for reduced progressive (or even flat) tax-based support for schools.

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