29 October 2007

Private Players in Most State Lotteries Corrupt and Inefficient

Given the history of private tax collection, you can go to Paul Krugman's blog post regarding the return of this activity, it is no of a surprise that the operation of most state lotteries greatly resembles the "Tax Farming" that bankrupted and caused the overthrow of the French monarchy.

It turns out that morally dubious is the most charitable description of how these companies operate, and when one takes the long view, they cost the states money when they operate a lottery.

While a state with an active lottery cannot switch immediately, it would benefit everyone by the lottery oligopoly, Gtech and Scientific Games, to take these functions internal to the state government, where there is far greater transparency.

I have not followed the lottery in Maryland, but it is clear that bribery, or something akin to bribery, has been going on in Texas for years.

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