Chicago Tribune Reports on Illinois Lottery Corruption

The Chicago Tribune reported this last Friday on the dubious goings on at the Illinois Lottery:

A Tribune investigation found the Illinois Lottery collected hundreds of millions of dollars from selling tickets to instant games in which it did not hand out all of the life-changing grand prizes — sometimes awarding no grand prizes before ending a game.

Are you shocked, shocked that corruption is going on at the Illinois Lottery? Well, you shouldn’t be. Corruption, inefficiency, and lack of oversight affect virtually every government agency in Illinois.

Poor management of tax dollars have left Illinoisans with billions in unpaid bills and well over a hundred billion dollars in unfunded liabilities despite record tax receipts to the state of Illinois. Some on the political right call for more privatization of public services. Unfortunately, that won’t improve services if the oversight of those programs by the state is as lousy as its oversight of its own bureaucracies.

Case in point — the Illinois Lottery. Again, here’s the Chicago Tribune:

Illinois became the first state in the nation to turn over day-to-day management of its lottery to a private firm. The firm, Northstar Lottery Group, took over the Illinois Lottery in July 2011. Since then, Northstar has been criticized for failing to deliver the profits to the state it projected when it won the Illinois bid. The state is now looking for a replacement.

The focus of the Tribune’s investigative report was “how private management affected players,” of which, the Trib notes, “there has been little talk.”

No big surprise there — that would have required oversight by our state’s elected officials. If our governor and General Assembly members would have done their job, they would have discovered things like the Chicago Tribune found:

It was called The Good Life and offered the biggest grand prize of any instant game the Illinois Lottery had ever produced.

Two lucky winners could scratch their way to $46 million each, paid in periodic installments. At $30, tickets weren’t cheap, but millions were sold. Then the game ended before the lottery sold most of the tickets that were printed, with neither top prize awarded.

The same thing happened with another instant game, called Birthday Surprise. Two large grand prizes offered. Neither awarded.

And with another version of The Good Life. Three large grand prizes offered. None awarded.

Seems like kind of a big thing to have missed by those who have the responsibility to run our state government honestly and effectively. For other examples where the payouts didn’t happen as promised, read the Trib article here. The Illinois Family Institute finds itself on the opposite side of the Tribune editorial board on many issues, but in this case, the Trib deserves kudos for this report. Embedded in their article is a five minute video featuring two of the reports outlining their findings. A job well done.

Even if the state had done it’s oversight job well, however, the Illinois Lottery is still a lose-lose for families and taxpayers. The Illinois Family Institute has been clear in its opposition to legalized gambling of all kinds, and you can learn more about the issue in our archives by clicking here.

It is a moral issue that, as so many moral issues do, involves tax dollars. A lot of tax dollars. Running up debt to the levels our state has, its funding of abortion and punishing taxation levels are all immoral in addition to being economically foolish. Decades of economic and social science research has shown the ill effects of private and government-run legalized gambling. In addition to the IFI archive of articles, more articles on the topic can be found here.

Economics professors Earl L. Grinols at Baylor University and David B. Mustard of the University of Georgia, have long studied the issue. They agree that to adequately count the costs of legalized gambling, several categories of various costs must be factored in. Their list includes: crime, business and employment costs, bankruptcies, suicides, illnesses, social service costs, government regulatory costs, family costs, and abused dollars (a term representing monies acquired under false pretenses to fund a gambling problem).

The math doesn’t quite work out the way proponents of gambling would have you believe. Society, and the economy, pay a heavy price for such “economic activity.”

First published by the Illinois Family Institute.