Journal & Courier on Lottery Privatization.

The Journal & Courier has a particularly unreflective editorial entitled With lottery in private hands, all win. They spend a lot of time gushing about what a good thing it would be to spend more on education and combat brain drain. Given unlimited resources, I agree, that would be a swell thing to do. So, we’ll just focus on the resources.

The editorial simply states that a private purchaser would pay $1 billion up front and $200 million annually plus a percentage of the take, and then states “that’s a lot of money.” But, they offer us no comparison. And, they make no effort to understand the opposition — 1) either we’re giving up more than we’re getting and/or 2) the only way the private contractor is giving up more than we’re currently getting AND will make money on the deal is if the contractor increases lottery participation, i.e. encourages more Hoosiers to dump more money into the lottery. Neither of those things are good things. But, here is the “justification” that made me roll my eyes:

But it’s hard to understand why any lawmaker would object to the lottery deal. Indiana’s other gambling endeavors are run by private groups.

Caesar’s Indiana in Elizabeth, Casino Aztar in Evansville and French Lick Resort and Casino — none is state owned. Neither are the horse tracks. So why should the Hoosier Lottery be the exception?

It’s not at all “hard to understand” for reasons #1 and #2 stated above. But, why does the editorial board think the quoted passage is an argument for privatizing the lottery. Why not have the State run the businesses mentioned above. Why should the State settle for a percentage of the take when it could have the whole thing? Normally, we want businesses to thrive because we want their goods and services distributed as widely as possible at the lowest possible price. The way to do that is to allow entrepreneurs to profit if they figure out how to make a good product and sell as much of it as they can as cheaply as possible. But, gambling is different. By and large, good public policy would be to frown upon spreading gambling as widely as possible. If that’s the case, then there is no reason for the state to share the profits. If total gambling in Indiana is less, but the State’s profits are more, I’d call that win-win. (At least if we accept the premise that gambling is socially troublesome — otherwise, we have to explain why we don’t just go for a casino on every corner.)