Easy money

A lottery is a reliable way of getting rich, so long as you’re not the one buying the ticket.  To be sure of making money, you need to be the one selling it.  If the vendor has designed her lottery well, which is not hard to do, she is almost guaranteed of making a healthy profit.  She knows what the lottery will pay out relative to ticket revenues.  She knows exactly how to attract buyers.  It hardly matters to the seller that someone will take a large share of the revenue as a winning payout, since this cost has been accounted for from the beginning.  In fact, she will celebrate and publicize the winner, since her enthusiastic recognition will encourage future ticket sales.  She will convince potential buyers that the latest winner is just like them.  And she will be persuasive because she is right.  It doesn’t matter much to her who wins, since no winner of a lottery is ever rewarded for virtue.  Not a single one of the ticket buyers is especially deserving.  All of the purchasers, but one, will be disappointed.  The seller, on the other hand, will not be disappointed by the outcome.  It all works out very well for her.

Still, the buyer insists, you can’t win if you don’t play.  Indeed so, just as you can’t lose if you don’t play.  The losers vastly outnumber the winners—always, necessarily, and by predictable margins.  This calculation is perfectly clear to the seller, somehow less so to the buyer.  I have a feeling about this one, says the buyer to himself.  So do all the other buyers.  And they will all be equally mistaken about the relationship between their subjective feeling and the winning reality.  Except the one who wins, you mean.  Oh no—no indeed.  The winner is exactly as wrong as all the rest.  He has no better reason for following his wishful feeling than the many, many losers.  The winner was not more deserving, nor virtuous, nor discerning.  Just luckier.  Undeservedly so.  The winner was exactly as deluded as every other punter.  But the seller had calculated the odds in advance, worked out the size of the winning pot against estimated revenues, judged the best price of an individual ticket according to what the market would bear.  The winner thinks he has been supremely clever by winning such a handsome payout for a bargain of a ticket.  In fact, he is so much more thick-headed for buying a cheap ticket in the first place.  The cheaper the ticket, the smaller the chance that an individual will win anything substantial.  The greater the payout, the less likely an individual ticket will win.  Cheap tickets combined with high jackpots is just stupidity squared.  But only for the buyer.  The seller has made a very astute calculation.

But surely the benefit is more than enough to justify the risk?  Just think of how the jackpot will change your life!  Never mind that if you get it, all the others who are counting on the same will not.  But would winning necessarily be worth it?  Are you frickin’ serious right now?  You might wonder how anyone could ask such a ridiculous question.  But consider.  How many hopeful winners have done substantial investigation into exactly how a winning lottery ticket might change their lives?  Perhaps it would not be quite as much as they expect or not as favorably as they assume.  Or perhaps not very much at all.  Winning might prove to be just another flavor of disappointment.  There are documented answers to these questions, but you are unlikely to believe them if you have no interest in asking the question for yourself.  Doesn’t matter, you say.  Others may squander their winnings or discover a new level of unhappiness.  But that’s not me—I know exactly how to make the most of my winnings.

So you are unlike all the rest?  Yes, I am the exception.  Almost every buyer agrees that they are.  They have to be.  If everyone wins, no one does.  They all assume others are bound by harsh realities.  But not themselves.  They must think so if they are willing to buy a lottery ticket in the first place.  They may even acknowledge that most will have to lose if they themselves are to win.  They’re all suckers, losers, but not me.  I am the exception.

Human beings have trouble seeing the well-documented, objectively-observed behaviors of their species when their own interests are concerned.  Nor are they well equipped by their evolutionary past for making rational calculations about financial risk.  There are a handful of exceptions, but they are not the lottery winners.  They are the statisticians and the sellers of the tickets.  The house always wins.  The seller knows, as everyone else ought to, that only one player will win the jackpot, but does not make the mistake of caring who it is.  The buyer of the lottery ticket makes that mistake every time.