Perspectives No 448: Inequality

new-zealand-business-roundtable

Wed Apr 27 2011 12:00:00 GMT+1200 (New Zealand Standard Time)

Perspectives No 448: Inequality

Wednesday, 27 April 2011, 2:24 pm
Press Release: New Zealand Business Roundtable

No. 448 April 2011

Inequality
John Goodman

21 March 2011

I can’t think of any single act of government that creates more inequality than the lottery—at least per dollar raised and spent. Think about it. Thousands of (mostly below-average income) people buy tickets and, after the drawing, one of them becomes immensely wealthy. As far as I can tell, the single largest winner in the United States at $315 million was Jack Whittaker, a West Virginia businessman who was already well off when he won!

I can’t think of anything in the private sector that even begins to compare to this reverse Robin Hood redistribution from the poor to the rich and the nouveau riche. And remember, in order to pull it off, government first has to establish a monopoly, keeping private competitors (who would at least raise the poor bettor’s expected return) out of the market.

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ENDS

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