Latinos: Lottery’s Big Losers

Three years ago, amid much hoopla and multilingual promises, the lottery was introduced into California as a panacea for a declining education system. And, to prove that it would be painless, the lottery’s experts “demonstrated” that the burden of supporting the lottery would not fall un- fairly or disproportionately on the poor.

For this state’s 6 million Latinos who are the primary victims of our present inadequate education system, these were irresistible promises.

The promises have not been kept. Bill Honig, the state superintendent of public instruction, has said that the lottery is a “bad bet” for education, since it merely replaces prior state commitments and in any event produces less than 3% of the total education budget.

The second promise, that the lottery would not victimize the poor, has turned out to be even more fraudulent. Three studies convincingly demonstrate that the lottery constitutes a wholesale, deceitful transfer of funds from the poor that re- lieves the affluent of their educational tax burden. Thus we have in effect a reverse Robin Hood, in which the majesty of the state is used to deceive the poor by artful, multilingual Madison Avenue techniques.

The most recent lottery study, by the San Jose Mercury News, demonstrates that those earning between $7,000 and $18,000 spend more than twice as much per person as do those earning between $34,000 and $75,000.

An earlier Los Angeles Times computer analysis supports the position that Latinos and the poor spend more than the affluent do on the lottery, and that their spending actually subsidizes the education systems in affluent counties like Marin. In three of the poorest farm-worker-populated counties--Imperial, Madera and San Benito--average household spending on the lottery was between 40% and 90% higher than in Marin County. Yet these poor counties receive the same per-student share of lottery funds as does Marin, this state’s wealthiest county.

The most damaging study is one conducted by the lottery itself. This study showed that the typical Latino lottery player purchased 2 1/2 times as many Lotto tickets as the typical Anglo, even though Latino per-capita income is about half the Anglo per-capita income statewide.

In order to ensure that the vulnerable immigrant and poverty-level population continues to support a “bad bet,” the Lottery Commission promotes its dubious wares in at least five languages, including appeals aimed directly at new immigrants, like “Saque su boleto a la buena vida . . . $100,000 al instante” (“Here’s your ticket to the good life, $100,000 instantly”).

Many Latino leaders believe that the best way to end this reverse Robin Hood thievery is to pass a constitutional amendment eliminating the lottery. Other suggestions include preventing the lottery from directing its promotional activities at the poor (the state provides hardly any other multilingual services) and/or setting up a consumer advocate office to ensure that the lottery honestly informs the public of the less-than-1-in-20-million chance of becoming a millionaire.

A third alternative is to ensure that a minimum of lottery funds are allocated to school districts proportionately to dollars that are spent on the lottery in that district, thereby giving poor districts a greater share per student.

A more effective and fairer solution is for our state legislators to guarantee ad- ditional revenue to the education budget. Two relatively painless tax alternatives to the lottery are:

--An oil severance tax that would raise at least as much revenue as the lottery. California is the only significant oil- producing state without an oil severance tax. A tax rate similar to that in other states would raise between $600 million and $1 billion a year.

--Indexing state alcohol and cigarette taxes to inflation. The California alcohol and cigarette tax rate has remained the same for 21 years. Our tax on wine, for example, is 1/20 of a cent per glass, no matter how expensive the wine, just 1/3 of a cent per can of beer, and just 2 cents for a shot of whiskey or cognac. If alcohol and cigarette taxes were merely indexed to inflation and the additional proceeds allocated to education, we would raise approximately $1.1 billion a year in additional revenue, or a sum more than 50% greater than the present lottery contribution.

The indexing to inflation of so-called sin taxes is a modest request, since states where legislators are stronger or lobbyists weaker have far higher sin taxes. The Florida tax on wine, for example, is 225 times greater than California’s, its tax on beer is 12 times greater, and its tax on whiskey is almost five times greater. Similarly, our cigarette tax is lower than virtually any other state’s, except for that in the tobacco-producing states.

California is 50th among states and the District of Columbia in terms of crowded classrooms and 51st in taxes devoted to education. An oil severance tax and the indexing of alcohol and cigarette taxes to inflation could raise an additional $2 billion or more a year and help California produce a truly educated citizenry.