When a state adopts a lottery, it legislates a government monopoly; establishes a public corporation or agency to run the lottery; begins operations with a small number of relatively simple games; and then, in response to constant pressure for additional revenues, progressively expands its offerings by adding new games. Lotteries are a classic example of the way public policy is made incrementally and piecemeal, with little overall oversight, and with special interests often gaining dominance over the process.

The most obvious issue with lotteries is that they promote gambling. Although many people play lotteries as a harmless pastime, it is clear that a substantial portion of lottery players are problem gamblers who may not be capable of controlling their gambling. This is a very serious concern that, in addition to the damage caused by gambling addiction, has led to a variety of other problems for families and communities.

Another significant problem is that lottery revenue has eroded in the face of increasing competition from other forms of gambling, and because the profits from lotteries have not increased as rapidly as the cost of operating them. This has left states with an unsustainable dependency on a source of revenues that they can control neither in terms of the amount of money spent nor its broader social impacts. It also raises serious concerns about whether or not the promotion of gambling is a proper function for a public agency.