Remember this moment, because it probably won’t last long. The U.S. lottery jackpot is predicted to exceed $1 billion, but it’s still a big deal.
Friday’s Mega Millions drawing, worth an estimated $1.15 billion, is likely to generate headlines and send even more people to convenience stores dreaming of a personal spacewalk on Earth.
It doesn’t seem to matter that the top 10 jackpots in the country, excluding this one, already boast payouts in the 10 digits. For many of us, when the number is one dollar more than $999,999,999, something happens inside us.
“The underlying question is, what happens when $1 billion becomes commonplace and people stop caring about it?” says the author of his book, For a Dollar and a Dream: State Lottries, published in 2022. Jonathan D. Cohen, author of “In Modern America.”
“There’s no easy round number over 1 billion,” Cohen said. “But how much money could one person possibly, possibly, need?”
Meanwhile, Mega Millions ticket prices will increase from $2 to $5 in April. The increase is one of many changes that officials say will improve the odds of jackpots, increase the frequency of big prizes and make payouts even bigger.
A brief explanation of the history of the lottery and why jackpots are increasing.
The origins of the lottery go back at least to ancient Rome.
Cohen states in his book that the lottery has existed in one form or another for more than 4,000 years.
In Rome, emperors and nobles painted at banquets and awarded prizes ranging from terracotta vases to enslaved people. In Europe, lotteries were used to fund city defense and other public projects in the 1400s.
Sweepstakes were common in the American colonies and helped pay for revolutions against Great Britain. Cohen said in his book that Thomas Jefferson approved the lottery and wrote that it was a tax “levied only on the willing.”
Lotteries began to fall out of favor in the United States in the 1800s due to concerns about fraud, mismanagement, and the impact on poor people. But starting in the 1960s, states began legalizing them to address budget shortfalls without raising taxes.
“The lottery was seen as a budgetary miracle, an opportunity for states to generate revenue out of thin air,” Cohen wrote.
Mega Millions’ first jackpot started at $5 million
When Mega Millions started in 1996, it was called “The Big Game” and only six states participated. It was intended to compete with Powerball, which at the time had 20 states and the District of Columbia.
The original payout for The Big Game started at $5 million. Factoring in inflation, its value would be almost double what it is today.
The $2,024 pre-tax prize could buy a rare copy of the U.S. Constitution or cover the $9 million contract for Washington Nationals pitcher Michael Soroka next season.
By contrast, the pre-tax winnings from Friday’s Mega Millions winnings could theoretically buy a Major League Baseball team. Nationals would be too expensive. However, Forbes recently valued the Miami Marlins at $1 billion.
A better comparison might be Taylor Swift’s tour income at the end of 2023. Her Elas Tour sold over 4 million tickets and earned over $1 billion for the first time.
But when Swift’s tour finally ended on Dec. 8, she was expected to have grossed more than $2 billion, according to concert trade publication Pollstar.
Why are jackpots so high?
These days, Mega Millions and its lottery sibling Powerball are sold in 45 states, as well as Washington, D.C. and the U.S. Virgin Islands. Powerball is also sold in Puerto Rico.
Mega Millions said in October that it expected more people to win because of increased ticket revenue and stratospherically lower odds, even as prizes became extraordinarily high.
Games with large payouts tend to be more popular despite having lower odds. A larger jackpot can attract more media attention, increase ticket sales and attract new players, Cohen said.
Cohen said lottery officials are allowing the odds to be lower by giving more numbers to choose from. This made the games harder to win and the payouts rolled into even bigger prizes.
The first $1 billion jackpot was in 2016. Cohen said he expects this upward trajectory to continue.
Meanwhile, he warned against the analogy of a troubled person or a bankrupt lottery winner.
A famous example is Andrew “Jack” Whitaker Jr. He won a record Powerball jackpot after purchasing a single ticket in 2002, but quickly fell victim to scandals, lawsuits, and personal setbacks as he endured constant demands for money. I can no longer trust it. others.
Most winners don’t end up like him, Cohen said.
“Even if we deny it, we all believe in some kind of meritocracy. This is the belief that even if you were lucky enough to win money, you probably didn’t actually deserve it. ” Cohen said. However, various studies have found that “lottery winners are happier, healthier, and wealthier than other people.”
