Would you really want to win the lottery?

"Did you remember to buy a Lottery ticket?"

My wife had shouted that from another room as I unpacked the groceries I had just come back from buying. I hesitated before answering. In fact, I had not bought a lottery ticket, but it was not because I had forgotten: I didn't buy it because I did not want to risk a chance of winning.

The specific lottery ticket would have been for the Mega Millions, a multi-state lottery that had a top prize of over $300 million dollars that week. That's a ridiculous amount of money - $15 million a year if taken as an annuity and something around $75 million dollars after taxes if taken as a lump sum.

If you Google for "lottery winners ruined lives" you get a quick appreciation of just how dangerous that kind of money can be. It's not just a matter of you being smart enough not to carelessly blow it all - this is the kind of money that causes divorces, estrangements from friends and family and can even lead to murder (Google for "Lottery Winner murdered").

I honestly wouldn't know what to do with that kind of money. Sure, I have some family and friends who could use a little financial help and our own retirement funds could certainly use some bolstering, but that much money is simply too far beyond anything any of us need.

The Evils of Gambling

People who object to all gambling would say the solution is simply not to have lotteries. That's unrealistic - there may or may not be valid arguments that the social cost of these activities exceeds their value, but if there are, those arguments are being ignored and will likely continue to be ignored.  Lotteries exist, and are unlikely to be stopped.

That doesn't mean we can't take some of the evil out.

A Proposal

I really think it would be smart if lotteries put limits on the top prizes and spread the excess across the lower prizes.

I know the immediate objection: people get excited by large amounts of money and lotteries use that excitement to help fuel ticket purchases. I understand that there would be strong objection to any monetary limits because of that.

However, let's not forget the ruined lives and the destruction of both friendships and marriages. Those things are important, are they not?

Moreover, I'm not sure that excitement cannot be built with a limit. Let's say, for example, that the Mega Millions lottery limited the top prize to $2 million dollars. That's $100,000 a year as an annuity and roughly $500,000 as a flat sum after taxes. That's a nice sum of money, enough to better most folks lives, but not so much that it is as apt to cause life disruption - that still could happen, of course, but it would be less likely.

What I'd suggest is letting the money build until someone wins, and then distributing the excess among the bottom tiers. So, in this case, someone did win $312 million dollars Friday night. Under my idea, they'd win $2 million and roughly $310 million would be distributed to other winners.

In the case of this lottery, the current breakdown of winners was:

I'll leave it to someone else to decide how the distribution would work and what the maximum prize should be, but if $10 million extra were allocated to the bottom tier and there were two million winners in that bracket, each winner would receive $7 instead of the $2 they get now.

The "Match 3 and Bonus" tier, which currently gets $150.00 and had a little less than 10,000 winners in that drawing, might get an extra $1,000.00 each - a nice incentive to buy tickets, I think. It may not be quite as exciting as $300 million, but again, we have to remember the problems that often accompany large lottery winnings.

There's another reason to do this. In these difficult economic times, spreading money out to more people seems more fair than making one or two people excessively wealthy.

I like this idea. If you do too, please help spread it around - email a link to your politicians to put a bug in their ear. and ask others to do the same.

If you don't like it, please do leave a comment with any suggestions you might have.