Most RI Powerball winners got $4 each — was it worth it?

Nov 29, 2012

Almost 48,000 winning Powerball tickets were sold in Rhode Island, although most were for the princely prize of $4, according to the state Lottery. Take away the $2 per-ticket cost, and the net gain for the vast bulk of winners was $2.

That’s a far cry from $587.5 million jackpot that sparked fevered dreams across the land of striking it rich. (Two winning jackpot tickets were sold, one each in Arizona and Missouri.)

Back in RI, the Lottery says 47,920 winning tickets yielded prizes ranging from $4 to $40,000. The total winnings on those 47,920 tickets were $346,126 — or a  bit more than 10 percent of the amount wagered here in hopes of winning the mega-prize.

Here’s a breakdown provided by the Lottery:

 RI WinnersPowerPlay® RI WinnersPrize ValuesPowerPlay® Prize Values5+000$1,000,000$2,000,0004+131$10,000$40,0004+09415$100$2003+115515$100$2003+04,513470$7$142+12,185198$7$141+112,6851,274$4$120+124,0982,214$4$12

Based on the payout in Rhode Island, a  one in 10 chance of winning might not seem bad — until you remember most winners enhanced their standing by just two bucks. That’s just another reminder of why lotteries function as a hidden tax on the poor.

No one can be blamed for wanting to strike it big, of course.

But how likely is that when the odds were, as financial columnist Chuck Jaffe noted, 175 million to one?

Jaffe offered this perspective:

It’s not that the lottery has no benefit for the gazillions of losers who, statistically speaking, are in it so someone else can win it, and win it bigger than ever. There’s some good that comes from playing what-if games, from doing something that gives hope and generates excitement in the middle of our mundane routines.

But it’s important not to lose sight of the basic fact that the lottery is a loser’s bet, and that the time spent asking “What would I do if I won the lottery?” should not undermine the more-important, seldom-asked, question: “What should I do if I never win the lottery?”