Is a National Lottery Constitutional?

Here’s another interesting nugget from the old OLC memos. Can Congress create a national lottery?The OLC (in the 1980s) took the position that no enumerated power could sustain a lottery.

I’m not sure why a lottery is not a tax. Granted, it’s voluntary, but lotteries do raise plenty of revenue. You could also argue that a lottery facilities commerce (for all of the retailers who sell tickets). There is no prospect, though, for congressional legislation on this point.

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10 Responses

  1. Brett Bellmore says:

    “I’m not sure why a lottery is not a tax. ”

    Because you don’t have to pay it. It’s as simple as that. Being involuntary is a core part of the concept of a “tax”.

    I agree with the OLC memo. There just doesn’t seem to be any of Congresses powers you could honestly shoehorn a lottery into.

    Not that that would even slow down today’s Congress, but back in the 80’s they were still paying lip service to the Constitution.

    • Christopher says:

      I do not think there is any place in the constitution that states lottery is a US constitutional.

      • Brett Bellmore says:

        Sure there is: 10th amendment. “The powers not delegated to the United States by the Constitution, nor prohibited by it to the States, are reserved to the States respectively, or to the people.”

        The Constitution doesn’t prohibit the states from running lotteries, therefor it’s a reserved power.

  2. dht says:

    Lotteries also make payouts to people who participate. I think this would be deemed a non-governmental expenditure, which could be an issue. Also, since the constitution says taxes must be collected uniformly across the states (Article 1, Section 8), and a lottery does not meet that standard.

  3. Joe says:

    There is no need to worry about only paying “lip service” here.

    A lottery has traditionally been a way to fund government programs. So it can be a “necessary and proper” means to carry out various federal programs. It could in effect be part of the Spending Power. Creative ways also can be imagined regarding payout to make it basically a form of tax break (an exception to my comment below).

    I don’t see it as a “tax.” Why would raising revenue make it a tax? Selling federal land etc. raises revenue. Not a tax. So, need more information there. Plus, a link to the OLC might be helpful.

  4. lindagist says:

    There is no place that it was specifically stated that lottery of any kind in the US is constitutional.

  5. Joe says:

    Power need to be closely “specific” and a clause was added (and rejected enhancer to the Tenth Amendment left out) to be legitimate.

    • Joe says:

      Ah. This finally shows up and I see it’s a typo affair.

      The Necessary and Proper Clause was basically added to underline that something need not be specifically stated to be allowed pursuant to federal power. Likewise, a proposal to add a specificity requirement to the 10th Amendment was rejected as well.

      As to “any kind,” we had an “immigration lottery” to cite one thing. A lottery to obtain a tax break or whatever also seems okay. A lottery, e.g., can be used to dispose of some government land or whatever. That might be deemed more a “raffle” but the line is pretty narrow.

      The power to dispose of land, e.g., is broad and not sure why a lottery can’t be used. Ditto let’s say disposing of funds seized in a forfeiture action or something.

  6. BobV says:

    It has been said that a lottery is a tax on those who are bad at math.

    • Henry Cohen says:

      I read an article online the other day (I can’t remember where) arguing that to say that buying a lottery ticket is a poor investment misses the point of buying one. People buy lottery tickets for the pleasure it gives them in fantasizing about winning and what they will do with the money they win.