If at first you don't privatize, try try again

You have to hand it to Governor Perry. He never gives up, no matter how bad the idea is.

Texans could buy lottery tickets at the checkout lines in supermarkets and big-box department stores, at coffee shops and cabarets. They could pay with credit cards or personal checks and play online or the old-fashioned way with a ticket that's also a tiny ad for anything from soft drinks to sporting events.

Those are just some of the proposals offered to state officials by some of the nation's largest financial firms that have an interest in remaking the 16-year-old government-run Texas Lottery Commission into a market-driven enterprise operated by companies motivated more by the prospect of profits than the vagaries of politics.

Although the prospect of turning over Texas' $1 billion-a-year lottery to the private sector received the coldest of shoulders when Gov. Rick Perry first suggested it, a year ago, proponents have been busy laying the groundwork for a second, more concentrated push when lawmakers return to Austin in January for the 2009 legislative session.

"I seriously doubt at this point that they have one vote, much less the 100 they'll need [in the 150-member House], but they're already here visiting with folks to lay out their case," said state Rep. Warren Chisum, a Pampa Republican who heads the powerful House Appropriations Committee.

Chisum, whose committee is among at least three legislative panels to be tasked with at least looking at the feasibility of a closer partnership between the lottery and private enterprise, describes himself as very much a skeptic. He questioned whether lottery ticket sales could generate the billions of dollars that the investment firms say are out there and whether the capital markets want to take chances on state lotteries.

"It sounds very pie-in-the-sky -- to me, anyway," Chisum said.

When folks like Warren Chisum are expressing this kind of skepticism, you wonder if Governor Perry has anyone in the Lege on his side of this. You have to wonder what the point of this effort is. I mean, don't we have bigger things to worry about?

According to a demographic study released in December by the University of Houston, fewer and fewer Texans are playing the lottery. And those who do play most tend to be lower wage earners with less education.

The study found that people without a high school diploma are likely to spend more than $60 a month on lottery games. People with a four-year college degree are likely to spend about $5 a month. People who earn $20,000 to $50,000 a year spend twice as much on lottery games as people who earn $100,000 a year or more.

The privatization proposals say the lottery needs to end its reliance on a ticket-buying base of low-income earners by marketing the games to people with college educations and more disposable income.

One suggestion is allowing ticket sales at grocery store and department store cash registers, where the price of the ticket would be rolled into the overall outlay. The same strategy could be used in cafes under some of the proposals.

Gerald Busald, a mathematics professor at San Antonio College who has conducted several studies of the Texas lottery operations and its players, questioned whether the pool of lottery ticket buyers can be significantly expanded.

"I don't think those players are out there," Busald said. "If people [with more disposable income] want to gamble, they can drive to one of the casinos across the state line."

Well, yeah. It's pretty simple, really - in terms of entertainment value for the dollar, a Lottery ticket is pretty far down the list. How much fun is a scratch-off ticket, anyway? I just don't get the allure. Thanks to South Texas Chisme for the link.

Posted by Charles Kuffner on April 09, 2008 to Jackpot!