So why did prizes skyrocket? Progressive jackpot games and multi-state lotteries such as Mega Millions have their roots in the particular economic and cultural circumstances of the 1980s. As rising inequality fueled a spike in luxurious lifestyles amid an economic downturn, hopeful gamblers, eager to enter the exclusive world of the wealthy, turned to the unprecedented prizes offered by rollover jackpot games. Over time, state lottery commissions have catered to gamblers’ appetite for rising jackpots, offering ever-increasing prizes that promise to catapult winners into the highest reaches of an increasingly unequal economy.
In the 1960s, state lotteries offered irregular drawings for small prizes. Through a complicated formula, results were tied to horse races, and players could not select their own numbers. As a result, lotteries were effectively glorified raffles. Though these games proved enticing at first, sales quickly declined as the novelty wore off.
Then, in 1978, the Massachusetts Lottery tried to change its luck by introducing a new game: lotto. In lotto, players select numbers from a predetermined range, for instance, six numbers between 1 and 49. If a player correctly selects all six, they win the top prize. The bigger the range of numbers, the less chance players have of winning the jackpot.
But longer odds means fewer winners and jackpots that roll over, resulting in bigger prizes for the following drawing. With each rollover, the jackpot grows larger, as does anticipation.
After a slow start in the late 1970s, lotto took off in the 1980s. In 1984, unprecedented rollover prizes in Massachusetts ($15.6 million), New York ($22.1 million) and Illinois ($40 million) whetted the public appetite for lotto nationwide. By 1986, 19 of the 23 state lotteries offered lotto and, in some states, the game accounted for as much as 75 percent of lottery revenue.
The emergence of lotto was facilitated in part by a cultural shift in ideas about wealth. In the 1950s, 1960s and 1970s, popular culture had depicted “the good life” as a comfortable middle-class life in the suburbs, a sanctuary from the threat of nuclear annihilation and a signal of the triumph of American capitalism.
By contrast, in the 1980s, Americans embraced visions of luxury. The public peered longingly into the lives of the nation’s wealthiest citizens. From the first edition of Forbes’s list of the richest Americans in 1982, to Donald Trump and Tony Schwartz’s best-selling “The Art of the Deal” in 1987, to the popularity of shows like “Dynasty,” “Lifestyles of the Rich and Famous” and “The Good Life,” popular culture reflected an obsession with wealth and opulence.
This culture of luxury was endorsed by no less than President Ronald Reagan. From lavish inaugural galas to a tax plan that benefited the richest Americans, the former actor happily celebrated affluence. “What I want to see above all,” Reagan explained in 1983, “is that this country remains a country where someone can always get rich.”
Visions of opulence, however, contrasted sharply with economic conditions at the grass roots. The president’s “trickle-down” economics failed to actually trickle down. Poverty rates hit double digits for the first time since the 1960s, and manufacturing jobs — a long-standing avenue to middle-class life — continued to evaporate. By the end of the decade, just 8 percent of those born into the bottom 40 percent of household wealth reached the top 20 percent.
For many Americans, the United States was no longer a land of opportunity.
Yet this reality did not dissuade Americans from dreaming of joining the rich and famous. As wealth became more visible, it also became the new metric of a successful life. The percentage of college freshmen who stated that their life goal was “to be well off financially” rose from 40 percent in 1972 to over 70 percent in 1985. Economic stability might have disappeared, but many Americans viewed wealth as a means of providing happiness.
Enter lotto: In this bleak climate, lottery jackpots appeared to offer an otherwise unattainable chance for regular Americans not just to find financial stability but to reach the highest echelons of wealth.
State lottery commissions were happy to cater to players’ big, expensive dreams. But over time, swelling prizes created what lottery officials deem “jackpot fatigue,” as jaded players expected increasingly large prizes to keep their attention. “We’ve had so many people who’ve won a million or more, it now takes a pot of $10 million to generate the interest that $5 million did once,” a Michigan Lottery spokesman explained in 1988.
Accordingly, lottery commissions reduced the odds of winning, thereby increasing the chance of rollovers. New York’s lotto game, for example, offered gamblers a 1-in-3.8-million chance of winning in 1978. By 1988, that number was 1 in 26 million. Because large prizes drew media attention, attracted new players and increased ticket purchases among regular players, lottery commissions had clear incentives to diminish the odds and let jackpots grow. Thanks to this tactic, the Florida Lottery offered the nation’s first $100 million lotto prize in 1990.
Smaller states, however, did not have enough players to offer such generous jackpots. Hurt by competition from the bigger prizes offered in Massachusetts, tiny New Hampshire, Vermont and Maine lotteries struggled to complete. As a result, they got together in 1985 to form the first multi-state lotto game, the Tri-State Lottery, a collaborative drawing that offered jackpots much larger than any of the states could have offered alone.
The success of the Tri-State Lottery inspired other, similar initiatives. In 1987, the District of Columbia and six states formed the Multi-State Lottery Association (MUSL), which introduced Lotto America. By 1992, MUSL had expanded to nine additional states and replaced Lotto America with Powerball, which frequently rolled upward of $100 million, the first such prize available to gamblers outside populous states.
Mega Millions was formed under similar conditions in the mid-1990s, and, like Powerball, it offers massive jackpots because it caters to gamblers in all 44 lottery states. The two games are engaged in an arms race, as each gradually worsens the odds of winning to offer the largest jackpot possible. Powerball dropped its odds in 2015, resulting in a $1.5 billion jackpot — the largest in American history — in January 2016. Mega Millions reduced its odds in October 2017 and, if no one wins tonight, may claim the jackpot record next week.
If history is any indication, gamblers will become bored when $900 million or $1 billion prizes gradually become more frequent. Powerball and Mega Millions will continue to reduce their odds until prizes reach unfathomable sums.
But as millions of gamblers flock to buy lottery tickets, it is worth considering the economic conditions that have made lotteries so popular over the past 54 years. Games like lotto draw much of their appeal from a relatively recent shift in aspirations for wealth and from a decline in economic opportunity. In an increasingly immobile society, the popularity of lotteries can be attributed not simply to greed, but to lack of alternative means to access the good life.
This post has been updated to reflect an increase in tonight’s jackpot after publication.