It's commonly known as The Stupidity Tax.
I speak of the lottery, of course.
Powerball, which has reached over $500 million, has a 1 in 175,223,510 shot at winning. Since a play is now $2, this means that you must have more than about $350 million in the pot before it becomes "reasonable" as a gamble to play. And oh by the way, that has to be the cash payout, not the "face" value which is a 20-year alleged "annuity."
But it gets worse than that, because (1) you must pay taxes on the winnings, but do not get to deduct losses, so the amount post-tax must exceed $350 million. That we're geting close to, but not yet surpassed -- on the 20 year annuity, not cash value.
And then there's the final problem -- you could have more than one winner, in which case you have to split the money.
So even with the $500 million (estimated) jackpot, the odds still suck -- just not as badly as they usually do. And yet huge numbers of Americans will play for this evening, just as they did for Saturday (and none won.)
Now to be fair you might win $1 million (about $500k after tax) which is 1 in 5.153 million as well, or any one of a number of lesser prizes. The total odds are 1 in about 32.
But again, remember that each play is $2, not $1, since they changed the game a while back. This, of course, was done to intentionally pump up the numbers on the size of the jackpot and suck more people in.
If you choose to buy tickets for tonight, just remember the golden rule -- you almost-assuredly flushed the money down the toilet. You're far more likely -- by more than a factor of 100 -- to be hit by lightning (1 in a million) than win the Powerball (1 in 175 million.)
Nonetheless I'm sure that this evening half the nation will be furiously looking at these little slips of paper, and half of those folks will have already figured out how they're going to spend the money.
The stupidity tax will have won again in aggregate, irrespective of the individual results.
Where We Are, Where We're Heading (2013) - The annual 2013 Ticker
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