Lottery history Started with King James I

Lotteries have been around since 1612 when King James I gave permission to the Virginia Company of London to generate revenue. The funds were to be used as part of the first settlement's financing. Lottery history shows that the lotteries in the colonies were successful and widely accepted by the colonists. Had it not been for the lotteries the building of the colonies would likely have been much slower and poverty would have been rampant.

Well over 200 lotteries were played according to lottery history from 1745 and when America broke off with England during the Revolution. The lotteries played a key role in funding the infrastructure of the colonies. The colonies enjoyed the benefits of the lotteries through new roads, libraries, colleges, churches and many other public infrastructures and facilities. The lotteries were the initial funding source for three very well known American universities, University of Pennsylvania, Princeton and Columbia University. Money from the lottery was used to finance the French and Indian war as well as parts of the American Revolution making it ironic that King James I first invented the lottery.

Lottery chits or tickets with George Washington's signature still exist and when sold at auction typically get $15,000, not a bad return on a little lottery history. Alexander Hamilton said that “Everybody will be willing to hazard a trifling sum for the chance of considerable gain...” Given that taxation was such a hot topic for the colonists the lottery system seemed like a good way to raise money without having to impose new taxes. The Continental Congress employed this strategy to help fund the war efforts. In the end the colonists believed the lotteries were a form of hidden tax.

Lotteries remained a popular game of chance and continued to be run by the government or local states. The system remained about like it is today with a drawing of lots to determine the winner. The prize was a portion of the purchased chances to win.

Lottery history took a turn for the worse when in 1982 the “Golden Octopus” was started by the Louisiana State Lottery. It was so named because it reached in to every home in the Americas. This lottery had its troubles with corruption. The trouble started at the onset of the lottery when the Louisiana State Lottery Commission had to bribe the legislators to get the lottery started. This came at a time when many states were starting to view lotteries as less than a legitimate source of revenue or a pure game of chance. In July of 1890 President Harrison attempted to end lottery history by asking Congress for legislation to limit what lotteries could do. The first step was to not allow U.S. mail to carry lottery tickets. This had a profound effect on the availability of lotteries. By 1900 the U.S. had put a halt to all lotteries. Today, all states allow lotteries and again are enjoying the revenues from lotteries. There are several multi-state lotteries that bring in millions of dollars to every state they are played in by sharing a portion of the proceeds of the tickets purchased in that state. These lotteries are large enough that the payout starts at $20 million and frequently exceeds $100 million. The states and the federal government win big too. The federal tax level for such events is in excess of 40%.