Powerball winners are those who did not play
It's too bad there's nothing newsworthy in common sense, where money is concerned.
When the Powerball lottery jackpot went over $300 million last week, it became an idiotic sort of news. Television couldn't ignore it. Anchor people had to pretend it was significant — like the Steubenville case, say, that perhaps exposed a national syndrome of high school rape and binge drinking. Or the president's peace trip to the Middle East.
Significance isn't the point, though. The lottery was exciting. All that cash! And it could be anyone's.
Unfortunately, to spread the word is to promote the folly.
Last-minute ticket sales got a boost that advertising couldn't have bought. Low-income people who might not have wasted any more on a billion-to-one shot at becoming Rockefeller surely felt moved to pitch another $2, if not $10 or $20. Fun was sweeping the country. The news said so.
And this is how we reinforce bad economics at the personal level.
Even as the Powerball bubble burst — somebody won the darn thing; game over — millions of other “winners” had never bought a ticket at all. They were simply the folks who tend not to throw money away, but do ply a certain amount into rainy day savings or investment.
No, they won't end up with $338.3 million (minus the government's wolfish tax bite).
But they will have $200,000 or better. That's a relatively easy long-range goal. Because it comes out of nonessential, mindless spending, which they don't do. On lottery tickets for one. On smoking even more so. Excessive drinking also qualifies.
Likewise, overpriced sports tickets and memorabilia. And fads they'd eventually regret, such as tattoos and body piercings.
A pack-a-day cigarette habit alone wastes $2,000 a year. How many millions of us can't put away as much as we throw away?
It might help if the government did a bit more to promote thrift vs. its opposite. Strange that it doesn't.
Keynesian economics makes a fetish of hoisting people's spending, not their saving. The consumer is “70 percent of the economy,” we're piously reminded. Is the virtue of saving even taught in the today's schools?
Interest and dividends, which ought to be tax-free, are government-swiped as if the only people who receive them are “the rich.”
The Federal Reserve keeps interest rates super-low to spur the sluggish economy allegedly. But can it be only coincidence that the federal government is given a practically free ride with interest on our disgraceful national debt?
And yet pinched elderly savers have to cast about for riskier ways to increase their shrunken income.
Meanwhile, government at the state level promotes lotteries that pry money out of the hands of the poor. Because most of the chances on the jackpot illusion are taken by low-income people.
If they'd put aside more for old age, they'd be less of a burden on Social Security. You'd think the government would want that. So should responsible news media. Instead, look what gets hyped.
One small nudge the other way appeared in a news story the day after the Powerball win. A loser was interviewed, a 45-year-old electrician who had bought 40 tickets at $2 apiece, pathetically trying to narrow the billion-to-1 odds.
“It was fun to dream for a few minutes,” he said.
But a more sensible dream is within reach of millions. It just doesn't have a catchy title. And doesn't make news.