Problem Gambling: Addicts, Lotteries, Sports, and Pensions

March is Problem Gambling Awareness Month (were you aware?) — and many people are becoming aware of an increasing problem with all sorts of gambling and betting being available 24/7, in easy reach, on our phones.

People wrestling with gambling debts and gambling addiction are not a new phenomenon, as these have featured as major items in literature (which I mention)… and unfortunately, too many politicians have pointed to people’s attraction to gambling via lotteries in supposedly helping to fund governmental functions.

Episode Links

National Council on Problem Gambling

FAQs: What is Problem Gambling?

What is problem gambling?

Problem gambling (sometimes referred to as “gambling addiction” or “gambling disorder”) is gambling behavior that is damaging to a person or their family, often disrupting their daily life and career. Anyone who gambles can be at-risk for developing a gambling problem. Gambling disorder is a recognized mental health diagnosis.

Some warning signs of a gambling problem are:

* Thinking about gambling all the time.

* Feeling the need to bet more money and more often.

* Going back to try to win your money back (“chasing losses”).

* Feeling restless or irritable when trying to stop or cut down.

* Feeling like you can’t control yourself.

* Gambling despite negative consequences.

* In extreme cases, problem gambling can cause bankruptcy, legal problems, losing your job or your family, and thinking about suicide.

For more information on the American Psychiatric Association’s criteria for gambling addiction, visit DSM 5 at www.psych.org.

Problem Gambling Awareness Month (PGAM)

Problem Gambling Awareness Month is a nationwide grassroots campaign, held annually in March, that seeks to increase public awareness of problem gambling and promote prevention, treatment, and recovery services.

PGAM Goals

* To increase public awareness of problem gambling and the availability of prevention, treatment and recovery services.

* To encourage healthcare providers to screen clients for problem gambling.

Literary Gambling

The Old Curiosity Shop by Dickens at Project Gutenberg

Chapter 29 excerpt to Chapter 30:

The child sat by, and watched its progress with a troubled mind. Regardless of the run of luck, and mindful only of the desperate passion which had its hold upon her grandfather, losses and gains were to her alike. Exulting in some brief triumph, or cast down by a defeat, there he sat so wild and restless, so feverishly and intensely anxious, so terribly eager, so ravenous for the paltry stakes, that she could have almost better borne to see him dead. And yet she was the innocent cause of all this torture, and he, gambling with such a savage thirst for gain as the most insatiable gambler never felt, had not one selfish thought!

On the contrary, the other three—knaves and gamesters by their trade—while intent upon their game, were yet as cool and quiet as if every virtue had been centered in their breasts. Sometimes one would look up to smile to another, or to snuff the feeble candle, or to glance at the lightning as it shot through the open window and fluttering curtain, or to listen to some louder peal of thunder than the rest, with a kind of momentary impatience, as if it put him out; but there they sat, with a calm indifference to everything but their cards, perfect philosophers in appearance, and with no greater show of passion or excitement than if they had been made of stone.

The storm had raged for full three hours; the lightning had grown fainter and less frequent; the thunder, from seeming to roll and break above their heads, had gradually died away into a deep hoarse distance; and still the game went on, and still the anxious child was quite forgotten.

CHAPTER 30

At length the play came to an end, and Mr Isaac List rose the only winner. Mat and the landlord bore their losses with professional fortitude. Isaac pocketed his gains with the air of a man who had quite made up his mind to win, all along, and was neither surprised nor pleased.

Nell’s little purse was exhausted; but although it lay empty by his side, and the other players had now risen from the table, the old man sat poring over the cards, dealing them as they had been dealt before, and turning up the different hands to see what each man would have held if they had still been playing. He was quite absorbed in this occupation, when the child drew near and laid her hand upon his shoulder, telling him it was near midnight.

‘See the curse of poverty, Nell,’ he said, pointing to the packs he had spread out upon the table. ‘If I could have gone on a little longer, only a little longer, the luck would have turned on my side. Yes, it’s as plain as the marks upon the cards. See here—and there—and here again.’

‘Put them away,’ urged the child. ‘Try to forget them.’

‘Try to forget them!’ he rejoined, raising his haggard face to hers, and regarding her with an incredulous stare. ‘To forget them! How are we ever to grow rich if I forget them?’

The child could only shake her head.

‘No, no, Nell,’ said the old man, patting her cheek; ‘they must not be forgotten. We must make amends for this as soon as we can. Patience—patience, and we’ll right thee yet, I promise thee. Lose to-day, win to-morrow. And nothing can be won without anxiety and care—nothing. Come, I am ready.’

‘Do you know what the time is?’ said Mr Groves, who was smoking with his friends. ‘Past twelve o’clock—’

‘—And a rainy night,’ added the stout man.

‘The Valiant Soldier, by James Groves. Good beds. Cheap entertainment for man and beast,’ said Mr Groves, quoting his sign-board. ‘Half-past twelve o’clock.’

‘It’s very late,’ said the uneasy child. ‘I wish we had gone before. What will they think of us! It will be two o’clock by the time we get back. What would it cost, sir, if we stopped here?’

‘Two good beds, one-and-sixpence; supper and beer one shilling; total two shillings and sixpence,’ replied the Valiant Soldier.

Now, Nell had still the piece of gold sewn in her dress; and when she came to consider the lateness of the hour, and the somnolent habits of Mrs Jarley, and to imagine the state of consternation in which they would certainly throw that good lady by knocking her up in the middle of the night—and when she reflected, on the other hand, that if they remained where they were, and rose early in the morning, they might get back before she awoke, and could plead the violence of the storm by which they had been overtaken, as a good apology for their absence—she decided, after a great deal of hesitation, to remain. She therefore took her grandfather aside, and telling him that she had still enough left to defray the cost of their lodging, proposed that they should stay there for the night.

‘If I had had but that money before—If I had only known of it a few minutes ago!’ muttered the old man.

‘We will decide to stop here if you please,’ said Nell, turning hastily to the landlord.

‘I think that’s prudent,’ returned Mr Groves. ‘You shall have your suppers directly.’

Accordingly, when Mr Groves had smoked his pipe out, knocked out the ashes, and placed it carefully in a corner of the fire-place, with the bowl downwards, he brought in the bread and cheese, and beer, with many high encomiums upon their excellence, and bade his guests fall to, and make themselves at home. Nell and her grandfather ate sparingly, for both were occupied with their own reflections; the other gentlemen, for whose constitutions beer was too weak and tame a liquid, consoled themselves with spirits and tobacco.

As they would leave the house very early in the morning, the child was anxious to pay for their entertainment before they retired to bed. But as she felt the necessity of concealing her little hoard from her grandfather, and had to change the piece of gold, she took it secretly from its place of concealment, and embraced an opportunity of following the landlord when he went out of the room, and tendered it to him in the little bar.

What next happens: Little Nell gets her coin changed in a separate room, trying to conceal the money from her grandfather and the card sharps, but after she falls asleep, somebody comes into her room and steals the money she has hidden underneath her pillow….she thinks it may have been one of the card sharps, and maybe they will attack her grandfather, so she goes to check….

The idea flashed suddenly upon her—what if it entered there, and had a design upon the old man’s life! She turned faint and sick. It did. It went in. There was a light inside. The figure was now within the chamber, and she, still dumb—quite dumb, and almost senseless—stood looking on.

The door was partly open. Not knowing what she meant to do, but meaning to preserve him or be killed herself, she staggered forward and looked in. What sight was that which met her view!

The bed had not been lain on, but was smooth and empty. And at a table sat the old man himself; the only living creature there; his white face pinched and sharpened by the greediness which made his eyes unnaturally bright—counting the money of which his hands had robbed her.

The Gambler by Dostoevsky at Project Gutenberg

Wikipedia article on The Gambler

Dostoevsky gambled for the first time at the tables at Wiesbaden in 1863.[2] From that time till 1871, when his passion for gambling subsided, he played at Baden-Baden, Homburg, and Saxon-les-Bains frequently, often beginning by winning a small amount of money and losing far more in the end.[2] He first mentions his interest in gambling in a letter he sent to his first wife’s sister on 1 September 1863 describing his initial success:[3]

Please do not think that, in my joy over not having lost, I am showing off by saying that I possess the secret of how to win instead of losing. I really do know the secret — it is terribly silly and simple, merely a matter of keeping oneself under constant control and never getting excited, no matter how the game shifts. That’s all there is to it — you just can’t lose that way and are sure to win.

Within a week he lost his winnings and was forced to beg his family for money. He wrote to his brother Mikhail on 8 September 1863:[2]

And I believed in my system ... within a quarter of an hour I won 600 francs. This whetted my appetite. Suddenly I started to lose, couldn’t control myself and lost everything. After that I ... took my last money, and went to play ... I was carried away by this unusual good fortune and I risked all 35 napoleons and lost them all. I had 6 napoleons d’or left to pay the landlady and for the journey. In Geneva I pawned my watch.

Dostoevsky then agreed to a hazardous contract with F. T. Stellovsky that if he did not deliver a novel of 12 or more signatures by 1 November 1866, Stellovsky would acquire the right to publish Dostoevsky’s works for nine years, until 1 November 1875, without any compensation to the writer.[2][4]

Pensions and Lotteries

May 2017: Stupid Pension Trick: Let’s Use Lottery Money!

This stupid trick comes courtesy New Jersey, which has been chock full of stupid pension tricks for years.

They’ve issued billions in pension obligation bonds.

They’ve gone chasing returns alternative assets to try to make up for undercontributions.

So now… what?

LET’S MONETIZE THE LOTTERY!

Here’s an explainer:

What you need to know about Christie plan to slash N.J. pension debt with lottery cash

Gov. Chris Christie’s administration on Thursday released long-awaited details of its proposal to use state lottery proceeds to boost the government worker pension fund.

In a briefing with reporters, the state treasurer emphasized the impact of the proposal, saying it said would take some of the burden off the state budget to come up with more and more money each year and will do more for improve the shaky pension fund than merely contributing the full amount recommended by actuaries.

The strategy is to inject a $13.5 billion asset into the pension fund and give it a guaranteed source of revenue for the next 30 years.

….

….

Yeah, so they’re going to take away the money from the lottery to spend on the pensions, and magically that’s going to make more money available for the things the lottery money is being spent on now.

FWIW, I saw people talking about this nifty idea back in April, and thought it dumb then.

May 2017: Geeking Out: How Dependable are Lottery Revenues? And Government Data Sources?

So I have a question: when they valued the lottery as an “asset” for the pension plan, did they assume that it would always keep growing? Linearly? Exponentially (same as constant % per year)?

I’m going to guess they didn’t fit a cubic.

There are a few other projections that may also make sense, assuming saturation of the lottery demand — cubic doesn’t really work, but something like a logistic function would probably be good.

(The reason I used exponential and cubic was because they’re built into Excel. I’m not going to do a huge amount of work here.)

June 2020: STUMP Classics: How Reliable Are Lottery Revenues?

Updated New Jersey lottery proceeds

In the old post seen above, NJ lottery proceeds had been moribund for a few years, which hit its growth rate. New York, on the other hand, had steady growth.

Well, this is what NJ lottery proceeds did once we add on three more years of experience:

Here are the 26-year growth rates for the states:

As before, New Jersey is well below the national trend.

But my main point is that proceeds from the lottery have been very variable for New Jersey, though that’s not true of the U.S. overall.

Treating their state lottery as a reliable asset to fund their pensions was a foolish decision.

Sports Betting

26 Dec 2025, Front Office Sports: 2025 Was the Year of Sports Gambling Scandals

Sports betting has expanded rapidly since the U.S. Supreme Court struck down the federal prohibition on sports betting more than seven years ago, but this year exposed vulnerabilities in the system with explosive scandals across professional and college sports.

Americans have bet “well north of” $500 billion since the 2018 Supreme Court decision, according to Legal Sports Report. Currently, 39 states and Washington, D.C. allow some form of sports betting. There have been prior controversies—like the saga with Shohei Ohtani’s former translator and the lifetime ban of NBA role player Jontay Porter—but 2025 was the year major scandals kept exploding.

23 Oct 2025, ESPN: Suspensions, arrests and lifetime bans: A timeline of sports betting scandals since the repeal of PASPA

On May 14, 2018, just after 10 a.m. ET, the United States Supreme Court struck down the Professional and Amateur Sports Protection Act of 1992, the federal statute that had restricted legal betting to primarily Nevada for 26 years.

It was a landmark decision for two of America’s favorite pastimes: sports and gambling.

States wasted little time launching -- and taxing -- legal sports betting markets, and professional leagues quickly formed partnerships with the bookmaking companies that would be taking bets on the games. Six years later, 39 states, the District of Columbia and Puerto Rico have legal betting markets, and bettors have already wagered more the $330 billion with the new state-sponsored sportsbooks. But as the betting has increased, so have the controversies that come from gambling.

In the past two years, dozens of professional and collegiate athletes and coaches have been suspended or fired for gambling violations, and at least one bettor has pleaded guilty to obstruction charges related to a college baseball betting scandal. In early 2024, a pair of investigations were launched involving suspicious betting on Temple men’s basketball and on prop wagers involving Toronto Raptors reserve center Jontay Porter. The NBA banned Porter for life after its investigation revealed he had disclosed confidential information to bettors, limited his participation in at least one game while he was with Raptors and bet on NBA games while playing in the G League.

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