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Selling the Lottery

Discussion in 'BBS Hangout' started by updawg, Feb 2, 2007.

  1. updawg

    updawg Member

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    doesn't matter how much its sold for, the current politicians will spend it as fast as they can, why not, once their political career is over it won't be their problem and all will be good while they are shelling out this new found wealth.

    Then we will be stuck with-
    1.) coming up with money to replace the lottery stream
    2.) coming up with money to sustain the new programs that they funded with the lottery sale proceeds

    (and we won't be able to use gambling, slots etc because there would be a non compete clause for whoever bought it.)

    If that wasn't the likely outcome, I would be all for it. But I'm not naive
     
  2. Major

    Major Member

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    You need to learn how government and politics work.
     
  3. thadeus

    thadeus Member

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    Here's the crucial question:

    Who is really going to benefit from this? Who will get the contract, and what will their relation to Perry be? How much will the new lottery company have donated to Republican coffers in the past?

    It's no longer a consideration of how it's going to benefit Texans - it's obvious at this point that state politics have little-or-nothing to do with that.
     
  4. deepblue

    deepblue Member

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    All I know is goverment will not be able to run a better business compare to a private company. They shouldn't be in the business of running businesses, they should collect taxes and govern.
     
  5. ShakeYoHipsYao

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    Exactly.

    But I suppose if we were willing to get rid of public education, the plan would be gravy!
     
  6. Major

    Major Member

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    That's nice and all, but here are some facts about government:

    1. They will sell the lottery for less than it's worth. That's always the case when the government sells off assets. 10 years from now, people will wonder why the hell they sold it for so little.

    2. They will spend any excess revenues they have, ignoring future needs, as they are doing with their $14 billion current surplus.

    3. They will then raise your taxes to cover the shortfall 3 years down the road.

    Government is not efficient - that's not its purpose nor its goal. Coming at government decisions exclusively from a business perspective has severe limitations and will result in a big mess.
     
  7. robbie380

    robbie380 ლ(▀̿Ĺ̯▀̿ ̿ლ)
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    lol...you need to go back to school. have you even watched the stock market with respect to acquisitions? let's be real and not act like markets are efficient and that people always get fair prices.

    smart people with a lot of money can make really dumb mistakes. and like I said earlier...we don't know any numbers associated with a potential sale so we can't make any judgements.
     
  8. thadeus

    thadeus Member

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    Definitely true, but I think we non-politicians often see mistakes where there is actually complete success.

    It's only a 'mistake' if you believe that a politician's stated goal is his/her actual goal. Often it's not.

    Say this lottery sale goes through, and it turns out that the revenue stream provided by the lottery was, in fact, necessary for funding Texas schools. You and I would say privatizing the lottery was a huge mistake.

    But let's say that Rick Perry sells the lottery to a good friend of his, and that good friend makes a massive campaign donation to Perry's party (and future presidential bid), and that Perry's kids get high-level jobs with a friend of the friend's billion-dollar company, and so on and so forth - where you and I see a mistake, Perry and the people he's really working for see a total success.

    I'm not saying this is the case (though it could be), but pointing out that these 'mistakes' are often not mistakes at all.
     
  9. robbie380

    robbie380 ლ(▀̿Ĺ̯▀̿ ̿ლ)
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    I understand what you are saying but I am just talking about correctly valuing the lottery. if the state is just putting out feelers to see how much they can get then that is fine. but if they are just looking to sell just to say they privatized the lotto then that could be a very poor financial decision, especially with how fast texas is growing.

    and I don't disagree with what you are saying especially after the merck/perry relationship. clearly, HPV and cervical cancer are not epidemics. while I think it's a good idea to start getting people vaccinated against it there is no reason to mandate it... especially at the high price of $360 per shot. not trying to get too far off the thread but just addressing your point.
     
  10. torque

    torque Member
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    If only we could be so lucky.
     
  11. rrj_gamz

    rrj_gamz Member

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    Sad but true...
     
  12. deepblue

    deepblue Member

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    The market determines what is the fair price, assuming there are multiple players. There are both possibilities that future lott revenue could go up or tank, which would impact the the valuation at that time, and if the revenue does go down or flatten out, would you be the first one to say they should have sold it when the value was high?

    The market is fluid, no one can predict the future, one thing we know for sure is private companies will be able to run a business a lot more efficient than the government.
     
  13. updawg

    updawg Member

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    that is not always true. In theory this is true, in practice not always. There are plenty of companies sucking the gov's tit that shouldn't be.
     
  14. JuanValdez

    JuanValdez Member

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    If the state doesn't want to run the lottery, just close it down and make it illegal again. I'm not too thrilled with the idea of giving a company a state-sanctioned near-monopoly on gambling in Texas. People were willing to approve it so that we could help our schools. Now, why should we tolerate gambling if it is just going to line corporate coffers?

    Or, if we're over our moral objections to gambling, then open it up and let all the casinos come in. But don't give one company a monopoly.
     
  15. Deckard

    Deckard Blade Runner
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    You DON'T know that "for sure," because it's not true. And you describe a government run program as a business. It is not... it's a government run program. The assumption that privatization is more efficient in running state government functions has been demonstratively blown out of the water in Texas. I asked Trader_J a question earlier in this thread, and I'll ask it of you... give me some examples of privatization of Texas state government functions being a success. Trader_J disappeared after I asked him the same question. I looking forward to your response.



    D&D. Government has a Function.
     
  16. weslinder

    weslinder Member

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    I agree with this completely, especially the bolded part.
     
  17. ShakeYoHipsYao

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    Prisons!
     
  18. GladiatoRowdy

    GladiatoRowdy Member

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    Personally, I find businesses that exist to make a profit from the incarceration of the American people odious, but that is just me.
     
  19. deepblue

    deepblue Member

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    Ok fine, nothing is 100%, I still think the majority of the time private companies will be able to run a business better than the government, if that were not the case, then we would have the state run everything.

    I don't live in Texas, so I can't speak for the past projects in Texas. Here is something I know personally, I travel to Toronto frequently, compare the private highway in Toronto and the state run Mass Turnpike here is like night and day. The level of corruption and bureaucracy here is just incomprehensible.
     
  20. Major

    Major Member

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    If the state really wanted to sell the lottery in a way that's best for Texas, they would charge an annual usage fee instead of an upfront amount. For example, if they are currently making $0.30 per ticket after costs, they'd bid it out starting at $0.31 per ticket or something like that.

    That way, you keep your annual revenue stream and you make it more profitable for the state. If private business truly can run it more efficiently, then someone would be willing to buy it. The big benefit is that you take the risk out of it for the state - you'll never undersell it or worry about politicians spending the money upfront.
     

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