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Time value of money says your argument is dead wrong. The lump sum payment is discounted, which is why it is less. Did you ever take high school math? When I did they taught me about compound interest and discounting. I don't disagree with you about the state being a bookie, but frankly governments have done much worse things than sell lottery tickets to pay for themselves. At least participation is optional. Yes the odds are terrible - so what? No one is forced to participate, which is more than I can say about other taxes. Yes, people do dumb things. I don't want the gov to be my nanny, and I am unwilling to pay for it to be anyone else's nanny. Got it? The Constitution defines what the Feds can do (or at least if we had a legislature that believed it meant what it said we would) and state constitutions define what they can do. If the people amend their state constitutions to allow lotteries then go for it.

That's true if you know how to manage your money. But people who can manage their money generally don't play the lottery anyhow. The typical lottery winner is better off taking the money in installments because they can fritter it all away and still get a check the next year.