Continued: As tough times hit, many try their luck

In spite of a trifecta of crises this year that have forced Americans to rethink the value of their homes, tighten belts amid rising food prices and reduce gasoline consumption, state lotteries -- including Minnesota's -- are posting record sales.

The jump surprised Minnesota Lottery officials. They saw sales drop in 2003, the last time the country went through an economic funk. But lottery ticket sales hit $461.5 million for fiscal year 2008, up 9.2 percent ($38.9 million) from 2007.

"We don't expect to do well when the economy's down," said Minnesota Lottery executive director Clint Harris.

Ten state lotteries posted record sales this year, he said.

How that's happened during tough times isn't understood. Theories abound -- from more people reaching for a ray of hope in times of despair to lotteries wooing more players with games that offer better odds to win smaller rewards.

"Some evidence suggests that you use gambling as a stress reliever," said Ken Winter, a Ph.D. in psychiatry at the University of Minnesota. "Things haven't been going well. You want to forget your problems, so the gambling option satisfies that itch.

"There is a compelling argument to make that when there is a little downturn in the economy, more people will decide to take that extra risk."

Winter has studied gambling since the 1990s, soon after a bill passed allowing the establishment of a state lottery. Casinos are taking a hit from the economy, he said, because they involve much more up-front costs in terms of travel, lodging and gambling money.

The lottery may still be kicking strong because that initial cost is small compared to the possible payout, he said. Players think about the buck or two they're spending at the moment, not the cumulative dollars they pour into the lottery over the course of a year.

"People aren't necessarily rational about that," Winter said. "When you're feeling a little less financially confident, you search out where you can get some hope."

It's true even for those who have played over and over with no luck. Duane Barsness, 68, said he buys a ticket every time he's at the grocery store. He's never won, but he still believes he can.

"I've been doing it for many years, but there's always that chance," Barsness said. "It only takes one ticket to hit the jackpot."

McDonald said a $20 scratch ticket with over $1 billion in prizes was especially popular. Scratch ticket sales set a record in Minnesota, making up nearly two-thirds of sales ($298 million). Helping the sales is that about 65 cents of every dollar spent on them goes towards prizes, giving them a higher payout value than other games.

Deloris Saless, 79, of Minneapolis, buys scratch-off and Powerball tickets a couple of times a week, she said. She's won on scratch-off tickets and sometimes lets her winnings pile up.

"When I'm going on a trip, I cash them in," Saless said.

One not-so-new facet of some scratch tickets is also alluring: Losers get a second chance to win. That is, players can send in losing scratch tickets for raffle giveaways, such as two Lund fishing boats and a trip to Hollywood with a chance to appear on the game show "Deal or No Deal."

"Five years ago, we weren't doing the second chance at all," said Don Feeney, Minnesota Lottery research and planning director.

Will the winning streak continue for state lotteries? Some lottery directors aren't so sure.

The Iowa Lottery, which has had record sales of $249 million this year, up from $235 million in 2007, may not feel the full effect of 2008's financial woes until it's time to tally sales for fiscal year 2009, said spokeswoman Tina Potthoff.

"I think 2009 is definitely going to be tougher," Potthoff said.

For some, it might not matter. James McGee buys lottery tickets every day, usually no more than a few dollars' worth.

"I did good a few times, but I don't like bragging," McGee said while buying $12 worth of the tickets Friday.

"I'm tired of working,'' he said. "That's why I play the lottery."

Staff writer Libby Nelson contributed to this report. Chao Xiong • 612-673-4391