The First Sanctioned National Lottery was a Colossal Failure

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By Ken Zurski

continental-congress-hero-abOn November 18, 1776, the First Continental Congress enacted a national lottery designed to complete with state and local lotteries at the time. The reason for getting in the lottery game was a simple yet important one for delegates of the thirteen colonies: help fund the costly Revolutionary War.

Not only were more muskets and ammunition needed to fight the war (which officially began in April of that year), but the men of the Continental Army expected to get paid too, in land or money – $6 a day for privates; up to $20 a day for captains.

The Continental Congress had no power to tax the people, so money was printed – lots of it – based on specie (minted coins from precious metals). They also borrowed supplies and currency from France and the Dutch. And wealthy Americans dutifully bought war bonds. But for the average citizen, the common villager, they could do their part as well. Buy a lottery ticket, take a chance, and help pay for the war, the Congress asked.

It didn’t go as planned.

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May 1, 1778 was the first scheduled drawing for the new lottery.  By then, only a little over 20-thousand of the 100-thousand were sold. So the drawing was pushed back to May 27th. On that date only 36,500 tickets were sold, an increase of just more than 16-thousand in less than a month, but still far less than expected.  The government was left holding 60,000 unsold tickets. At $10 a piece that was a net loss of more than $72-thousand. The government expected a net profit of $1.5 million from the lottery. They made an estimated $100,000. Certainly not enough to fund a war.

But the poor sales were only part of the problem. Three other classes of a national lottery also failed to ignite the public’s interest. Publicity marketing and distribution were some of the the reasons why. The other reason was the greatly depreciated value of the continental dollar. According to Steve Swain, a lottery historian: “At the completion of the first class lottery in May of 1778, it took 2-5 Continental dollars to equal one dollar in actual exchange value. By the completion of the second class lottery in June of 1779, it took from 13-20 Continental dollars. By the completion of the drawing a year later, the rate of exchange was over $1,000 in Continental bills to $1 in actual exchange value.”

It’s easy to see why the government was interested in cashing in on the lottery idea. Lotteries or public raffles had been in the spotlight for more than a hundred years. In fact,  America’s very first lottery winner is Thomas Sharplisse, a tailor from London. We know this rather trivial historical fact thanks to a another man named John Stow who decided to chronicle English life in in the 16th century. His book Survey of London was released in 1598, a life’s work indeed, since he was dead just seven years later at the age of 80. At the start of the 17th century, however, other diarists picked up the slack, commissioned by King James I, and continued to record anecdotes and life experiences of fellow Londoners. The Stow’s Chronicles is the result.

And because of it, we know the name: Thomas Sharplisse.

aaa.jpgSharplisse had nothing to do with America except as other Londoners did at the time a passing interest in what was going on in the New World.  It was after all 1612. The stock holding Virginia Company of London, had funded the first English colony in North America, the struggling James Towne, or more commonly known as Jamestown, named of course in honor of his majesty.

The newly established settlement (actually it was the second incarnation, the first was James Fort) was reeling from sickness, starvation  and occasional attacks by hostile Indians. They were in desperate need for more supplies, but the Virginia Company was broke. So the King approved a lottery, a game of chance really, but also an opportunity for fellow countryman to invest at a time when charitable contributions didn’t exist.

Marketing for the lottery was in the guise of a song:

To London, worthy Gentlelmen,

goe venture there your chaunce:

good lucke standes now in readinesse,

your fortunes to advance 

In June of 1612, Sharplisse was among the crowd that gathered in a specially constructed “Lotterie house” near St. Paul’s Church in London to watch tickets drawn in the first Great Standing Lottery.

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Little else is known about Sharplisse except that he spent two-shillings-and-sixpence on the chance. And according to Stow’s Chronicles, Shaprlisse’s ticket  was the Grand Prize winner – four thousand crowns in “fayre plate, which was sent to his house in a very stately manner.” It was a fortune at the time. Two Anglican churches took home smaller winnings

After the Virginia Company paid for the prizes, salesman, managers, and other expenses, the remaining revenue covered the cost of shipping people and supplies to Jamestown. It was such a vital resource that Captain John Smith referred to the lottery as “the real and substantial food.” Disappointing, however, was the turn out. Nearly 60-thousand lottery tickets went unsold. Eventually, the crown banned lotteries that benefited Jamestown because of complaints that they were robbing England of money.

More than a century later, the First Continental Congress tried a lottery to help pay for the Revolutionary War.

It failed.

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(Some text was reprinted from The Lottery Wars: Long Odds, Fast Money, and the Battle Over an American Institution; Source: Colonial  America Lottery by Steve Swain)

2 thoughts on “The First Sanctioned National Lottery was a Colossal Failure

    […] Lotteries didn’t just save the Virginia Company’s settlers from starvation, though. When the colonies revolted against the crown, lotteries helped the new United States of America survive. In 1776, the Constitutional Congress held one to benefit the soldiers of the Revolution. (Since the value of the new country’s currency was fluctuating wildly, it was less successful than hoped.) […]

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    […] Lotteries didn’t just save the Virginia Company’s settlers from starvation, though. When the colonies revolted against the crown, lotteries helped the new United States of America survive. In 1776, the Constitutional Congress held one to benefit the soldiers of the Revolution. (Since the value of the new country’s currency was fluctuating wildly, it was less successful than hoped.) […]

    Like

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