I've long maintained that states should get out of the lottery business. It's wrong twofold. First, a lottery isn't anywhere close to a governmental function. Lotteries don't enable equality, they're extremely non-essential and they're not even sectors in which the government can do a better job than the free market. And second, the government decries gambling as immoral in the same breath that it sets itself up as bookie. There are matters in which the government rightfully claims a monopoly: driving rules, war and imprisonment come to mind. But in general, if something is okay for the government to do, it should be okay for the private sector to give it a try. Businesses can even provide private police forces, more or less. If states want to run a lottery — which they shouldn't — they should at least let businesses get a piece of the action.
State governments run lotteries because they're lucrative, but it's a shell game: governments should be open about the funds they need and the taxes they enact to raise them. This form of taxation also happens to be fairly regressive. That many states direct their gambling profits to particularly feel-good causes like education doesn't excuse the fact. In fact, it's a bit of an insult to raise school money from a disproportionately under-educated demographic.