Most lottery activity was banned by law before the advent of the Civil War. All but three states had constitutional or statutory prohibitions on the activity. In the 1860s the federal government began to consider legislation to keep lottery schemes from using the mail system (see Federal Lottery Laws). Amid these efforts to discourage lotteries, Louisiana lawmakers were persuaded in 1868 to charter a private company to run a lottery for twenty-five years. Other Southern states had also established lotteries as means of creating revenues during a period of governmental impoverishment brought on by the aftermath of war, defeat, and reconstruction. The Louisiana lottery was clearly the largest, and within ten years the other states ended their lottery experiments, leaving Louisiana’s lottery in a monopoly position in the entire country.
The twenty-five-year charter was won for an annual fee of $40,000 that was promised by the promoters – a New York syndicate including John Morris and John Morrisey as well as New Orleans front men. A nationwide promotion campaign popularized drawings, which were conducted with much fanfare by two retired Confederate generals. Tickets cost from two dollars to forty dollars. Ninety percent of the sales of tickets were to persons living outside of Louisiana, and they used the mails to purchase tickets. Monthly prizes were as high as $600,000. Annual profits for the lottery company reached as much as $13 million. When the lottery charter was about to end, Morris sought a renewal for a fee of $1 million a year.
Considerable opposition to the lottery arose from many sectors. The lottery’s operators were accused of corruption as well as extensive bribery. The federal government passed many acts seeking to stop the sale of tickets outside of Louisiana, but there was little effort to enforce the laws. An 1890 statute seemed to be more effective, and the promoters were cut off from the use of the mail. Efforts to win support for a renewal of the lottery were unsuccessful, and in 1893 the state joined all the others in the country and banned all lotteries. The syndicate that operated the lottery moved its operations to Honduras and shipped tickets into the United States through Florida. Congress plugged the loophole discovered in the law, however, and passed a very definitive prohibition against the importation and interstate transportation of lottery materials. The effective end of the Louisiana Lottery in 1895 marked the end of this form of gambling until New Hampshire began its state-run sweepstakes sixty-nine years later in 1964.
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