Winner Winner, Chicken Dinner!
Indiana Governor Mitch Daniels wants to privatize the Hoosier Lottery
Governor Daniels has made it clear during his two terms that he is a big fan of limited government and privatization. It now looks like he wants one more big score before moving on to the President’s office at Purdue University. The Indianapolis Star is reporting that Camelot Global Services has withdrawn its application to take over the Indiana lottery but there are still others who are interested in managing all that money that gets dropped on the lottery week after week. Camelot Global Services runs the United Kingdom’s National Lottery but had this to say about Indiana’s lottery,
It will not allow the successful bidder to maximise returns to society in a responsible way, nor will it provide a commercially viable opportunity for new bidders.
According to the Indy Star article, the Hoosier Lottery generated $188 million but apparently Governor Daniels thinks a private conglomerate can squeeze even more cash out of the Hoosier population. Illinois turned their state lottery over to a private group and they are now in arbitration over the fact that the company fell well short of the promised income of $825 million. According to Governor Daniels,
…it could translate to millions of dollars in new revenue for the state. The Hoosier Lottery currently provides about 30 percent of the state’s Build Indiana Fund, and contributes to pension and retirement funds for police, firefighters and teachers.
There’s no explanation on how a private firm could achieve higher profits than the state could but it’s privatization so it must be good. The Indianapolis Star article closes with the following.
The governor has been a proponent of privatization efforts since taking office nearly eight years ago. In 2006, he leased the Indiana Toll Road to a private consortium for $3.8 billion and hired IBM to overhaul the state’s welfare system for $1.37 billion.
The state fired IBM three years later, amid widespread complaints about delayed benefits and impersonal interactions. That set off a legal battle that has cost the state $10 million in legal bills and a$52 million judgment for what the judge in the case called “a ‘perfect storm’ of misguided government policy and overzealous corporate ambition.”
Let’s just hope that whichever firm takes over the lottery has better luck handling state business than IBM did.