Image courtesy of the Library of Congress
Each of these second class United States Lottery tickets entitled its bearer "to receive such prize as may be drawn against its number."
On this date, the Second
Continental Congress agreed to create a nationwide lottery to raise money for America’s ongoing war for independence against England. During the first few months of the conflict, Congress mainly funded the cause by printing Continental dollars backed by promissory notes of “Spanish milled dollars” or an equal value of gold or silver. Similar kinds of paper currency had long been in use in North America; Massachusetts first printed its own notes in 1690, followed by other colonies through the early 1700s. During the war years, inflation was a constant concern. Because the Continental Congress lacked the authority to collect taxes, it printed vast quantities of paper notes to fund its obligations. But wartime interruptions to imports and domestic production meant there were rarely enough goods available, driving up prices. In 1776, Delegate
John Adams of Massachusetts noted that most colonists disliked paper currency. “The Depreciation of it, in all the States,” he said, “is manifestly very great and rapid.” As the value of Continental dollars declined, Congress looked for new ways to raise revenue. On October 14, 1776, Congress appointed
Richard Henry Lee of Virginia,
James Wilson of Pennsylvania, and
Lyman Hall of Georgia to a committee on “the ways and means of supplying the treasury.” After studying the issue, the committee proposed a two-fold solution: creating a lottery and printing $500,000 additional Continental dollars. The lottery system Congress approved set ticket prices between $10 and $40, and divided tickets into four classes. Lottery participants were called “fortunate adventurers.” The first drawing took place in May 1778, more than a year after Congress intended the lottery to start. Despite strong ticket sales initially, especially in Philadelphia, the overhead costs of running the lottery proved high. Although Congress managed to settle some debts using lottery proceeds, the contest ultimately failed to raise sufficient revenue. The last drawing took place in April 1782. That December, more than six years after its inception, Congress agreed to formally bring the lottery to a close. Even after the war ended, debt from the Revolution plagued the new nation for years. In 1790, the
First Federal Congress (1789–1791) agreed to assume remaining colonial debts from the states.
