A Congressional commission pondering the social and economic effects of gambling may ask states to follow a code of conduct in their lottery advertising.
The proposal arose as the National Gambling Impact Study Commission evaluates the social and economic effects of gaming.
"We need to make specific recommendations to the states to improve advertising," commission chairman Kay Cole James said at a hearing Friday in Washington. The commission heard testimony suggesting that states have no business advertising what is essentially a vice.
"I don't think states should be in the position of encouraging people to gamble more than they would otherwise want to," Philip Cook, a professor of public policy studies at Duke University, said at the hearing.
Cook showed several TV and print ads which he said are misleading. One, for the Arizona state lottery, displayed a bank deposit slip for $175 million with the caption "Just Think." Cook said lottery winners cannot immediately deposit winnings which are paid out over time.
Advertising lobby groups said state attorneys general can easily stop deceptive or misleading advertising. "The authority is already there to act," said Dan Jaffe, executive vice president of the Association of National Advertisers. "There doesn't need to be a new authority."
Hal Shoup, executive vice president of the American Association of Advertising Agencies, wants the industry to come up with its own code for gaming ads. "We feel it is possible to develop certain principles that might be helpful to the states."
George Anderson, director of the Minnesota State Lottery, said state lotteries are highly regulated and use public brochures to clearly outline the chances of winning. "I was not taken aback by the advertising shown today," he said.
Thirty-seven states and the District of Columbia operate lotteries, which tallied $36 billion in sales in 1997.
The commission's final report is due to Congress in June. The panel will likely
limit its focus to state lottery ads, since the Supreme Court has agreed to hear a case challenging a federal law banning casino gaming ads from being broadcast. A ruling is expected in June.