The Great Tennessee Lottery of 1810

by Jack Neely

A lottery is, of course, a tax. It's a tax based not on your income or sales, but on your gullibility. It's as if a 1040 form arrived, and the TAX YOU OWE was determined by how you answered one question: If you buy a $5 lottery ticket every day for the rest of your life, will you probably get rich? If you answer "yes," of course, your tax is $1825/year. If you correctly answer "no," your tax is $0.

It's the uneducated—people who didn't get far enough in school to study probabilities—who buy the bulk of lottery tickets. And it's the uneducated we may soon be expecting to foot the bill for troubled state-funded programs, especially higher education. Like nearly everything, we've already tried it. UT was once East Tennessee College, a tiny liberal-arts school in a single building on Gay Street. In 1809, the college's founder, Presbyterian minister and classics professor Samuel Carrick, suddenly died. Legend has it he was exhausted from writing a sermon, but he might well have been trying to balance the books.

See, his college was in deep trouble. Though the federal government had mandated that Tennessee use half the proceeds derived from a land grant of 100,000 acres to support ETC, the squatters who lived on the land weren't about to start paying rent. By 1809—its funds depleted, its founder and primary instructor dead—our college closed its doors.

A lottery seemed the only salvation. The state legislature, then meeting in Knoxville, passed an Act to authorize the drawing of a Lottery for the benefit of East Tennessee College. It wasn't the first. Even before Tennessee was a state, a lottery had funded a road from Kingston to the Cumberland River. Six years earlier, the legislature had sponsored a lottery to build a new Masonic Hall in Knoxville.

In early 1810, the Board of Trustees advertised a "Scheme of a Lottery for the Benefit of East Tennessee College." They planned to sell 11,000 tickets at $5 each, offering a total of 3,405 prizes. Prizes advertised ranged from $6 to $5,000. Unlike modern lotteries, in the ETC lottery you stood a 30% chance of scoring at least a slight profit.

Still, the trustees assumed people would be motivated more by civic responsibility than by the odds. "When the object to be attained by this lottery is considered," went the ad, "it is believed every individual will be anxious to become an adventurer."

Advertising 11,000 tickets just in Knoxville obviously wouldn't be enough. A committee headed up by future U.S. Senator and presidential candidate Hugh Lawson White tried to sell it to a nationwide audience by recruiting a few very-high-profile salesmen. One was President James Madison. We're not sure whether he dignified their request with a response.

Another was the recently retired president, 66-year-old Thomas Jefferson. He did respond. If somebody I don't know calls me out of the blue and asks me to sell lottery tickets, I hope I can be as polite about my answer as Jefferson was.

On May 6, 1810, Jefferson wrote a letter and mailed it to Judge White and company in Knoxville. If he received lottery tickets to sell, he wrote, "It would be impossible for them to come to a more inefficient hand. I rarely go from home and consequently see but a few neighbors and friends who occasionally call on me." He followed that with a gentle reproach: "Having myself made it a rule never to engage in a lottery or any other adventure of mere chance, I can with the less candor or effect urge it on others, however laudable and desirable its object might be."

As if to deflect the whole idea, the Sage of Monticello complimented ETC for having found any resources at all: "I am sincerely rejoiced...to find that so excellent a fund has been provided for this noble purpose in Tennifsse." [That's how Jefferson spelled the name of this state he'd never visited, with the 18th-century f for the first s, suggesting that he would have spelled it with three s's and two e's.] Jefferson advised that they take the $50,000 he understood the trustees already had and deposit it in a "safe bank" to earn $1,000 a year to build the new college. Two percent was apparently the going APR in 1810.

He also advised us not to be extravagant with the physical plant. A large, expensive building, he said, would be "unfortunate and erroneous." ETC should be an economical and modest "academical village, instead of a large and common den of noise, of filth, of fetid air." (Jefferson's University of Virginia was still just a dream.)

When Hugh White read that patronizing two-page letter, he probably spat a wad of tobacco on the floor, as was his custom. Whether Jefferson's refusal made any difference, the lottery was a dismal failure. Some ticket sellers apparently pocketed the money, because the trustees were receiving claims on tickets which hadn't even been sold. Their total take from the gamble, almost three years after they announced it, was $450—about one-twentieth of what they'd projected, and not nearly enough to reopen ETC. The college stayed closed, in fact, for 11 years.

The lottery's failure certainly wasn't due to any prejudice against gambling in 1810 Tennessee. As one traveler observed, Knoxville in those days was full of "gamblers, hard-eyed and vigilant." Many Tennesseans were gamblers, and because they were gamblers, they knew the odds. And the odds in any lottery weren't nearly as good as the odds at a game of poker or dice at Anthony's Tavern.

Judging by a letter to the Gazette complaining about being asked to help send "the rich man's son" to college, there was also some disgruntlement among the working classes that they were being asked to help finance higher education. It's an idea whose time has come—and, you'd think, gone.