Facing the immense, immediate costs of fighting the British in 1776, the fledgling government of the Continental Congress was in a desperate financial bind. Without the authority to levy taxes—a power granted only after the war under the Constitution—the delegates had to rely on loans, donations, and the issuance of rapidly depreciating paper money, known as Continental Currency.

To raise urgently needed funds and harness patriotic fervor, Congress turned to a popular, though unconventional, solution: a national lottery.

The Patriotic Gamble of 1776

On November 18, 1776, the Continental Congress formally authorized the first-ever national lottery. The goal was ambitious: to raise $1.5 million in Continental Currency. The lottery was structured in four classes, with 100,000 tickets to be sold for the first class, and prizes ranging from modest sums to a grand prize of $50,000.

This initiative was framed as a patriotic act, giving ordinary citizens a chance to support the Continental Army directly while also offering the enticing prospect of a significant financial win. In many ways, it was an attempt to make the war effort financially accessible to a wide public audience.

The Descent into Failure

While lotteries had successfully funded public works in the colonies for over a century (such as the settlement of Jamestown), the Congressional lottery was fundamentally crippled by three major factors: wartime logistics, mismanagement, and, most critically, economic instability.

1. Logistical Nightmare: The first drawing, originally scheduled for March 1, 1777, had to be repeatedly delayed. Ticket sales were slow due to the vast, decentralized geography of the new nation and the difficulty of distributing tickets efficiently during wartime. When the first drawing was finally held on May 27, 1778, less than 40% of the tickets (only 36,000) had been sold.
2. Lack of Trust and Depreciation: The Continental Congress had no secure fiscal foundation. The paper money it issued—Continental Currency—was already losing value rapidly due to over-issuance and lack of backing. As the currency depreciated, so did the real value of the prizes offered in the lottery. By the time of the second drawing, public interest had plummeted, driven by the realization that even if they won, the currency they received was becoming virtually worthless.
3. Financial Disaster: The lottery failed spectacularly to meet its goals. By the early 1780s, the Continental Currency was so devalued that the phrase “not worth a Continental” became a common idiom for worthlessness. The lottery effectively ended, having raised only a fraction of the intended $1.5 million and leaving many winners—and ticket purchasers—with little more than worthless paper.

A Cautionary Tale

The failure of the Continental Congress lottery highlighted the fundamental weakness of the early American government. While creative, the reliance on voluntary public participation and a unstable currency proved unsustainable for financing a long, large-scale conflict.

The financial desperation of the Revolutionary War—of which the lottery was a clear symptom—became a powerful motivator in the post-war era. The painful lessons learned from the fiscal collapse under the Articles of Confederation led directly to the Constitutional Convention of 1787, where delegates agreed that the new federal government must have the power to levy taxes and manage a stable, centralized financial system.

Today, the 1776 lottery stands as a fascinating historical footnote: an innovative, patriotic gamble that failed, but one that ultimately contributed to the foundational debates that secured America’s long-term financial structure.