Consumer confidence is in the gutter, lending is at a standstill and widespread unemployment is on the rise.  But Illinois residents continue to make bullish bets in one arena, the state lottery.

Sales for the first eight months of fiscal year 2009, through Feb. 23, are $1.33 billion, flat to the sales for the same time period last year, according to Laura Lehmann, a spokeswoman for the Illinois State Lottery.

Illinois lottery revenues were $2.08 billion in the year that ended June 30, highest in the lottery’s 34-year history, up 3 percent from $2.02 billion in the prior year.

“Generally, gambling is probably the least hard hit of a lot of economic enterprises,” said William S. Ballenger, a former state senator and ex-racing commissioner of Michigan. “Gambling seems to be a recession-proof occupation,” he said.

“The feeling is if times are tough, sometimes you can just go for the jackpot,” Ballenger added.

Indeed, it seems that Illinois residents are impulsively going for the big win. Instant ticket sales for the first eight months of fiscal year 2009 are $722 million, up 3 percent from the same time period last year, despite the deepening recession.

Instant lottery tickets sales generate the most revenue of all Illinois lottery games by far, 54 percent of total sales in fiscal 2008. The second-highest is the Pick 3.

“It’s luck,” said a 37-year-old Hyde Park woman who purchases lottery tickets every day, primarily the Pick 3 and Pick 4. She won $1,000 two weeks ago from a ticket she bought at a local gas station.

“I don’t know why [I buy tickets],” said Joe Jones Sr., 52, who spends about $8 weekly on tickets at various venues. But Jones bellies up to the counter only when the jackpot for the MegaMillions gets high; he said he needs a big win to make a dent in his $125,000 debt. This Friday’s payout is $171 million.

“Maybe spending on lottery tickets was never rational in the first place…the people that spend are not doing it from a rational base,” said Earl L. Grinols, economics professor at Baylor University and author of “Gambling in America: Costs and Benefits.”

Lotteries tend to take disproportionate amounts of money from those who have less income, Grinols said. Some people think, if I don’t play the lottery, I have zero chance of becoming rich; but if I do play, then at least I have a chance, he said.

Grinols says the question to ask is, “Is the lottery really the best form of taxation? It’s a tax on the wrong group of people.”

For every dollar spent on Illinois lottery tickets, 57 cents goes to winning prizes, 33 cents to the common school fund, 7 cents to retailer and vendor commissions and 3 cents to Illinois lottery operating expenses. In fiscal 2008, $657 million went to the school fund, where the Illinois General Assembly determines which school districts actually get the money.

State-wide, the lottery, which began in 1974, sells tickets in 7,500 retail establishments, about 1,520 of which are located in the Chicago area. Dallas-based 7-Eleven Inc. was the largest franchised seller of Illinois state lottery tickets in fiscal 2008.

“We sell lottery tickets at every one of our stores where it is legal to,” said Margaret Chabris, a 7-Eleven spokeswoman, in an e-mail. “We view lottery tickets as a competitive advantage.”

“Some people regularly buy their tickets from 7-Eleven as some regularly purchase their morning cups of coffee with us,” Chabris said.

Lottery tickets affect how other items are selling, said Abhi Ali, sales associate at the 7-Eleven on the corner of South Wabash Avenue and East Adams Street in Chicago's Loop. If the machine is down, people won’t come in as much, he said.

Ali said the store sells from 200 to 300 lottery tickets a day.

The largest single vendor of lottery tickets for fiscal 2008 was Route 3 Liquor & Lottery in Sauget, on the Illinois-Missouri border, lottery spokeswoman Lehmann.

The hope of cashing in big continues to loom large in Illinois, touted by the state lottery’s pot of gold at the end of the rainbow logo and “Have a Ball!” slogan.

“The most I’ve ever won is five numbers, $1,400,” Jones said, “but after taxes and my wife, I only had about $20 left.”