At my local deli, a middle-aged man used to come in almost daily and buy 2 dozen scratch-off lottery tickets. He would sit in the corner and feverishly scratch through all of them before leaving. If he did get lucky -- which was rare -- he would parlay his measly winnings into yet more tickets.

For decades, people like the “Scratch-off Guy” -- as we called him -- have been easy prey for state officials and their growing stable of lotteries. Have a budget shortfall? Just add another Mega Millions. One in 5 people play the lotto regularly, and they are among the most vulnerable in society: Those who spend the most on tickets earn less than $12,400 a year, surrendering about 9% of their total income.

But, in this recession, and to the surprise of many, revenues for state lotteries are falling. This turns the age-old wisdom that gambling is recession-proof on its head -- in the Great Depression, for example, gambling boomed -- and that in desperate times, people will look to a roll of the dice for a chance at riches.

According to La Fleur’s magazine, which tracks the lottery business, lottery-sales nationwide fell by about $215 million from July to September, compared to the same period last year - a decline of 2%. Lottery-ticket sales have dropped only once since 1992, in fiscal year 1998 - and that drop was less than 1%.

Across the US, many state lotteries are reporting sharp declines. Ticket sales are down nearly 10% in California and more than 4% in Texas over the past few months, according to the Wall Street Journal. It’s an unusual phenomenon: Hardcore degenerate gamblers are expected to play more in bad economic times, even as marginal players cut back.

This time is different. “Now they are thinking, ‘My retirement is gone, I might lose my job, I’d better start putting money away’ - that means fewer dollars for lottery tickets,” Jack Boehm, director of the Colorado Lottery, told the Journal.

In Colorado, sales since July have dropped almost $5 million, or 2.3%, compared with the same period last year. Boehm said that even scratch-off games are on pace to come in 5% lighter than last year.

This is all bad news for states that use lottery revenues to fund educational programs or infrastructure programs. Massachusetts, for example, uses much of its lottery money to aid cities and towns, and it expects proceeds to drop to $863 million from $913 million, according to the Journal.

The concurrent drop in Las Vegas gambling doesn’t seem coincidental. (Casino stocks -- including Wynn (WYNN), Las Vegas Sands (LVS) and MGM Mirage (MGM) -- have fallen by 60% in 2008.) In the short run, there's been a growing allergy to risk, of which gambling is the epitome. It’s certainly no surprise that Nevada has the highest rate of home foreclosures: The gambling appetite, there and elsewhere, extended to buying homes.

With state lotteries, perhaps people are saying they’ve finally had enough. When rich businessmen gamble away their life savings -- or those of their employees -- they can expect government bailouts.

The same can’t be said for the poor individuals who buy rolls of scratch-off tickets.