The battle over Issue 7, whether or not to renew the sin tax on alcohol and cigarettes, revenues from which finances upgrades to our professional sports facilities, ended up being the main event in Tuesday’s primary here in Cuyahoga County. Ultimately, Cuyahoga County residents voted 56%-44% to continue the tax for another two decades.
The arguments for and against the sin tax, at least as it is currently defined, have been laid out quite effectively and ad nauseum; I’m not here to rehash them. It was nearly impossible for anyone watching, listening to, or attending a Cavs or Indians game to avoid being hit over the head with pro-Issue 7 ads.
The Browns, Cavs, Indians, and their allies – particularly the Greater Cleveland Partnership and The Plain Dealer (which basically acted as the official media mouthpiece of the campaign) – outspent the ragtag anti-Issue 7 crowd 170-to-1; the groups spent roughly $1.2 million and $7,000, respectively. While the anti-Issue 7 campaign mounted an effective charge on social media and built a solid, if motley, coalition around the issue, the group never really stood a chance against those odds.
In a post yesterday, Cleveland Magazine reporter Erick Trickey argued that this debate perfectly encapsulated how politics works in Northeast Ohio. Lines don’t really break down according to party affiliation – this is one of the most Democratic counties in the country. Rather,
The best way to understand most Cleveland political debates isn’t party politics. It’s, do you believe in spending tax money on “public-private partnerships” that draw people and business downtown? Or do you thinks that’s corporate welfare, giveaway of money better spent on other needs? That debate has run through our politics for decades, from tax abatement in the ’80s through Gateway in 1990 through the convention center debate in 2007, to the sin tax rematch yesterday.
This got me thinking about the political economy of this issue. We already know that all sin taxes are inherently regressive; they are consumption taxes assessed equally, regardless of income, ensuring that the poor pay more than the wealthy as a share of their income. Accordingly, it’s perhaps not surprising that, while the sin tax had already passed twice in Cuyahoga County, it failed each time in Cleveland.
Given these facts, I wanted to explore the relationships between per capita income and Issue 7 results. Below, you will see the correlation between median household income from 2006-2010 (5-year average) and the percentage of voters voting yes on Issue 7 (PDF). Income data are drawn from the American Community Survey (via NEO-CANDO), and elections results are from the Cuyahoga County Board of Elections.*
As you can see, the relationship is quite strong (the correlation coefficient is .607). As income increases, so too does the percentage of voters supporting the sin tax. But, as you can see, there are a few municipalities on the right side of the chart that may be skewing the data due to their extremely high income levels. These include Bentleyville and Hunting Valley, where the median household income is $191,250 and $250,001, respectively. For comparison, the median household income for Cuyahoga County was $59,583 for this period.
In order to account for this potential skew, I removed the five municipalities who had incomes more than 2 standard deviations greater than the mean. These were Moreland Hills, Gates Mills, Pepper Pike, Bentleyville, and Hunting Valley – your extremely tony eastern suburbs. (On a related note, Gates Mills also has the highest household carbon footprint of any municipality in the region). As you see below, when I remove these five outliers, the correlation becomes even stronger (correlation coefficient of .621).
Issue 7 only failed in six municipalities; these had an average income of $47,744, more than $11,000 less than the median for the County as a whole. Five of these cities are middle class, inner-ring suburbs located just south of Cleveland; the other two are the city of Cleveland and Valley View. Shockingly, East Cleveland, easily the poorest city in the County, actually voted for the sin tax 53%-47%.
Clearly, there is a major income divide over this issue, with lower-income voters, who will bear the burden of the tax, far less likely to support it than higher-income voters. Maybe that would have made a difference if voter turnout in Cleveland wasn’t 13.85%. But it is what it is, at this point.
Update (5/9/2014, 9:38am): A few updates. First, per Sam Allard at the Scene, the election results were compiled Christopher Lohr, a graduate research assistant at Cleveland State’s Center for Economic Development. Credit to him. Secondly, due to discrepancies between the datasets, I had to fold the election results for Chagrin Falls and Chagrin Falls Township together.