What’s up this week at Oklahoma Policy Institute? The Weekly Wonk is dedicated to this week’s events, publications, and blog posts.

This week at OK Policy, summer intern Trevor Shanklin makes the case for reconsidering the criminalization of marijuana in Oklahoma.  With our prison system currently operating at 96 percent capacity, over half of which are non-violent offenders, it’s time for a well-informed discussion on the costs and benefits of prohibition.  We also took up corrections reform on our blog this week.  Although our prison population has doubled since the mid-90s, the Department of Corrections budget has been reduced by about $43 million since 2009.  While state leaders made real progress on corrections reform this year, we discuss what still needs to be done.

Yesterday’s blog post revisited the ‘cliff effect’ -  the abrupt loss of all work-support benefits when a low-income family earns a small increase in wages and becomes ineligible.  The Department of Human Services recently announced new eligibility rules for child care subsidies, effectively penalizing working parents who have moved up the income ladder by withdrawing support just when financial security is within their reach.  Last but not least, we interviewed fourth grade teacher Anna Eller on ways that teachers can encourage children to make healthier choices.

In the Know, Policy Notes

• The Center on Budget and Policy Priorities looks at the myths and realities about who pays federal taxes.
• A Pulitzer Prize winning reporter who worked for The Washington Post tells his story of living as an undocumented immigrant.
• The Urban Institute has a new brief summarizing the effects of health reform on small businesses and their workers.
• Illinois is pulling out of the Secure Communities program because it was identifying too many undocumented immigrants with only minor convictions or no criminal record.
• The AP looks at how lawmakers across the country are attempting to collect unpaid taxes on Internet sales to close state budget gaps.

Numbers of the Week

• 78,000 – Number of millionaires living in Oklahoma in 2010.
• $2,983,362 – Amount paid by 8 pharmaceutical companies to Oklahoma providers between 2009-2011.
• 2^nd – Oklahoma’s rank in a national survey of states with the highest concentration of Wal-Mart stores, with 103 locations in 2011.
• 6 – Number of abortion providers – clinics, hospitals, private physicians – in the state of Oklahoma, 2008.
• 16 percent – Percentage of the civilian population of Oklahoma without health insurance in 2009; Oklahoma ranks 34th highest nationally on percentage of the population that is uninsured.

Last week, the Department of Human Services announced new co-payment and eligibility rules for the child care subsidy program, which we discussed in this post. By lowering the eligibility threshold for subsidies, the new rules will worsen the “cliff effect” whereby workers with the opportunity to move up the income ladder are penalized by losing work support benefits. Here we rerun a blog post on this subject that first appeared in June 2009; we have also discussed how health care reform promises to significantly improve the situation.

In recent years, whenever I’ve participated in forums on poverty and barriers to self-sufficiency, the single barrier raised most often and most fervently by those who work with low-income individuals and by low-income individuals themselves is the “cliff effect”. A 2007 report prepared for the Women’s Foundation of Colorado and the Women and Family action Network Coalition defined the cliff effect as follows:

Eligibility for work support benefits is typically based on income, so as their earnings increase, families lose eligibility for supports. A benefit cliff occurs when just a small increase in income leads to the complete termination of a benefit. The result is that parents can work and earn more, while their families end up worse off than they were before. Read the rest of this entry »

This is the first of what will be an ongoing series of posts looking at the impact of the new federal health care reform law on Oklahoma and Oklahomans. For full information on health care reform, the Henry J. Kaiser Family Foundation website is excellent. We encourage your contributions as comments or as  a guest blog.

Last June, I posted a blog which I titled “Sorry, I can’t afford that raise” discussing the cliff effect. This is the situation  that occurs whereby low-income working families lose eligibility for public benefit and work support programs as their incomes rise.  As described in a 2007 report prepared for the Women’s Foundation of Colorado and the Women and Family Action Network Coalition:

A benefit cliff occurs when just a small increase in income leads to the complete termination of a benefit. The result is that parents can work and earn more, while their families end up worse off than they were before.

I noted that:

At a certain threshold, workers find themselves in a situation where the rational response to an offer of a raise or a better job is to respond, “Sorry, but I just can’t afford it.” Read the rest of this entry »

In recent years, whenever I’ve participated in forums on poverty and barriers to self-sufficiency, the single barrier raised most often and most fervently by those who work with low-income individuals and by low-income individuals themselves is the “cliff effect”. A 2007 report prepared for the Women’s Foundation of Colorado and the Women and Family action Network Coalition defined the cliff effect as follows:

Eligibility for work support benefits is typically based on income, so as their earnings increase, families lose eligibility for supports. A benefit cliff occurs when just a small increase in income leads to the complete termination of a benefit. The result is that parents can work and earn more, while their families end up worse off than they were before.

The cliff effect is most dramatic for Medicaid health insurance coverage, which tends to be an all-or-nothing benefit. Children in Oklahoma are eligible for Medicaid up to 185 percent of the federal poverty level, while adults lose eligibility when they make less than 50 percent of the poverty level. Other work support programs, including the earned income tax credit, the food stamp program, and child care subsidies, minimize the cliff effect by phasing out the amount of benefits at higher incomes, or in the case of child care subsidies, requiring higher co-payments. The cumulative effect, however, is that for most low-income workers who are attempting to move up the income ladder, additional earnings can be largely or fully offset by higher taxes and the loss of benefits. At a certain threshold, workers find themselves in a situation where the rational response to an offer of a raise or a better job is to respond, “Sorry, but I just can’t afford it.”

Read the rest of this entry »