Smart policy decisions could improve economic well-being for all Oklahomans

Oklahoma’s state budget is recovering from record deficits and the unemployment rate remains near record low levels. Despite that, not all Oklahomans are doing well. The newly released Prosperity Now Scorecard confirms that too many Oklahomans still struggle to meet basic needs while building a better, more stable financial future for their families.

Each year, the Prosperity Now Scorecard provides a comprehensive look at Americans’ ability to save and build wealth, move out of poverty, and create a more prosperous future. Oklahoma’s overall rank of 29th this year looks like we’re doing relatively well.  However, that overall rank is not quite as encouraging as it looks at first glance. A state’s overall rank is a combination of two factors – its outcome measures and its racial disparities – and Oklahoma’s outcome measures put us in the bottom ten. 

This year, Oklahoma ranks 43rd in outcomes that measure the financial health and well-being of its residents, the same ranking as last year. The Scorecard also evaluates 28 policy measures to determine how well states are creating an environment that makes it easier for their residents to get ahead. By comparison, the Scorecard ranked Oklahoma 34th in 2016 for economic outcomes, and the state’s ranking has been falling or stagnant since then. 

Last year, the scorecard added a new factor, racial disparity, which measures the gaps in outcomes between white residents and residents of color. As a state, Oklahoma ranks 6th in this new category. This means that, looking at the state as a whole, there are comparatively small gaps in the well-being of white Oklahomans and Oklahomans of color. But our top 10 ranking here comes with a significant caveat.  The fact that we see comparatively small gaps in Oklahoma doesn’t mean that we’re all doing equally well. In Oklahoma’s case, it means that a lot of white Oklahomans (especially in rural Oklahoma) are struggling just as much as Oklahomans of color — we’re all finding it difficult to make ends meet.

Some of the most troubling challenges facing Oklahomans are a shared difficulty in building wealth and having access to affordable health care. Fortunately, there are good policy solutions to address these issues. With smart policy choices, the state can improve economic conditions for all Oklahomans and come closer to becoming a Top 10 state.

Make work pay for Oklahoma families

Oklahoma’s poverty rate of 15 percent puts the state in the bottom ten – 38 states are doing a better job of helping their residents avoid poverty. Contributing to our state’s high poverty rate is a low minimum wage and a high share of low-wage jobs. A lot of Oklahomans are working hard for a paycheck that is too small to meet their basic needs.

The state can start to help working families build economic security by making Oklahoma’s Earned Income Tax Credit refundable again. Legislators made the credit non-refundable in 2016 to fill a budget hole, and many of them later regretted that decision. The cut made more than 200,000 working families worse off, taking an average of $121 dollars per year from each EITC family. Making the EITC refundable again would give that money back to Oklahoma families, helping them to meet basic needs (like food, clothing, and household necessities) and supporting local economies. 

Oklahoma must also ensure that workers do not face financial hardship because they need a bit of time away from their job to care for themselves or a loved one. Unfortunately, the vast majority of Oklahomans do not have access to paid family and medical leave and cannot afford to take unpaid time off. Nine states have already adopted statewide insurance programs to make paid family and medical leave available to all workers, including the self-employed in their state. These programs work very similarly to unemployment insurance and are funded by a small payroll tax. Oklahoma could easily adopt this type of statewide insurance system and make paid leave a reality for working Oklahomans.

Raising the minimum wage is another policy decision that would positively impact Oklahomans. The state’s minimum wage has been sitting at $7.25 for more than a decade, and it loses value every year due to inflation. In 1968, the minimum wage was worth $11.55 in today’s dollars – much closer to a living wage than today’s minimum wage.

Expand Medicaid to make Oklahoma healthier

Oklahoma scores especially low in health care outcomes, cracking the top 25 in only one of the six outcomes measures on the Scorecard. The state’s uninsured rate is higher than the national average, fewer Oklahomans have employer-provided health insurance and we pay a higher share of the premiums, and we’re more likely to skip going to the doctor because of the cost. It should not be surprising, then, that a higher percentage of Oklahoma report poor or fair health status

Significant racial gaps are also evident in health care outcomes in Oklahoma. People of color in the state are more likely to lack health insurance. And Black Oklahomas are especially likely to avoid going to the doctor due to cost concerns. One positive note in Oklahoma is that American Indians are less likely than other residents of the state to report that they skipped medical care because of the cost – a testament to the extensive network of tribal health care facilities.

The best way to improve the health of Oklahomans is a straightforward expansion of Medicaid. Just doing this would substantially reduce the number of uninsured and make access to care affordable for the more than 100,000 Oklahomans who would likely benefit directly from expansion.

Reduce debt and financial insecurity for low-income and retired Oklahomans

Overall, one in five Oklahomans report low financial well-being. Oklahoma ranks higher than the nation in several outcomes that lead to financial instability – income volatility, falling behind on bills, or having delinquent credit or student loan accounts are a few examples. 

To help these struggling Oklahomans, we need to reform policies that punish people simply for being poor. Criminal fines and fees are one of the most troubling examples of this type of policy. Since 2000, the Legislature has levied dozens of new fines and fees on criminal defendants to help finance a chronically underfunded court system. As a result, those who cannot afford to pay the thousands of dollars in fines and fees piled on them risk ending up back in jail for the crime of being poor. Oklahoma should adequately fund its justice system through the budget process, and end the practice of modern-day debtor’s prisons.

Finally, we need to remember that financial security is important throughout life, including retirement. More than 120,000 Oklahomans depend on state retirement systems, including state employees, teachers, firefighters, and police officers. Employees pay into these systems throughout their career, and then receive a fixed monthly retirement benefit based on their years of service and salary. But the Oklahoma system does not provide automatic cost-of-living adjustments to those benefits. Since the last time state retirees received a cost-of-living adjustment, the general cost of living has increased by 20 percent. These Oklahoma public servants gave decades of their lives to make our communities healthier, better educated, safer, and stronger. It’s time for all Oklahomans to give back to them by keeping them secure in retirement.

Oklahoma can do better

This year’s Prosperity Now Scorecard reminds us that Oklahoma faces significant challenges. But the good news is that the state has the opportunity to reverse course and set Oklahoma on a path to a more prosperous and sustainable future. Please contact your state representative and senator and ask them to support policies that help Oklahoma families build wealth and economic prosperity for themselves and our state.

ABOUT THE AUTHOR

Courtney Cullison joined OK Policy in March 2017 as a policy analyst focusing on issues of economic opportunity and financial security. Before coming to OK Policy, Courtney worked in higher education, holding faculty positions at the University of Texas at Tyler and at Connors State College in eastern Oklahoma. A native Oklahoman, she received an Honors B.A. in Political Science from Oklahoma State University, and an M.A. and Ph.D. with emphasis in congressional politics and public policy from the University of Oklahoma. While at OU, Courtney was a fellow at the Carl Albert Congressional Research and Studies Center. As a professor she taught classes in American politics, public policy, and research methods and conducted original research with a focus on the relationship between representatives and the constituents they serve.

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