Predatory Legislation

On Thursday, February 18, 2016, The Oklahoma Business and Commerce Committee passed SB 1314: The Flexible Credit Act.  The bill is sponsored by Senator David Holt and creates a new product for Payday Loan companies.  Known as “Flex Loans,” companies will be able to lend money to consumers that carry rates higher than 200% APR.  According to the Center for Responsible Lending, if this bill passes, this means a $500 Flex Loan would be subject to $1,100 of interest and fees over the course of twelve months, plus a last balloon payment of almost $300.  Borrowers will be worse off afterwards than they were before they took the loan.

Now, to be fair, proponents argue the bill will actually lower the current APR from 395% to 240%.  While this is technically true, the question still looms to why such a high interest rate altogether?  If legislators were serious about caring for the poorest Oklahomans, they would amend this current bill or bring another bill that lowers the APR to a reasonable rate.  Something is amiss!  Oklahomans need to unite and oppose such predatory legislation.  Our state needs legislation that is not going to place our poorest citizens in a perpetual state of debt.

Baptist News Global reported last year that both conservative and moderate Baptists came together to oppose such predatory business practices.  Known as the Faith for Just Lending coalition, associate coordinator of partnerships and advocacy for the Cooperative Baptist Fellowship, Stephen Reeves, stated, “It is time for a return to traditional lending practices that acknowledge usury as immoral and detrimental to communities.”

Russell Moore, head of the Southern Baptist Convention’s moral concerns agency, recognized the victims of such unjust business practices, “As Christians, we are called by Jesus, by the prophets and by the apostles to care for the poor, individually, and also about the way social and political and corporate structures contribute to the misery of the impoverished.  Groups across this diverse coalition don’t agree on every issue in the public square, but I am happy to work together on this issue to stand against unchecked usury and work for economic justice, human dignity and family stability.”

It is astounding that Oklahoma legislators think this business practice is legitimate.   Oklahoma residents are left wondering how can entrusted elected officials turn their backs on those they are called to serve.  The Pew Charitable Trusts discovered the majority of Payday Loan customers are white, female, and between the ages of 25-44 years old.  Other demographics reveal the poorest of our society are lured by these companies promising fast cash to fund ongoing financial needs.

Let’s examine the typical Payday Loan customer reported by the Pew Charitable Trusts, of which 69% of borrowers use the loans for everyday expenses.  A young mother of two in Oklahoma, working for minimum wage, $7.25 per hour, has a mortgage/rent, utilities, car payment, grocery bill, children’s activities fees, and other life expenses mounting up.  The bills become so overwhelming she feels as though she has no other option but to get a quick payday loan that is peddled as a financial fix.  However, it quickly digs her into a deeper hole. Because of the extremely high interest rate she will be paying on the loan for years. The poor just get poorer.

When Jesus announced his formal start to ministry in the Gospel of Luke, he stood among the community leaders, unrolled a scroll at the synagogue in Nazareth, and read from the prophet Isaiah.  Jesus claimed, “The Spirit of the Lord is upon me, because he has anointed me to bring good news to the poor.  He has sent me to proclaim release to the captives and recovery of sight to the blind, to let the oppressed go free, to proclaim the year of the Lord’s favor.”  Oklahoma, for those who truly believe in words of Jesus, then we must follow his ways.  We must be champions for the poor, standing against unjust legislation and predatory practices.

Smoke & Mirrors: OK’s Ed. Savings Accounts

Oklahoma House Bill 2949, known as the Oklahoma Education Savings Account Act, narrowly advanced through the state’s House Common Education Committee with a 9-8 vote on Monday (2/15/2016).  The bill will allow Oklahoma residents to create “savings accounts” which will be funded through taxes dollars, diverting income away from public education budgets.  These savings accounts, funded by public money, will then be available to fund private, religious education.

The Tulsa World reported on Tuesday, February 16th, “The bill would instruct the Department of Education and the state treasurer to deposit money into individual accounts for students who choose not to attend their local public schools. The amount deposited would range from 30 percent to 90 percent of the per-pupil expenditure of the local school, depending on household income and whether the child has special needs.

The funds could be accessed only through approved schools and vendors. They could be used to pay for a variety of education services, including private school tuition, home school curricula and tutoring, but not to buy computers or other technology or pay for normal transportation. Converting the account to cash would be considered fraud.”

Proponents have used smoke and mirrors to promote the bill’s passage.  Using a clever vernacular change, they have deceptively veiled their true intent.  Education savings accounts are nothing more, and nothing less, than school vouchers.  It goes without saying this bill will drain funds away from public school budgets that are already hemorrhaging, but there are other issues at stake for people of faith.

When tax dollars get mingled with religious practices, both government and religion suffer.  Public funding has guidelines and restrictions for the purpose of serving all within the community.  Oklahomans pool their taxes together for the purpose of creating a better community.  When an individual pays taxes, they should feel confident the government will not establish religious beliefs that go against their conscience.  Therefore, government should remain neutral when it comes to religion, because they have the responsibility of championing the rights of both majorities and minorities.

As both state and federal citizens, every citizen should remain free to follow their conscience and refuse public funding of a religion with which they disagree.  John Leland, a Baptist preacher during the Revolution, stated, “Government should protect every man in thinking and speaking freely, and see that one does not abuse another. The liberty I contend for is more than toleration. The very idea of toleration is despicable; it supposes that some have a pre-eminence above the rest to grant indulgence, whereas all should be equally free, Jews, Turks, Pagans and Christians.”

School vouchers violate this personal conscience for those not wanting to support specific sectarian education.  General Counsel for the Baptist Joint Committee, Hollyn Hollman, argues, “While we affirm the right of parents to choose a religious education for their children, we oppose using public funds to support religion. Religious teachings should be funded by voluntary contributions, not through compulsory taxation. Voucher programs that provide tuition to religious schools violate the freedom of conscience of taxpayers who have the right to insist that the government remain neutral in matters of religion. In addition, government funding of religious education tends to jeopardize the autonomy of religious schools, bringing regulations or political pressures that threaten the schools’ religious character.”

Here are two examples of why school vouchers are a very dangerous precedent:

First, private religious institutions can wield enormous power within a state.  With the voucher system in place, a large religious institution could have tremendous negotiating power when it comes to elections and state legislation.  What if a state religious institution began to make demands about private school funding in return for election votes or support for another legislative issue?  The potential for a powerful religious institution to hold the state hostage is horrifyingly real with vouchers in place and the flow of public money open.

Second, government funding of religious education comes with strings attached.  As the First Amendment guarantees all citizens, government should remain neutral when it comes to the establishment of religion.  Therefore, when churches, synagogues, and mosques accept taxpayer funding they should be subject to the neutrality of government guidelines and restrictions.  Do churches really want to follow the hiring restrictions of government neutrality?  This would mean that churches would be forced to set aside their religious convictions when hiring, supervising, and firing employees.  Why would religious institutions jeopardize their religious convictions?

School vouchers are a bad idea for the state of Oklahoma, our children, and people of faith hoping to maintain religious liberty for all.  The Oklahoma Education Savings Account is nothing less than smoke and mirrors in an attempt to defund public education with the intent of funding private religious education.  This piece of legislation should be defeated to maintain the vitality of public education, prohibit religious majorities from commandeering public interests, and preserve religious liberty without government interference.