Recently, the Oklahoma Supreme Court struck down the Energy Discrimination Elimination Act (EDEA) of 2022 as applied to the Oklahoma Public Employees Retirement System (OPERS) – a ruling that adds to a growing record of Oklahoma prioritizing economic good sense over political convenience.
The EDEA was intended to protect the state’s energy sector, giving the Treasurer’s Office the power to compile a “blacklist” of financial institutions perceived to be boycotting fossil fuels and required public bodies like OPERS to divest from any firm that appeared on it. The Oklahoma Supreme Court’s majority, led by Justice James Edmondson, identified this problem precisely. The EDEA created a “dual purpose” forcing pension managers to serve a political directive alongside their fiduciary duty to members, which the court found irreconcilable with the state’s foundational law.
This decision is important for free markets in a way you might not expect. This ruling was specific to OPERS, but the principle extends further – any public body managing taxpayer funds exists to serve its beneficiaries, not a political agenda, and the real-world implications are already apparent.
It turns out, the firms most affected were not enemies of fossil fuels. According to the Banking on Climate Chaos report, many of the institutions the treasurer targeted for blacklisting are in fact among the largest financiers of oil and gas in the world, which raises an uncomfortable question about the criteria being used to compile the list in the first place. Meanwhile, the Oklahoma Rural Association (ORA) found that the EDEA increased municipal borrowing costs by 15.7 percent compared to states that did not adopt similar laws, translating to nearly $200 million in additional expenses for local governments since the law’s enactment. A separate analysis also estimated the law would have cost OPERS retirees at least $9.7 million in commissions, taxes and fees – a direct hit to public employees’ retirement security.
It goes to show how meddling with the free market always has unintended consequences, and Oklahoma is consistently taking the right approach.
This ruling follows a series of decisions by Oklahoma lawmakers that reflect the same underlying instinct. Legislators turned back interchange fee legislation that would have made it harder for small businesses to accept credit cards. They declined to pass a state-level de-banking bill that would have layered conflicting regulations onto a market already being addressed at the federal level – wisely deferring to President Trump’s solution taking shape in Washington rather than creating a patchwork of state mandates. None of these decisions made front pages, but together they form a consistent record: Oklahoma chooses free markets over restriction.
That record is showing up in the numbers that matter most. Oklahoma has grown by nearly 164,000 residents since 2020 and the striking detail is where that growth is coming from – the majority are people who actively chose to relocate here, over 107,000 from elsewhere in the United States and more than 51,000 from abroad. Broken Arrow now ranks as the 12th best place to live in the United States. These are not coincidences. They are what happens when a state consistently gets the fundamentals right.
Oklahoma does not need politically engineered investment mandates to demonstrate loyalty to its energy sector or its economy, nor does it need to meddle in the free market. It needs pension funds that protect retirees, municipalities that can borrow affordably and markets that are open to competition. The court’s ruling restores all three. The task now is to keep going in the same direction.
About the author: Trevor Dorsey is Senior Vice President Prosperity Bank and Vice Mayor of Bartlesville, OK