Critics Blast Suspension of Racist, Pro-Union Law
President Bush stands accused of insensitivity toward minorities and the poor because he has temporarily suspended the Davis-Bacon Act–which requires contractors working on federally subsidized projects to pay so-called "prevailing wages"–in areas affected by Hurricane Katrina. The President’s critics, however, ignore both the discriminatory history and current perverse effects of Davis-Bacon. In fact, the President’s order does not go nearly far enough.
In 1927, Rep. Robert Bacon (R.-N.Y.)–whose pet issue was protecting America’s racial "homogeneity"–introduced what became the Davis-Bacon Act after a contractor employed African-American workers from Alabama to build a Veteran’s Bureau hospital in his district. The "neighboring community," Bacon reported, was "very upset," as were local unions.
Bacon’s bill was later co-sponsored by a fellow avowed racist, Sen. James Davis (R-Pa.), who sympathized with Bacon’s complaints about the "outfit of Negro laborers" who worked on the hospital. Davis-Bacon’s legislative history is punctuated by repeated complaints from various congressmen about African-American construction workers stealing jobs from "white labor."
Congress ultimately chose to pursue the goal of excluding blacks for the benefit of unionized white workers by requiring federal contractors to follow union wage and work rules.
Davis-Bacon forces federal contractors to pay their workers the "prevailing wage," but this wage is not determined by actual average local construction wages. Rather, the "prevailing wage" is generally determined by official local union wage rates, which are often much higher than average local wages. Indeed, the prevailing wage is sometimes higher than even actual union wages, because local unions often negotiate discounts for particular projects.
The intended result of requiring federal contractors to pay inflated union wages was to bar workers whose wages were below union scale. These excluded workers included blacks–who have long suffered discrimination from the building trades unions–and non-union workers more generally.
Moreover, construction craft unions insist that unskilled laborers get paid inflated wages to discourage contractors from hiring them. If a contractor has to pay an entry-level laborer almost as much as a skilled worker, he will often hire the more versatile worker, even if that worker winds up primarily doing unskilled work.
Davis-Bacon’s bias in favor of skilled workers especially harms minorities. Blacks, for example, are significantly less likely than whites to be skilled construction workers, but almost one-and-one-half times as likely as whites to be unskilled workers.
Enforcement of union work rules compounds Davis-Bacon’s discriminatory effects by limiting the ability of unskilled workers to receive on-the-job training. A laborer who so much as picks up a hammer or a wrench is immediately classified as a carpenter or plumber, and must be paid at a skilled worker’s rate. Under union practice, the only category of unskilled workers who may receive training for skilled positions are workers who receive one of the few available slots in a registered apprenticeship program, or to find a rare "helper" job, which are sometimes permitted on Davis-Bacon projects.
Minority contractors, meanwhile, find that Davis-Bacon’s pro-union bias, opaque regulations, and expensive compliance costs create a tilted playing field, favoring established, white-owned union construction companies.
Ralph C. Thomas III, former director of the National Association of Minority Contractors, believes that the key to solving the problem of under-representation of minorities in the building trades is on-the-job training in non-union, minority-owned construction firms. According to Thomas, however, Davis-Bacon prevents minority contractors from successfully training workers.
Even when a minority contractor successfully bids for a Davis-Bacon covered contract, he has "no choice but to hire skilled tradesmen, the majority of which are of the majority. This defeats a major purpose in the encouragement of minority enterprise development–the creating of jobs for minorities. . . . Davis-Bacon . . . closes the door on such activity in an industry most capable of employing the largest numbers of minorities."
For 74 years, then, Davis-Bacon has fulfilled its purpose of reducing minority participation in the construction industry.
Ironically, Davis-Bacon no longer even serves its original function of ensuring that public works jobs go to local workers. Residents of urban areas today often find themselves looking on with understandable resentment as government contractors import union workers from distant suburbs and beyond rather than hire local minority workers who lack the skills, experience and connections to command union wages.
Beyond Davis-Bacon’s discriminatory effects, the law adds billions of dollars to the cost of infrastructure projects. Apologists claim that the law results in higher quality construction and reduces workplace injuries. However, this claim is based on the unsupported assertion that union workplaces are inherently safer than non-union workplaces.
Besides, grading and rewarding federal contractors based on their actual performance would be a far more efficient way to achieve those goals.
In short, Davis-Bacon is wasteful political pork with dubious racist origins. It’s not about ensuring a "fair wage," as the President’s critics contend, but about benefiting the politically powerful building trade unions at the expense of non-union and unskilled workers. President Bush should be applauded for suspending it in areas impacted by Hurricane Katrina, and Congress should completely repeal it.
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