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2/26/2009
Iowa's trying to SAVE dollars on public projects. Imagine.
Interesting contrast. Iowa working to save dollars for its taxpayers. Wisconsin working to find more ways to increase costs for its taxpayers.
I did a brief piece on prevailing wage laws in September, 2007, attempting to explain a complicated warren of labor laws in just a few hundred words.
Wisconsin’s prevailing wage rate law… mandates all contractors, including the 80% of construction workers in Wisconsin who work for merit shop (non-union) contractors, that workers be paid according to union bargained agreements and according to union-negotiated work practices and conditions. (18 states, recognizing their high cost to taxpayers, do not have prevailing wage rate laws, and must deal only with Davis-Bacon for federally funded projects.)
[brief descriptions of arguments for and against Prevailing Wage laws….]
And here’s the bottom line for me. When federal block grants are used to build affordable housing, when those block grants are used to make home repairs in Appleton’s Neighborhood Revitalization program, when a school is built, when the county or city or state contracts to build a road, we taxpayers are paying inflated labor rates to get those projects done. 5% or 10% or 38% - whatever the savings – certainly our state budget could dearly use those bucks. And our municipal budgets. And our county budgets. And our school budgets. Prevailing wage rate laws are a huge drain on public project spending in Wisconsin. The argument is a slam-dunk. So this week, two news articles showed up - I think I included both in FoxPolitics News.
The first appeared in Sunday’s Des Moines Register. Iowa failed to pass Prevailing Wage legislation because, it seems, some legislators objected when others tried to exempt certain public projects in this time of very stretched public budgets. Some legislators thought Prevailing Wage demands this year might just be too costly for folks back home. Imagine that.
A languished union bill has created tension among Democrats and could tarnish the party's stronghold in Iowa politics, some representatives said Saturday.
…. Democrats believed they had 51 votes for the bill. But one provision that would have exempted some school board, community college and public hospital projects never came up for a vote because of a procedural quirk. That led Rep. McKinley Bailey, D-Webster City, to vote no.
[House Minority Leader (Republican) Kraig Paulsen said] "The part of this that makes it easier for us in 2010 is the fact that they're trying to push a bill that is anti-taxpayer, anti-disaster victim and anti-contractor." Contrast that with this article, appearing in yesterday’s Daily Reporter, detailing a Dept. of Workforce Development ruling expanding the purview of Wisconsin’s costly Prevailing Wage regs.
The [Construction Business Group] in August sent the Department of Workforce Development inquiries on projects in 13 municipalities where developers receiving public money agreed to build public utilities or streets. The League of Wisconsin Municipalities supported eight of the municipalities’ argument that prevailing wages weren’t required for the work, but the state sided with the CBG.
…. The decision doesn’t change state prevailing wage law, said CBG Executive Director Robb Kahl. He said some municipalities require prevailing wages when building infrastructure to serve private projects, but others don’t. Does it make sense, especially in these tough economic times, to force higher, less flexible, less market-oriented wages on Wisconsin communities?
Jo Egelhoff, FoxPolitics.net
COMMENTS
Jo,
The phrase "market forces" must not have taken on a bad enough smell for you "in these tough economic times" to stop using it as a justification for anything.
Market forces in this context means scab labor that will undercut the prevailing wage for experienced workers. That was what was done in New Orleans after Katrina and (let it be assumed) anywhere else management can get away with it.
Applying these standards to government contract work would be playing into
the notion that (speaking as the government) if the corporate world
can do it so can we. Has no one on the right seen what that leads to yet? And if not what will it take?
Lon Ponschock (Thu Feb 26 08:59:48 2009)
Lon:
To answer your question as to what this leads to is lower cost for the project and hence less the taxpayer has to support. But I guess, as you said "speaking for the government" that this is not the right thing to do. Most of your comments over the years in this blog have been "speaking for the government and a disdain for the private sector, so this response is no suprise.
Mike Thomas
Mike Thomas (Thu Feb 26 11:13:18 2009)
Lon, Lon;
How demeaning to use the 1920's term, Scab" to those "Merit Shop" Tradesmen who prefer to ply their craft free from Union inteference.
Unions continue to sink! Get with the 21st Century and become part of the solution- NOT part of the problem!
GLS
GL Schilling (Thu Feb 26 11:33:39 2009)
I'm glad to see people addressing this issue, and the negative comment regarding workers who haven't been forced to join a union. I was going to comment before, but I really didn't relish being termed a "scab."
As I look to the great job unions are doing in Detroit, I have to come down on the side of Jo and the others. Forcing wages and benefits higher and higher just increases the cost of the product to the consumer and makes the employer less competitive in the marketplace - a marketplace that's becoming more global every day. I guess about the only place left where unions don't have to be a part of the business solution anymore is in government. But then government was never intended to be in business, being that it exists only to protect the borders and deliver the mail.
As one who wants to both see my tax bill go down (like that's gonna' happen in the next 2 generations), and see as many people employed as possible, I'm thinking making wages rise to UAW extortion levels won't meet either of those goals. Forcing wages to those levels in this day and age would make about as much sense as forcing banks to make mortgage loans to octo-moms in our inner-cities. Oh, wait..., we've done that already!
Lon, you ask, "Has no one on the right seen what that leads to yet?" I don't. Please tell me.
Duke (Thu Feb 26 13:57:27 2009)
I don't really like to respond to bait but to answer the question posed I'll point to that Slum Dog Millionaire Bobby Jindal and how Katrina was handled. This author says it much better and with more humor than I ever could.
Lon Ponschock (Thu Feb 26 14:25:45 2009)
Sorry Lon, I wasn't trying to "bait" you. I really didn't see (and still don't) the connection between Katrina, Jindal, Barbour, unemployment comp. and Jo's commentary about prevailing wage rates running up the tax bills for government contracts.
Multiple reads of Palast's essay, which appears to mostly trash the Gov. of Lousianna, tell me that states with massive poverty problems certainly don't need to spend prevailing union wage rates when people are willing to do the work for the wages prevailing in the marketplace. I really don't get it - why would we force them to pay more?
Duke (Thu Feb 26 21:54:29 2009)
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