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Chris Prandoni

AWF Urges Senators to Oppose Smith Nomination to DOL Solicitor General

Posted by Chris Prandoni on Wednesday, September 9th, 2009, 4:54 PM PERMALINK

Dear Senator:

The Alliance for Worker Freedom (AWF), an organization established in 2003 to combat anti-worker legislation and promote free and open labor markets, urges you to support Senator Mike Enzi’s (R-WY) call for President Obama’s withdrawal of  Patricia Smith’s nomination for Solicitor at the Labor Department.

During Senate hearings in May, Ms. Smith gave false testimony about the development of New York’s Wage and Hour Watch program, a group Smith presided over. In her testimony, Smith said the Wage and Hour Watch program was developed internally by state officials, when, in fact, the new program received substantial funding from organized labor unions.

Predictably, the Wage and Hour Watch program became a means for unions to organize. Labor’s organizing arms, the New York State Laborers Organizing Fund and the Plumber Local, applied to join the program. Once in, they regularly attended meetings, despite having nothing to do with the programs intended purpose, preventing wage abuse.

The Wage and Hour Watch program was not only a tool for unions to organize but a weapon for them to intimidate employers. After acquiring Wage and Hour Watch licenses, unions could pressure nonunion employers to recognizing collective bargaining agreements or face litigation.

Unions saw an ally in Smith, evidence of which is found in a union newsletter which assured its members that the Wage and Hour Watch program will only investigate “non-union” grocery stores. Unions, after shoveling money into Wage and Labor Watch and then becoming the programs police officers had successfully hijacked Smith’s program. 

Smith also lacked a basic understanding of her program during her hearing before Congress calling it an “education effort” when it is characterized as an enforcement agency. At best, Smith’s testimony shows a unaccepable level of ignorance about the basic function and development of a program she created. At worst, her testimony demonstrates an attempt to mislead the Senate.

In either case, she is unfit to lead a large, complex organization. Smith has shown an inherit bias towards labor through her management of New York’s Hour Wage and Hour Watch program. It is for these reasons that I urge all of you to follow Senator Enzi’s lead and pressure President Obama to withdraw Patricia Smith’s nomination.    

Brian M. Johnson, MPA
Executive Director

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The Ugly, but True, History of Labor Day

Posted by Chris Prandoni on Wednesday, September 9th, 2009, 4:43 PM PERMALINK

The Department of Labor’s (DOL) website, www.dol.gov, describes Labor Day as, “a creation of the labor movement and is [a] dedication to the social and economic achievements of American workers[i].” After reading the DOL’s website for five minutes one might liken union bosses to saints.

In reality, Labor Day’s inception was much less righteous. It was a political move by President Grover Cleveland to pacify angry unions in 1894. The rationale for Labor Day has been rewritten and labors’ iniquities ignored. Morgan Reynolds writes that unions were known for being,

   “Secret societies with secret oaths, and unionists engaged in intimidation, threats, vandalism, and violence, especially against uncooperative workers denounced as subhuman "scabs" and "blacklegs." Private property, freedom of contract, competition, and freedom of movement across occupations (slavery and indentured servitude aside) were celebrated concepts [only in name][ii].”

The Department of Labor must have forgotten all that “stuff.”
If Labor Day was not an act of appeasement, and President Cleveland genuinely wanted to acknowledge the labor movements’ “social and economic achievements,” said “achievements” should be easy to find. Unfortunately, such achievements were largely imaginary in 1894. Socially, many labor unions were actively racist and prohibited minority inclusion. Economically, labor unions inflated their wages while running non-union companies out of business and keeping non-union workers from obtaining a job. Historically, these non-union members tended to be African-Americans and Irish and Italian immigrants.
A look at unions’ exclusion, persecution, and violence towards African Americans twenty years before and after Labor Day’s official creation tells a story of union abhorrence, not social achievement. 
After the Civil War, African-Americans were allowed to occupy jobs that were previously inaccessible to them. Newly freed slaves flooded the labor market, (specifically those north of Virginia) looking for low skilled manufacturing and factory jobs. One of the first places African Americans looked for work was in the railroad industry - a flourishing sector which employed hundreds of thousands of Americans.
Native Protestants, (as they labeled themselves), and primarily Northern white males, saw the influx of African American workers as a threat to their livelihood and feared that these new “workers” would ‘steal’ their jobs by offering to work longer hours and for lower wages.
In order to maintain the status quo-white domination of the railroad industry- “natives” joined or created labor unions that constitutionally banned African Americans and even Catholics in many places.  By 1880, nearly all railroad unions proscribed African Americans. Railroad employers’ hands were tied: if they did not accept labor’s “native”-only terms, unions would strike, and their businesses would collapse. Employers had to comply with labor unions or find an entirely new labor force.
These non-union African Americans and recent immigrants would slowly incorporate into the railroad workforce by offering substantially lower wages and taking menial jobs. This direct disobedience of labor’s exclusionary wishes was not appreciated by unions. The Brotherhood of Railroad Firemen and the Brotherhood of Railway Trainmen, most notably, launched “white-only” campaigns and led violent attacks against African Americans and European immigrants to combat outside employment[iii].
The nationalization of the railroads which occurred during World War I provided a new means to prevent non-whites from working on railroads - anti-African American legislation. Railroad unions quickly appealed to the federal government. The U.S. Railroad Administration, a federal body, responded to union requests by issuing a directive instructing regional managers that African American, ‘firemen, hostlers, switchmen, brakemen, etc.’ should not be employed ‘beyond the practice heretofore existing,’ nor should they be employed on ‘any line or in any service upon any line or in any service where they have not heretofore been employed, or to take the places of white men[iv]” Only after the National Association for the Advancement of Colored People protested ruling was this directive rescinded.
This would not be the last time the federal government intervened on behalf of unions. The Railroad Administration created new regulations in 1919, one of which said: “Negroes are not to be used as conductors, flagmen, baggagemen, or yard conductors[v].” This was seen as a handout to the Trainmen’s Union.
Although most anti-African American legislation has expired, one major piece of legislation from this era, the Davis-Bacon Act, endures. The Davis-Bacon Act looked to prevent African Americans from working on federal construction projects through price controls. Under Davis-Bacon, federal construction contracts could only be given to employers who paid their workers the “prevailing wage” of that region. African American workers often charged less than the government determined “prevailing wage” making them ineligible to receive government contracts.
This was the intended effect, to require wages to be so high that it would be illegal for African Americans to obtain federal contracts. Before Davis-Bacon was passed, many legislators openly talked about their desire to prevent African Americans from competing with “white labor.” In 1931, Rep. Clayton Allgood, D-Ala said “Reference has been made to a contractor from Alabama who went to New York with bootleg labor. This is a fact. That contractor has cheap colored labor that he transports, and he puts them in cabins, and it is labor of that sort that is in competition with white labor throughout the country[vi].”
Davis-Bacon is still law. Although Davis-Bacon’s proponents have adopted a non-racist narrative, the result is still the same: union favoritism at the expense of poor minorities. 
By effectively demonizing African Americans, unions prevented competition from a powerful minority group. It is fair to say that early unions, in fact, benefited from exclusionary laws as their wages remained inflated well over what the market would provide. The union threat to strike prevented employers from hiring cheaper African-American and European labor.
African-Americans and European immigrants were not the only minorities targeted by organized labor, nor were railroad unions the only unions to implement minority-bans. Asians were prohibited from joining the American Federation of Labor (AFL). Catholics of Irish and Italian decent faced discrimination in the northeast. Hispanics in the newly settled West were constantly harassed. Unions during this period were almost entirely comprised of Caucasian male members.
As Henry George wrote in 1891, "Those who tell you of trade-unions bent on raising wages by moral suasion alone are like people who tell you of tigers that live on oranges[vii]." I doubt Henry George thought he would be warning people about the Department of Labor.



[i] http://www.dol.gov/OPA/ABOUTDOL/LABORDAY.HTM
[ii] http://mises.org/story/3553
[iii] http://www.independent.org/pdf/tir/tir_05_2_bern.pdf
[iv] http://www.independent.org/pdf/tir/tir_05_2_bern.pdf
[v] http://www.independent.org/pdf/tir/tir_05_2_bern.pdf
[vi] http://townhall.com/columnists/WalterEWilliams/2008/04/23/politics_and_black_americans
[vii] http://mises.org/story/3553


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How Cap and Tax Will Hurt Massachusetts

Posted by Chris Prandoni on Wednesday, September 9th, 2009, 2:48 PM PERMALINK

In our continuing, daily, state by state, look at the financial impact of the Waxman-Markey Cap and Trade Tax Bill, we will show you the projected losses in Gross State Product, Personal Income, and Non- Farm Jobs in Massachusetts.

Detailed information on this and other energy taxes can be found in the Americans for Tax Reform Energy Tax Analysis, May 2009.

According to a study by Karen Campbell, Ph.D. and David Kreutzer, Ph.D. at the Heritage Foundation, Massachusetts will suffer the following losses in 2012 as a result of Cap and Tax:

  • A decline in Gross State Product of -$4,039,000,000
  • Total Personal Income Loss of -$5,613,000,000
  • Non-Farm Job losses of 36,474

An update to the Heritage Foundation’s study further shows an:

  • Increase in Electricity Prices from 2012-2035 of $556.25 per household.
  • Increase in Gas Prices from 2012-2035 of $0.66 per gallon.

Contact your Senators today and tell them to VOTE NO on the Waxman-Markey Energy Tax.
Senator John Kerry: (202) 224-2742 

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How Cap and Tax Will Hurt Maryland

Posted by Chris Prandoni on Tuesday, September 8th, 2009, 10:14 AM PERMALINK

In our continuing, daily, state by state, look at the financial impact of the Waxman-Markey Cap and Trade Tax Bill, we will show you the projected losses in Gross State Product, Personal Income, and Non- Farm Jobs in Maryland.

Detailed information on this and other energy taxes can be found in the Americans for Tax Reform Energy Tax Analysis, May 2009.

According to a study by Karen Campbell, Ph.D. and David Kreutzer, Ph.D. at the Heritage Foundation, Maryland will suffer the following losses in 2012 as a result of Cap and Tax:

  • A decline in Gross State Product of -$3,087,000,000
  • Total Personal Income Loss of -$462,300,000
  • Non-Farm Job losses of 31,573

An update to the Heritage Foundation’s study further shows an:

  • Increase in Electricity Prices from 2012-2035 of $820.34 per household.
  • Increase in Gas Prices from 2012-2035 of $0.64 per gallon.

Contact your Senators today and tell them to VOTE NO on the Waxman-Markey Energy Tax.
Senator Benjamin L. Cardin: (202) 224-4524
Senator Barbara A. Mikulski: (202) 224-4654

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Not New News: Americans Disenchanted with Organized Labor

Posted by Chris Prandoni on Friday, September 4th, 2009, 4:46 PM PERMALINK

Organized labor’s approval ratings have tanked. Gallup found, for the first time in the polling organization’s history, that a majority of Americans disapprove of unions, 52%. Although labors’ popularity has fallen amongst voters of every political party, Independents are particularly disenchanted with labor- 66% of Independents this time last year approved of Labor compared to 44% this year.

Measuring a slew of different indicators, Gallup shows that anti-labor sentiment is on the rise in every category. This year more Americans think that labor mostly hurts the American economy (51%) and a plurality of Americans would like to see unions have less influence (42%).

These findings should come as no surprise. Americans watched as the United Auto Workers (UAW) bankrupted GM and Chrysler and then refused to enter meaningful negotiations. Unemployment rates are their highest in decades and high unionization rates only inflate this number. Americans have caught on- unions impede economic growth.

Click here to see Gallup's full report.

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Federal Comment Period on PLA's Re-Opened: Submit Your Comments

Posted by Chris Prandoni on Tuesday, August 25th, 2009, 12:15 PM PERMALINK

The following is cross-posted at www.workerfreedom.org

With the Obama administration flush with borrowed cash and eager to spend it, the fight for billions of dollars in federal construction contracts is heating up. Old battle lines have been redrawn pitting organized labor against private business. Organized labor, more often than not, is the beneficiary of generous federal contracts because of the billions of dollars they throw at Democrat’s campaigns and an arcane contract loophole, theDavis-Bacon Act. It gets worse for private business; President Obama signed Executive Order 13502 (E.O. 13502) which urges the Federal Acquisitions Regulation to mandate that all federal construction projects with price tags higher than $25 million (nearly all do) contain project labor agreements (PLA).

Additionally, Section 7 of the Executive Order calls for Secretary Solis and the Office of Management and Budget to make recommendations about an expansion of E.O. 13502, most likely to recipients of federal money (state and local construction projects). Obama is using federal loans as leverage to bully local governments into encouraging or requiring PLAs on their construction projects. Translation: Obama wants to deal exclusively with labor when contracting construction projects.

The proposed handout to labor would distort the construction market and raise the cost of governmental projects. By guaranteeing labor all federal contracts Obama isolates labor unions from outside competition. This would inflate the price of construction jobs and is the equivalent of signing a monopoly into law. Monopolies are bad. They are even worse when taxpayers get stuck funding unnecessarily expensive projects. This is not cynical; labor has been price gouging the federal government for years through manipulation of the Davis-Bacon Act.

Obama’s proposed PLA mandate has the additional effect of pressuring employers to unionize so they can receive governmental contracts. With unionization rates plummeting, currently at 7.6% in the private sector, labor has turned to Democrats to help bolster membership. Obama’s executive order and the misnamed Employee Free Choice Act are evidence of Democratic initiatives to increase union membership.

There is hope though, the Federal Acquisition Regulation Council, the board Obama submitted Executive Order 13502 to, is considering extending the comment period that expired August 13. Currently, the debate is being dominated by labor’s well organized effort to ratify Executive Order 13502.

 Alliance for Worker Freedom urges interested parties to submit comments here  and will continue to follow this story.

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Sen. Specter Doublespeak on Employee Free Choice Act

Posted by Chris Prandoni on Tuesday, August 18th, 2009, 1:24 PM PERMALINK

17 AUGUST 2009
Sen. Specter (D-Penn.) “Doublespeak” on Employee Free Choice Act
The Alliance for Worker Freedom (AWF), an organization established in 2003 to combat anti-worker legislation and promote free and open labor markets is asking Sen. Arlen Specter (D-Penn.) to clarify his position on the Employee Free Choice Act (EFCA), aka “card check”.

Sen. Specter in April 2009:
In I will not be an automatic 60th vote, and I would illustrate that by my position on Employee Free Choice, also known As Card Check. I think it’s a bad bill and I'm opposed to it and would not vote to invoke cloture.
…four months later on August 14th, he changes his mind:
Question: Is it fair to say that on the climate legislation, on employee free choice, on a public option healthcare plan, these are all areas where you would be voting with the majority for cloture to have these up or down votes?
         Specter: Yes, no doubt about those three issues at all

In March of this year, Sen. Specter was concerned about the economic impact:
         [The] problem of the recession make this a particular bad time to enact employees choice legislation. Employers understandably complain that adding a burden would result in further job losses
…only three months later in June, the Senator again switched his opinion at a rally:
I think you will be satisfied with my vote on this issue about union organizing and about first contract.
Which is it Sen. Specter?

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International Brotherhood of Teamsters Strong-Armed by Internal Union

Posted by Chris Prandoni on Friday, August 14th, 2009, 4:20 PM PERMALINK

Sometimes, in labor negotiations, the union proposes something outlandish (6 months paid vacation), the employer refuses to comply and the union goes on strike. At this point, businesses have two options; ignore the union and continue to lose productivity while the market reacts negatively and their stocks plummet, or come to a “compromise” with the union. Where of course here, “compromise” means “give the unions a portion of what they want without going bankrupt.” Don’t believe me, ask Allan Mulally.

The power to strike lets unions dictate contractual negotiations. Labor rarely hesitates to wield its powerful weapon, the picket line, even against their own.

In a strange turn of events, a rogue union, the Washington-based Office and Professional Employees International Union (OPEIU), has rebelled against its national union, the International Brotherhood of Teamsters (IBT), threatening to, yes, strike if contract disputes are not settled. This puts the IBT in the awkward position of having to negotiate with the unreasonable OPEIU. The chickens have come home to roost.

An IBT spokesman lamented the situation OPEI has put them in, saying, “no amount of embarrassment will cause us to commit to a collective bargaining agreement that jeopardizes the financial health of your International Union." IBT’s critique of OPEI is the same claim businesses have levied against unions for decades; you can’t negotiate with these people.

Sympathy for IBT is in short supply, for them to condemn OPEI is utterly hypocritical. It should come as no surprise to IBT that the OPEIU has threatened to strike; its labors go to play.


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From Today Forward, the Money You Earn Working is Actually Yours!

Posted by Chris Prandoni on Thursday, August 13th, 2009, 3:23 PM PERMALINK

The following is cross-posted at www.workerfreedom.org

Happy Cost of Government Day...well, yesterday. From today forward, all the money you make is actually yours!
Yesterday, the average American worker earned enough gross income to pay off his or her share of the spending and regulatory burdens imposed by government on the federal, state and local levels. There are numerous ways that government can reduce waste, obviously, but one of the most needless money pits is made possible by the Davis-Bacon Act.

The Davis-Bacon Act requires contractors on all federal construction projects to pay their workers the prevailing wage in the same locality. To its proponents, Davis-Bacon is necessary to prevent the distortion of labor markets from the government’s deep pockets and political power, fair enough. This argument is predicated on the Department of Labor ability to accurately calculate “prevailing wages.”

Current survey techniques are egregiously error-filled. A recent audit found that 100% of Davis-Bacon wage estimates contained errors and that some “prevailing wages” have not been recalculated in 25 years. Two examples of incorrect Davis-Bacon wage calculations to illustrate how the bill, in fact, facilitates market distortion. In Sumter, South Carolina, the government paid plumbers $5.15 an hour compared to the market rate of $16.96 per hour. In San Diego, California, the government paid plumbers as much as $38.36 an hour compared to the market value of $21.61.

Much to the dismay of Davis-Bacon supporters, the bill consistently misprices wages and by doing so distorts the market. Most commonly overpaying for labor, the government will waste an estimated $9 billion paying above market prices for work this year.

Someone has to receive inflated government contracts, and in most cases it is unions. Due to flaws in the survey system, union wages more often than not end up determining the “prevailing wage.” Union wages are so high that they effectively price out all competitors as no other company can afford to pay its workers as much. As mandated by Davis-Bacon, the government is forced to pay the “prevailing wage” which usually means hiring unions.    

There is no point in continuing Davis-Bacon, a bill which in practice has the exact opposite effect of its intended purpose. So why is Davis-Bacon still a law? Because labor cannot fairly compete with other companies for government contracts so they continue to line the pockets of Democratic Representatives. Until it is repealed, or survey techniques overhauled, Davis-Bacon remains one of the most needless wastes of taxpayer money.

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Trial Lawyers Thwart Meaningful Healthcare Reform

Posted by Chris Prandoni on Thursday, August 6th, 2009, 3:22 PM PERMALINK

There is consensus among Americans that something must be done to address healthcare costs, currently consuming 16 percent of GDP. The Obama administration has wedded itself to healthcare and is searching for reform. Unfortunately, Democratic plans are incredibly expensive and do not lower costs, just minor details. With a price tag around $1 trillion over 10 years, it is hard to see how spending extravagant amounts of taxpayer money saves Americans money. And Democrats wonder why a plurality of Americans oppose Obama’s healthcare plan.

Regrettably, for Americans who see their medical expenses rising, Democrats have taken one obvious cost-cutting measure off the table: medical tort reform. The current malpractice system is one that is terribly inefficient and expensive. There is no limit to how much money patients can sue for and no standard system for dealing with these claims.
Doctors combat impending lawsuits in two ways, both of which unnecessarily inflate the cost of healthcare. Most doctors purchase malpractice or asset protection insurance as safeguards against lawsuits. These insurance plans are expensive and raise overhead costs for hospitals. Secondly, doctors are forced to practice defensive medicine. Defensive medicine takes place when doctors order needless tests or procedures to protect themselves against future lawsuits. A 2008 survey found that 83% of Massachusetts doctors practice defensive medicine and that 25% of all imaging tests were ordered for defensive purposes.
Medical tort reform drives down insurance premiums by reducing the amount of tests insurance companies cover each year. This would reduce healthcare costs by as much as $200 billion a year. So why are no Democrats talking about eliminating defensive medicine as an easy way to save billions of taxpayer dollars? Trial lawyers, the only opponents to medical tort reform, happen to be in bed with Democrats, consistently raising millions for the Democratic Party. Democrats have sold out the American public for trial lawyers’ “donations.”
While Congress recesses, Democrats will try and cook the books on healthcare, looking to make their plans appear deficit neutral. An honest discussion about healthcare reform is not possible until special interests- trial lawyers- are expelled from the conversation. Until then, the status quo and handouts that burden our healthcare system will continue.   


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