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Davis-Bacon Act Undermines Democrats' Stimulus Bill


Posted by Chris Prandoni on Monday, September 28th, 2009, 2:35 PM PERMALINK


While many have criticized the Democrat-passed “stimulus bill” for its expediency, or lack thereof, and its inevitable waste, inherent in massive spending, it is rare that the two deficiencies cross paths in one magnificent example of government irrationality. Democrats justified hastily passage of the recovery bill through the “we are on the precipice of a recession” fear mongering; that inaction would prove disastrous.

A recent release from the Government Accountability Office suggests that urgency is supplanted by waste in the hierarchy of stimulative requirements. Stimulus funds that were allocated to the Weatherization Assistance Program remain unspent, heaven forbid, due to questions about construction workers wages which are determined by the arcane Davis-Bacon legislation, a depression-era bill that, in practice, is a wage subsidy for workers contracted by the federal government.

Davis-Bacon makes it illegal for the federal government to award contracts to companies unless they pay wages determined by a government body, the Wage and Hour Division. The Wage and hour Division uses the imprecise method of surveying to calculative wage rates- audits have found a 100% error rate when comparing the Wage and Hour Divisions’ calculations to a statistical analysis of an areas wages. Usually, Davis-Bacon inflates wages for construction jobs raising the price tag for such projects.   

Davis-Bacon drives up costs and adds red tape. This is not new news but is counter to the Democrats' rational for the stimulus. Instead of employing workers queued up for jobs, Democrats are spending time and money calculating prevailing wages in areas where the Weatherization Assistance Program will be implemented. In the real world, contracts are awarded to companies who offer their services for the lowest price and can accomplish the given task effectively. How logical. The federal government should embrace this common methodology and throw Davis-Bacon’s unscientific wage rates out the window.     Unfortunately for Democrats, two of their favorite bills, the Stimulus, a bill predicated on speed, and Davis-Bacon, an old bureaucratic arrangement, are incompatible, with one undermining the other. 

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