John Stossel on Project Labor Agreements
After John Stossel, the investigative journalist famous from his work on ABC’s 20/20, appeared yesterday on FNC’s Your World with Neil Cavuto to talk about President Obama’s push to use union labor for big federal construction projects via Executive Order 13502 — and the related controversy surrounding the U.S. Department of Labor’s (DOL) decision to cancel its solicitation for bids to construct a new Job Corps Center in Manchester, N.H. under a government-mandated project labor agreement (PLA) — he blasted PLAs in a recent piece on “John Stossel’s Take” ( Tax Money for Unions, 11/13).
A Labor Department spokesman didn’t return our calls or an e-mail for comment. We called Ken Holmes, the contractor who filed the protest against the rule, and he said that Labor Department either had to cancel their bidding or respond to this complaint this week. Although Holmes technically won, he says he isn’t celebrating yet. He said that the administration is currently drafting an official policy on union-only (PLA) contracts, and that it may simply be waiting until that is in place to restart union-only bidding
“It’s a victory in that they canceled this bid, but we’ll feel a lot better when they open the contract to all bidders,” he said.
Holmes says his company protested the union-only rule because the policy “takes taxpayer money and earmarks it to a special interest group… to me, this seems like political payback.”
To me too. It costs taxpayers about 18 percent more when only unions are allowed to bid on federal contracts. One reason union construction costs more is the wasteful, motivation-killing union work rules.
In Buffalo, New York, private contractors point to rules that require crane operators to be accompanied by a “crane oiler” – even though that job is obsolete.
A couple years ago in Philadelphia, Comcast wanted to build the tallest “green” building in the US. That meant installing water-efficient pipes . But Philly Magazine reports:
“Not so fast, the city’s plumbers union said. Less water means fewer pipes. Fewer pipes mean less work. And so the union blocked the job, threatening the completion of the building, and in turn delaying all the business that would happen inside it… the city twaddled in the face of a clear decision: “We’re still looking into this,” the top building code official told the Inquirer at the time. “I want to make sure they’re safe.”
Thankfully, the unions ended up losing that fight.
These types of union inefficiencies experienced above (and by Mr. Stossel in the studios – see his full post) are pushed onto nonunion contractors and their employees when government mandates a PLA. Whether or not a nonunion contractor is able to win work on a PLA project, wasteful union work rules prevent taxpayers from getting the BEST possible product at the BEST possible price. Add that to reduced competition from quality nonunion contractors driven away by PLAs during the procurement process and it is no wonder why PLA projects cost so much more money than non-PLA projects.
It is a shame that political cronies have successfully lobbied the government to force inefficiencies down the throats of businesses that the free market has already addressed and corrected.
John Stossel knows that the public needs a break from PLAs.