WSJ Editorial Blasts Obama’s Project Labor Agreement Scheme (Again)

2 May 17, 2010  Federal Construction, Uncategorized

The Wall Street Journal’s editorial board continues to criticize the Obama administration’s steady support of Big Labor’s special interest agenda  (“Obama’s Union Favors: The Latest Rule Change Slams The Airlines,” 5/15).  The latest gift to Big Labor benefits labor unions in the airline industry. readers may recall that an April 14, 2010 WSJ editorial blasted President Obama’s scheme to funnel federal construction contracts to Big Labor through project labor agreements (PLAs) via Executive Order 13502. Calling PLAs “crony contracts,” the editorial had this to say about PLAs:

“Only 15% of the nation’s construction workers are unionized, so from now on the other 85% will have to forgo federal work for having exercised their right to not join a union. This is a raw display of political favoritism, and at the expense of an industry experiencing 27% unemployment … It’s also a rotten deal for taxpayers.”

Here is the most recent editorial’s take on PLAs:

“Starting this month, the Administration has also ordered federal agencies to award public construction contracts to union-friendly companies. Separately, companies that get contracts funded by the stimulus are required to pay construction workers the going union wage. Funny, we thought the government’s job was to find the best deal possible for the taxpayer, not use the federal purse to reward union shops.”

While it is true that these two policies are clear examples of key constituents receiving special treatment at the expense of taxpayers, it is important to clarify that not all federal construction projects will be subject to PLAs (that would likely be illegal under a variety of federal competitive bidding and labor law statutes). But the White House is strongly promoting PLAs and encouraging federal agencies to award federal contracts to union companies wherever and whenever they can (on a discretionary basis, of course). 

And while it is true that construction projects receiving stimulus dollars must pay prevailing wage and benefit rates under the Davis-Bacon Act (DBA), the DBA rate is not always the union rate. 

However, studies found that DBA determined prevailing wages and benefits are typically union wage and benefit rates, although that tends to vary from locality to locality, depending on when the last wage survey was conducted by the U.S. Department of Labor’s Wage and Hour Division and a variety of complicated factors related to the broken and archaic methodology employed by the government to determine what construction wages are “prevailing” in a locality.

Still, the WSJ is on the mark. Big Labor’s agenda is getting top priority and there is a growing concern it may not be the best thing for our country and economy.  It certainly isn’t the best deal for taxpayers and these Big Labor favors have no place in honest government.

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2 Responses to WSJ Editorial Blasts Obama’s Project Labor Agreement Scheme (Again)

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