Want construction much cheaper? Demolish 1931 law
“You really ought to give Iowa a try.
Provided you are contrary.”
— “Iowa Stubborn,” from Meredith Willson’s “The Music Man”
“Contrary” does not quite capture Steve King’s astringency. The Iowa native and conservative congressman was born, appropriately, in Storm Lake, and carries turbulence with him. He also carries experience of actual life before politics, when he founded a construction company, which is one reason he has long advocated an excellent idea — repeal of the Davis-Bacon law.
King came to Congress in 2003 and has been stubbornly submitting repeal legislation since 2005. He would not have succeeded even if he were less of a prickly cactus and more of a shrinking violet. Davis-Bacon is just another piece of government that is as indefensible as it is indestructible.
It is too secure to require defending because it benefits a muscular faction. Repeal would, however, reduce the cost of new infrastructure by many billions of dollars.
Davis-Bacon was enacted in 1931 to require construction contractors to pay “prevailing wages” on federal projects. Generally, this means paying union wage scales. It was enacted as domestic protectionism, largely to protect organized labor from competition by African-Americans who often were excluded from union membership but who were successfully competing for jobs by being willing to work for lower wages.
By 1931, the Depression had made government construction money especially coveted and Davis-Bacon passed with the support of the American Federation of Labor. The congressional debate that preceded enactment was replete with references to “unattached migratory workmen,” “itinerant labor,” and “labor lured from distant places” for “competition with white labor throughout the country.”
In 1931, the unemployment rate of blacks was approximately the same as the rate for the general population. Davis-Bacon is one reason the rate for blacks began to deviate adversely. In 1932, generally there were about 3,500 workers building what became the Hoover Dam. Never more than 30 were black.
In 1993, with Congress stoutly opposed to taking anything from something as powerful as organized labor, opponents of Davis-Bacon turned to the judiciary. A lawsuit on behalf of some minority contractors challenged the law’s constitutionality, arguing that it burdened the exercise of a fundamental civil right — the right to earn a living. And that it had a disparate impact on minority workers and small minority-owned construction businesses. The suit languished in court for almost a decade before the plaintiffs lost, victims of excessive judicial deference to the legislature.
A 2011 Heritage Foundation study estimated that Davis-Bacon would add almost $11 billion to that year’s construction costs. That sum will be eclipsed when — if — bold talk about making America’s infrastructure great again is translated into spending. Then we build up the national debt while purchasing less infrastructure than the appropriated sums should purchase.
Davis-Bacon is rent-seeking, the use of political power to supplant the market as the allocator of opportunity and wealth.