ARC's 1st Law: As a "progressive" online discussion grows longer, the probability of a nefarious reference to Karl Rove approaches one

Thursday, October 13, 2005

Davis-Bacon Act, Part II

Well, I originally posted on Bush's suspension of Davis-Bacon for the hurricane Katrina ravaged Gulf Coast and pointed out that the purpose was to allow smaller contractors and new entreprenuers to get a piece of the action. I also pointed out that it was probably politically unwise for Bush, as the headlines write themselves. However, it looks like the argument can be turned back on the Left, as Davis-Bacon's history is less than "progressive."

Davis-Bacon sets a price floor on construction labor. It says that construction work for the government can only be compensated at the union scale. But the construction labor market, like any other labor market, isn't really a single price market. In an open market, employers trade off between price and certainty. The union labor, while more expensive, comes vouched for in terms of experience and standards. As a result, both ends up being consumed in the marketplace. On the other hand, if you say that you have to pay employees the union rate, the incentive to hire non-union employees pretty well vanishes. Why, after all, would you take a gamble on someone, when you've got a known commodity with the union guys.

The racial implications of this policy weren't some sort of unintended consequence. They were actually the entire point of the law. During the migration of black people Northward in the 1930s, emerging unions actively sought to exclude them from the market. Consider the following:
The comments of various congressmen reveal the racial animus that motivated the sponsors and supporters of the bill. In 1930, Representative John J. Cochran of Missouri stated that he had "received numerous complaints in recent months about southern contractors employing low-paid colored mechanics getting work and bringing the employees from the South."[15] Representative Clayton Allgood, supporting Davis-Bacon on the floor of the House, complained of "cheap colored labor" that "is in competition with white labor throughout the country."The Davis-Bacon Act: Let's Bring Jim Crow to an End ; Cato Institute
If they get their way on this matter, and Davis-Bacon remains in effect in Katrina recovery, I predict that within a few months we'll hear either Yglesias or Marshall beating their breasts sanctimoniously about racism in the reconstruction effort. I've little doubt that they'll use the accusation to suggest racism is symptomatic of America, and that we as a country are little removed from cross-burning rednecks. The least one can expect is that they refrain from sewing the hoods and buying the gasoline.

However, I would be surprised if the affluent liberal bloggers and pundits in the Beltway actually admit that there are unintended consequences and underlying racism of their policy positions. Or, even if they do recognize these troubling facts, will brush them aside in order to further their attacks against BFEE (Bush Family Evil Empire for those of you unfamiliar with the conspirazoid Left). After all, (in their minds) what's a job to a poor and unskilled worker worth compared to the ability to score points against your political foe?

Mickey Kaus also weighs in on the topic and illustrates the folly of the conventional wisdom (promoted by the NYTimes, of course) that suspension of Davis-Bacon "hurts the disadvantaged poor." He has some great emails from people who are familiar with the law and its unintended consequences. Kaus also shows that Davis-Bacon improves the likelihood that Halliburton would get a larger share of the contract, as I pointed out in my original post.

Josh Marshall, Kevin Drum, and the "Progressive Left" - unabashed supporters of Halliburton and the oppression of the unskilled worker.

Your Co-Conspirator,
ARC: St Wendeler