[Congressional Record Volume 141, Number 31 (Thursday, February 16, 1995)]
[Extensions of Remarks]
[Page E366]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]


                         DAVIS-BACON ACT REFORM

                                 ______


                        HON. WILLIAM (BILL) CLAY

                              of missouri

                    in the house of representatives

                      Wednesday, February 15, 1995
  Mr. CLAY. Mr Speaker, today I am reintroducing legislation to reform 
the Davis-Bacon Act. The bill I am introducing is identical to 
legislation reported by the Committee on Education and Labor in the 
103d Congress.
  When Government enters the construction industry through federally 
funded contracts, its monopoly risks skewing this unique market 
unfairly. Construction wages vary greatly across the country, 
reflecting differences in communities' cost of living and business 
environments. The uncertain nature of construction work, however, where 
employees move constantly from job to job and employer to employer and 
regularly face periods of unemployment, makes the industry more 
susceptible to cutthroat business practices than most. The Davis-Bacon 
Act was enacted in 1931 by a Republican Congress in order to correct a 
procurement system that otherwise disrupted local employment practices 
and encouraged the exploitation of workers.
  By law, the Federal Government awards contracts on the basis of the 
lowest qualified bid. Absent the protection of prevailing wage 
statutes, such as the Davis-Bacon Act and the Service Contract Act, the 
requirement that contracts be awarded on a low-bid basis, particularly 
in labor intensive economic sectors such as the construction industry, 
would inevitably result in contracts being awarded to the contractor 
bidding the lowest wages. In effect, Government procurement policy 
would act to undermine locally prevailing labor standards and reward 
those employers who pay the least to their employees. The Davis-Bacon 
Act serves the vital function of ensuring that Federal procurement 
policy does not act to drive down the wages of working Americans.
  Opponents of the Davis-Bacon Act have created a number of inaccurate 
and misleading myths about the law. The most outrageous myth is that 
minority workers will somehow benefit from repeal. Our colleague from 
Texas, Mr. DeLay, has contended that repeal of the Davis-Bacon Act will 
``reduce discrimination against women and minorities that so often 
occurs within the construction industry.'' George Will has purported 
similar nonsense in his column. Mr. Will begins this fabrication by 
misrepresenting the circumstances that led to enactment of the Davis-
Bacon Act, contending the law was enacted ``to impede blacks competing 
for federally funded construction jobs.'' In fact, the law was 
supported by and enacted to protect contractors from the exploitative 
and predatory practices that were driving legitimate contractors out of 
the Federal construction market. Mr. Will
 goes on to claim that the law has a ``disparate impact disadvantageous 
to minorities.'' The plain and simple truth is that the disadvantage 
under which minorities typically suffer is not that they are paid the 
prevailing wage, the same money for the same work that most workers 
receive, but that historically and continually they have been paid 
less. Implicit in both Mr. Will's and Mr. DeLay's assumptions are that 
minority workers are not as productive and therefore not worth the same 
wages as white, male workers.

  The second myth that opponents of the law have perpetuated is that 
the law requires union wages or somehow protects unions. In fact, the 
law requires employers to pay the same wages that are found to be 
prevailing in the local area. A union wage prevails only if most 
workers in the area are union employees. Seventy-one percent of all 
wage-based determinations issued by the Department of Labor in 1994 
were based on nonunion scales.
  The final falsehood being perpetuated by opponents of the Davis-Bacon 
Act is that repeal is sound Government fiscal policy. As leading 
construction industry economists have recognized, however, there is a 
direct correlation between wage levels and productivity. Well-trained 
workers produce more value per hour than poorly trained workers, low 
wage workers. Economic studies have demonstrated that construction 
projects built by under-trained and under-paid workers cost more to 
build than those using trained workers. Recent studies clearly 
illustrate the impact that repeal of the Davis-Bacon Act will produce. 
When Utah's prevailing wage law was repealed, there was a decrease in 
apprenticeship training, the availability of skilled workers, and a 
decline in average construction wages. More importantly, lowering the 
standard of living of American workers by cutting their wages and 
fringe benefits will not translate to lower costs for any government, 
be it Federal, State or local.
  The legislation I am introducing strikes a balance between two 
important goals. While retaining the protection the law affords to 
ensure that the Government policy does not undermine the living 
standards of our citizens, it also updates and modernizes several 
provisions of the Davis-Bacon Act, including limiting some of its 
reporting requirements and raising the coverage threshold. I urge my 
colleagues to join me in supporting this legislation.


                          ____________________