[Congressional Record Volume 141, Number 42 (Tuesday, March 7, 1995)]
[House]
[Pages H2792-H2793]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




       URGING MEMBERS TO SUPPORT MAINTAINING THE DAVIS-BACON ACT

  The SPEAKER pro tempore. Under a previous order of the House, the 
gentleman from California [Mr. Becerra] is recognized for 5 minutes.
  Mr. BECERRA. Mr. Speaker, I would like to first begin by thanking 
several of my Democratic colleagues who came here tonight to speak in 
support of the Davis-Bacon Act, which now is in jeopardy of being 
repealed by the new Republican majority.
  Mr. Speaker, I want to thank them, because this is an issue which 
goes directly to my family situation and to my heart. My father is 
someone who had the chance to benefit from the Davis-Bacon Act. My 
father is a retired construction worker, a road construction worker. 
Many of the roads that people use in California, from Highway 5 and 
other highways that were constructed in the big days of the sixties and 
seventies, those roads were constructed in part by men like my father.
  My father never earned a lucrative wage, but he did earn a decent 
wage. This is, in my opinion, an Act, the Davis-Bacon Act, which made 
it possible for my family to have some security and some decency in
 its living standards. I know when I speak on behalf of those who 
support the Davis-Bacon Act that I speak not just for them, but also 
for my father.

  Mr. Speaker, to repeat what some of the Members have said before, the 
Davis-Bacon Act is an act that passed in 1931. It was an act that 
passed through the sponsorship of Republican legislators and was signed 
by a Republican President.
  The law merely mandates that taxpayer dollars go to contractors who 
offer the greatest quality craftsmanship, the highest productivity, the 
quickest turnaround, and the best management. The primary purpose of 
the law is to assure that by requiring the payment of locally 
prevailing wages, that Federal spending practices do not undercut the 
wages of hard-working people, and that they do not put local 
contractors and their employees in an unfair competitive situation.
  Individual and industry contractors benefit, because in discouraging 
competition that would be based on the payment of substandard wages, 
the act promotes a greater availability of skilled construction 
workers. The act, by enduring more stable and predictable wages, 
facilitates the recruitment, the training, and the retention of skilled 
construction workers.
  Mr. Speaker, let us talk about who loses if the Davis-Bacon Act is 
repealed. More than a half a million construction workers would suffer 
reduced earnings and a lower standard of living if the act were to be 
repealed. Individual construction firms and the construction industry 
as a whole may also lose if conscientious contractors are forced to 
compete with the fly-by-night and low-balling contractors who pay 
depressed wages and offer workers no benefits.
  Taxpayers would lose if the act is repealed. Given the way labor 
markets operate, savings to be achieved through lower wages would be 
offset by the lower productivity of less skilled and less experienced 
workers. Their work product, roads, bridges, building, then become the 
public's responsibility. If the work product is of low quality, then 
that is a consequence that taxpayers will be forced to live with.
  Mr. Speaker, repeal of the Davis-Bacon Act is not a money saver. 
Contrary to what the Republican majority is saying these days, repeal 
of Davis-Bacon would not automatically save the Government money, 
because well educated, well-trained, and fairly paid workers are more 
productive than their poorly-trained low paid counterparts. They often 
bring in projects at less cost than those using low-wage workers.
  Repeal of Davis-Bacon also threatens worker safety. When productive, 
skilled, properly-trained labor is hired at a Davis-Bacon wage, safety 
and health are also hired. The use of untrained, poorly-skilled workers 
results in a higher occurrence of injuries and fatalities on the 
Nation's job sites.
  Repeal may also threaten public safety, as poorly trained workers are 
more likely to make dangerous mistakes.
  Mr. Speaker, what would happen if Davis-Bacon were repealed? Each 
construction worker would see his or her annual income fall by about 
$1,477. That may not seem like a lot to some people, Mr. Speaker, but 
think of it this way. $1,477 pays for about half a year's worth of 
groceries for an average American family.
  For my family when I was growing up, and my father and my mother were 
working hard, that was a tremendous amount of money. It would have 
affected the way we lived and the standard of living that we were able 
to have, which was very meager. It would have affected it greatly.
  Members of Congress have supported the Davis-Bacon Act in the past on 
a bipartisan basis. I hope, Mr. Speaker, that we have that same 
bipartisan support for this particular act, because quite honestly, it 
helps American because it helps America's workers and American's 
contractors.
  I would hope at this time, Mr. Speaker, that we would see the value 
in maintaining the act and move forward from there.
  Ms. ESHOO. Mr. Speaker, it puzzles me why the Republicans are 
determined to repeal the Davis-Bacon Act. After all, this law has its 
origins in State initiatives, was written by two Republicans, and has 
been declared successful by a leading Republican economist. If this 
isn't a winning combination as the majority defines it, then what is?
  Despite current GOP claims to the contrary, the Davis-Bacon Act is 
based on years of State experience with prevailing-wage standards prior 
to its passage by Congress. Back in 1891, Kansas adopted the country's 
first prevailing-wage statute, and at least six other States had passed 
similar legislation before the first prevailing-wage law was introduced 
in Washington.
  By the late 1920's, Republicans in Congress were extremely concerned 
about increasing incidents of cutthroat Federal bidding by fly-by-night 
contractors using low-wage labor. With shoddy construction threatening 
massive Federal building programs, Representative Robert Bacon--a New 
York Republican--introduced the forerunner of the Davis-Bacon law.
  With the help of Senator James Davis--a Republican from Pennsylvania 
and former Labor Secretary under three Republican Presidents--the 
Davis-Bacon Act was eventually passed and signed into law by President 
Hoover in 1931.
  Since that time, the Davis-Bacon Act has proven to be a remarkable 
success for local communities, minorities, and American taxpayers.
  Local communities have benefited because their wages have been 
protected against low-balling, out-of-State contractors, while their 
economies have been enriched by residents maintaining enough purchasing 
power to keep locally owned businesses thriving.
  Minorities have benefited from the Davis-Bacon Act's protection of 
wage gains made over the years, and become heavily employed in the 
construction industry because of the decent wages it pays.
  In addition, the percentage of minorities employed by Federal 
contractors is higher than the percentage of minorities employed by 
non-Federal contractors, which reflects the positive impact Davis-Bacon 
has had for minority workers.
  Finally, Davis-Bacon has benefited American taxpayers. Dr. John 
Dunlop--Secretary of Labor under President Ford--has concluded that any 
additional costs incurred by paying prevailing wages have been offset 
by better quality, productivity, timeliness, and reliability on Federal 
projects. It's vital for our bridges, schools, dams, nuclear waste 
removal projects, military installations, and superhighways to continue 
to be built to the highest specifications by the most qualified, well-
trained workers available--and the Davis-Bacon Act ensures that will 
happen.
  Mr. Speaker, for over 60 years, Davis-Bacon has been an unqualified 
success. It must be preserved.
  Mr. ENGEL. Mr. Speaker, the opponents of the Davis-Bacon Act have 
mounted an attack 
[[Page H2793]] to repeal a law that helps American workers. This is 
nothing more than an effort to pull the rug out from under working 
people. As the son of a dedicated ironworker, I resent this shameful 
union bashing and the implication that the workers of this country are 
not entitled to a decent wage for their labor.
  Davis-Bacon is a law that actually strengthens our economy and helps 
America. Contractors and American workers both benefit from its 
provisions. I ask you to consider these facts:
  Repealing Davis-Bacon will result in lower wages for half a million 
Americans. Construction workers is the United States who currently 
receive prevailing wages could lose $1,400 annually if Davis-Bacon is 
repealed. The average annual earnings of a construction worker is 
$28,000. Isn't this the type of middle-class American that we should 
protect rather than punish?
  The prevailing wage law actually generates benefits to local 
communities 2.4 times the amount spent on a construction project 
because workers spend their money locally and pay local taxes. 
Repealing Davis-Bacon could result in the widespread importation of 
non-local, low-wage workers, causing an adverse affect on local 
economies.
  According to a study conducted by the University of Utah, repeal of 
the Davis-Bacon Act will reduce Federal tax collections by $1 billion 
per year because of the decline in construction earnings, while 
simultaneously causing a massive increase in cost overruns. In States 
that have repealed their little Davis-Bacon laws, construction costs 
have risen because of substandard work that must be redone when less 
skilled workers are used on the projects.
  Davis-Bacon does not require contractors to pay union wages. 70 
percent of the prevailing wage schedules are not union wage rates, yet 
still allow a fair wage to be paid in the local area to middle class 
workers.
  The Workers Protection Subcommittee of the House Economic and 
Educational opportunities Committee hurried the markup of the repeal of 
the Act without adequately considering its ramifications. The 
Subcommittee did not even allow the Secretary of Labor to testify.
  It's time to bring some reason to this issue. At a time when the 
middle class is feeling the crunch in our economy, the repeal of Davis-
Bacon would adversely affect the workers that are a productive and 
important segment of our society. I strongly urge you to fight any 
attempts to repeal this Act. By doing so, you will be working to keep 
our construction industry competitive and viable.
  Mr. RAHALL. Mr. Speaker, I rise in support of the continuation of the 
prevailing wage laws embodied in the Davis-Bacon Act, and against 
repeal of this vital act.
  As you know, Mr. Speaker, on March 2, 1995, the Subcommittee on 
Worker Protections, so-called, voted to repeal the Davis-Bacon Act. 
They did so without a single member of the minority membership being 
present, an action that is, in and of itself, unprecedented in recent 
memory. The Democrats, refusing to be a party to the demise of the 
Davis-Bacon Act at the hands of their colleague in the other party, 
walked out in protest.
  The Davis Bacon Act has been in effect since 1931, and 32 States have 
their own Davis-Bacon Acts, with 9 States having repealed previous 
State statutes. Perhaps before taking any further action to repeal 
Davis-Bacon, all Members should take a look at what has happened in the 
nine repeal States.
  A recent, February 1995, study conducted by the University of Utah, 
one of the nine States having repealed their State Davis-Bacon Act, 
showed that:
  First, it resulted in driving down construction earnings and the loss 
to the State's coffers of substantial income tax and sales tax 
revenues.
  Second, as a result of the repeal of the State statute in Utah, the 
size of total cost overruns on State road construction tripled, and 
there has been a major shift to a less-skilled labor force, lowering 
labor productivity along with wages, and increasing injuries and 
fatalities in the workplace.
  Third, looking at all States, the study found that repeal cost 
construction workers in the nine States at least $1,477 per year in 
earnings.
  Fourth, the nine State repeals have reduced construction training in 
those States by 40 percent.
  Fifth, minority representation in construction training has fallen 
even faster than have the training programs in repeal States.
  Sixth, occupational injuries in construction rose by 15 percent where 
State prevailing wage laws were repealed.
  Based on the above six findings, the study concluded that Federal 
income tax collections would fall by at least $1 billion per year in 
real terms for every year for the foreseeable future--if the Federal 
Davis-Bacon Act were repealed.
  The University of Utah's study concluded further that: At the Federal 
level, construction cost savings would have to be very high indeed to 
generate any budget benefit from a repeal of the Davis-Bacon Act 
because of the Federal income tax structure. For example, using a 
conservative estimate of 3 percent construction cost savings with a 20 
percent marginal tax rate (based on the 1991 level of Federal 
construction spending), the Federal Government would lose $838 million 
per year by repealing the Davis-Bacon Act.
  For those who falsely claim that a repeal of the Davis-Bacon Act 
would reduce the deficit, they are wrong--the above-cited study showed 
that a repeal will raise the Federal budget deficit, because the 
purpose and effect of a repeal is to lower the cost of wages on 
federally funded construction projects--which in turn lower wages and 
earnings. Proponents of the claim that repeal would lower the deficit 
are wrong also because the study found that the lower cost of wages 
cannot be isolated to federally financed public works--because in fact 
such wages would decline across the entire construction labor market 
causing the Government to lose more in income tax revenues than it 
would gain in construction cost savings.
  Mr. Speaker, the repeal of the Davis-Bacon Act is not about reducing 
the deficit, or saving construction costs in federally assisted 
projects. It isn't about lowering wages so that more people can be 
employed.
  It is about union busting.
  The Act does not--I repeat does not--require that collectively 
bargained (union) wages be paid unless such wages also happen to be the 
prevailing wage in the locality where the work takes place. Davis-Bacon 
isn't about unions--although unions have made Davis-Bacon work by 
stabilizing the construction industry, keeping fly-by-night operations 
from operating; keeping health and safety standards in effect, and 
assuring that all workers, including apprentices, are well-trained and 
able to contribute to cost-effective productivity at the work site.
  Davis-Bacon assures that federally assisted construction projects are 
completed by well-trained, decently-paid workers, not store-front 
operations who use poor workmanship and shoddy materials--meaning 
higher maintenance costs and costly rehabilitation and repairs down the 
line. It means fewer cost overruns that drive up the total cost of 
construction.
  For many years Congress has made efforts to protect the working men 
and women in construction and other industries by assuring that they 
are paid the local prevailing wage, and particularly for projects that 
are paid for out of Federal funds. Now that there has been a shift in 
the majority parties in Washington, the repeal effort is in full force 
and is being pursued with vigor by opponents of the Act.
  I believe that a repeal of the Davis-Bacon Act, would be a betrayal 
to all who are affected by the construction industry, and that is every 
American. Most importantly, it would be a betrayal to the workers who 
rely on good wages for a decent livelihood.
  I am diametrically opposed to the repeal of the Davis-Bacon Act, and 
I call upon the House of Representatives to continue the broad, 
bipartisan support that the Act has enjoyed to date by rejecting 
legislation to repeal Davis-Bacon.


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