[Congressional Record Volume 142, Number 82 (Thursday, June 6, 1996)]
[House]
[Pages H5996-H6002]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
BENEFITS OF THE DAVIS-BACON ACT
The SPEAKER pro tempore (Mr. Stearns). Under a previous order of the
House, the gentleman from New York [Mr. Owens] is recognized for 60
minutes.
Mr. OWENS. Mr. Speaker, on May 22 of this year, the Senate, the other
body, heeding the voices of more than 21,000 construction contractors
and millions of American workers throughout the Nation, voted to reject
any plans to repeal the Davis-Bacon Act. By the overwhelming margin of
99 to zero the Senate endorsed bipartisan reform to preserve Davis-
Bacon.
I think that is very significant that the Senate, the other body in
this Congress, has taken a strong stance in favor of reform, with the
assumption that any law, any institution, any structure would benefit
from reform. But the Senate is not following the lead of the House and
demanding that there be a repeal of the Davis-Bacon Act.
I think this is a vindication of the system that was set up by the
Founding Fathers when they said that we needed two Houses, one which
could accept, and the analogy was made of the saucer and the cup, the
pouring of tea or coffee into a saucer to cool it off; and the other,
of course, would generate the heat that is in the cup.
I think the House of Representatives is a body where there is a great
deal of heat and energy. We have 435 Members, after all. When you
multiply even the minimal energy of one person by 435, you get a great
deal of heat and energy.
The heat and energy in this body sometimes spins out of control. We
need the wisdom and the patience of the Senate to sometimes bring us
back to reality. I want to congratulate the Members of the Senate, all
99 Members who voted that Davis-Bacon should not be repealed, that the
Davis-Bacon Act should be reformed.
Mr. Speaker, I stand before this body, and today I would like to
dispel the myth that the prevailing wage determination in the Davis-
Bacon Act is inflationary, and that it adds billions of dollars to the
Federal budget.
I have talked before about Davis-Bacon and racism. Davis-Bacon is not
the source of racism. If there is racism in the construction industry,
Davis-Bacon is certainly not generating or not nurturing it. Davis-
Bacon is the antidote. Davis-Bacon has done more to counteract the
impact and the effects of racism than any other Federal law or local
law on the books.
It is through Davis-Bacon that we have maximum cooperation between
unions and contractors, and through the maximum cooperation of unions
and contractors that we have gotten the kind of training programs that
have begun to slowly but surely and steadily increase the number of
minority workers who are qualified in the various skill areas in the
construction industry.
Prevailing wage laws were enacted to maintain community wage
standards. They were enacted to support local economic stability, and
they were enacted to protect taxpayers from substandard labor on State
and Federal projects. These laws set clear parameters to ensure that
contractors bid on public projects on the basis of skill and
efficiency, and not on how poorly they pay their workers.
As I have stated before, Davis-Bacon was created by two Republicans.
Both
[[Page H5997]]
Davis and Bacon were Republicans. Both Davis and Bacon were concerned
primarily about the middle class. Both Davis and Bacon were concerned
about families and communities. The Davis-Bacon Act, when it was
created in the early 1930s, was there to help stabilize communities. It
was there to guarantee that families are not destabilized, and families
are not subjected to the kind of wild things that happen when you can
transport workers from one area under substandard wages and pay them
substandard wages and be able to have unscrupulous contractors bid on
projects at very low levels, and take over the work of the local
contractors, who are paying good wages to local workers who are part of
a local community and stabilize that community.
That was what we were trying to avoid in the early 1930s. Davis-Bacon
continues to help to stabilize communities and to guarantee that the
pool of construction workers, their skills, and their incomes will be
there to help stabilize their families and their communities.
{time} 1815
Unfortunately, the House Republicans, the Republican majority here in
this House, is driven by antiunion hysteria, which I do not understand.
There is some kind of contract with an unscrupulous group of
contractors, I think, in the case of Davis-Bacon, because they will not
let up.
Certain House Members keep going and they refuse to recognize the
facts. They come from areas that are certainly not paying very high
wages. If you look at the Davis-Bacon wages of the areas that many of
the Republican majority Members come from, you will find that they are
very low wages and sometimes close to minimum wages. And they cannot
really complain about Davis-Bacon driving up the cost of local
construction. But the facts do not seem to matter. There is a kind of
hysteria determined to reverse the fair and equitable standards that
Davis-Bacon has established.
They have worked themselves into a feeding frenzy, and they made
absurd charges about Davis-Bacon. Davis-Bacon is racist. These charges
are made by people who normally are not concerned with racism, but they
use this as a charge to be able to belittle and denigrate Davis-Bacon.
They also charge that contractors are forced by Davis-Bacon to pay
inflated wages, and that this has been the result of what Davis-Bacon
has accomplished.
The gentleman from Pennsylvania [Mr. Goodling], who is the chairman
of our Committee on Economic and Educational Opportunities, appearing
before the appropriations subcommittee on the Department of Labor,
Health and Human Services earlier this year, stated that quote, quoting
representative Gooding, the chairman of our committee: The 1931 Davis-
Bacon Act drives up construction costs for any Federal construction
projects valued over $2,000 by requiring contractors to pay a
government-determined wage rate.
Chairman Goodling's remarks before the appropriations subcommittee is
proof positive that Republicans are not ready to really listen to the
facts and take responsibility for leading this body in a move to have
labor and contractors, labor and management come together for the
benefit of stabilizing communities and for the benefit of stabilizing
workers whose families very much need this kind of stability.
The actual wages of construction workers is going down. They are as
much a part of the wage gap and the wage stagnation in America as any
other set of workers. If you take away Davis-Bacon, many of them will
be subjected to violent swings in the conditions that set their incomes
and their salaries.
The Republicans have put on a sneak attack and fright campaigns in
the hope that the American people will buy into a conspiracy theory, a
theory that Davis-Bacon is out there conspiring to drive up the costs
by guaranteeing workers something that is unreal. Chairman Goodling
suggested that there is some kind of institutionalized and entrenched
collusion at the Department of Labor. And to quote him again, ``There
appears to be a deliberate effort to manimpulatee data for political
gain.'' There appears to be a deliberate effort to manipulate date for
political gain.
If you look at the Department of Labor and the history of the
Department of Labor, if you examine the surveys that they do in
determining prevailing wage rates, you will find that it is impossible
to establish that there is any kind of collusion or any kind of
conspiracy. In fact, there are many cases where the surveys done by the
Department of Labor actually lower the wages of construction workers
relative to the highest-paid workers in that particular area. I am
going to talk about that in a few minutes.
Mr. Speaker, we have a booklet here which shows the results of some
of the surveys that are done. They show that often the construction
workers are paid below the wages of the average salary for workers in
similar kind of jobs in given localities.
Further evidence of the dream world existence among the Republicans
who are fighting Davis-Bacon is that many of them have bought into the
party rhetoric that Davis-Bacon inflates wages. Again, this is our
primary topic today, to look at the wages, look at what is really
happening with Davis-Bacon wages. It comes as no surprise that many of
the most vociferous foes of Davis-Bacon comes from States that have
extremely low wage determinations which include no health or pension
benefits. No only do we have in States like North Carolina very low
wages paid to Davis-Bacon workers, workers who are covered by Davis-
Bacon on Federal construction jobs, but those workers, the same workers
in those areas have no pension benefits, they have no health benefits.
I was in a hearing this morning covered by the Employer-Employee
Relations Subcommittee of the Economic and Educational Opportunities
Committee, and the hearing was focused on pensions. They pointed out
the fact that there are only a small percentage of Americans who are
covered by pensions. Two-thirds of the people do not have pensions of
any kind beyond Social Security. For more and more people, the coverage
for people is going down. There are more and more people who are
uncovered as the years go by. We had more people covered 20 years ago
who had pensions and pension benefits than have it now.
So there is a whole category of construction workers who not only
have no health benefits; they have no pension benefits as well. These
are the same people, the same people who want to criticize the Davis-
Bacon prevailing wages also are the people who fought against the
minimum wage. Minimum wage at least establishes a floor. Unfortunately,
in many areas the Davis-Bacon prevailing wage rate is close to the
minimum wage rate.
Minimum wage, as we have pointed out before, is too low. It is
presently $4.25 an hour, and we voted a few weeks ago on the floor of
this House to raise the minimum wage. And after we raise it, if we get
the other House to pass the bill, after we raise it, it will go from
$4.25 an hour over a 2-year period to $5.15 an hour. This is very low,
but there are many Davis-Bacon workers, people who are covered by
Davis-Bacon who are very close to this minimum wage.
Mr. Speaker, how can $4.25 an hour with no benefits be called
inflationary by any rational and thinking person? How much longer can
he go? At those rates, no one can support a family. Surely none of my
esteemed colleagues would want to maintain that you can live on $4.25
an hour, working 40 hours a week every week of the year. Construction
workers, as we know, do not work on a regular basis like other folks.
They have very uneven working periods due to the weather and a number
of other factors.
So here we have a situation where the Republicans in the House, the
Republican majority in the House is insisting that we must go ahead and
do something radical again. We have a situation where extremism is the
only answer to the problem. The Members of the Senate have looked at
the problem, and they have said: We need to have some reform, and we
are willing to go forward with reform.
But they did not say we need to be radical and extreme, and we need
to repeal Davis-Bacon. They started with that discussion. There were
people in the Senate who were maintaining that we should repeal Davis-
Bacon.
What happened on May 22, 1996, just a few weeks ago? They started
with a
[[Page H5998]]
discussion of a repeal of Davis-Bacon. And then it was proposed by
Senator Santorum that they once and for all for this session of
Congress decide that we are either going to repeal or reform. He was in
favor of reform.
Senator Santorum, and I quote him, I quote him from an ad that
appeared in Roll Call, and it is available for all who want to see it.
Senator Santorum said, ``We have just voted, we just voted on whether
to repeal Davis-Bacon. Many of us are not for repeal of that. We
believe that there need to be reform of the Davis-Bacon law and that
we, in fact, should assume that for the purposes of the budget we are
going to be reforming Davis-Bacon. I think there is bipartisan support
for reform of Davis-Bacon. I wanted the Senate to go on record for that
reform measure.''
That is what Rick Santorum, a Republican from Pennsylvania, said on
May 22, 1996, as a result of the leadership taken by Senator Rick
Santorum, formerly a Representative from this body, a Republican, as a
result of the leadership that he took the Senate voted 99 to 0 for
Davis-Bacon reform, not repeal, Davis-Bacon reform.
The Senate voted for Davis-Bacon reform because they understand that
Davis-Bacon should be kept alive and remain in force because it
encourages the private sector to invest more than $400 million in vital
training programs, $5.75 billion for privately funded health care, and
$4.3 billion for privately funded pensions. The Senate understood that
Davis-Bacon is not racist.
In fact, national civil rights organizations and the Congressional
Black Caucus strongly support Davis-Bacon because it provides training
and employment opportunities for minorities through apprenticeship
programs. Davis-Bacon does not mean union rates. Unfortunately, I do
not think that is so great. I think we should have union rates because
union rates are far closer to what reality is in terms of people
needing a decent wage, because Davis-Bacon does not seek to solve that
problem.
Davis-Bacon was not designed to solve the problem of collective
bargaining, just as Davis-Bacon has nothing to do with racism or civil
rights. It was not designed for that purpose. It has, as a byproduct,
produced a situation where you have contractors and unions willing to
work together. Because Davis-Bacon helps to stabilize the industry, you
have had great benefits flow for civil rights for the improvement of
the opportunities for minorities to work in the construction industry.
But that is not what it is about. Davis-Bacon is not for civil rights,
not designed to correct the problem of racism.
We need lots of measures to go to work on correcting problems of
racism throughout our whole society, and certainly some problems within
the construction area, but this is not what Davis-Bacon is designed to
do.
Mr. Speaker, Davis-Bacon was not designed to replace collective
bargaining. Davis-Bacon does not mean union rates. Seventy-one percent
of prevailing wage rates issued by the U.S. Department of Labor are
nonunion rates. Eighty percent of the wage decisions issued by the
Department of Labor contain a rate of $10 or under. Davis-Bacon does
not set the wage rate; it reflects existing community standards.
Mr. Speaker, I submit this statement of the Senate's vote, 99 to 0.
It appeared in advertisement form in Roll Call.
I submit the material for the Record.
Why Did the Senate Just Vote 99-0 for Davis-Bacon Reform?
On May 22, 1996, the United States Senate, heeding the
voices of more than 21,000 construction contractors and
millions of American workers throughout the nation, voted to
reject plans to repeal the Davis-Bacon Act. By the
overwhelming margin of 99-0, the Senate endorsed bipartisan
reform to preserve Davis-Bacon.
The Senate voted for Davis-Bacon because:
It encourages the private sector to invest more than $400
million in vital training programs, $5.75 billion for
privately funded health care and $4.3 billion for privately
funded pensions;
Davis-Bacon is not racist. In fact, national civil rights
organizations and the Congressional Black Caucus strongly
support it because it provides training and employment
opportunities for minorities through apprenticeship programs;
Davis-Bacon does not mean union rates: 71% of prevailing
wage rates issued by the U.S. Department of Labor are non-
union rates. 80% of the wage decisions issued by the
Department of Labor contain a rate of $10 or under. Davis-
Bacon doesn't set the wage rate, it reflects existing
community standards.
Ultimately, the U.S. Senate rejected the scare tactics and
misinformation employed by Davis-Bacon's detractors:
We just voted on whether to repeal Davis-Bacon. Many of us
are not for repeal of that. We believe that there needs to be
reform of the Davis-Bacon law and that we, in fact, should
assume that for the purposes of the budget. I think there is
bipartisan support for reform of Davis-Bacon. I wanted the
Senate to go on record for that reform measure--U.S. Senator
Rick Santorum (R-PA), Congressional Record, May 22, 1996.
Stop the lies. Reform Davis-Bacon now. Pass H.R. 2472/S.
1183.
Mr. OWENS. Mr. Speaker, there are efforts afoot, and part of this
comes from the same committee, the committee I serve on, the Economic
and Educational Opportunities Committee. It comes from a subcommittee I
serve on, the Subcommittee on Workforce Protections, an effort to
promote a concept called the TEAM Act where they try to say that they
want to take steps to give management and labor a chance to work more
closely together, and they think we need to legislate this. Those of us
who oppose the TEAM Act say that the legislation and the context of
union-busting that is taking place in the country now is another form
of intimidation, another form of ambush that can be set for workers and
that we do not need a TEAM Act; what we need is more freedom to
organize.
We need new regulations, and perhaps a change in the law, not
perhaps, but certainly a change in the law which would allow workers to
organize more freely and without having to go through the tremendously
long waiting period and the bureaucratic struggle they have to
undertake now in order to organize, get a vote, and be recognized.
The advantage at this point is on the side of management, and
management has used that advantage in many ways. So, we oppose the TEAM
Act.
Mr. Speaker, here is another way to have management and labor work
together without interfering with the collective bargaining process and
without interfering with the union organizing process. The contractors
in Davis-Bacon, those who are part of the process of building Federal
buildings and have for years found the stability of the Davis-Bacon Act
and the kind of environment that it creates to be good for business,
not for higher profits necessarily, but for stability which gives them
a workforce that has skills, a workforce that is stable and will be
around, that allows them to treat their workers in some kind of humane
way and give fringe benefits like health care and pensions. The Davis-
Bacon employers are very different from the non-Davis-Bacon employers.
{time} 1830
The contractors who are against Davis-Bacon are the ones who are the
most unscrupulous contractors seeking to maximize profits by exploiting
workers. They want to take one group of workers in one part of the
country at very low rates and move them to another part of the country,
and capitalize on the fact that they are exploiting those workers.
Usually those workers are not as skilled as the people who come up in
a situation under Davis-Bacon, and they usually provide a whole series
of problems. They generate a whole series of problems in construction.
They do not do as good a job, they have many problems. We have some
very substandard buildings that have been constructed and others that
have to be corrected. There are problems when you have workers who are
working at the very lowest wages, workers who do not have health care
benefits and workers who cannot look forward to a stable long-term job
and any pension benefits.
So, we have instead, a situation where contractors, employers,
management, have taken the initiative to put forward the best possible
condition for workers. Workers, on the other hand, have responded and
they have in many cases made alliances to the benefit of the total
community. It is the total community that Davis-Bacon is concerned
with, and it is not inappropriate for the Federal Government to be
concerned about the total community.
When it goes to build a building, building a building or constructing
any project within a community or a locale is not the only thing the
Federal Government should be concerned about.
[[Page H5999]]
The Federal Government has to be concerned about what it does to that
community and what the response is in terms of the labor market and the
total environment of that community.
This is not anything unusual. We have a defense budget which has been
slowed down. We have not dealt with closing bases in a helter-skelter
manner. Closing bases has been a slow process. We appointed a
commission. We have taken every precaution to make certain that the
closing of bases, which are military bases, be done in ways which do
not injure communities, be done in ways which minimize the dislocation
of workers.
So the Federal Government is in the business of defending the
country. Military bases are constructed as part of a process to
contribute toward the defense of the country, but the Federal
Government does not ignore what our military posture and our military
changes with respect to bases or the movement of any facility does to
communities.
Why should it be any different in the construction of large Federal
projects, whether you are constructing highways, bridges, or you are
constructing buildings? Why should it be different? Why should the
Federal Government not try to maximize the impact on that community?
I congratulate Senator Santorum because he comes from Pennsylvania.
Davis came from New York, Bacon from Pennsylvania, vice versa. I do not
remember, but one of them is from Pennsylvania, one is from New York.
It is altogether fitting and proper that a Pennsylvania Senator should
take the initiative at this time and provide some light on the subject
for his fellow colleagues in the Senate.
Let me just talk a bit about the Contractors Coalition for Davis-
Bacon and some of the statements that they have made. These are
businesspeople. I do not think the Republican majority wants to be in a
position of turning its back on small businesses or large businesses.
They are the ones who say that the future of the country is certainly
tied up with what happens in the private sector.
I do not exactly agree that the private sector can make magic, but I
think a partnership between the private sector and the public sector is
very much in order, and in Davis-Bacon you have a great partnership
between the Government and the private sector, between management and
labor, and that is what some of these contractors are talking about. I
want to just quote from a few of them.
Thomas H. Parkinson, president of the Burris Construction Co., Mount
Laurel, NJ:
The Davis-Bacon Act insures that we are bidding on a basis
that will allow the use of skilled labor. To think that
merely reducing the cost of labor will provide a cheaper
product is ludicrous.
Matthew Card, president of KEC Engineering, Corona, CA:
Davis-Bacon provides added value to virtually every facet
of our lives, from the superior quality of our public
improvements to a more stable productive society that has the
ability to contribute constructively to the future of our
great country. Fair wages are a requirement to attract
high quality people to provide high quality construction
products. One only has to look outside our borders to see
the destabilizing and potentially dangerous effects of
widespread low wages and poverty.
Ronald J. Becht, executive director of the Northern California
Drywall Association based in Saratoga, CA:
As you know, the Davis-Bacon Act does not specify union or
nonunion nor should it; it does, however, establish a minimum
wage to be paid all workers which enables those contractors
who have made the commitment to pay for worker training and
who are able to retain their work force by paying a higher
wage, to at least compete with those who are not willing to
fund the future of their industry. Elimination of the Davis-
Bacon Act which stabilizes wages would only serve to
exacerbate the current problem of skill shortages in the
construction industry. Since the public entity is required to
award to the low bidder, low wages would be further depressed
by unscrupulous contractors in a mad scramble to underbid
each other in order to win public contracts--to the detriment
of all.
Troy T. Comer, Jr., executive vice president, Associated General
Contractors of Indiana:
This is going to be a tough issue for the Congress to
address, because there is a lot of misleading and incorrect
information floating around which would give the impression
that repeal of the Davis-Bacon Act would save the taxpayers
heaps of dollars. We disagree. Quality of construction and
the taxpayers are well served with the Davis-Bacon Act.
Judith L. Striebinger, president of Eastern Steel Constructors, Inc.,
Fallston, MD:
To think that not maintaining a standard for wages and
benefits will, in any way, be an asset can only be mentally
developed by people who are outsiders looking in and not
aware of the complexities of the industry.
Experience increasing difficulty in executing projects
leading to higher cost and extended construction schedules at
a time when our industry is under severe cost pressure.
That is a quote from W. Douglas Ford, executive vice president of
Amoco Corp., in the BNA Construction Labor Report on November 22, 1995.
I quote from Robert Gasperow, executive director, Labor Research
Council:
Attracting qualified young workers has to be the biggest
long-term problem the industry has. It is possible that the
industry has sufficient numbers of workers but their quality
is not good enough.
And the final quote from Matthew Brown, Associated Press, in the Salt
Lake Tribune:
Beyond the upbeat statistics for soaring construction
employment and a doubling in the value of commercial
construction over the past 3 years is a desperate campaign to
find workers with enough skills to get the job done.
We have a problem in the quality of work that is being produced by
the fact that too many unscrupulous contractors are already at work in
the construction industry and seeking to now destroy Davis-Bacon
protection.
Mr. Speaker, I submit in its entirety a statement called Contractors'
Coalition for Davis-Bacon--Reform Yes, Repeal No.
Contractors' Coalition for Davis-Bacon ``Reform--Yes, Repeal--No''
Here's what some of our contractors have to say about the
Davis-Bacon Act:
Thomas H. Parkinson, President, Burris Construction, Mount
Laurel, NJ: ``The Davis-Bacon Act insures that we are bidding
on a basis that will allow the use of skilled labor. To think
that merely reducing the cost of labor will provide a cheaper
product is ludicrous.''
Matthew Card, President, KEC Engineering, Corona, CA:
``Davis-Bacon provides added value to virtually every facet
of our lives, from the superior quality of our public
improvements to a more stable productive society that has the
ability to contribute constructively to the future of our
great country. Fair wages are a requirement to attract high
quality people to provide high quality construction products.
One only has to look outside our borders to see the
destabilizing and potentially dangerous effects of widespread
low wages and poverty.''
Ronald J. Becht, Exec. Director, Northern CA Drywall
Contractors Association, Saratoga, CA: ``As you know, the
Davis-Bacon Act does not specify union or non-union nor
should it; it does, however, establish a minimum wage to be
paid all workers which enables those contractors who have
made the commitment to pay for worker training and who are
able to retain their workforce by paying a higher wage, to at
least compete with those who are not willing to fund the
future of their industry. Elimination of the Davis-Bacon Act
which stabilizes wages would only serve to exacerbate the
current problem of skill shortages in the construction
industry. Since the public entity is required to award to the
low bidder, low wages would be further depressed by
unscrupulous contractors in a mad scramble to underbid each
other in order to win public contracts--to the detriment of
all.''
Troy T. Comer, Jr., Exec. Vice President, Associated
General Contractors of Indiana, Inc.: ``This is going to be a
tough issue for the Congress to address, because there is a
lot of misleading and incorrect information floating around
which would give the impression that repeal of the Davis-
Bacon Act would save the taxpayers heaps of dollars. We
disagree. Quality of construction and the bottom line are
what really count, and we think the taxpayers are well served
with the Davis-Bacon Act.
Judity L. Striebinger, President, Eastern Steel
Constructors, Inc. Fallston, MD: ``To think that not
maintaining a standard for wages and benefits will, in any
way, be an asset can only be mentally developed by people who
are outsiders looking in and not aware of the complexities of
the industry.''
John D. Porada, Exec. Director, Associated General
Contractors of OH, Cleveland Div., Cleveland, OH: ``The
construction industry is a highly competitive and high risk
business that must attract the most productive workforce in
the quest to be the lowest responsible bidder. Joint labor/
management apprenticeship training programs provide the
resources needed to train workers and is primarily self
sufficient without the need for major financial assistance
coming from the government. Repeal of the Davis-Bacon Act
could have a very negative impact on the continuance of this
type of joint apprenticeship training programs.''
[[Page H6000]]
Dominick J. Graziano, President, Dominion Construction
Services, Inc., New Kensington, PA: ``We have had no problem
complying with the intent of the Davis-Bacon Act and wish to
add that it has in turn guaranteed those municipal or
governmental bodies a higher degree of quality and conformity
with the design intent by eliminating just anybody who wished
to call himself a contractor. It has functioned as part of a
base to provide experienced contracting and insure that all
contractors bidding on prevailing wage projects bid in an air
of equal and fair process with respect to such expenditures
of public revenue.''
Kimberly Igo, President, Kim Con Inc. Sarver, PA:
``Repealing Davis-Bacon would destroy the equal bidding
process and would cause the loss of many skilled tradesmen
which I have access to with a mere phone call. This would
also hurt the families of the people who put Congress members
in office. Like you, they too deserve a fair wage.''
John Busse, Chairman, Master Builders' Association of
Western PA, Pittsburgh, PA: ``The absence of the prevailing
wage will force employers to drive down wages to the lowest
possible level in order to compete for federal construction
projects. Further, repeal of the Davis-Bacon Act will
negatively impact training, health insurance, pensions,
federal and state taxes, social security and local
economics.''
Ned W. Bechthold, President, Payne & Dolan, Inc., Waukesha,
WI: ``Welfare reform must be accompanied by an atmosphere
that will allow minorities and others to work in our central
cities at rates of pay that will permit them to raise
families. Davis-Bacon accomplishes this.''
Francis X. McArdle, The General Contractors Association of
New York, Inc. ``Our heavy construction contractors survive
and thrive on the effectiveness of their workforce, not on
the shine of the equipment. The best assets leave each day at
the end of the shift. Those assets are most productive when
they are paid enough to work without family worries and are
able to contribute to their communities.''
____
``Experience increasing difficulty in executing projects
leading to higher cost and extended construction schedules at
a time when our industry is under severe cost pressure.''--W.
Douglas Ford, Executive Vice President, Amoco Corp., BNA
Construction Labor, Report, November 22, 1995.
``Attracting qualified young workers has to be the biggest
long-term problem the industry has. It is possible that the
industry has sufficient numbers of workers but their quality
is not good enough.''--Robert Gasperow, Executive Director,
Labor Research Council, BNA Construction Labor Report,
October 18, 1995.
``Beyond the upbeat statistics for soaring construction
employment and a doubling in the value of commercial
construction over the past three years is a desperate
campaign to find workers with enough skills to get the job
done.''--Matthew Brown, Associated Press, The Salt Lake
Tribune, July 8, 1995.
Mr. Speaker, I am saying that we have no small item here on the
agenda. Certainly the Democrats on the Committee on Work Force
Protections are battling an onslaught, an assault against working
families that is being waged across the board. As I have said before,
they have attacked the Fair Labor Standards Act, they have attacked
OSHA which provides protection for workers including construction
workers. They have attacked the right to organize by drastically
proposing to cut the budget of the National Labor Relations Board and
there is legislation to curb the powers of the National Labor Relations
Board. As I have previously stated, we were caught by surprise by this
onslaught against working people. The Contract With America did not say
anything about trying to make the workplace of Americans less safe.
OSHA was not mentioned in the Contract With America. So we were caught
by surprise. It was a sneak attack on working people, a sneak attack on
people out there who go to work every day and deserve to have safe
places to work, a sneak attack on people who do not deserve to have the
Fair Labor Standards Act tampered with.
They are proposing now to get overtime. They want the overtime of
workers to be captured by management, by employers. Instead of paying
overtime, they are proposing to extend the provisions in law which
provide for compensatory time, compensatory time which is very
difficult to control and to enforce without it being to the advantage
of the employers and the management at the expense of the workers.
What does all this have to do with my district, the 11th
Congressional District in Brooklyn? What does it have to do with the
large percentage of people out there who are unemployed? We have had
unemployment at the level of 20 percent for adults and close to 30
percent for young adults for a long, long time. One of the areas that I
get the most complaints about is men who want to work, so they would
like to have more work to do and they would also like to work on
contracts which have Federal funds involved. We have quite a number in
New York City of projects that involve Federal funds, the projects
which are related to transportation, projects which are related to
government buildings. There are a number of areas where young men,
healthy men want to get jobs.
What we find often in the streets of New York and on various
federally related projects in New York is you find people who are
complete strangers from the outside, even with Davis-Bacon in force,
they are getting through and disrupting the labor supply at the local
level. Our men in Bronxville and our men in Bedford-Stuyvesant and our
men in East New York and our men in East Flatbush who want to work on
the construction industry--I should stop saying men because there are
women now who also work on these jobs--are finding that they have
people from the outside who are working for the companies who have come
in and bid it on a low basis, even with all the constraints and the
oversight of the controller's office. In New York City, it is the
office of the controller that oversees prevailing wages. I am told that
they do a pretty good job of that, but even then there are large
numbers of contractors who are not local contractors who come in and
take advantage of government work because of the fact that they are
able to maneuver around some of these prevailing wage laws.
There have been some scandals recently and they have fined many
contractors for violating Davis-Bacon. The last thing we want to do is
have a situation where Davis-Bacon is not there as a control on the
contractors who bring in outside workers. This thing can go to
worldwide levels. It is not exaggerating to say that if you do not heed
the lesson of Davis and Bacon, two Republicans, who in the 1930's saw a
problem with Government contracts being let to people who could come
from any part of the country and use cheap labor from one part of the
country to undercut the wages in another part of the country, if you do
not heed that wisdom, you may have the situation where under NAFTA and
under GATT, they will be coming from outside the country.
Eventually NAFTA and GATT will bring down all the walls and you will
have contractors who can come from any part of the world and bid on
contracts in any areas of the United States. You have an advantage
going to those contractors. You can have Japanese contractors who
operate out of Mexico. They have the skills and whatever it takes to
put together the proposals and to come in at low cost but they will use
workers that come across the border from Mexico. Or you would have
workers who are transported in from Bangladesh. There is a certain
percentage of people in every job that could come from outside
according to the way the GATT and the NAFTA laws work. So it could go
to ridiculous proportions if you just take away all of the kind of
protections that are provided by the Davis-Bacon Act. This thing could
keep going.
Prevailing wage is a sound concept. Prevailing wage probably is more
sophisticated than the minimum wage. The minimum wage applies across
the country assuming that economic conditions are the same in all parts
of the country. The minimum wage does not take into consideration that
there is a higher standard of living, the cost of living is higher in
one part of the country than it is in another. Davis-Bacon does that.
Davis-Bacon does not try to disrupt one community and bring it down to
the level of the lowest common denominator in America. If you did not
have Davis-Bacon, then all construction workers would be making these
fantastically low salaries that are paid in places like North Carolina.
let us just take North Carolina as an example. I have a book here
which has prevailing wages all across the country in various places,
from Abilene, TX, all the way to New York City.
{time} 1845
And you would be surprised at what it shows in terms of the
comparison between the wages that Davis-Bacon workers make and the
average pay for all workers. In many instances the pay of workers under
Davis-Bacon is far lower than the average.
[[Page H6001]]
I wonder how the Labor Department computes these prevailing wages,
because generally they come under the average worker's wages in these
areas. Any Member of Congress who would like for me to give them a
rundown on their area, I would be happy to do it. We can tell them what
is happening with respect to Davis-Bacon rates and we can bring some
light onto the situation.
The heat, the energy of the House is out of control, and the Senate
has showed it wants to bring light into the situation. I think the
House should make an effort to try to bring some light into the
situation.
Let us take a look not just at North Carolina but the 10th
Congressional District in North Carolina. Representative Cass
Ballenger, my colleague who heads the Subcommittee on Work Force
Protection. Representative Ballenger probably does not know that
boilermakers in this area, who work for no fringe benefits, and
boilermaker is one of the highest skills, I started at the top, a
boilermaker's hourly wage is $16.20. They are highly skilled people.
The fringe benefits for them, they do have some fringe benefits, they
amount to about $4.10 an hour. Add it together and the average annual
salary for a boilermaker in the 10th Congressional District is as high
as $22,680. That is as high as you get.
Let us take the other extreme and take a look at the laborers in the
10th Congressional District of North Carolina and we find that they
make $4.41 an hour. The laborers. And they have no fringe benefits. No
health care, no pension. And their annual pay comes out to $6,174.
These annual pays are computed on the basis of 1,400 hours for the
construction industry employees, and we can see that in North Carolina,
in the 10th District, all the categories except one, boilermaker of one
level and boilermaker of another, they are the royalty, all the other
categories are lower.
Boilermaker, as I said before, makes $16.20. Another boilermaker
classification makes $12.96 per hour. And then you get to electricians.
Very skilled people, $10.26 an hour, and no fringe benefits. The
average annual salary of an electrician in the 10th Congressional
District in North Carolina is $14,364.
Now, I am using statistics that come from the survey done by the
Labor Department and these compilations done by the National Alliance
for Fair Contracting. They have compiled this, but it is based on the
survey done by the Department of Labor.
A plumber makes $7.42 an hour, no fringe benefits. Average salary of
a plumber under Davis-Bacon, $10,388 in the 10th Congressional District
of North Carolina. Now, plumbers in New York would go, wow. Plumbers in
most of our large cities would go berserk if you tried to offer them
$7.42 an hour.
Cement mason in the 10th Congressional District of North Carolina,
$6.11. Carpenter, $6.63. Truck driver, $4.67. Millwright, $5.27 an
hour. I told you the laborer is the very lowest, $4.41 an hour. As
anyone can see, $4.41 is slightly above the minimum wage of $4.25 an
hour. Pavement roller operator, $4.98 an hour. And we think those guys
have good jobs, good paying jobs, but even under Davis-Bacon, when
Government funds are involved, these are the salaries, these are the
hourly wages.
Asphalt raker, I just said $4.93 an hour. All these people have no
fringe benefits, the last ones I have read. Only two categories have
any fringe benefits. The bulldozer operators. We always think of
bulldozers, they are symbolic of what construction contractors outside
do on the highways in preparing for new buildings, when they are
building the cellars. A bulldozer operator has a kind of prestige in
the minds of kids and a lot of other people as being standard for
working class America's very best.
In North Carolina bulldozer operators make $5.96 an hour and no
fringe benefits. That comes out the $8,344 per year, less than the
minimum wage of a person who works on a steady job all year long,
because construction work is based on 1,400 hours for construction
industry employees.
So here we have a situation in the district of the chairman of the
Subcommittee on Work Force Protection, the committee in the House that
is leading the fight to destroy Davis-Bacon, and the workers there are
only slightly above minimum wage in most categories, and in categories
which require considerable skills they are working at jobs that do not
have any fringe benefits and are generally very low paying.
We can take examples right across the country and find the same kind
of problem. Let us take a few examples, If we go to Abilene, TX, what
is surprising is that in Abilene, TX, a place like that, we have the
average pay for all workers, people who work for a living and work for
hourly wages, their averages pay is $20,000 a year for all workers.
All of the Davis-Bacon construction worker are below what other
workers are making. This is annual income. Annual income is $20,000 for
the average worker, the average worker's pay. an electrician makes
$14,000. Electrician. Backhoe operator, $13,000. Iron worker, $12,000.
Carpenter, $11,000. and laborer, $8,552. These are wages that are under
the wages that other workers are making in the same area.
Prevailing wage has really not given them any kind of advantage.
Prevailing wage is not designed to do that, unfortunately. I wish it
were. Prevailing wage is just what it says; it is based on the
prevailing wage. I wonder and I question why it always seems to be that
the prevailing wage falls in so many instances under the average wages
being paid in a given locale.
Let us take another example. Gainesville, FL. In Gainesville, FL, the
average pay for all working people who work on hourly wage jobs is
$21,300 per year. The closest you get to that is the electrician under
Davis-Bacon, $10,800 a year. Now, we do not have to be mathematical
geniuses to see we are talking about a little more than half, a little
more than half of what the average worker makes in Gainesville.
We are not comparing Gainesville to New York or Chicago; we are
comparing the Gainesville workers in other categories, the average
worker level, $21,300 under Davis-Bacon, an electrician $10,800, a
cement mason, $9,800, carpenter $9,109, iron worker, $8,355, backhoe
operator, $6,000, laborer, $6,000. In Gainesville, FL, Davis-Bacon
really does not help workers to rise above or even match the local
level.
Let us go back to North Carolina. Greensboro, Winston-Salem, High
Point, NC, in the same area, same survey applies to them all. If you
average the pay of the workers in Greensboro, NC, you come out with an
average annual salary of $23,000. The average annual salary for all
wage earners, all workers, is $23,000.
The best you can do in terms of coming close to that under Davis-
Bacon is a boilermaker who makes $12,000, an electrician, $11,600, an
iron worker, $10,274, a bricklayer, $10,118, a painter $9,421,
carpenter, $9,000, backhoe operator $8,682, cement mason, $6,267.
Is Davis-Bacon enriching workers at the expense of the American
taxpayers? What we hear on ABC's ``20/20'' is a distortion. ABC's ``20/
20'' had a documentary piece on Davis-Bacon which did not make any
pretense of being objective. If ever there was a contracted piece
seeking to discredit a program that has been in existence since 1931,
it was the piece that ran on ``20/20'', which described Davis-Bacon as
being a swindle of the taxpayer.
They gave none of the facts about how the survey was done to
determine what the prevailing wage is. They gave none of the facts
about how the salaries of the workers that they depicted in Chicago
compared to other construction workers. They distorted the situation
and made it appear that Davis-Bacon was responsible for the fact that
so many of the workers were white versus the workers who were
unemployed in the same area who were black, as if Davis-Bacon was
designed to solve the race problem. It is not.
They did not talk about a program which relates to Davis-Bacon called
the service contract, based on the same principle. Federal workers who
are service workers, also governed by the prevailing wage law, called
the service contract law, and that does have large numbers of
minorities, blacks and other people, who are covered by that provision.
But the real point here is not to relate to who is covered,
minorities, mainstream, et cetera. I dealt with that before, and I
would like to focus here on the astounding fact that Davis-Bacon
workers do not get close to the average pay of other workers in the
[[Page H6002]]
same area. Inflation is not caused by Davis-Bacon workers.
Jacksonville, FL: Average pay for all workers, $24,000 dollars;
average pay for working people, wage earners, $24,000. The closest you
get to that in Davis-Bacon is the iron workers in Jacksonville, FL.
They make $15,000 average, $15,200. And the backhoe operators, way down
to $10,000, carpenter, $9,951, and the laborer down to $7,000.
I can find it for any Member who would like to know the facts. As I
said before, the Senate has spoken. The other body has made it clear
that they do not feel that Davis-Bacon should be repealed. The wisdom
of 1931 of Davis and Bacon still prevails. It makes sense to use
Federal money for construction projects. Whether you are constructing
highways or bridges or building Federal buildings, it makes sense to go
into a community and try to maintain the stability of that community by
paying the workers at the same level that other workers are paid.
Unfortunately, Davis-Bacon is certainly not close to, in most cases,
what really is the prevailing wage. For some reason it always comes
under. Not always, there are a few exceptions, but it comes way under
in most cases what is really the prevailing wage.
Davis-Bacon is not driving up the cost of building, I assure you. In
Macon, GA, we have the same pattern. We are talking about the average
pay for all workers in Macon, GA, $23,000, workers who are hourly
workers.
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