Imagine, for a moment, that you’re growing a garden in your backyard. Among the laundry list of resources your crops need, water is arguably the most important. But the amount of water you provide is essential to your garden’s ultimate success. You can’t drown your crop and expect a period of severe dehydration to remedy the situation, to fix the damage done. Inconsistent and extreme gardening tactics do not wield a healthy and abundant crop. It simply results in a waste of water and dead crop – something we just don’t do in Arizona!
This simple analogy describes the predicament we find ourselves in when we start discussing federal contracts and the Davis-Bacon Act (DBA). DBA was created to require contractors to pay the “prevailing wage” on federal projects. These wages were to be determined by the local cost of similar jobs and often amount to pay set on union scales. And to many, that seems logical: a fair wage for a fair job. The problem that quickly arose, though, is that this wage isn’t fair. The Wage and Hour Division (WHD) of the Department of Labor (DOL) uses an obscure and factually inaccurate method of calculating these wages. They are flawed because they are error-ridden, years out-of-date, and do not accurately represent construction compensation.
Reforming Davis-Bacon makes sense. A DOL Inspector General (IG) audit found that 100% of the wage reports reviewed had some type of error. That wasn’t a typo. Every report the IG investigated in its audit indicated that wages were set either too high or too low for the local prevailing wage. As a Heritage Foundation report described, some wages were reported as being just “one-third of market wages prevailing in some counties and more than 75 percent about the prevailing wage in other counties.” And when Congress appropriated funds to fix these reporting inaccuracies, the Inspector General found even higher rates of error than before. Clearly, throwing money at a money problem isn’t going to solve anything.
Fortunately, there already exists a division of the federal government whose sole priority is to measure wage rates throughout the country. The Bureau of Labor Statistics (BLS) within the DOL produces wage data that is both scientifically accurate and up-to-date. The BLS has proven time and time again that they can accurately and transparently determine real-world national and local wages. If we were to utilize the expertise of the Bureau of Labor Statistics to calculate a more accurate prevailing wage we would save nearly $9 billion in federal contracting every year. The error-ridden status quo is fiscally irresponsible. The Congressional Budget Office has estimated that if we fail to reform DBA, upwards of $13 billion could be wasted over the next ten years.
The opposition – primarily backed by union lobbyists – says that reforming DBA is job-killing. They say supporters are trying cut the wages of middle-class Americans. They say if the system isn’t broke, why try to fix it. At the end of the day, all of these reasons are nothing more than rhetoric. Reforming DBA isn’t job-killing; it’s job-creating. If the government is paying workers a fair wage for a fair job, we hire five workers where we could previously only hire four. It doesn’t cut the income of the middle-class; it provides fair wages, especially to those unfairly receiving pay under the minimum wage. To say Davis-Bacon isn’t broke would be laughable if it weren’t so factually absurd. When the Inspector General reports that wage calculations are inaccurate 100% of the time, that’s not the designation of a broken system, it’s an indictment of a failed system.
Earlier this Congress, I introduced H.R. 1042, the Responsibility in Federal Contracting Act. It seeks to update the manner in which Davis-Bacon is calculated. Instead of looking at self-selected, union-managed reports, it asks DOL to calculate prevailing wages based on scientifically and statistically accurate data. My bill supports competition, equality, accuracy, and transparency for everyone. It would cut waste, create jobs, and save billions in the federal budget. It would restore a fair wage for a fair job and, at the end of the day, that’s what’s fair to the American taxpayer.
Congressman Paul Gosar, D. D. S., serves the people of Arizona’s 4th district in the U.S. House of Representatives.