Posted on 09/15/2005 12:57:49 AM PDT by Cincinatus' Wife
SOME Houstonians who plan on moving to Louisiana and points east to get work in the Katrina rebuilding effort may discover their wages won't be as high as they might have expected.
That's because President Bush signed an executive order last week rescinding the rule that contractors on projects receiving federal money pay the prevailing wage in areas damaged by the hurricane.
"It's so important to have decent wages for these workers," said John Sweeney, president of the AFL-CIO. Sweeney visited the hurricane relief efforts in Houston and met with union leaders earlier this week.
Without it, he said, contractors will try to get away with paying the least amount they can, the federal minimum wage of $5.15 an hour.
"It's taking the low road," the union leader said.
The rule governing the prevailing wage — the average wage paid to workers in a specific trade in a certain geographic area — is supported by labor unions and other workers' rights organizations because it typically brings wages closer in line to union wages, which usually are higher than nonunion wages. Businesses oppose the prevailing wage because it pushes up costs and limits the number of workers they can hire. Lifting the rule will make the "unprecedented amount of federal assistance" go further and allow more workers to be hired, according to the president's order.
Union leaders angry
Labor union officials were outraged. Sweeney recalled how Bush tried to rescind the prevailing wage scale shortly after the Sept. 11, 2001, terrorist attacks. But a group of congressional, labor and business leaders got together to beat back that effort.
But there's not a lot of bipartisan support this time, Sweeney said.
"I think it's a great idea," said Randy Magdaleno, chairman of the Hispanic Contractors Association of Houston, who was pleased with the president's order.
"It's less paperwork," said Magdaleno, who is also president of Frontier Contractors and is thinking of going to Louisiana to bid on some of the work. "People can actually get to work."
Overall, construction wages will probably fall, he said. But on the flip side, contractors will probably hire more people.
In Harris County, the prevailing wage for a journeyman electrician is $22.05 an hour plus $7.93 an hour for benefits, according to the Department of Labor. In Orleans Parish, the prevailing wage for the same job is $22.09 an hour and $6 in benefits.
Longtime goal
Prevailing wages were first imposed during the Depression to prevent an influx of federal money from depressing local wages.
Republicans have wanted to do away with prevailing wages for a long time, said U.S. Rep. Gene Green, D-Houston.
"They have been trying to eliminate the prevailing wage, and I don't want them to use this disaster as an excuse," Green said. "I'd hope a lot of the people hired from the Louisiana, Mississippi and Alabama areas would be paid a decent wage to get back on their feet and rebuild their communities."
Green said he is supporting the bill filed earlier this week by Rep. George Miller, D-Calif., to reinstate the prevailing wage. But he doubts the bill will even get a hearing from the Republican-dominated House.
The only real hope to undo what the president has done, Green said, is to attach Miller's bill to other legislation.
Health care affected
The effect won't just be less money jingling in the pockets of those who are installing new roofs, running electrical wire or welding pipes together.
Taxpayers will end up footing much of the bill in a roundabout way, according to E. Dale Wortham, president of the Harris County AFL-CIO and a board member of the Harris County Hospital District.
With the requirement suspended for contractors to pay for employee benefits such as health insurance, many of the construction workers will end up at public health facilities when they get sick or injured.
In the end, Wortham believes it will be the contractors who will win.
lm.sixel@chron.com
That's the only statement he made that's true. The rest is a steaming pile
However, workers won't work at minimum wage, contractors will have to pay what the market dictates, not what the union dictates. That's why the union bosses are mad.
I don't hear the AFL-CIO "shouting from the mountain top", that the men and women in uniform, in our military deserve to get at least the minimum wage. The average NG soldier working the next 30 days, in the hurricane region, for an average of 12 hours a day. Will receive from $3.43 to $4.48/hr, and not receive overtime pay when they exceed 8hrs in a day. That is before state, federal, fica, and other taxes are taken out. I guess they don't care, since they can't get any union dues out of them, to line their pockets!!!
The rule governing the prevailing wage — the average wage paid to workers in a specific trade in a certain geographic area — is supported by labor unions and other workers' rights organizations because it typically brings wages closer in line to union wages, which usually are higher than nonunion wages. Businesses oppose the prevailing wage because it pushes up costs and limits the number of workers they can hire. Lifting the rule will make the "unprecedented amount of federal assistance" go further and allow more workers to be hired, according to the president's order.
1. The following GREAT projects of the 20th century could not have been created if the system of "prevailing wages" were followed.
a. Mount Rushmore.
b. The Hoover Dam.
c. Tennessee Valley Authority (TVA)
d. And numerous other "New Deal" projects.
2. Yes there will be a need to bring expert and trained workers from other states to Louisianna to rebuild it. But also, there should be a requirement for every "able-bodied" MAN & WOMEN that were evacuated from LA, and especially New Orleans, be brought back to the area, and help with the reconstruction.
a. Let's see if ole Jimmy Carter can work a MASSIVE "Habitat for Humanity" Project, in New Orleans. He still owes us for the disasters he caused during his four (4) years in the White House!!!
b. The activist like Jesse Jackson demand jobs for poor minorities, well now there will be many, and probably last for years. Plus, this will give these individuals a trade, that if they decide to eventually leave New Orleans and surrounding hurricane affected areas, they will have learned skills that they can take with them. Better than any gov't training program, that are squandered with waste by activists like Jesse Jackson, and his Rainbow Coalition.
Prevailing wages were first imposed during the Depression to prevent an influx of federal money from depressing local wages. Republicans have wanted to do away with prevailing wages for a long time, said U.S. Rep. Gene Green, D-Houston.
More like the practice of "prevailing" wages" were implemented "after" the Great Depression years, and during the WWII years, in the many war plants that were built. During the New Deal Days, many workers came to earn after a 16 hr/day, less than $5.00/day minus federal income tax, which was also introduced then.
::Some are starting to suggest that their contributions are worth at least a temporary visa. ::
At least those people are working. I have an idea, let's send those looters and whiners from NO to Mexico and allow those illegals who have a work ethic a temporary visa. I have a feeling we would be getting the better deal.
If those with a work ethic weren't also the same people willing to break any law that impedes their desire to "just have a better life", then I might agree with you.
Besides, Mexico wouldn't take the looters and whiners. ;^)
Without unions, without government intervention and with large supply of labor the wages will stabilize at the subsistence level.
In free market context the wages are seen as the cost/expense/necessary evil so the market optimization will bring them to the minimum.
I know that they should not be given temporary visas but honestly I would rather have a hard working illegal as a neighbor than the thugs of NO. I've live in the NO area and know that some of the things we saw happened before.
Perhaps we need to look at how the visas are alloted so at least we know who's here, if thorough background checks are done with temporary visas. Mexico isn't that stupid to take the thugs.
Actually, depending on the model you use, it would stabilize below subsistence. That way it keeps the workers beholden to the "company store".
Let the Market decide!
"...many of the construction workers will end up at public health facilities when they get sick or injured."
Since many will be illegals, they'll be on the public dole anyhow when it comes to health insurance. We may as well save some money on the front end.
This would be a perfect opportunity for some lawyer to send in some folks for jobs with these construction companies that hire illegals.
If turned away for a job, sue them.
Supply and demand and maybe even skill will dictate what wages are paid, what a concept.
Thank you. It actually just popped into my head. Must be my cynical nature. LOL
Usually prevailing wage and union workers are on government and commercial work and nonunion, non-prevailing wage is in the residential market.
Now, with all the residential units needing to be rebuilt with federal funds, it will have the effect of having union, prevailing wage workers working in the usual nonunion market.
I Can see why the President suspended Bacon-Davis.
Are you naive? Free market ideology stipulates that profits are good and should be maximized while wages are bad (as part of the costs) and should be minimized.
You have a point. BTW, the open borders policy is designed to provide the employers with the very cheap labor BELOW the subsistence level.
How is it possible? The immigrant workers live in the conditions not sufficient for normal families (like several young men sharing the small apartment), getting the medical services in emergency for free and including in their costs/gain calculation potential US citizenship (the last means allowing private employers to use citizenship as a part of pay package).
I love 'em to death. And the sooner, the better.
Fits right in with Bush's open borders policies. The work will be done by illegal aliens, no doubt. American jobs should go to Americans, period.
I can hear the response now, "We don't want no slave job. We want real jobs for real money. No jobs, no justice, no jobs, no justice..."
The Walmart business model?
In theory, yes, but not when your labor pool consists of illegal aliens -- I'm sorry, undocumented workers -- who are willing to work at third world wages.
One of the interesting things I have seen is what happens to the kids born to the illegal immigrants.
Most of them start complaining about the "other" illegals driving the wages down!
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