Highways will be packed this Labor Day weekend as families visit lake houses and relatives, trying to make the most of the dwindling summer. Along the way, many drivers will gripe about the condition of their state’s roads: Too bumpy, not enough lanes, etc. Few will mention a simple solution for better infrastructure: Repeal prevailing wage laws.
In 32 states, prevailing wage laws have artificially pumped up the cost of state construction projects. The laws require that publicly-funded projects pay wages equal to an arbitrary standard, to those of a majority of workers in an area or to local rates based on collective bargaining, depending on the state.
Liberals should recognize that by repealing prevailing wage laws, millions in funding could be freed up for their other pet projects. Schools, public universities, parks and other priorities would have more money for new or renovated facilities.
Many states have been looking for more transportation funding. Rather than seeking ways to cut costs on transportation projects, legislatures often seek gas tax hikes or attempt to collect sales tax on online purchases. Instead of hitting taxpayers for more cash, repealing prevailing wage laws would free up more cash and ensure that workers get the wages they deserve.
Advocates claim that prevailing wage laws ensure public construction projects are of higher-quality than they would be otherwise. Rather than artificially force contractors to pay higher wages, states could set higher-quality standards and then let contractors bid to meet those standards at the lowest possible cost and in the most efficient manner.
Requiring higher pay doesn’t guarantee the final product will be high-quality. In fact, it could force contractors to spend more on labor and less on high-quality materials. Prevailing wage laws only ensure that government construction projects will cost more than they otherwise would.
For federal projects, the Davis-Bacon Act inflates the cost of construction projects by almost 10 percent. Repealing the Davis-Bacon Act would save billions of dollars, the Congressional Budget Office says. That money could be spent on reducing the federal deficit or bolstering infrastructure projects.
Prevailing wage laws are a relic of the Great Depression era. Davis-Bacon was signed into law by President Herbert Hoover in 1931. Many states followed suit, but 10 states repealed their laws or had them invalidated by court decisions. Eight others never had the laws to begin with. More states limited the scope of their existing laws.
Before states try to hit cash-strapped families with higher taxes for roads, they should seek ways to cut costs. Repealing prevailing wage laws are just one way easy way for states to do so.
