Labor unions spent an estimated $300 million helping elect President Barack Obama last year and he is wasting no time paying them back. His latest gift for the union bosses is his new executive order encouraging Washington bureaucrats to require costly Project Labor Agreements (PLAs) on federally funded construction projects worth at least $25 million. A PLA means only companies with unionized labor can bid on federal contracts. Costs increase as much as 20 percent as a result on contracts to build critically needed infrastructure like roads, bridges and office buildings.
Obama’s executive order thus bars from federal contracting thousands of companies that employee the 93 percent of private sector workers who are not union members. This is grossly discriminatory in addition to being a blatant pay-back to the labor bosses who control a tiny minority of all private sector workers. Forcing government contracts to include PLAs will also cost taxpayers more. Between 2001 and 2007 when PLAs were not mandatory for federal contracting, more than $123 billion in federal contracts were awarded. Those contracts would likely have cost federal taxpayers about $25 billion more had they included PLAs.
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The negative effects of Obama’s PLA payback to the labor bosses will extend to state and local government, too, as they often pattern their contracting practices after the federal government. And it is likely the government will have to devote more resources to defending the Obama order in court, as individuals and companies rightfully claim they are being denied equal protection of the law and freedom of association and seek legal redress. At a time of economic distress, the last thing government contracts ought to do is mandate sweetheart deals for union bosses, using tax dollars.
