President's Column - The Continuing Looting of Katrina Victims

The poor and disenfranchised in Louisiana, Texas and other places hit by the double whammy of Hurricanes Katrina and Rita are now facing other problems. These problems are not a force of nature but the fact of anti-worker, pro-corporation, give to the big donors’ avarice. In places devastated by the hurricane and the accompanying debacle, President Bush placed another burden or two on their backs. First he announced that the construction work to recover and rebuild would be let usually to the same cast of construction cronies by a no-bid system and that they would be relieved from paying the prevailing wage rate under the Davis-Bacon Act.

In an area where unemployment is at an all time high and with no work to be found, the President proudly announced that the towns will be rebuilt and the “victims” would help in the process. Jobs for all! But at what price?

This reconstruction is federally funded and therefore under the federal “Prevailing Wage Rate”, but the President signed an Executive Order waiving that law. In addition, to pile on the downtrodden, the Office of Federal Contract Compliance Programs (OFFCCP) has waived any requirement for these “no-bid” contractors to have an affirmative action plan. Most of these contractors have had to be in compliance for other federally funded construction in the past, but waiving the requirement that mandates them to have fair hiring practices. To add insult to injury less than 10% of the work will be given to local contractors.

The irony is that the prevailing wage rate for the New Orleans area is around $9.00 per hour and similar around the rest of the stricken areas, which is barely over the poverty level at best. The continuing irony is that less than. A recent study by the Congressional Research Service says that suspension of Davis-Bacon Act wage rules would not necessarily ensure federal contracts hold reconstruction costs in this area. Conservatives and liberals in Congress have been pushing competing measure regarding this issue. Conservatives are pushing legislation that would automatically suspend the wage-protection law in areas designated by the president as disaster areas, while liberals are supporting several bills that would revoke Bush’s suspension of the law. In the Congressional Research Report poses the question,” Perhaps the most frequently asked question concerning the Davis-Bacon act is: would the federal government (and the taxpayer) save money if the Davis-Bacon Act were repealed or modified to narrow its scope? The short answer is: No one really knows. Conversely, might Davis Bacon result in savings to the federal government in its purchase of construction? That too, would seem to be an open question,”CRS argues in “Davis-Bacon Suspension and Its legislative Aftermath.”

According to CRS, drawing conclusions about the law’s effects on contracting costs is impossible because “the state of current research would probably be insufficient to justify just an assertion.”

But the more pointed question is why give contracts to “friends” without competitive bidding, and then to skimp on the wages paid to the workers? It would be much better to give the bulk of the work to the local contractors, make them pay at least the prevailing wage rate. The money would stay in the area and bolster the economy.

The best way for the Bush Administration to rebuild these areas would be to stop the looting of taxpayer dollars, provide the victims of the tragedy a way to help them get out of poverty with dignity and fair wages.