The Biden administration has come up with an innovative way to aid its union allies: redefining the word “prevailing” to mean its opposite. The administration is doing this to aid its allies in organized labor so they can receive more federal funding.
Specifically, the administration is proposing to make the Davis-Bacon Act, a law that has long been a sop to organized labor, even more of a benefit. The law requires any company that accepts a federal construction contract to pay its workers the “prevailing wage” for that occupation. In practice, that has meant that contractors must either have unionized workers or pay them as if they were unionized. The law’s purpose is to ensure that nonunion companies have no competitive advantage when bidding for federal contracts.
The Oxford English Dictionary defines the word “prevailing” as meaning “most common at a particular—the average. The Biden administration now wants to reinterpret the law so that “a wage rate will be considered prevailing if it is paid to at least 30% of such workers.”
The apparent intention is to get around one main of the main problems with Davis-Bacon: compiling reliable data on prevailing wages for a majority of workers isn’t easy. The Department of Labor acknowledges that the “process is burdensome on contracting agencies, contractors, and the department.” Rather than concluding that the burdensome nature of the process means that maybe the law is more trouble than it is worth and should just be scrapped, the administration has decided that it will instead keep it and just get by with less research.
Never mind that this undermines the ostensible purpose of the law: to ensure that workers get consistent wages for the type of work done. A sample based on just what 30 percent of workers earn means the mandated wages may not be the average for all workers. It could conceivably even create a continuous wage spiral if the sample mostly includes the top 30 percent of the wages paid. That would force the mandated wages for federal contracts wage rates to rise in tandem to keep up—not a great idea at a time when inflation risks are a concern.
But then again, Davis-Bacon has never truly been about ensuring fairness. It is about control. The Biden administration’s proposal to revamp Davis-Bacon to say that 30 percent can serve as the standard makes it obvious that the regulation serves no purpose other than to artificially manipulate wages according to an arbitrary federal standard. Here is a radical idea: Let the market determine what the wage rates should be. Who knows, it might even save taxpayers some money.