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The economy is not the fault of working people

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Posted: Thursday, February 16, 2012 12:00 am | Updated: 5:29 am, Thu Feb 16, 2012.

A peer made the surprising statement that the Bacon-Davis Act had "accomplished little except to drive up wages; in particular, the cost of school buildings."

I have done bid take-offs for several school projects. It is not the wages that drive up the cost. It is the pork of politicians to bring jobs to their constituents that drives up the cost. The wages — aka unions — have little effect as we are all (the contractors) cutting costs everywhere we can to win the bids. Non-unions contractors win these jobs too.

The Bacon-Davis Act was passed by a Republican congress and signed into law by a Republican president. It was designed to keep low-wage outsiders from doing work in a politician's home district. The pork barrel spending was not lining the pockets of the politician's contributors. Bacon-Davis solved that!

It is notable that Republicans find no fault with someone who raises the price of their products so high that they can pay tens of millions of dollars in salary, benefits and contributions, or that politicians can get inside trading deals and a lifetime super-pension, or as in the case of our last president and congress, extend no-bid contracts to a vice president's company.

But the current condition of the economy is somehow the fault of regular people who want wages and benefits that let them live modestly. They are the real people building and maintaining the infrastructure of America.

I ask you, who is the real patriot?

Jerry Bransom

Lodi

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Welcome to the discussion.

22 comments:

  • Darrell Baumbach posted at 8:34 pm on Wed, Feb 22, 2012.

    Darrell Baumbach Posts: 9405

    Jerery... have been self employed since 1979... and have worked with this act for my clients during this time.

    I know exactly what I am talking abut and you are misunderstanding what I am saying

     
  • Jerry Bransom posted at 7:28 pm on Wed, Feb 22, 2012.

    Jerry Bransom Posts: 363

    DB - if you ever were a real employer, you would know how absurd your statements are. You have no idea beyond Google how Davis-Bacon works.

    db;"The employer has no rights to determine appropriate wage"???? He sure does - the wages are in a suggested minimum range, usually lower than anyone will work for. It is the STATE OF CALIFORNIA that increases the wages you are referring to!! I pay MORE than Davis Bacon wages every day.

    db;"The title of the workers job determines his wage..."??? NO...the Experience determines the TITLE! There are pay grades for helpers to journeymen, usually in 3 ranges.

    db;"..not how well the worker does his job.."?? I have fired many and sent the others back to the Hall as per my right as a contractor. Sheesh!! I don't even have to hire Union! I can hire anyone I want as long as I pay them a living wage - which I do!

    You just hate unions. How about giving them some credit for your benefits? Oh yeah.. you are just a middleman salesman. You can't actually build anything can you.

     
  • Darrell Baumbach posted at 2:20 am on Wed, Feb 22, 2012.

    Darrell Baumbach Posts: 9405

    Mr Litton...Good to see you have awaken from your nap... your point is interesting but wrong again...if you want to talk about original intent, the Cato Institute as an accurate take: “according to them, this act was passed by Congress in 1931 with the intent of favoring white workers who belonged to white-only unions over non-unionized black workers. The act continues to have discriminatory effects today by favoring disproportionately white, skilled and unionized construction workers over disproportionately black, unskilled and non-unionized construction workers. Because Davis-Bacon was passed with discriminatory intent and continues to have discriminatory effects, its enforcement violates the Constitution's guarantee of equal protection of the law. President-elect Clinton and Labor Secretary-designate Reich should therefore exercise their power of "executive review" and refuse to enforce Davis-Bacon.”

    Therefore, your feeble attempt to blame republicans for something happened before you and I were born is silly, especially since republicans and democrats are nothing today like they were then. So again, to say this is not about unions is absurd.

     
  • Tim Litton posted at 7:23 pm on Tue, Feb 21, 2012.

    Tim Litton Posts: 24

    @ DB, You’re absolutely right. Herbert Hoover and his union loving minions James Davis and Robert Bacon set up prevailing wage to hook up all of those big union fat cats for decades. Drat, those dastardly republicans and their right wing agenda. The republicans have far too long been in bed with those big union fats cats and their socialist agenda. C’mon get over yourself DB!

     
  • Darrell Baumbach posted at 8:29 pm on Sun, Feb 19, 2012.

    Darrell Baumbach Posts: 9405

    I understand Tim... when faced with attempting to comprehend both sides of the coin,
    it can be taxing causing one to yawn...you very nicely articulated the union mentality
    and perception.... but unfortunately, it is so unrealistic that anyone with any sense and objectivity would just shake their head in the futility getting someone like you to understand.

     
  • Tim Litton posted at 6:51 pm on Sun, Feb 19, 2012.

    Tim Litton Posts: 24

    yaawwn

     
  • Darrell Baumbach posted at 4:05 pm on Sun, Feb 19, 2012.

    Darrell Baumbach Posts: 9405

    Lets establish some facts that are not disputable.
    1. The Davis-Bacon Act is an old law by which the Department of Labor dictates the wages to be paid on federally financed construction projects.
    2. Wage determinations are on average about 25 percent higher than private sector real-world prevailing wages.
    3. It adds significantly to the cost of every project approved . When it became law in 1931, it applied only to projects costing more than $5,000. That threshold was reduced to $2,000 in 1935, and it hasn't been raised since even though inflation has increased dramatically.

    4. Creates rigid job classifications and procedures which, though easy for well staffed well financed unions or large private sector construction corporations, are nightmares for the average smaller non-unionized firms. Many of these companies do not bid on Davis Bacon projects just to avoid the pitfalls associated with complicated compliance issues.
    5. Quality or work is never linked to the wage paid under the Davis Bacon Act. The wage is however, commonly linked to union standard of wage. No worker has ever had wage reduced based on lack of quality of work performed.
    6. The employer has no rights to determine appropriate wage based on his knowledge of the worker he employs. The title of the workers job determines his wage... not how well the worker does his job.

    In my view, Davis Bacon is more appropriate in a communist country where capitalism and free market principles are restricted.

     
  • Darrell Baumbach posted at 4:05 pm on Sun, Feb 19, 2012.

    Darrell Baumbach Posts: 9405

    Mr Litton... Mr Litton... to say it is not about the union is blatantly false and raises to the level of “fairy tail”. It is all about the union. It is not a coincidence that the prevailing wage is almost always the same wage as the union pays... To not connect the dots is inexplicable and beyond belief.

    It is famous strategy that unions embrace in rationalizing a selfish unfair
    aspect of their existence. The teacher's union says they are all about the kids so their education is better, the government unions says it is all about the rights of the public to get quality essential service, it goes on and on...The reality, the unions represent the union's members and themselves. They never are on the side of the private sector owner of the company or the tax payer and treat them as enemies who want to enrich themselves at the expense of the worker.

     
  • Tim Litton posted at 9:06 am on Sun, Feb 19, 2012.

    Tim Litton Posts: 24

    @DB, Like I stated Davis Bacon is in place to insure that the workers on the project are being paid a living wage that is to the benefit of the community. It pumps tax dollars back into the economy by those workers buying houses, cars, and other goods. Someone making $8 an hour does not benefit the community nearly as much as someone making $30. It's an investment of our Tax dollars that replenish local economies. It has nothing to do with union vs. non-union. That is my point. There are many social benefits to prevailing wage. You keep trying to make this into a unions are evil argument and that is why in my first post I said your argument is ignorant and the same old political rhetoric. I tire of your non points and must just agree to disagree with you. Good day!

     
  • Darrell Baumbach posted at 3:48 am on Sun, Feb 19, 2012.

    Darrell Baumbach Posts: 9405

    @mr Litton...If all that you say is true in your last post, I think you have made the case
    that there is absolutely no reason to keep Davis Bacon Act in force.

    The unions are superior in quality of work, they save all sort of money
    for the employer; such as clerical, medical insurance, and workers comp.
    There is absolutely a link to quality work which results in higher wage...therefore, no law is needed to
    protect the unions.

    I think a person that perceives a reality as stated above would fight to abolish this act since it needlessly brands the unions as needy and incapable of protecting itself. Its why I stated that the union should compete for the business in the free market and let quality of the work dictate who gets the business. I think its time to put their money where their mouth is.

     
  • Tim Litton posted at 8:35 pm on Sat, Feb 18, 2012.

    Tim Litton Posts: 24

    @DB, What I'm trying to articulate is that yes they can, and yes they do. That's why I listed examples of such projects. And yes, most union contractors perform higher quality work due to the training their workers continuously receive. Davis Bacon is not put in place to give unions an edge. It's in place to insure that the workers on the project are being paid a living wage that is to the benefit of the community. It pumps tax dollars back into the economy by those workers buying houses, cars, and other goods. Someone making $8 an hour does not benefit the community nearly as much as someone making $30. Another point is that most construction workers are somewhat seasonal, so when you divide actual hours worked per year by gross income it comes out quite a bit less than $30 per hour. Other costs of prevailing wage work are in the fring benefits. This is put in place for the employees to buy medical insurance and not be a drain on society. Unless you prefer socialized medicine for all. Honestly, if a company like Diede joined a trade union they would actually save costs on overhead such as clerical, medical insurance, and workers comp. They could also benefit from such things as marketing, a highly trained work force, and a hiring hall. It’s actually a bad decision on their part to not join one. You seem like a smart guy. Do you actually think that trade unions would have members if it didn’t make business sense? There is a reason that the top contractors in the county, state, nation belong to trade unions and most of them have for generations. Maybe you should go by a jobsite and talk with some of the workers and ask them if there wage is artificially inflated. Most of them make between $40K - $50K a year. I don't know about you but that does not seem bloated to me.

     
  • Darrell Baumbach posted at 3:37 am on Sat, Feb 18, 2012.

    Darrell Baumbach Posts: 9405

    @Mr Litton...
    No Mr Litton, I do not consider you or anyone else who has a different perception of reality as being dumb. In fact, you sound quite intelligent and offer substance to what you articulate. I do appreciate people like yourself that make points instead of just a put down. I also respond to people as they respond to me. You mentioned some negative things about me and I responded in kind.

    As far as cheaper is not always better... I would restate that in the context of Davis Bacon to say more expensive is not better just because it is more expensive. Unions are notorious for workers getting paid without it linked to the quality of work performed. This act requires wages to go up much higher than fair market. The quality of work in the union is irrelevant and is not considered even though the wage is artificially high.
    No part of this bill addresses quality of work. If the quality of work was related to the increase cost, I would have no objection.

    I am perplexed with your position though... Are you saying that unions can compete against non union
    without the protection of this Act? Why do you think unions need so much protection and unfair advantages like not being subject to anti trust laws? You would think if the quality of work is better as you state, one might think it insulting that they have all this unfair protection.

     
  • Tim Litton posted at 10:22 pm on Fri, Feb 17, 2012.

    Tim Litton Posts: 24

    @DB, What 's typical is that when someone disagrees with people like you they must be dumb. Quite the contrary DB, I got your point. I just think your arguemnt is flawed and weak. If Langetwins, Stadium 12, Cottage Bakery and Lodi Memorial could've gotten the quality they wanted for less money don't you think they would have? You get what you pay for Mr. Baumbach, cheaper is not always better. Personally, I would rather my tax money go to a more expensive better qualified contractor than some fly by night low bidder. Some of us see the bigger picture instead of the bottom line.
    Oh, and by the way, Davis Bacon wages are not always union wages. I believe the wage for a drywall worker in this area on a Davis Bacon project is about $15 per hour. So, we better watch out for those bloated Davis Bacon wages.

     
  • Darrell Baumbach posted at 5:23 pm on Fri, Feb 17, 2012.

    Darrell Baumbach Posts: 9405

    Sorry Mr Litton, you missed my entire point 100% ...sounds a bit ignorant to miss the whole point. One might have thought you could have gotten some of it..typical of the people like you

    I did not make any point as to who got the business ( union/non-union). I stated the labor unions benefit from forcing wages higher than the free market would generate... So in your examples, these private sector companies are forced to increase the cost of the bids ( make it more expensive) in order to compete for the business. In other words, they must charge more than what the fair market supports. The Lange Twins winery could have been built for much less, making it easier for the company to reduce the price of its products that the consumer pays for and maintain the same profit margin. You prefer the consumer to pay more for the products they buy... Sounds a bit selfish to me.

    Charter schools can build a building and are not subject to prevailing wage... the cost of the facilities are much less and result in saving tax payers money. This is a good example of how unfair the Davis Beacon Act is.

    Like I said before, the unions cannot compete in a fair market environment and want to force private sector companies to pay more so that they can maintain their inflated unrealistic unfair wage the employers ( and tax payers) are “FORCED” to pay.

     
  • Tim Litton posted at 9:56 am on Fri, Feb 17, 2012.

    Tim Litton Posts: 24

    @DB - Last time I checked building trades unions represented contractors that are part of the privates sector. The largest and most successful contractors in California belong to unions and do more than just prevailing wage work. For example, Lodi based F&H Construction built the Langetwins winery, the movie theatre downtown, and most of Cottage Bakery. All examples of private sector work where they paid prevailing wages and benefits. Yet they’re not getting any awards from the Lodi Chamber. Then take Diede (an ABC member), they bid 95% public works projects and don't belong to any unions. But, every blue moon when they get a private job they cut their worker’s wages in half. It's about caring for your workers and believing in the sustainability of your community, not profiting from it. So, to make this a union vs. non-union argument seems a bit ignorant and the same old tired rhetoric you’re known for. Typical DB!

     
  • Jerry Bransom posted at 9:31 pm on Thu, Feb 16, 2012.

    Jerry Bransom Posts: 363

    It is no wonder that legislation like this stays on the books since none of you will attempt to understand the truth of it. I am not sure I would allow this group to vote if I had a choice.

     
  • Darrell Baumbach posted at 3:22 pm on Thu, Feb 16, 2012.

    Darrell Baumbach Posts: 9405

    @ TL
    The labor unions benefit from forcing waging higher that the free market would ever do. These same unions gives billions of dollars to lobby politicians. These unions have their "own" interests in mind at the expense of the tax payers of America.

    Davis Bacon Act does nothing more than protect unionized construction workers from competition. I guess if you are into unfair labor practices, you would be in favor of this act.

    Unions are not subject to anti trust laws. This gives them unfair advantages. Even if they use violence and thuggery to get what they want, labor unions have blanket immunity against prosecution for their unfair labor practices like forcing people to join unions and having no competition

    Private sector companies are subject to anti trust laws and do not have the unfair protection the unions enjoy. Its time for unions to join the real world and compete for the business just like any other company. The Davis Bacon Act should be renamed... The Up Yours If You Do Not Like It Act” Or "Legal Right to Discriminate Act"

     
  • Tim Litton posted at 1:35 pm on Thu, Feb 16, 2012.

    Tim Litton Posts: 24

    @ DB
    The ABC is a lobbyist group that has their own self interest in mind. It's an association of contractors who's main goal is to drive down wages and line their pockets as much as possible. There are dozens of contractor associations like the CEA or AGC that completely dismiss the ABC and their values. Or you can check out www.smartcitiesprevail.org.

     
  • Steve Schmidt posted at 10:12 am on Thu, Feb 16, 2012.

    Steve Schmidt Posts: 2465

    Good post Kevin. I would only comment that I think it is PARTIALLY the common man's fault. The common man could never have gotten into this situation without the aid and encouragement of the Financial industry and the Financial industry could never have gotten us into this mess without willing customers who's greed exceeded their sense.

     
  • Kevin Paglia posted at 7:51 am on Thu, Feb 16, 2012.

    Kevin Paglia Posts: 2027

    I'm not even going to comment on the D-B Act as I have no experience or knowledge on it. But I will comment to the "it's not the common mans fault" argument.

    Yes, it is our fault.

    The socially accepted obsession with creating debt is what is hurting the economy. Debt takes BILLIONS out of the economy and gives it to the 1% that everyone loves to hate. If you don't like the super-rich, STOP using their money to finance your toys. Cut off their income, which is the common man.

    I have a friend who is a cop in an Oregon city. He said most of the cops there are looking for a contract renegotiate because they can't afford the payments on all their things, like boats, jet skis, motorcycles, ATV's. Because they have financed so much they want MORE money from the city so they can make ends meet.

    The economy will only recover when people STOP using debt like it is free money. Debt is the reason a VAST majority of people will retire broke.

    I've posted this site over and over. Maybe someone will actually take it to heart and see that debt is dumb (thanks Dave Ramsey). One scary stat from the site "
    •Average credit card debt per household with credit card debt: $15,799* " How do you expect to have the economy recover when people are carrying so much debt? If you follow the numbers it is even scarier. Because that 15k number is AVERAGE. 29% of people don't use credit cards. That means the 15K has a total from 71% of users and 29% with a balance of ZERO. That is disturbing.

    Read more: http://www.creditcards.com/credit-card-news/credit-card-industry-facts-personal-debt-statistics-1276.php#ixzz1mYn4hIXr

     
  • Darrell Baumbach posted at 3:30 am on Thu, Feb 16, 2012.

    Darrell Baumbach Posts: 9405

    In addition, according to http://reason.com/archives/2010/03/24/repeal-the-davis-bacon-act... they ask...


    why would contractors working on a federal project hire any unskilled workers when the government forces them to pay all of their workers what amounts to a union wage? Contractors make the rational choice and get their money's worth by hiring skilled unionized labor even when the project calls for much less.

    Davis-Bacon is a blatant piece of special-interest, pro-union legislation. It hasn't come cheap for taxpayers. According to research by Suffolk University economists, Davis-Bacon has raised the construction wages on federal projects 22 percent above the market rate.

    James Sherk of the Heritage Foundation finds that repealing Davis-Bacon would save taxpayers $11.4 billion in 2010 alone. Simply suspending Davis-Bacon would allow government contractors to hire 160,000 new workers at no additional cost, according to Sherk.

     
  • Darrell Baumbach posted at 3:26 am on Thu, Feb 16, 2012.

    Darrell Baumbach Posts: 9405


    According to Associated Builder's & Contractor's, Inc , there is evident disagreement in the building industry that thinks Mr Bransom is dead wrong...
    http://www.abc.org/

    DAVIS-BACON ACT/PREVAILING WAGE
    The federal Davis-Bacon Act is a Depression-era wage subsidy law enacted in 1931, whose time has run out. In a 21st Century global economy, it is essential to allow the free market system to determine wages.

    ABC strongly supports legislative and regulatory efforts designed to limit the negative effects of the Davis-Bacon Act and state prevailing wage laws.

     

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