Marathon Pundit: Union chief questions Obama's pro-labor High Road Contracting Policy

Monday, April 19, 2010

Union chief questions Obama's pro-labor High Road Contracting Policy

The Obama White House has been the most pro-union administration since since at least Lyndon Johnson's day. But there is a significant difference between the 1960s and now: About one-third of the workforce belonged to a union then--compared to just 12 percent now. And of those contemporary union members, a majority of them are government workers.

Labor has been a generous donor to Obama's campaign fund and other Democrats.

Since February, the Obama has administration has been considering something called the "High Road Contracting Policy," which would force federal contractors to pay its workers "living wages" and offer employee-funded retirement plans, among other things.

Unionized firms are more likely to offer these things--keep in mind that many union multi-employer pensions are woefully underfunded--so High Road is nothing more than payback for Obama's union pals.

Current law is a bit complicated, but as it is now, the low-bidder on a federal project generally gets the job, but firms must pay the local prevailing wage, or what can be interpreted as a fair wage. Union leaders want that turned into what they define as a "living wage."

In a letter to the director of the Office of Management and Budget, John Gage, the president of the 600,000 member American Federation of Government Employees, warned that High Road could "significantly increase subjectivity and politics in federal procurement."

From the Daily Caller:

"The various preferences for small businesses that 'High Road' proponents cite as precedents for rewarding a certain class of contractors are in fact riddled with fraud and often ultimately benefit ineligible businesses that act as subcontractors," Gage wrote. "Finally, as proponents now acknowledge, there are no jurisdictions at the state or local levels that use a process similar to the one proposed by ‘High Road’ proponents."

While Gage's comments are striking coming from a prominent labor leader, they echo the concerns of numerous observers within the federal procurement community. Contracting experts have argued the new award process would be highly opaque and open to corruption and favoritism. Al Burman, a top federal procurement official under Presidents Reagan and George H.W. Bush said any such changes would add to the burden of an already overtaxed procurement work force.

"We've already got issues with an understaffed contracting corps. They're just trying to keep their heads above water," Burman said, pointing out that the federal government has seen a huge increase in funding during the last 10 years but the acquisition work force has remained the same size. President Obama has proposed increasing the acquisition work force by 5 percent but that change could take years to implement given the federal government's lengthy recruitment and hiring process.