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Another Union Bailout by Obama

April 15, 2010, 10:11 am

After famously throwing out 200 years of bankruptcy law to hose secured creditors in favor of uni0ns at GM and Chrysler, the Obama Administration is again bailing out the unions that helped get him elected

Barely 15 percent of all construction-industry workers in the United States are union members, while the remaining 85 percent are nonunion, according to the U.S. Department of Labor's Bureau of Labor Statistics. So why has President Obama signed Executive Order 13502 directing federal agencies taking bids for government construction projects to accept only those from contractors who agree in advance to a project labor agreement that requires a union work force? Obama's new order applies to all federal construction projects with price tags of $25 million or more, and it means all such contracts will only be awarded to companies with unionized work forces.

The costs of this to the public are pretty obvious, not only in terms of fairness but in increased costs and reduced competition.

Another factor helps explain Obama's willingness to sign an executive order that will put millions more tax dollars in union coffers. Mix points out that unions under PLAs typically exact agreements that include requiring contractors to make payments to union pension funds. This is an increasingly urgent issue, as the Washington Examiner's Mark Hemingway has recently detailed in these pages. According to Labor Department filings, the average union pension has only enough money on hand to cover 62 percent of the benefits it has promised to union members. Pension plans with 80 percent funding are considered "endangered" by federal auditors, while those with less than 65 percent funding are put on the "critical" list. With this latest executive order, it's clear that Obama intends to give unions on the critical list a massive dose of federal tax dollars to cure what ails them.

I'll keep saying it - this is right from the playbook of the European-style corporate state.

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Category: The Corporate State
  • m

    I think this is a good thing. Let the government have their unionized workers. With only 15% of the firms unionized, they'll be too busy to work on private contracts.

    Which means private buildings will be well-built, state-of-the-art buildings, built at a fraction of the cost.

    Government buildings will be, well, made by union workers.

  • Methinks

    Government buildings will be, well, made by union workers.

    Yes, but you and I will be forced to pay more for this shit construction and then pay even more to continually fix it.

  • gj

    Just curious... what's the definition of a union? Does it need to be recognized by the federal government in some way? If not, what's to keep a bunch of contractors from getting together and forming a "union" where dues are $1 for lifetime membership, just so they can be eligible for these kinds of government contracts?

  • Peter

    Well this will be interesting because my company is non union and it is the only concrete company available to my area. Does that mean it is illegal for the federal government to issue a contract that requires concrete in my area? The coast guard is going to suddenly find that it is not possible to get concrete that meets their government required specifications.

  • Craig Loehle

    The irony is that unions have been and continue to be strongly all-white. Check out your local electrical or plumbing union. One of the reasons federal rules called for "prevailing wage" to be paid on gov't construction, way back in the 1950s, was that minorities were willing to work for less than whites in order to get work at all. Forcing "prevailing wage" rules removed their advantage in getting government construction work even in non-union states like the South.

  • caseyboy

    "m" thinks that is a good thing because it will leave the non-union contractors to do the private jobs at lower cost and higher quality. Sounds reasonable? But consider the bigger picture. Government is taking over the economy one industry at a time. Construction companies will need to encourage their workers to unionize in order to participate in government contracts, which may be the only game in town. Obama has a grand plan and this is more than just a union payback. It fits with his remake or America.

  • Wally F

    I don't think the government can do any thing right. I just saw a funny video by Joe Boss, her really hits the nail on the head on Obamacare.
    http://www.youtube.com/watch?v=sB7E-BLfFjU

    Just some humor.
    Wally

  • Michael Miller

    This is a glimpse at the collusion that rots our system. And this sort of behavior exists everywhere in our government, and at all levels. Its pay for play. Remember when the Clinton administration Justice Department sued Microsoft? What was that all about? I'll tell you. Bill Clinton didn't like the pittance that Bill Gates and Microsoft contributed to the Democrats and his presidential campaign. So Clinton sics his big dogs at Justice after Microsoft. Today Bill Gates makes substantial contributions to the Democrats, and to Bill Clinton's presidential library. That's how the game is played. As long as Gates keeps paying off, he's most unlikely to be shaken down by Justice.

    I guess you could say this is Euro-style. I would agree that our government is run in many ways like a very big European Corporation.

    The Mafia, and protection money is paid to political office holders and their front organizations by corporations every day.

  • Doug Diggler

    Oh wow, another Libertarian loser in AZ, let me guess, you work for the govt or a govt contractor? Well, I guess you get waht you paid for, unlit streets, unpaved roads, and an uneduacated workforce.

  • sethstorm

    Better than bailing out other countries or entities that decide to locate offshore. Not ideal, but at least there's that.

  • Stephen Burgoyne Coulson

    Union construction workers ARE part of the public. At 15% of construction workers they are a significant percentage. When they get paid better money then they will spend it in their communities (unlike the transnationals and bankers who will simply lend it to your communities thus costing everyone more).

    Instead of complaining that the union guys are making too much money everyone should just join a union and get the same deal. Why tear down the guys who are making out all right just to make yourself feel better about how badly you are getting ripped off for your work.

  • Ryan Carns

    It's not necessarily the union workers or their wages as much is it is the union leaders. The loss of a free labor market= socialism.