Walter E. Williams bio photo

Walter E. Williams

Bradley Prize Winner 2017

Professor of Economics.
(703) 993-1148
D158 Buchanan Hall
Department of Economics
George Mason University

Related Sites:
The homepage of George Mason University.
Homepage of the Department of Economics at GMU.

There’s a little known law called the Davis-Bacon Act of 1931. It remains on the books today. Before saying what the law is and its effects, let me run by you some of the language used, in the early 1930s, to push the law through Congress. Rep. John Cochran of Missouri said he had “received numerous complaints in recent months about Southern contractors employing low-paid colored mechanics getting work and bringing the employees from the South.” Alabama Rep. Clayton Allgood complained: “Reference has been made to a contractor from Alabama who went to New York with bootleg labor. This is a fact. That contractor has cheap colored labor that he transports, and he puts them in cabins, and it is labor of that sort that is in competition with white labor throughout the country.” Rep. William Upshaw complained of the “superabundance or large aggregation of negro labor,” which is a real problem “you are confronted with in any community.” New York’s Sen. Robert Bacon replied, “I just mentioned the fact because that was the fact in this particular case, but the same would be true if you should bring in a lot of Mexican laborers or if you brought in any non-union laborers from any other state.” Other congressmen expressed their support for the Davis-Bacon Act in ways that were more temperate in expressing their racially discriminatory agenda. They railed against “transient labor”, “cheap labor” and “cheap imported labor.” AFL president William Green made it clear what his union’s interests were, “(C)olored labor is being sought to demoralize wage rates.” You might ask, “What is this Davis-Bacon Act?” The Davis-Bacon Act is a federal law that mandates that a prevailing wage be paid on all federally financed or assisted construction projects. The secretary of labor illegally sets the “prevailing wage” at the union wage or higher, regardless of what the average wage is in the affected locality. The effect of the Davis-Bacon Act is that of discriminating against contractor employment of non-union and lower skilled workers. Thus, it has a racially discriminatory effect, since most blacks are in the non-union sector of the construction industry. Even black contractors wanting to hire a lower skilled black worker can’t do so. Why? If the Davis-Bacon Act requires that any worker handling a hammer and a nail, for example, be paid $25 an hour, no contractor in his right mind is going to hire a worker with $10 an hour skills and pay him $25. Any minimum wage law tends to discriminate against the employment of low-skilled works; the Davis-Bacon Act is simply a super-minimum wage. During South Africa’s apartheid era, it had laws similar to the Davis-Bacon in its quest to protect white workers from competition with lower-skilled, lower-paid black workers. One naturally asks how such a law can remain on the books today. Davis-Bacon survives because of the powerful interest-group support it receives, namely labor unions who lobby congressmen, both Democrats and Republicans. What’s sad is the support the Davis-Bacon Act receives from black congressmen. Black congressmen have made a deal with the devil because unions represent their strongest supporters in terms of campaign contributions and their legislative agenda. Of course, today’s Davis-Bacon Act supporters don’t have the same intentions and don’t use the racist language of their predecessors. That shouldn’t make any difference to us. Our concern should be the law’s effects, not its intentions. After all, if someone is pushed off a building it’s not the intentions of the pusher that determines how he falls, it’s the law of gravity. It’s the same with economic laws. Intentions behind price-fixing are not necessarily the same as its effects.