The Racial Element of Prevailing Wage Laws

(Andy Matthews/NPRI) – In his recent study on Nevada’s prevailing wage laws, Geoff Lawrence examines how the original backers of such laws were motivated by racial factors — specifically, their desire to price black laborers out of the market.

Geoff writes:

Congressional records make it clear that the intent of the Davis-Bacon Act was to undermine the competitive advantage enjoyed by a specific category of highly mobile construction workers: Southern blacks. Sen. James Davis of Pennsylvania and Rep. James Bacon of New York, among others, feared that contractors who used black labor would underbid contractors using white labor and win federal contracts.

Now, modern-day supporters of prevailing wage laws would no doubt argue that, even if the earliest supporters of such laws were motivated by a desire to discriminate on racial grounds, no such desire exists among supporters today. And they’d no doubt be correct. So is that particular angle irrelevant?

Not at all, and for two reasons:

First, history is important, plain and simple. Even if some particular facts seem to become less relevant over time, it’s still good to recognize how we got to where we are today.

Second, and more crucial, is that even if the racial motives behind the laws’ creation are less relevant now, the fact remains that the tactics used to accomplish the desired goal still tell us a lot.

After all, those who pushed for prevailing wage laws as a means to price black laborers out of the market did so because they understood keenly the distortive impact that such laws have on the market. And that remains as true today as it was back then. Which is why such laws were, and are, a bad idea.