The idea that shovel-ready jobs exist just waiting for funding from the president is a fantasy. Either the president did not understand the workings of government subsidies or he was making promises he could not keep.
Plans to fund hundreds of infrastructure projects across the country, producing new jobs to spark the economy, was a complete failure. It failed because the so-called infrastructure projects were not identified by the communities seeking the funds, cost estimates and engineering plans were not written, matching funding sources were not secured, administration accountabilities were not identified, and the proper public hearings were not in place. All of these steps are necessary for project planning that is written and approved by the municipalities, and then approved by the federal government or in some cases the state government, depending how the money is allocated.
Once a project is deemed viable and approval has been granted by the funding agency, a variety of compliance items must be completed and forwarded to the same agency. Up to this point, the time frame from identification to approval of the project takes approximately three months. That is the short end of preparation. After approval compliance documentation takes about another six months. So far, the shovel-ready project has taken up to nine months in just paper work. The nine months is a very modest time-frame. In some cases, it can take two years to reach this point. Much of it depends on how quickly the municipal officials, politicians, engineers, administrators, solicitors and architects, do their part of the work.
All federal government funded infrastructure projects over the amount of $2,000 are subject to the Davis-Bacon Act. This act requires that prevailing wages be paid to all workers involved on the construction sites. Prevailing wage is the same rate that the unions pay for any particular job description. It also means that benefits must be paid at the union rate. In some states, such as New Jersey, it can mean that a general laborer that works on a road project must receive; $25.30 per hour plus $11.92 in benefits per hour. The company awarded the job does not have to be part of a union. The U.S. Chamber of Commerce estimates that Davis-Bacon projects cost the American taxpayers 15 percent more than non-prevailing wage jobs resulting in one billion dollars a year. Unions argue that union workers are more skilled and do a better job.
The next time you hear shovel-ready jobs, keep in mind that the government bureaucracy makes the term an oxymoron. An experienced person in government would have known better than to promise jobs to hundreds of workers that could not be delivered.
Remember that the president not only brings his experience to the White House, but people that make up his branch of government that will advice him and carry out policies. Not only did this president not know what he was talking about, neither did his staff of advisors. What else do they not know?
The author wrote government grant applications for infrastructure and economic development projects, administered the same, and monitored Davis-Bacon projects for more than 15 years.
Wage Determination On Line: Davis Bacon Wage Decision New Jersey
U.S. Chamber of Commerce: Davis Bacon Act