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Obama to Use Federal Procurement to Encourage Pro-Worker Policies

(photo: Fibonacci Blue)This was first reported at Tucker Carlson’s Daily Caller, and we’ve been hearing about it too, but today the larger media organizations jumped on it. The federal government is strongly considering adopting a “High Road Contracting Policy” which would give preference in procurement contracting to companies which offer a living wage, health insurance, pensions and paid sick days. Essentially, Obama would leverage the government’s purchasing power to enact worker-friendly policies, adding that to the other criteria for contracts, like bidding price and performance. And he may enact this new policy via executive order.

Steven Greenhouse reports for the New York Times:

By altering how it awards $500 billion in contracts each year, the government would disqualify more companies with labor, environmental or other violations and give an edge to companies that offer better levels of pay, health coverage, pensions and other benefits, the officials said.

Because nearly one in four workers is employed by companies that have contracts with the federal government, administration officials see the plan as a way to shape social policy and lift more families into the middle class. It would affect contracts like those awarded to make Army uniforms, clean federal buildings and mow lawns at military bases.

Although the details are still being worked out, the outline of the plan is drawing fierce opposition from business groups and Republican lawmakers. They see it as a gift to organized labor and say it would drive up costs for the government in the face of a $1.3 trillion budget deficit.

The government may be adopting policies favored by organized labor, but nowhere in any of the briefs does it say they would only offer contracts to unionized shops. The US Labor Department, currently headed by Hilda Solis, would have the responsibility to score the labor records of federal contractors.

Business leaders are upset that they have to actually do right by their workers. It’s fairly simple to welcome their hatred on this one. Furthermore, the government contracting process has become so ugly – with billions in cost overruns, waste, fraud and abuse, that citing good labor standards as a basis for receiving a contract would at least ensure that some of this bloat gets into the hands of the worker. Businesses really have no standing to complain, having essentially stolen taxpayer dollars for this long. And, by promoting worker-friendly policies in procurement, thousands of the working poor across the country may not need to rely on food stamps or Medicaid if they get a living wage and health benefits at work. That would arguably save the government money in the long run.

Bill Clinton enacted regulations similar to this during his Administration; George W. Bush quickly vacated them.

Senator Susan Collins has already written to the White House pleading with them not to enact this procurement policy. She wrote, “We are concerned that the imposition of these requirements, during a time of significant economic turmoil in the private sector and tight federal budgets, could have serious, negative consequences, especially for our nation’s small businesses.”

There’s a chance that Obama will simply write this into law by a stroke of the pen:

Some supporters of the new procurement policy — and even some opponents — say Mr. Obama could impose it through executive order. They assert that the president has broad powers to issue procurement regulations, just as President John Kennedy did in requiring federal contractors to have companywide equal employment opportunity plans.

But some opponents argue that legislation would be needed because an executive order may collide with laws that require federal contractors to pay the prevailing regional wage for the type of work being done. The executive order, they fear, would call for higher wages.

Let’s hope Obama lines up with John Kennedy on this one. And he should tout this very strongly, explaining how he is staying on the side of the people instead of companies that wrong their workers.

CommunityThe Bullpen

Obama To Use Federal Procurement To Encourage Pro-Worker Policies

This was first reported at Tucker Carlson’s Daily Caller, and we’ve been hearing about it too, but today the larger media organizations jumped on it. The federal government is strongly considering adopting a “High Road Contracting Policy” which would give preference in procurement contracting to companies which offer a living wage, health insurance, pensions and paid sick days. Essentially, Obama would leverage the government’s purchasing power to enact worker-friendly policies, adding that to the other criteria for contracts, like bidding price and performance. And he may enact this new policy via executive order.

Steven Greenhouse reports for the New York Times:

By altering how it awards $500 billion in contracts each year, the government would disqualify more companies with labor, environmental or other violations and give an edge to companies that offer better levels of pay, health coverage, pensions and other benefits, the officials said.

Because nearly one in four workers is employed by companies that have contracts with the federal government, administration officials see the plan as a way to shape social policy and lift more families into the middle class. It would affect contracts like those awarded to make Army uniforms, clean federal buildings and mow lawns at military bases.

Although the details are still being worked out, the outline of the plan is drawing fierce opposition from business groups and Republican lawmakers. They see it as a gift to organized labor and say it would drive up costs for the government in the face of a $1.3 trillion budget deficit.

The government may be adopting policies favored by organized labor, but nowhere in any of the briefs does it say they would only offer contracts to unionized shops. The US Labor Department, currently headed by Hilda Solis, would have the responsibility to score the labor records of federal contractors.

Business leaders are upset that they have to actually do right by their workers. It’s fairly simple to welcome their hatred on this one. Furthermore, the government contracting process has become so ugly – with billions in cost overruns, waste, fraud and abuse, that citing good labor standards as a basis for receiving a contract would at least ensure that some of this bloat gets into the hands of the worker. Businesses really have no standing to complain, having essentially stolen taxpayer dollars for this long. And, by promoting worker-friendly policies in procurement, thousands of the working poor across the country may not need to rely on food stamps or Medicaid if they get a living wage and health benefits at work. That would arguably save the government money in the long run.

Bill Clinton enacted regulations similar to this during his Administration; George W. Bush quickly vacated them.

Senator Susan Collins has already written to the White House pleading with them not to enact this procurement policy. She wrote, “We are concerned that the imposition of these requirements, during a time of significant economic turmoil in the private sector and tight federal budgets, could have serious, negative consequences, especially for our nation’s small businesses.”

There’s a chance that Obama will simply write this into law by a stroke of the pen:

Some supporters of the new procurement policy — and even some opponents — say Mr. Obama could impose it through executive order. They assert that the president has broad powers to issue procurement regulations, just as President John Kennedy did in requiring federal contractors to have companywide equal employment opportunity plans.

But some opponents argue that legislation would be needed because an executive order may collide with laws that require federal contractors to pay the prevailing regional wage for the type of work being done. The executive order, they fear, would call for higher wages.

Let’s hope Obama lines up with John Kennedy on this one. And he should tout this very strongly, explaining how he is staying on the side of the people instead of companies that wrong their workers.

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David Dayen

David Dayen