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December 2, 2014

Jonathan Tobin: Defending the Right to a Jewish State

Heather Hale: Compliment your kids without giving them big heads

Megan Shauri: 10 ways you are ruining your own happiness

Carolyn Bigda: 8 Best Dividend Stocks for 2015

Kiplinger's Personal Finance editors: 7 Things You Didn't Know About Paying Off Student Loans

Samantha Olson: The Crucial Mistake 55% Of Parents Are Making At Their Baby's Bedtime

Densie Well, Ph.D., R.D. Open your eyes to yellow vegetables

The Kosher Gourmet by Megan Gordon With its colorful cache of purples and oranges and reds, COLLARD GREEN SLAW is a marvelous mood booster --- not to mention just downright delish
April 18, 2014

Rabbi Yonason Goldson: Clarifying one of the greatest philosophical conundrums in theology

Caroline B. Glick: The disappearance of US will

Megan Wallgren: 10 things I've learned from my teenagers

Lizette Borreli: Green Tea Boosts Brain Power, May Help Treat Dementia

John Ericson: Trying hard to be 'positive' but never succeeding? Blame Your Brain

The Kosher Gourmet by Julie Rothman Almondy, flourless torta del re (Italian king's cake), has royal roots, is simple to make, . . . but devour it because it's simply delicious

April 14, 2014

Rabbi Dr Naftali Brawer: Passover frees us from the tyranny of time

Greg Crosby: Passing Over Religion

Eric Schulzke: First degree: How America really recovered from a murder epidemic

Georgia Lee: When love is not enough: Teaching your kids about the realities of adult relationships

Cameron Huddleston: Freebies for Your Lawn and Garden

Gordon Pape: How you can tell if your financial adviser is setting you up for potential ruin

Dana Dovey: Up to 500,000 people die each year from hepatitis C-related liver disease. New Treatment Has Over 90% Success Rate

Justin Caba: Eating Watermelon Can Help Control High Blood Pressure

The Kosher Gourmet by Joshua E. London and Lou Marmon Don't dare pass over these Pesach picks for Manischewitz!

April 11, 2014

Rabbi Hillel Goldberg: Silence is much more than golden

Caroline B. Glick: Forgetting freedom at Passover

Susan Swann: How to value a child for who he is, not just what he does

Cameron Huddleston: 7 Financial Tasks You Should Tackle Right Now

Sandra Block and Lisa Gerstner: How to Profit From Your Passion

Susan Scutti: A Simple Blood Test Might Soon Diagnose Cancer

Chris Weller: Have A Slow Metabolism? Let Science Speed It Up For You

The Kosher Gourmet by Diane Rossen Worthington Whitefish Terrine: A French take on gefilte fish

April 9, 2014

Jonathan Tobin: Why Did Kerry Lie About Israeli Blame?

Samuel G. Freedman: A resolution 70 years later for a father's unsettling legacy of ashes from Dachau

Jessica Ivins: A resolution 70 years later for a father's unsettling legacy of ashes from Dachau

Kim Giles: Asking for help is not weakness

Kathy Kristof and Barbara Hoch Marcus: 7 Great Growth Israeli Stocks

Matthew Mientka: How Beans, Peas, And Chickpeas Cleanse Bad Cholesterol and Lowers Risk of Heart Disease

Sabrina Bachai: 5 At-Home Treatments For Headaches

The Kosher Gourmet by Daniel Neman Have yourself a matzo ball: The secrets bubby never told you and recipes she could have never imagined

April 8, 2014

Lori Nawyn: At Your Wit's End and Back: Finding Peace

Susan B. Garland and Rachel L. Sheedy: Strategies Married Couples Can Use to Boost Benefits

David Muhlbaum: Smart Tax Deductions Non-Itemizers Can Claim

Jill Weisenberger, M.S., R.D.N., C.D.E : Before You Lose Your Mental Edge

Dana Dovey: Coffee Drinkers Rejoice! Your Cup Of Joe Can Prevent Death From Liver Disease

Chris Weller: Electric 'Thinking Cap' Puts Your Brain Power Into High Gear

The Kosher Gourmet by Marlene Parrish A gift of hazelnuts keeps giving --- for a variety of nutty recipes: Entree, side, soup, dessert

April 4, 2014

Rabbi David Gutterman: The Word for Nothing Means Everything

Charles Krauthammer: Kerry's folly, Chapter 3

Amy Peterson: A life of love: How to build lasting relationships with your children

John Ericson: Older Women: Save Your Heart, Prevent Stroke Don't Drink Diet

John Ericson: Why 50 million Americans will still have spring allergies after taking meds

Cameron Huddleston: Best and Worst Buys of April 2014

Stacy Rapacon: Great Mutual Funds for Young Investors

Sarah Boesveld: Teacher keeps promise to mail thousands of former students letters written by their past selves

The Kosher Gourmet by Sharon Thompson Anyone can make a salad, you say. But can they make a great salad? (SECRETS, TESTED TECHNIQUES + 4 RECIPES, INCLUDING DRESSINGS)

April 2, 2014

Paul Greenberg: Death and joy in the spring

Dan Barry: Should South Carolina Jews be forced to maintain this chimney built by Germans serving the Nazis?

Mayra Bitsko: Save me! An alien took over my child's personality

Frank Clayton: Get happy: 20 scientifically proven happiness activities

Susan Scutti: It's Genetic! Obesity and the 'Carb Breakdown' Gene

Lecia Bushak: Why Hand Sanitizer May Actually Harm Your Health

Stacy Rapacon: Great Funds You Can Own for $500 or Less

Cameron Huddleston: 7 Ways to Save on Home Decor

The Kosher Gourmet by Steve Petusevsky Exploring ingredients as edible-stuffed containers (TWO RECIPES + TIPS & TECHINQUES)

Jewish World Review August 10, 2005 / 5 Av, 5765

Setting high wages that keep people poor

By John Stossel


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http://www.JewishWorldReview.com | In its contempt for the market, the federal government is setting high wages that keep people poor.

On government construction jobs, federal law requires that everyone be paid "the prevailing wage." By "prevailing wage," the feds mean the wage the bureaucrats were prevailed upon to set. The Davis Bacon Act, passed in 1935, requires every construction worker be paid exactly what the bureaucrats decree.

The real "prevailing wage" is set by the law of free exchange, of course: If you don't pay enough, no one will work for you. Demand too much, and you won't get much construction work. Supply and demand make sure people are paid a wage that's most efficient for the most people.

The Davis Bacon Act redefines the term "prevailing wage." For the facts of the market, it substitutes the arbitrary whims of bureaucrats. But the facts are the facts, and ignoring them is never safe. In this case, the victims of the government's self-deception are the people the government is refusing to see: the people for whom the real prevailing wage — the amount they can earn on the open market — is lower than that set by the government.

Under Davis Bacon, the government issues wage edicts that are different in every town. The wage rates are based on a complicated formula that supposedly averages previous union and non-union wages in a given town. But, of course, the union contractors, because they're organized, are more likely to get their wage data to the government, so the averages are skewed.

Construction had long been the kind of work where young people could break in by helping, watching and working cheap until they acquired skills. The Davis Bacon Act eliminates that.

When Chicago decided to repair the Cabrini Green housing project, people who lived in the project assumed such a big job would provide work for the unemployed young men who grew up there. But because of Davis Bacon, every contractor had to pay high salaries — even for the simplest jobs. So contractors, locked into paying high salaries, were not about to take a chance on beginners. They hired the most experienced union workers they could find. They used workers who would "normally never come near our neighborhood," said aspiring construction worker John King. "I think it's wrong that they do that. We want to provide. We're not just derelicts and drug dealers and thugs."

If it weren't for Davis Bacon, people like King could have competed for jobs by being willing to accept a lower wage. If you've got a choice between inexpensive, inexperienced workers and expensive experts, it often makes sense to hire at least some of the new people. Their work isn't as valuable, but since their pay is lower, it may be a better deal for the money — and if you hire a few old hands, too, the beginners can learn from them, making their labor more valuable to you and putting them in a position to charge more on their next job.

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But if the law forces you to pay top-scale wages no matter whom you hire, there's no benefit to hiring the inexperienced people. For expert's pay, you can get expert's work, so that's what you do. The would-be beginner doesn't get a start. He's just not worth what you'd have to pay him.

Unions claim Davis Bacon is necessary "to make sure government buildings are well-built." Without first-class union labor, unions say, the buildings might not be safe. That might sound reasonable if you didn't stop to consider that most buildings are not government buildings, and they're safe.

There are some in Congress who realize this and want to repeal the Davis Bacon Act. There is almost no chance that they will succeed. The people who like the law make good money from it and lobby well. The people Davis Bacon hurts are less organized. When you're trying to learn a trade and become a productive citizen, you don't have much time to lobby your congressman.

Every weekday JewishWorldReview.com publishes what many in in the media and Washington consider "must-reading". Sign up for the daily JWR update. It's free. Just click here.

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Stossel explains how ambitious bureaucrats, intellectually lazy reporters, and greedy lawyers make your life worse even as they claim to protect your interests. Taking on such sacred cows as the FDA, the War on Drugs, and scaremongering environmental activists -- and backing up his trademark irreverence with careful reasoning and research -- he shows how the problems that government tries and fails to fix can be solved better by the extraordinary power of the free market. Sales help fund JWR.



JWR contributor John Stossel is co-anchor of ABC News' "20/20." To comment, please click here.


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