September 15, 2005

President Bush last week announced that the federal "prevailing wage" law, which generally requires government contractors to pay the equivalent of union-scale wages whether or not they employ union labor, would be suspended in areas affected by Hurricane Katrina. The suspension, which follows earlier precedent in times of natural disaster, has drawn much outrage on lefty blogs as well as in such predictable quarters as the N.Y. Times editorial page. A better question is why this dinosaur of a wage-fixing law, kept on the books through the political clout of labor unions in defiance of the principles of a free labor market, should not be repealed altogether and permanently. Tim Worstall has some fun with the Times; Steve Antler at EconoPundit and Michael Fox at Employer's Lawyer also comment.