What's in your wallet?

Apparently the New Orleans evacuees were not the only ones to whom the Feds wanted to give debit cards. According to the New York Times and numerous other sources,  Halliburton, The Shaw Group, Bechtel Corp and Boh Brothers Construction have all received their own ‘corporate debit cards’ in the form of billions of dollars in no-bid contracts for hurricane recovery and reconstruction work.

In some cases the no-bid awards have been fast tracked because of the urgency of the work and in other cases there are long standing contracts that apparently were awarded on a ‘when and if needed’ basis. All of this sounds logical enough and is the kind of thing I would suspect the government must incorporate in any disaster recovery planning.

However, this becomes an olfactory reminiscence of a week old bull carcass in the summer sun in light of the proclamation signed last Thursday by our ‘Re-constructor-In-Chief’ which suspends the core provisions of the Davis-Bacon Act of 1931. That act requires government contractors to pay construction labor wages equivalent to the prevailing local rate. Now by Presidential fiat, Bechtel, Halliburton and the like can reduce their labor costs on the backs of what are most likely already the lowest paid and most numerous workers in the very neighborhoods that will be struggling to recover.

There are two really juicy twists to this action. One is that there are no provisions in the proclamation that would require the contractors to pass the savings through to the government. It looks as if their biggest problem could be how to shift the difference (savings) over to contract categories other than cost of labor so they can still use up that available balance on their federally issued debit cards. The second is that the suspension just applies to Louisiana, Mississippi, Alabama and Florida.

It is surprising to me that the President did not include Central Texas in the suspension area.  With all the brush he had to leave uncut when he shortened his vacation by 72 hours to return to Washington, he’ll probably award a FEMA contract claiming that the cost of hiring a crew to cut bush is a hurricane related expense.

Government contracting usually takes the form of a fixed cost contract or a cost plus contract. If these contracts are the cost plus variety it will take a little more work for a contractor bent on hosing the public to fatten their own balance sheet. Fear not though; remember that where there's a will,  there's a way.

Finally, for those of you who plan to vote in 2006 mid terms, the suspension of the Davis-Bacon Act allegedly followed a letter to the President asking for the suspension and signed by 35 Republican House members ….might be an interesting question to ask your representative in next year's election run-up. Given the administration’s penchant for retribution towards heretics though, it might be best to use an assumed name, especially if you have a relative that works for the CIA.