Prevailing Wage Law Wastes Taxpayers' Money

Click for audio Prevailing Wage Law Wastes Taxpayers' Money

Citizens would march on Lansing in anger if the legislature passed a law forcing consumers to pay more than what businesses normally charged for everything from groceries to automobiles. But why would the legislature ever pass such a silly law?

Taxpayers should be asking that very question about Michigan's so-called prevailing wage law, which unnecessarily drives up the cost of government building projects by forcing all contractors to pay their employees at artificially high union wage rates.

This means that even when non-union contractors can do the same work for less than unionized contractors, the state insists on paying more by mandating inflated wages for all construction workers, whether union or non-union.

Because of the prevailing wage law, Michigan taxpayers annually pay hundreds of millions of dollars more than necessary on projects such as road repair, public housing, and school construction.

A new Mackinac Center study estimates that in one year, 1995, repealing the law could have saved taxpayers over $275 million—the equivalent of a five percent rebate on every taxpayer's income tax for that year.

Michigan lawmakers should be good stewards of the public purse and repeal the wasteful prevailing wage law.

For the Mackinac Center, this is Joseph Lehman.