January 28, 2014

"President Obama will announced plans to use his executive authority to raise the minimum wage to $10.10 per hour for federal contract workers during the State of the Union address..."

"... Federal workers like janitors, construction workers and dishwashers hired under new federal contracts would benefit from the new order, which the White House calls an example of how the president can 'lead by example.'"

Is that "example" or fiat? Since he's spending the taxpayers' money, he's not really an example, if what he's purporting to do is model behavior that private businesses could follow. They don't get to pay people with money raked in from the general populace.

But who's really getting a raise here? Do janitors and construction workers make minimum wage? Who are the minimum wage federal employees? How many are there?

114 comments:

Broomhandle said...

I'm amazed that any Federal employee is making less than 10.10 per hour. Sounds like bullshit to me.

Robert Cook said...

As much as I think the minimum raise for all workers should be raised--and higher than a mere $10.00 per hour--it is not permissable under our system as we understand it for the President to raise the wages--even if just for federal employees--by fiat.

This is another tell--this one seemingly innocuous, even beneficent, assuming Obama gets away with it--that we are not any longer living under the system we thought we were but are in a de facto police state.

Rumpletweezer said...

The man is a walking, talking crap merchant. He says there's no evidence that raising the minimum wage causes unemployment. In fact there are mountains of such evidence.

He also conveniently ignores who makes minimum wage--primarily second or third household income earners.

Sheesh.

Xmas said...

Isn't there a law already in place for that: Davis-Bacon.

I'm with you, how many government contracts are paying minimum wage? Maybe a handful of cafeteria workers and some cleaning people? Will this law apply to unpaid interns, too?

Robert Cook said...

"I'm amazed that any Federal employee is making less than 10.10 per hour."

Perhaps you shouldn't rely on what you believe to be true to determine what is really true.

Matthew Sablan said...

"will announced"?

Editor eye twitch....

Barry Dauphin said...

CNN goes all alpha male with headline saying Obama flexes presidential muscle on minimum wage. So that is the question, is it (legitimate) authority or is it muscle?

virgil xenophon said...

He's doing it for the unions. ALL union contracts have automatic escalator clauses that state that when the min wage is raised ALL pay levels get bumped up accordingly to maintain the "spread" between pay-scales. This is why black teenagers hang around street-corners unemployed: All for the greater glory of the union workers who already are on the employment ladder..

Matthew Sablan said...

It's... it's the first verb in their article. The Hill... why? There is an author, and one person later contributed and NEITHER noticed the error in the first four words of the article?

... I'm going to go cry now.

Matthew Sablan said...

To better mirror a private entity, why doesn't he tell us where the money for the raises is going to come from? What are we doing without to pay them more [note: Raising taxes means that other people's real wages go down to make these people's wages go up -- is that a fair trade?]

Minimum wage is a hard issue because you have to make trades, and once you start looking at the decision as that [trading more jobs for better jobs or worse jobs for more jobs], you realize that you have few 100% only good outcome choices.

Gahrie said...

If raising the minimum wage to $10 is good, and will make a difference in people's standard of living...why not raise it to $20? or $100?

Robert Cook said...

"This is why black teenagers hang around street-corners unemployed: All for the greater glory of the union workers who already are on the employment ladder."

Yep! You nailed it...that's why we have an employment crisis...it's the unions!

(Ahem...not.)

Henry said...

In 1984, working the summer as a common laborer for a small construction firm, I was paid $12/hour for work on the federal project, half that for everything else.

How many federal contract workers will actually benefit from this?

Matthew Sablan said...

Also, "federal contract workers" =/= "federal workers." There's a huge difference there.

SteveR said...

Well its about federal "contract" workers, not actual federal workers. In any case there aren't very many at that level to begin with. So this is empty political rhetoric which will work for the intended audience.

Broomhandle said...

"Perhaps you shouldn't rely on what you believe to be true to determine what is really true."

Well, that'd be a great Zen koan.

Matthew Sablan said...

So... by raising federal contract workers minimum wages, how is that not a give away to corporate interests? He's basically weakened the federal bargaining position to get best value OR lowest cost.

B said...

This sounds expensive. Good thing we don't have a budget deficit anymore.

Henry said...

One consequence of a rise in the minimum wage that you won't see in terms of Federal contract jobs is the increase of the cash black market. The increase of the cash black market means the feds collect less money in taxes, FICA, ACA penalties, etc.

jacksonjay said...


Obama job approval at 81% in D.C. is the rest of the story! They have truly created a ruling class! It is their world and we are just living in it!

Pay up, Sucker!

darrenoia said...

This president continues to attempt to turn the country into a dictatorship. I'm getting increasingly nervous that the last law he flouts in his second term will be the one stating that he can't remain president....

Mattman26 said...

To tie a couple things together (mentioned elsewhere in this thread): These aren't federal employees, they're employees of federal contractors. I would bet both of my thumbs that either (a) none; or (b) virtually none receive less than $10 an hour. Under Davis-Bacon, which is a horrible law, federal contractors must pay what's euphemistically called the "prevailing wage," which is in reality an inflated union wage, such that an unskilled worker who pushes a wheelbarrow of scrap materials from the worksite to the dumpster gets paid about $30 an hour plus benefits.

So this is nonsense masquerading as substance. And that's what's become of this guy's presidency.

gspencer said...

Another amazing talent of Obama the Great - the inability to read.

“All legislative powers herein granted shall be vested in a Congress of the United States . . .”

All means all and that’s all that all means. Unless of course you’re the great O and his minions.

SGT Ted said...

Cook has it right.

What no "news" outfit is even bringing up is that most Union collective bargaining agreements throughout the nation use the minimum wage as a floor for their own wages. So, when the min. wage goes up, they get automatic raises as per their contract.

This was little more than a stealth pay raise for Union members.

Also not mentioned all of the non-union employees that will lose their jobs in the Commissaries they are going to close, as well as the reduced COLA for Military retirees.

Fuck the people that put their lives on the line for every President they serve under and YAY! for overpaid Union leeches.

Robert Cook said...

"Cook has it right."

Sgt. Ted, you have seriously misread me...or confused me with Virgil Xenophon.

Harold said...

What I've seen in other articles about this is that it will only apply to new contracts. Existing contracts that are extended won't be affected. I suspect that the number of people who will actually see a raise as a result of this is below the three digit range.

ESM said...

Since Obama doesn't have the authority to increase spending, an extra dollar of federal spending for minimum wage workers means one dollar less of spending elsewhere. It's a zero-sum game, which I guess is better than the negative sum game which the minimum wage law represents in the private sector.

SGT Ted said...

Union intractability on wages kills jobs, Cooke. Look at Detroit and the Rust Belt.

All were partially destroyed by Unions too greedy to realize that the business they were leeching off of must be able to compete with other companies and that labor is the most cost to a business.

It took breaking the union in WI for them to have a surplus of money. The Unions don't care about that; they just want that money. Period.

"Pro-Union" doesn't mean any sort of moral superiority. They are another rent-seeking special interest, just as greedy as any corporate raider on Wall Street purchasing favorable legislation from Government.

rehajm said...

Who are the minimum wage federal employees? How many are there?

A good question I can't find the answer to. BLS doesn't strip out data for only federal workers. If anyone finds this...

We do know via BLS 1.55 million workers earned federal minimum in 2012, with another 2 million special exemption workers- tipped wait staff, full time students, disabled employees- earned less than minimum. So while 3.55 or 3% of the workforce technically earned federal minimum, when tipped employees are considered, it's likely the number of people that actually earned minimum wage was closer to 1.55 million...

Of those earning minimum, 50% were teenagers or young adults.

63% were second or third earners in their household, not primary earners.

Given how so few people are impacted it's disturbing the disproportionate amount of time on this, as if it were important. And that those who believe it is important believe raising the minimum wage is the best vehicle for improvement for workers. Why place the economic burden entirely on minimum wage job creators? The Earned Income Tax Credit is a fairer way to do it.

I guess EITC didn't poll well with the president's speechwriters.

Hagar said...

"Contract worker" means you effectively are a sub-contractor. That is, you work when and if work is available for a set fee per hour, day, or whatever, and you take care of all your problems - taxes, health insurance, tools and equipment, etc. - yourself.
This may well exist for some people employed by firms holding Government contracts, but they would not be covered by the President's proclamation. The very essence of the arrangement is that such "employees" are independent contractors and the "employers" assume no responsibility for them.
So "government contract workers" is a misuse of the term in this context.

Beyond that, as far as I can see through my working life, the "Minimum Wage" question is an evergreen campaign plank for the left, but has little practical effect; it has always trailed slightly behind the actual "minimum wage" being paid at the time.

SGT Ted said...

This is another tell--this one seemingly innocuous, even beneficent, assuming Obama gets away with it--that we are not any longer living under the system we thought we were but are in a de facto police state.

This is where you are right.

Where you are wrong is that the unions position is moral.

Seeing Red said...

The unions are getting the raise. What does your contract say?

Freeman Hunt said...

Can the President do that? He's not a king. The money isn't much of an issue as $10 an hour is a pretty common wage for these jobs, but the President acting like he's our ruler is certainly an issue.

EDH said...

Republicans should introduce legislation that would pay the minimum wage to all interns in the federal government, and give private employers a tax credit equal to any increase in the minimum wage.

Robert Cook said...

Sgt. Ted,

Ah...I see. Thanks for clarifying.

Seeing Red said...

When is the asfcme contract up?

SGT Ted said...

He's doing it for the unions. ALL union contracts have automatic escalator clauses that state that when the min wage is raised ALL pay levels get bumped up accordingly to maintain the "spread" between pay-scales.

This, a thousand times. He just gave a stealth raise to the union suck-ups, using our money.

Robert Cook said...

By the way, the unions didn't kill Detroit or the Rust Belt. It was the carmakers and other industrial employers, a result of malfeasance, mismanagement and greed, and the automation of many jobs that were formerly performed by humans, and the offshoring of jobs to countries where workers make a fraction of what would be living wages for American workers.

This is happening all over America now, and we barely have a union presence anywhere, yet the corporate parasites are hollowing us out to enrich themselves.

Brando said...

Also interesting is how SMALL this presidency has become. Obama has moved from major global warming and health care legislation to abusing his executive power to achieve . . . a modest minimum wage increase for a small category of federal contractor employees? I guess he figured he can't get anything important accomplished so he might as well play small ball.

At least when Lincoln and Jefferson abused their executive powers they did it for bigger reasons, like doubling the size of our country or saving the Union from disintegration. But for a minimum wage hike?

EDH said...

Mattman26 got it right:

So this is nonsense masquerading as substance. And that's what's become of this guy's presidency.

I get the feeling Obama knows the worst is yet to come and he's fucked.

Seeing Red said...

This could be a minimum of 500k to a million.

Ignorance is Bliss said...

SGT Ted said...

He just gave a stealth raise to the union suck-ups, using our money.

They are trying to do that by trying to raise the federal minimum wage, but they have not done so yet. The union contracts are not pegged to the minimum that the federal government chooses to pay for labor in the contracts it negotiates, which is what is being raised by executive order.

Seeing Red said...

This sets the bar for union negotiation going forward.

YoungHegelian said...

@Harold,

What I've seen in other articles about this is that it will only apply to new contracts.

Damn straight on that, Harold! Otherwise, since the President would be imposing a burden on present Federal contractors that was not part of their agreed on contractual terms with the Feds. To impose such a new burden would mean that the contracts would need to be re-negotiated (which NO ONE, fed or industry, wants to do) or industry would take the Obama Admin to court & clean the Admin's clock. Federal Courts have historically taken a very dim view of the the Federal Government abusing its contractual advantages vis-a-vis private industry.

jacksonjay said...


If a public school receives federal funds for a lunch program, will they be require to pay the workers $10 per? What constitutes a federal contract?

Ignorance is Bliss said...

Freeman Hunt said...

Can the President do that?

I would assume so. The executive branch negotiates the contracts for all sorts of services that they purchase. President Obama just ordered his subordinates who negotiate such contracts to include one more clause. As long as Congress has appropriated the money for the service being purchased, this should be within the President's powers.

Matthew Sablan said...

"What constitutes a federal contract?"

-- A contract negotiated with a representative of the federal government. So, no. Those school employees may be employees of the school district or contract workers to the district [either state or local government, depending.]

Of course, that's assuming that all the words mean what they mean, and there isn't legal jargon I'm unaware of.

LarsPorsena said...

Matthew Sablan said...

Also, "federal contract workers" =/= "federal workers." There's a huge difference there.

1/28/14, 10:48 AM
___________________________________

It makes no difference if you are a tax payer. You'll be picking up the tab.

Seeing Red said...

So professor, would McCain have done this?

Ovaries. Spit!

But don't talk derogatory, wagging the finger, can't have that!

James said...

I listened to a report by Ann Compton on the ABC radio network yesterday. She reported that Obama has scheduled a meeting with corporate CEOs on Friday to discuss hiring the long-term unemployed.

My ears perked up was when she said the CEOS will attend the meeting "to pledge support" for the president's plan. I couldn't help but think that we're now like North Korea or the old USSR where CEOs are required to go to the White House to "pledge" their support for the president.

lgv said...

Hmmm, is it a zero sum game? Unless greater spending is authorized, then fewer goods and services will be procured, which will lead to fewer employees. Doesn't that demonstrate the law of supply of demand? It doesn't matter if it actual federal employees or contractors. The result is the same.

The only way it doesn't impact employment is if spending (and taxes) are increased to cover the rise in wages. If that is the case, then it is simply more wealth transfer from taxpayers to low wage employees.

Hagar said...

When I got out of the Army and got a part-time job stocking grocery shelves to help hold body and soul together while going to college, gas cost $0.329/ gal., the Minimum Wage was $1.00/hr., and we got paid $1.10/hr.
The present Minimum Wage actually is lagging behind the rate of inflation, and the world is not going to end if it is raised to $10.10/hr. (Curiously precise number; must be based on the officially calculated inflation rate from some base year.)

That said, I think this sort of thing definitely takes legislation by Congress.
However, that would mean Congressional leaders taking on a fight to oppose the President's usurpation of powers and at the same time legislate to achieve the object of his usurpation.
The muddle the MSM would make of this beggars the imagination, and think few in Congress are going to wish to go there.

tim maguire said...

Robert Cook's assertion notwithstanding, I too would be amazed if it turned out that a federal employee made less than $10.10/hour.

In fact, going to sheer speculation, I'd be willing to bet that that is how Obama intends to get away with it legally--nobody will get an actual raise out of this.

Alex said...

I never understood the point of the federal minimum wage. Shouldn't this be county by county given the vast difference in cost of living? $10 in New York City is not the same as $10 in Kansas City.

PB Reader said...

He'll do or say anything to buy votes.

The Drill SGT said...

LOL,

I'm not sure any of you know of what you speak WRT Federal contracting.

Mattman may :)

50+ comments and nobody has said Service Contract act or DOL Wage Determination.

I bet Obama's weenies don't have a clue either.

Federal contracting (and it's construction subset governed by Davis Bacon) is driven by the Service Contract Act.

These Blue Collar jobs have a federally mandated floor which is determined by occupation and locality. Contractors must pay at least the minimum plus a benefits pay package on top.

For most every category, the already set minimum is above the DOL WD amount. Thus the impact of the Obama EO is going to raise the floor of some of these categories a bit, but won't alter any above the line, though it may cause some interesting cases by setting several wages, like Cashier I and Cashier II both at the same wage of $10.50.

An example of a table:

**Fringe Benefits Required Follow the Occupational Listing**
OCCUPATION CODE - TITLE FOOTNOTE RATE
01000 - Administrative Support And Clerical Occupations
01011 - Accounting Clerk I 11.93
01012 - Accounting Clerk II 13.39
01013 - Accounting Clerk III 15.02
01020 - Administrative Assistant 20.97
01040 - Court Reporter 14.60
01051 - Data Entry Operator I 10.84
---------------

What a mess. All I know is it's going to make the lawyers happy. Already, nobody can figure out the impacts of Obamacare on the benefits packages required...

Hagar said...

Janitorial services, say, are generally contracted out, so the building janitors are employees of Acme Janitorial Services, not the U.S. Gov't. Obama is issuing an executive order requiring Gov't procuring officers (keep it clean here!) to insert a clause requiring Acme to pay their employees a minimum of $10.10/hr. in the Contract Services Agreement.

Seeing Red said...

Until we know how "federal contract employee" is defined, we don't know where this will hit.

Even if it's defined, it wouldn't be the first time it was ignored.

It all depends on what the definition of "is" is.

Freder Frederson said...

. I would bet both of my thumbs that either (a) none; or (b) virtually none receive less than $10 an hour.

I'll take your thumbs. I'll give you an address to send them to.

Oh, and please preserve them in some way before you mail them.

Robert Boxer said...

I recently wrote an article about how an increase in the minimum wage rate increases unemployment. You can read it here: http://wp.me/p3N9zD-4e

n.n said...

Obama does not understand that supply and demand are derivative of the natural order and are neither speculative nor subject to debate.

Besides, it's so much easier, and [politically] profitable, to treat symptoms (e.g. medical insurance "reform", redistributive change) than to address progressive cost-of-living and economic development, as well as stressors including excessive or unmeasured immigration.

Seeing Red said...

Foxconn. Setting up s hop in America cos were cheaper? Fat chance.

garage mahal said...

If big government can crush unions why can't big government give them a raise?

Dave Schumann said...

Hagar @11:53 wins. What Barry's doing appears to be legal in the sense that as the executive, he can negotiate whatever terms he likes with contractors, including a "you must pay at least X to everyone" term. Davis-Bacon *requires* contracts to include certain terms related to "prevailing" wages, but nothing stops Barry from adding additional terms.

That being said, we should look for what's not seen. This will necessarily make federal contracts more expensive, without increasing the budget for any agency. What will these agencies spend less on?

One would expect them to follow the thug strategy adopted during the "shutdown" and spend less on whatever it is that people actually use. Then they'll cry poverty in budget hearings.

Brennan said...

I never understood the point of the federal minimum wage. Shouldn't this be county by county given the vast difference in cost of living? $10 in New York City is not the same as $10 in Kansas City.

Uncle Sugar does provide exceptions in very restricted, limited cases.

Liberals will tell you that raising the minimum wage has no relationship with increased unemployment. Ergo, it appears to be an easy choice to raise wages with absolutely no consequences.

Seems easy, but why have Presidents of the past avoided raising the minimum wage? Were they all under some spell?

Hagar said...

I see what you did there, Freder!

The Wonkblog Freder refers to above then proceeds to talk about Federal workers making less than $12.00/hr. and further muddles it by talking about construction contracts, which come under the Davis-Bacon Act, which is a totally different proposition.

Totally dishonest as usual!

Brennan said...

@Robert Boxer: Thanks for sharing your post. I enjoyed it.

MadisonMan said...

President Obama will announced plans to use his executive authority to raise the minimum wage to $10.10 per hour for federal contract workers during the State of the Union address,

Does the increase continue after the SOTU address concludes?

What the Republican Response should do is to point out how very very few people this gesture actually benefits. And conclude by thanking the President for an empty gesture.

Hagar said...

Well, he is President Styrofoam!

Mattman26 said...

Freder has demanded my thumbs to make good on my bet that no one or virtually no one (surely some wiggle room there!) gets less than $10 an hour. Looks from the WaPo article that just over half a million get less than $12/hr, but still unclear how many of them get less than $10.

Freder, what say we compromise and I'll send you my nail clippings?

Hagar said...

None of the commenters above have mentioned fringe benefits.

40 years ago, when I worked for a general contractor in Illinois - a 100% unionized area - we figured an average of 22% additional to the direct labor costs for "fringe benefits," and I doubt this has gone down any since.

When you are dealing with Democrats, you should always ask for the exact details of what they are proposing, and make sure you get them before committing yourself!

Sigivald said...

Robert Cook said: You nailed it...that's why we have an employment crisis...it's the unions!

(Ahem...not.)


Well, it sure is plausible that it's a factor, though not "the cause" - as there is no one single cause.

Will you disagree that the very nature and point of unions requires that they constrain the labor pool for the unionized fields?

They can only ever gain increased relative wages by preventing competition for labor supply and by constraining entry into the fields.

This is axiomatic to the very idea of the labor union as wage-increaser, and borne out in every example I've ever seen from people trying to join one - lots of waiting for "a space to open".

So at some level they are increasing unemployment, and cannot possibly do otherwise, without giving up the alleged benefits they provide their (often captive) clients.

("The union has thus achieved a restrictionist wage rate. [...] But a sacrifice has been made — specifically, there are now fewer workers hired[...]. What hap­pens to them? These discharged workers are the main losers in this procedure. "

Alternative theories as to how unions can command a price premium on labor without restricting employment are welcomed, but had better be pretty compelling and more interesting than "they just don't".)

Brennan said...

@Freder: Wonkblog is relying on Demos study. Demos is relying on a study by EPI. EPI doesn't tell us how they get their figures for federal workers that are making less than $12 per hour.

This looks like allies trusting allies to me. I've seen this game before. They're not willing to apply a healthy sense of skepticism. It's go along to get along.

Can you fill in the gaps?

Seeing Red said...

Dave, de blasio's doing that on affordable housing. Gonna take the mayors to DC to get more money for affordable housing.

It's a shame mayors can't take a look at their local regulations and clear out the deadwood. It's like they have no control over what they're mayor of.

Brennan said...

Interesting enough, Demos says legislation is necessary to remedy this. I suppose to tomorrow morning they will have a new study that claims it's not.

Peter said...

The question is, how much work that's now done at minimum wage produces more than $10. value to the employer?

If you're a federal employee (or contact employee), the answer is "it doesn't matter."

But if you work for an employer in the private sector, well, no one's going to pay more for an employee than the employee is worth.

I'd ask if the president knows this, but I'm pretty sure the answer is, he doesn't care- when everything is political, reality outside the political sphere is irrelevant.

BTW, the inflation-adjusted value of the minimum wage peaked in 1968- but there was still robust demand for low-skill labor then.

Today the value of low-skill labor is reduced by globalization (if your wage is too high, someone, somewhere will do it for less) and automation (if an algorithm can do your job then it probably will). And to some extent customers can often be made to do some of the work (i.e. self-checkouts at stores, ordering from touchscreens at restaurants).

Seeing Red said...

Ita put all interns under a new contract and tell congress no new money they're coming out of your budget.

Phaedrus said...

Why limit the minimum to $10.10 why not $20.20 or $30.30 or $40.40 etc. If raising the minimum has no harmful impact why stop at $10.10.

Hagar said...

If the present market minimum wage is about 10-11 dollars an hour, raising the Federal Minimum Wage to $10.10 is not going to have much effect, one way or another, but is always a powerful emotional campaign promise.

Joe said...

However much fault management has for the decline of the steel belt, to hold unions faultless is absurd. Their work rule restrictions and willingness to drive companies to bankruptcy rather than compromise was, and continues to be, extremely destructive.

Hagar said...

and campaign is what Captain Styrofoam does.

Mattman26 said...

I agree with Phaedrus. As long as the number of cents is the same as the number of dollars, only good can come from this policy.

RecChief said...

Robert Cook said....
"By the way, the unions didn't kill Detroit or the Rust Belt. It was the carmakers and other industrial employers, a result of malfeasance, mismanagement and greed, and the automation of many jobs that were formerly performed by humans, and the offshoring of jobs to countries where workers make a fraction of what would be living wages for American workers."

While I agree with you that there is a fair amount of incompetence and even malfeasance in corporate america, the costs of union labor is one that can't be ignored. your lament about automation is particularly interesting. How do you think productivity gains have increased to where they are? I'm not trying to be combative, but your statement represents a failure to recognize all of the factors that led to the destruction. If you have a blind spot to all the factors, how can you find solutions that are fully formed. And this is why so many "solutions" that come out of Washington create as many problems as they purportedly solve.

The Drill SGT said...

I looked at a SCA listing for DC, from 2009 just now. The only categories under 10.10 among the 340 plus listed were

- waitress @ 9.70
- 7 assorted laundry workers @ 9.88
- carnival worker @ 9.24

9 of 340 job types

http://www.wdol.gov/wdol/scafiles/archive/sca/05-2103.r12


The Drill SGT said...

PS: and those under 10.0 jobs also come with:

---------------
ALL OCCUPATIONS LISTED ABOVE RECEIVE THE FOLLOWING BENEFITS:

HEALTH & WELFARE: $3.71 per hour or $148.40 per week or $643.07 per month

VACATION: 2 weeks paid vacation after 1 year of service with a contractor or
successor; 3 weeks after 5 years, and 4 weeks after 15 years. Length of service
includes the whole span of continuous service with the present contractor or
successor, wherever employed, and with the predecessor contractors in the
performance of similar work at the same Federal facility. (Reg. 29 CFR 4.173)

HOLIDAYS: A minimum of ten paid holidays per year, New Year's Day, Martin Luther
King Jr's Birthday, Washington's Birthday, Memorial Day, Independence Day, Labor
Day, Columbus Day, Veterans' Day, Thanksgiving Day, and Christmas Day. (A
contractor may substitute for any of the named holidays another day off with pay in
accordance with a plan communicated to the employees involved.) (See 29 CFR 4174)

The Drill SGT said...

PPS: Minus the Union dues of course :)

Darrell said...

I think that Obama should get his $10.10/hr. Heck, make it $10.20. He's worth it.

Jay said...

"President Obama used his executive authority"

What, exactly, permits Obama to do this under the Constitution?

Trashhauler said...

I wonder if this applies overseas. We probably have tens of thousands of federal contract workers at embassies, Afghanistan, and any number of far-flung outposts, all working for less than ten bucks an hour (but for far more than the local economy pays).

Unknown said...

Does this mean any contractor who acquires a contract with the feds must now pay minimum wage to their employees?
Of course they can just stick it to the feds in their bidding, but it could also lead to layoffs. It will certainly lead to unskilled workers having fewer opportunities to work for federal contractors.

Brennan said...

The Wagner Act hampered the big three. The private management of these firms is responsible if they don't try to seek flexibility from it.

The imports with operations in the United States are entirely flexible with their labor operations. Shifting personnel happens every day. No union has to approve the change. None of them are governed by Wagner Act chicanery.

Hagar said...

Contractors to the Federal Government certainly must pay the Federal Minimum Wage plus comply with a host of other requirements such as Equal Opportunity, etc. that they must be ready to document at any time.

This is about paying 10.10/7.25 = 40% above the Minimum Wage plus all those other requirements.

Bruce Hayden said...

Cook, as usual, ignores the reality that the American automakers were being pushed to automate by their foreign competitors, and the unions, sensing the consequences to their membership, made it as hard as they could. Automation provided a number of competitive advantages. One was reliability - the less human intervention in the manufacture of a vehicle, the better it is made. And, it also brought down the cost of the vehicles. So, the U.S. auto manufacturers were faced with superior vehicles being imported (or, made here with non-union labor), and sold for less. The union work rules kept staffing levels too high to effectively compete with these foreign flagged competitors. And, yes, kept the Big 3 pumping out less reliable vehicles much longer than they needed to.

DanTheMan said...

Cookie,
There is a thriving auto manufacturing industry in the south.
Funny how greed, automation, and malfeasance are isolated to Detroit.
But, if you mean greed on the part of the unions, then we might agree....

Brennan said...

@Bruce Hayden: Do you have any book recommendations if a reader want to learn more about that?

I'm a loyal Honda owner, but previously have had wide praise for Nissan. I really couldn't tell you why their vehicles have been so reliable. I have happenned to own(and only buy) their most reliable vehicles. As I get more into DIY repairs, I'm really curious what makes a flippin 25 year old Nissan hardbody truck purr along at 400,000 miles and counting.

Bruce Hayden said...

I should add to my previous post that I moved away from U.S. flagged vehicles a bit over 30 years ago, because I got a more reliable, better performing vehicle with Japanese and German vehicles. A couple years ago, I moved back, and haven't been all that happy about the quality, even in a mid 2000s era vehicle. You still hear horror stories about quality with modern GM, Chrysler, and even Ford vehicles.

The Drill SGT said...

Brennan said...
@Bruce Hayden: Do you have any book recommendations if a reader want to learn more about that?


One word: "Kaizen"

The continuous quality improvement process across the entire company and bought into by the CEO and down to the line monkey.

The term was introduced into the Japanese culture in this context by Americans in the early 50's.

For the inverse, one just has to hear the stories about how the big three auto makers used their employee car purchase program. When a UAW worker bought a new Chevy, as it moved down the line, it had a sign on the roof that read: "This ones for us".

That says volumes about US Quality assurance and how that would horrify a Honda exec and his workers, where every car gets the best from everybody...

Hagar said...

Unions are wonderful when they are small and struggling for recognition, "combinations in restraint of trade" when they are successful and gain recognition, and become criminal rackets when they team up with the government.

n.n said...

Hagar:

Unions were a reactive movement with legitimate cause. As all reactive movements, they should have an end of life, and should never have incorporated.

That said, they could still have a legitimate place in society, but their focus would have to materially change, and they would need a decidedly universal perspective. Also, there is no equivalence between public and private unions. So, the former would have additional constraints of their scope and leverage.

mccullough said...

States can and do raise the minimum wage in their state above the federal minimum. As with most things Obama, this is a trivial proposal. No wonder 20 percent of black men age 18-30 voted for Romney. Obama is incompetent. Any plan he proposes or puts into action will increase income and wealth inequality and will hurt black men the most. Obama is Hoover, with a much lower IQ.

CatherineM said...

http://www.thedailybeast.com/articles/2013/03/06/the-administration-s-thin-complaints-about-the-sequester.html
Bret H. Swanson, assistant sergeant at arms for operations and the manager of cleaning technicians, said 27 people are employed on the night cleaning shift and 16 people on a day shift; a majority of the cleaning takes place at night. There is a differential for the overnight shift, so the night janitors earn an average of $51,644 a year and the day janitors earn an average of $49,481.

Harold said...


Federal workers in pay scales WG1- WG3 in Puerto Rico, which is part of the US, make less then $10.10 an hour. http://www.cpms.osd.mil/Content/AF%20Schedules/survey-sch/151/151R-17Sep2013.html

Marty Keller said...

"I never understood the point of the federal minimum wage."

As a practicing Neanderthal, I've never understood the point of minimum wage legislation, period. Permitting government the capricious authority to willy-nilly barge into strictly private employment transactions between consenting adults is now a never-ending and economically debilitating enterprise, which, if we could monetize it, might pay off the federal debt.

Hagar said...

Historically, I think the least "unequal" societies have been those where people, goods, and capital have had the most freedom to move, and the most "unequal" have been the most regimented.

garage mahal said...

No wonder 20 percent of black men age 18-30 voted for Romney

I would be shocked if that were true.

Rusty said...

What is the unemployment rate among black teenagers?

Lord Ben said...

He should refuse political donations from anyone not paying their workers his new minimum wage. That would be great for the nation.

mccullough said...

Garage,

It should be 20 percent of black makes between 18 and 30 who voted in last election, voted for Romney. That's according to Pew research.

Obama's immigration proposals will pretty much kill off employment opportunities for young blacks, especially males. Not surprising they are turning against that. It would be troubling if they weren't.

garage mahal said...

mccullough
Still think that's wrong. Exit polls pegged the 18-29 black vote at 91% for Obama. Link. Not a big deal in any way...

Douglas said...

I've worked construction both union and non-union, and although it was a long time ago, I have a clear recollection that the union jobs both paid more and involved a lot more waiting around doing nothing.

Hagar said...

And on union jobs, crane operators do the least, are the highest paid, and the most unhappy, disagreeable people, while the laborers tend to be always working, the lowest paid, and the happiest and most congenial to get along with.

Food for thought?

n.n said...

Douglas, Hagar:

Morality trumps instant or immediate gratification. Each party should be considerate of the other. Compensation should be commensurate with productivity and reasonably correlated with cost-of-living in order to control the need for progressive adjustments, which when unbacked by productivity are the cause of progressive inflation, distortion generally, and, of course, corruption.

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Rusty said...

Why do democrats hate young people?