As their previous actions have shown, the Obama administration has proven it has no idea what a functional economic policy looks like. Obamacare is the biggest example of this, but the Department of Labor has just given us another. They are creating what amounts to a blacklist rule to help determine which private businesses are awarded government contracts. Using a 2014 executive order, here’s what they are planning to do, per the Washington Free Beacon:
The regulations could restrict federal agencies from working with companies that have been accused of labor violations or have long track records of “serious” or “pervasive” violations. It forces government agencies to hire “Labor Compliance Advisors” to oversee contractors. Companies will also be forced to disclose pay determinations to employees and regulators over the course of the contract.
On the surface, this might not sound like a bad idea. After all, we wouldn’t want our own businesses to work with companies that have poor track records of labor law violations, right? However, when you look at the rule’s consequences in greater depth, problems start to appear. One of these is the issue of redundancy. As a joint statement from Representatives [mc_name name=’Rep. Phil Roe (R-TN)’ chamber=’house’ mcid=’R000582′ ] (R-TN) and [mc_name name=’Rep. Tim Walberg (R-MI)’ chamber=’house’ mcid=’W000798′ ] (R-MI), who chair the relevant subcommittees on the House Committee on Education and the Workforce, says:
Bad actors who choose to operate outside of the law and deny employees basic protections should not be rewarded with taxpayer dollars.That is why we already have a system in place to deny federal contracts to these bad actors. Instead of promoting more government overreach and more regulations, the administration has a responsibility to ensure the current system is enforced and used effectively.
Redundancy is such a common problem with the government. Whenever a story like this surfaces, I always think back on the list produced by former Senator Tom Coburn back 2011 that highlighted between $100 and $200 billion in government waste from redundant programs alone. Despite the fact that we already have the rules in place to prevent the government from working with bad companies, President Obama has to put his own special touch on this, even if it means redundancy.
This brings us to the next couple of problems the new Labor Department rule will create. Geoff Burr, Vice President of the Associated Builders and Contractors trade association, explains these problems well:
“This rule creates a murky federal acquisition system that is absurdly cumbersome and allows contracts to be awarded in a subjective nature by unelected bureaucrats…The ‘blacklisting’ proposal released today will unnecessarily complicate the federal acquisition process by adding undue subjectivity and may result in some of the best federal contractors being blacklisted from winning future contracts. Additionally, the administration’s latest assault on federal contractors via illegal executive overreach will result in more bid protests and more frequent and costly labor and employment disputes.
“Taxpayers, contractors and their employees deserve a fair and transparent process that will award contracts to firms that will deliver the highest quality product at the best price, however, this proposal is a clear step in the wrong direction…Today’s proposal will discourage small businesses from pursuing federal contracts; threaten the livelihood of millions of Americans employed by federal contractors; and expose taxpayers and businesses to increased costs and risk. We are committed to fighting this proposal in the courts, Congress and through any additional avenue.”
His description makes it plain that this is just the government engaging in one of its standard operating practices: creating rules and regulations that sound well intentioned but in reality only make the legal compliance situation much murkier and more complicated. The cynical side of me says that adding the element of “undue subjectivity” to awards project is precisely why this regulation was developed. Simply put, if you are a private business that wants to work with the Obama-led government, you have to be a company they like, as opposed to the best qualified for the job. The purported concerns about compliance with federal workforce regulations is just a means of achieving that end.
Congress has made a lot of noise about opposing executive branch overreach since Republicans took back the Senate in 2014, but thus far, we haven’t seen much in the way of results. For example, it is the courts, not Congress, that have shut down President Obama’s illegal executive amnesty. [mc_name name=’Rep. John Boehner (R-OH)’ chamber=’house’ mcid=’B000589′ ], meanwhile, caved and funded it, in hopes that the courts would overturn it. [mc_name name=’Sen. Mitch McConnell (R-KY)’ chamber=’senate’ mcid=’M000355′ ] followed suit, but the House basically forced him into the position. At any rate, I mention this to remind us of the Republican-led Congress’ horrible record of stopping executive overreach. Reps. Roe and Walberg talk tough in their press release, but will they and the rest of the Congress follow through when they really must? If they want to gain back a shred of accountability among conservatives, they absolutely should.
Featured image via Ed Brown at Wikimedia Commons.