Does anyone understand?

If you want to understand why the O’Malley Administration cannot get a handle of basic economics, and if you want to understand why Martin O’Malley is continuing to help make it harder and harder for working and middle class families to make it, look no further than his cabinet. State Secretary of Labor Tom Perez tries to sell the argument today in the Gazette that prevailing and living wage laws are good for Maryland.

But of course like most liberals do when discussing the economy, Perez completely contradicts his own argument:

And yet study after study of prevailing wage laws, many that have been on the books for decades, finds that the prevailing wage does not increase costs, and actually has benefits for governments and taxpayers in the form of increased quality and productivity.

A recent paper by the Economic Policy Institute attributed the lack of a link between the prevailing wage and increased costs to various factors, including the fact that in many cases, workers already earn the prevailing wage, and the statute is simply a way to ensure employers who do right by their workers are not underbid by those who do not.

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The emphasis is mine and points out a couple of things:

  1. If employees are already earning the equivalent to the prevailing wage, what point is there adding prevailing wage laws to the books
  2. If the statute is a way to “ensure employers who do right by their workers” is that not artificially inflating costs? If a company paying a prevailing wage needs statutory protection to ensure that they are not underbid by a company who does not pay the prevailing wage, more taxpayers dollars must be spent than otherwise necessary in order to complete the project.
  3. Is is better to “do right by workers” by providing more jobs to people who don’t have them, or by taking away jobs from people who need them in order to cover the costs of a prevailing wage?

So, to make a long story short, Tom Perez is either lying or doesn’t understand simple economics.

I do find it interesting that Perez waxes poetic about ensuring workers receive the “basic respect they deserve in return for the work they do.” As a taxpayer of Maryland, I sure as hell don’t feel like Perez and the rest of the O’Malley Administration has a basic respect for the work Maryland’s working and middle classes do, and the taxes we pay to cover their wasteful spending and profligate lawmaking.


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