920 Allowances:Repeal the Davis–Bacon Act

Sources

Savings are expressed as budget authority and were calculated by comparing current federal construction spending of $277 billion annually, as found in U.S. Census Bureau, “Construction Spending: Value of Construction Put in Place at a Glance, November 2014,” January 2015, to spending levels in the absence of Davis–Bacon. Both spending levels were increased at the same rate as growth in discretionary spending, according to the CBO’s most recent August 2014 baseline. Davis–Bacon increases construction costs by 9.9 percent, as documented in Sarah Glassman et al., “The Federal Davis–Bacon Act: The Prevailing Mismeasure of Wages,” The Beacon Hill Institute, February 2008, and it extends to 32 percent of all public construction spending.

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Technical Notes on Scoring

CBO Baseline

Unless otherwise noted, calculations for savings for each recommendation relies on the most recent Congressional Budget Office baseline, as found in “An Update to the Budget and Economic Outlook: 2014 to 2024,” published August 27, 2014, has been used.

Savings “Totals”

While totals for the five and 10 year savings are provided by section and for the complete set of recommendations, there are two reasons they should not be viewed as representing total savings for The Budget Book.

First, as noted in the introduction, The Heritage Foundation would recommend that the savings realized in the Function 050 Defense section would stay within the Department of Defense to strengthen the nation’s defense capabilities.

Second, the numbers cannot be deemed to represent the realized savings if every single recommendation were adopted because policy changes made in one program can impact spending levels in other programs.  Thus, the numbers in the table do not reflect any potential interactions between the various policy changes affecting spending or savings.

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