by Lance T. Izumi, Fellow in California Studies
Pacific Research Institute
June, 1999

Announcer lead: Time for Perspectives. Lance Izumi says that local project labor agreements undermine fundamental freedoms.

The recent strike by union carpenters working on the San Francisco airport expansion project has focused attention on the problems with so-called "project labor agreements" or PLAs. The airport expansion is governed by a PLA which allows only union labor to work on the project in exchange for union promises of labor peace. The carpenters' strike, however, demonstrates that such promises are often more illusory than real.

False promises of labor peace, though, are not the only problem with PLAs. PLAs reduce competition by shutting out non-union contractors from bidding on public works contracts. Studies show that PLAs increase costs because unionized firms are less efficient than non-union firms. Taxpayers end up bearing these costs.

Unfortunately the Bay Area has been a fertile breeding ground for PLAs. Late last year, the city of San Jose approved the negotiation of a PLA for the expansion of San Jose Airport. In San Francisco, a board of supervisors committee has approved a plan to require PLAs for all city-funded public works projects. And in Oakland, the Port Authority board recently voted to negotiate a $1.4 billion PLA for the expansion of the Oakland airport and harbor.

Among those hurt most by PLAs are minority contractors, the overwhelming number of whom use non-union labor. Hispanic and black contractors associations oppose PLAs. The American Asian Contractors Association, which has filed suit against the San Francisco airport PLA contending that it violates state competitive bidding laws, says that PLAs are "a disaster for minority-owned businesses."

In its assault on employers, non-union workers, and the taxpaying public, big labor and its local government allies are destroying basic freedoms: the freedom to contract, the freedom to work, and the freedom to associate. In June, the California Supreme Court will hear the Asian contractors' lawsuit. Hopefully the court will rule in favor of liberty and against special interest monopoly.

With a perspective, I'm Lance Izumi.