Sunday, July 12, 2009

What's Behind Abercrombie's Ammendment?

What’s behind the Abercrombie amendment?
Sunday, 12 July 2009 23:49 by Jayne Flores
The Marianas Variety

It’s a trade off: the long-awaited payment of war reparations to our dwindling number of survivors of the Japanese occupation, for a Hawaii-based wage rate for the buildup.

That seems to be the most logical reason behind Hawaii Rep. Neil Abercrombie’s two additional amendments to the National Defense Authorization Act for Fiscal Year 2010.

Abercrombie is running for governor, and if he can boost his state’s struggling economy by giving construction workers jobs on Guam that pay just as much as if they were working in Hawaii, it would be a large feather in his political cap. It’s a cap that, according to a candidate watchdog web site, has been paid for with contributions from the likes of Lockheed Martin, BAE Systems, and 21st Century Systems, all military contractor heavyweights.

On the other side, we’re getting to the point that if we don’t settle this war claims issue soon, there won’t be any WWII survivors left to receive the money.

Abercrombie’s first amendment requires that Hawaii construction wage rates, which are approximately double what construction workers on Guam are paid, will apply to all build-up related projects funded with money specifically earmarked for the build-up.

The second amendments says that not more than 30 percent of the total hours worked per month on a buildup construction project may be performed by foreign workers, or workers holding temporary work visas.

So we’ve now got requirements that the Defense Department has to pay everyone who works on a buildup project those high Hawaii wage rates, and on each of the jobs, 70 percent of the work hours have to be worked by U.S. workers.

Obviously, Abercrombie is trying to prevent jobs going to foreign workers while construction workers in his state and other states are out of work. His amendment makes perfect sense if you’re a senator watching unemployment rates skyrocket in your state, or watching your state hand out vouchers for payment because it is broke.

This amendment seems to strike fear in the hearts of contractors on Guam and the overall Guam business community. They’ve been collectively saying that doubling wage rates for these projects might kill the buildup, or cause a domino effect and increase the cost of living on the island. But would it?

The large contractors that will be paying these higher rates already pay similar rates in many states. According to, journeyman electricians make an average of $25.44 an hour in the states. Carpenters make from $22.33 to $32.43, depending on where they work. So these contractors’ bids will reflect the Hawaii-based wage rates accordingly. It’s the Department of Defense that will have to fork out the big bucks.

Local contractors are not getting these jobs – that’s the word through the grapevine. They may get subcontracts, but they can work the higher wages into their subcontract bids. So the local contractors won’t actually have to pay these rates, because Abercrombie’s amendment is specific to the buildup, not to the prevailing wage rate on Guam.

What will happen, though, is that the buildup will create two classes of H-2 workers and local workers, those who work on federal projects and are paid the higher wages, and those who work on local projects and are paid Guam’s prevailing construction wage rates. This could cause some animosity among workers within a company, especially among foreign workers who might fight over who gets to work the 30 percent hours on federal projects.

The higher wage rate might actually work in Guam’s favor. Although stateside workers will probably send home a significant portion of their paychecks if they don’t move their families out here, rest assured, they’ll frequent local restaurants and other establishments, and spend more of their money here than would foreign workers, who as a general rule send home most of their paychecks.

The defense budget bill, including the war claims and Abercrombie amendments, is now in the U.S. Senate. What senators are going to have to decide is whether they want to increase the cost of the buildup in order to put more Americans back to work, or scratch the whole bill and start over. Or, they could take out Abercrombie’s amendments, or the war claims amendment, or both.

At this point, anything can happen. But having to deal with the higher buildup wages won’t be as devastating as will having the war claims legislation slip through our fingers once again.

If this is the deal – we should take it.

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