A $10 billion add-on

Washington Post: Tucked away in the 2010 Defense Authorization Bill just passed by the House is a provision that should give senators — and taxpayers — pause. Over the next five years, 17,000 U.S. troops and dependents will relocate from Okinawa to a new base on Guam. This project will require billions of dollars to build the base itself, as well as billions more to repair and add to Guam’s infrastructure. The $10 billion projected cost is to be split by Japan and the United States: Japan would supply $2.8 billion directly and an additional $3.2 billion in third-party funds while the United States would contribute $4.2 billion.

Major change

That was the plan. But the provision inserted by Rep. Neil Abercrombie, D-Hawaii changed all that. It has more than doubled the cost of the relocation by requiring that at least 70 percent of the construction force be U.S. citizens and that construction workers be paid at the Hawaiian prevailing wage rate, which is double to triple Guam’s. The ostensible rationale is that Guam does not have a large enough workforce to meet the demand, and it is necessary to bring wage levels into a competitive range to attract U.S. workers. But the initial estimate for construction expenses was near $300 million, while the change would drive construction worker compensation costs to more than $10 billion.

If giving U.S. workers jobs on Guam is a priority, this could be accomplished without driving wages up artificially to such a high level. ... But given that Japan is paying for much of the relocation, does it make sense to limit the participation of Japanese construction firms