Latest / The Fiscal Policy Podcast with Fexingo: Government Budgets, Stimulus, and Public Spending
Why the Government Pays 50 Percent More for Construction Than Private Firms
The federal government spends over $200 billion annually on construction projects, but a 2025 Government Accountability Office report found that public building projects cost 50 percent more per square foot than comparable private-sector developments. Lucas and Luna drill into one specific case: the $6 billion renovation of the FBI headquarters, which has been delayed for over a decade and is now projected to cost 70 percent more than initial estimates. They examine the root cause: the Davis-Bacon Act, passed in 1931, which requires contractors on federal projects to pay 'prevailing…
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