JACKSON, MS (AP) President Bush’s suspension of a decades-old labor law could drive down wages in hurricane ravaged areas while allowing massive corporations to exploit workers, union leaders said.

But at least one of the companies that was awarded a multi-million dollar contract in the wake of Hurricane Katrina says it will not reduce wages.

Key officials with the AFL-CIO in Mississippi, Louisiana, Texas and Alabama met in Jackson Sept. 29 to urge Bush to reinstate the Davis-Bacon Act of 1931. The act requires payment of prevailing wages on government contracts based on surveys that take into account pay in a given area.

Bush suspended the act on Sept. 8, saying the move will help reduce rebuilding costs, which some estimate at $200 billion, and open opportunities to minority-owned companies that often are left out of federal government contracts.

“Days after Katrina destroyed so many lives and families and when people were still rescuing from roof tops in New Orleans, President Bush took time to strike a blow to the working men and women,” said Alabama AFL-CIO president Stewart Burkhalter. “The suspension of Davis-Bacon is designed to do nothing more than increase the profits in large corporations with close ties to this administration.”

Bush spokesman, Allen Abney, said that suspension of the act will speed recovery in devastated areas while cutting costs.

“The president has said he wants to cut red tape whenever necessary to ensure that the victims of this natural disaster are cared for and that the communities are restored as quickly as possible,” Abney said. “The suspension of the Davis-Bacon Act will do just that.”

Kellogg, Brown & Root, which was awarded a $16 million contract, won’t reduce wages, said Cathy Mann, a company spokeswoman.

Robert Shaffer, president of the Mississippi AFL-CIO, had a more grim take on the Gulf Coast recovery.

“There are reports of contractors using humans as indentured servants and keeping them and not letting them get back across the wire,” Shaffer said, referring to razor wire around hard hit areas. “I haven’t seen that for myself but it’s been reported to me.”

The other union leaders said they have no proof of workers forced into indentured servitude, and when questioned by The Associated Press, Shaffer said he was speaking from secondhand reports.

Burkhalter said Florida-based Ashbritt Inc., which was awarded a $500 million contract to cleanup Mississippi, hired a Washington lobbying firm co-founded by Gov. Haley Barbour for $40,000 this year.

“While Gov. Barbour and President Bush are looking after their big corporate friends, the people of the Gulf Coast who need jobs ... are getting left behind,” Burkhalter said.

Barbour’s spokesman, Pete Smith, said the governor is no longer a part of the firm and stepped down to take his current office.

AshBritt officials did not immediately respond to calls to its Pompano Beach, FL, office.

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