The question is whether it's fair market value. So if there were competent people willing to do the work for $60 an hour, then $70 would no longer be fair market value.

The laborers don't make $70 an hour, that's what the project bills their rate as. They make closer to $20, the difference accounts for management salaries, times when the buisness has to pay the employees when they don't have work but don't want to lay off (because they are expecting work) and benefits (sick time, pto, parental leave, training etc.)

This is simply not true. See plenty of other comments in this thread talking about actual rate cards.

It is true for me. My employer charges the government $142/hr for my time and pays me $43

> What does a software developer make in California?

Yeah, not the best example to go with. If the numbers on HN are at all accurate, it's not uncommon for a FAANG employee to make more than a DOCTOR in North Carolina.

>it's not uncommon for a FAANG employee

that's why I chose it as an example to compare with the wage of somebody who does hard physical labor underground with a significantly higher chance of injury https://www.ncbi.nlm.nih.gov/pmc/articles/PMC4667042/ - relevant quote:

"However, there is still a relatively high incidence of labour accidents during tunnel construction when compared to incidence rates in the construction industry in general. During tunnel construction, rock fall events at the cutting face are a particularly characteristic of the type of accident that occurs."