Who's more nuts?

Construction Managers or Owners?

Over the last year or so, many Construction Managers have been caught up in a downward spiral of ever reducing fees?  (Architects have been doing the same thing - but that's a topic for another day.)

Conventional wisdom is that, with a routine CM contract, fees of between 2 and 3 % are needed to spin off enough profit to maintain the business.  How can it be that many proposals are now coming in at 1/2 of that?  What the heck is going on?

• Are Owners now rationalizing some sort of retribution?
• Are CM's buying work to keep staff occupied?
• Have some accounting changes made conventional wisdom invalid?
• Is risk getting reassigned?
• Are there hidden profits not fully disclosed by CM's?

Does any one really know?  What do you think?