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• Letter to the President of the United States: Re: Reform of L-1B Visa “Specialized Knowledge” Definition (PDF). Excerpts: Dear President Obama: The U.S. Chamber of Commerce and 62 multi-national corporations sent you a letter on March 22, 2012 asking you to make it easier for them to transfer employees with “specialized knowledge” from their overseas offices to the U.S. The undersigned organizations urge you to reject their request to weaken the L-1B visa definition of “specialized knowledge,” because the change is not in the best interest of foreign or domestic workers.

  The L-1B visa gives employers access to a large labor force that has very few rights in the workplace. First, employers are not required to pay L-1B visa beneficiaries a minimum or prevailing wage. Workers are not in a position to negotiate better wages, because they can be easily fired, which renders them out of status and requires that they leave the country immediately. Second, the L-1B visa is not a long-term investment in the U.S. economy since only a small fraction of L-1B visa beneficiaries will be sponsored by their employers to stay in the U.S. permanently. The L-1B visa is really about businesses having ready access to a powerless, low-wage workforce.

  The L-1B visa also has a significant impact on U.S. workers. U.S. workers can be fired and replaced with L-1B visa beneficiaries. A report by the Department of Homeland Security, Office of Inspector General in January 2006 found “[t]hat so many foreign workers seem to qualify as possessing specialized knowledge [that it] appears to have led to the displacement of American workers.” Labor unions support the use of nonimmigrant visas for high-skilled workers, but also strongly support assessing the impact of work visas on the U.S. workforce.

  The L-1B visa is largely a black box. We do not know how many beneficiaries are currently working in the U.S., where they are working, what their qualifications are, and how much they are earning. We should have answers to these very basic questions and a thoughtful debate before the standard for “specialized knowledge” is weakened. ...

  Editor's note: I can attest that IBM abuses the L-1B visa program extensively. Before leaving IBM recently, most of my IGS projects were staffed with over 50% (and sometimes nearly 100%) employees from IBM India here on L-1B visas. The IBM India employees included program managers, developers, database administrators, business analysts, and others...hardly employees with "specialized knowledge." In fact, many of the IBM employees were newly hired into IBM India and their first IBM job was in the United States on an L-1B vista.

  Unlike the H1-B visa, which is more closely monitored, the L-1B visa program has provided IBM with a means to bring unlimited numbers of offshore employees to the U.S. to staff projects, instead of employing North American employees. It is a travesty.

• Job Cut Reports
  • Comment 05/03/12: Help! The Retire Trans offer sounds like a good deal for me, but I have to be missing a major downside given the comments already posted. Here's my situation. Eligible to receive IBM pre-2008 pension now (small as it may be), but planned to retire Dec 31, 2013 so I can collect my FHA. Loss of customer accounts has reduced my workload to 44 hrs/week. That makes me more nervous about being targeted for RA. So the Ret Trans program would assure me of not being RA'd and I'd only work 26hrs/week. (my bad if I go beyond 26hrs). Eligible to collect FHA Dec 31, 2013. So the Ret Trans program would ensure that will happen. Have retirement income from a former employer, to recover some of the 30% drop in pay. Have an annuity that I could begin drawing from to offset most of the remaining drop in pay. Everything else is neutral (med, insurance, benefits etc) Any wisdom to share to help me (and possibly others in my position) avoid making a big mistake by signing up? -On The Fence-
  • Comment 05/04/12: For the people asking the downside, what happens when you commit to leave on 12/31/2013 and then become un able to fulfill that commitment? For instance a medical issue comes up? -Critical Mass-
  • Comment 05/04/12: As of yesterday, there were over 4000 hits to Transition to Retirement brochures and documents. It was subsequently reset. For the sake of argument, let's say there are 4000 possible retirees. Let's also say they make an average of $100k and severance would have been on average $50K (max 26 weeks). 4000 x $50k = $200 Million IBM savings in severance. 70% of average $100k salary would be savings of $30k. 4000 x $30k = $120 Million. So be signing up for TTR Plan, IBM would save average $320 Million, given above scenario. What does the employee get??? -Anonymous-
  • Comment 05/04/12: Well, some companies apparently do understand the value of an educated workforce in the knowledge economy (and put their money where their mouth is): united-technologies-is-a-rare-corporate-do-gooder

    In today's IBM there's no money for business essentials like new computer equipment, software licenses, or travel, let alone education. Ginni and Sam talk about all the money available for education, but have you tried asking your immediate manager whether any of it is available to you? From personal experience, you will get a resounding "no", perhaps accompanied by a strange look, or even raucous laughter. Yet, here's UTC spending $1B (yes that's a "B", Ginni and Randy, not an "M") because they realize the value of an educated workforce. Take heed IBM; this one-sided labor market isn't going to last forever, and you are going to very much regret how you have treated your most valuable asset ... your employees. -IBM Mentat-

  • Comment 05/05/12: The transition to retirement program costs IBM nothing. instead of paying 6 mos severance and unemployment, IBM gets the employee to work for an additional year. Since it is "voluntary" it gets IBM good press versus, negative press for laying off the same person. Employee loses 30% pay for a 18 mos. and loses unemployment when terminated and probably reduced 401K contributions for 18 mos. What a scam. -anonymous-
  • Comment 05/05/12: Dear On-The-Fence. Hanging around 20 months just for 2.5 years of Medical coverage seems like a painful approach. You never mentioned whether you are already at 29+ years, it's obvious you aren't quite 55. So the additional pension bump at eligibility can be as much as 20%. However the Transition to Retirement does not guarantee against job-loss for other reasons besides an R/A. Don't underestimate IBM upper-management and their sociopathic thinking. You poor person, you are only a little more than 40 hours a week busy so that level of torpidity makes you a target in this sick company. A healthy company would be worried about how much work you would be leaving behind. But that's not how things work, here on the death-star aka IBM. -Poughkeepsie Engineer-
  • Comment 05/05/12: IBM is tightening the noose. Many of those of us on the IGS Global Account are being forced to IGS commercial travel jobs. If we refuse, we have been told we will be terminated without severance. The code name for this is "Nautilus Program". -Anonymous-
  • Comment 05/05/12: In response to On-The-Fence, and to further add to Poughkeepsie Engineer's comments, FHA is NOT vested. IBM Management can eliminate this benefit ANY time they wish, without prior notice. In fact, once Medical Insurance Exchanges become available under the Healthcare Reform Law in 2014, I fully expect that IBM Management will eliminate this benefit.

    Look for another e-mail from Randy around the end of 2013 with some bizarre, twisted explanation about how HR is responding to the requests of IBM employees and retirees by eliminating this benefit (not to mention probably ALL retiree health insurance). Because, IBM Management, out of the goodness of their hearts and in support of Health Care Reform, wants to provide everyone with the opportunity to purchase insurance through the Exchanges (using their own money, of course).

    Bottom line, it might be worth sticking around to get the enhanced pension annuity, depending on your circumstances, but I wouldn't stick around just for the FHA, because it probably won't be there after next year. I know I'm certainly not counting on it. -Hope this Helps-

  • Comment 05/06/12: Kerin Flannery's mouthpiece sent this out late Friday (5/4): Folks (guess she isn't familiar with the term "Fellow IBM Employees"), today, IBM has signed a new lease to remain at the Huron campus for another three years (Funny how that coincides with Road Kill 2015), with options to extend our agreement (Right! More like good-bye IBM Endicott after 104 years). By November 1, 2012, all IBM Endicott employees will be located in Building 256. It will be an IBM only access building with a staffed lobby entrance, mobility area/guest space and updated public conference rooms. There will be some construction necessary, and office moves will be orchestrated in stages. The Endicott RESO team and my office will be coordinating and communicating logistics throughout the upcoming months. I appreciate your cooperation to make this consolidation successful. -IBM Endicott Sardine-
  • Comment 05/06/12: This T-R-T plan is just the beginning. Watch for new levels of LOW when they start firing for cause. Roadkill 2015/RA is HUGE expense for the bastards. Severance is costing them too much money. Those who continue to make it through rounds of RA will see that it will be more difficult get the severance when it is your time. Continue the maze to Wipe out 2015. -GinniCanYouHearMe?-
  • Comment 05/07/12: for -IBM Mentat- IBM does invest in its workforce.. Ask anyone in Costa Rica, Brazil, India etc .. Just don't ask a US worker. -reply for Mentat-
  • Comment 05/07/12: I'm eligible for the Transition to Retirement program. I received an email last week informing me of the program and my eligibility for it. The next day my manager spoke with me about it (I told her I wasn't interested) and first thing this morning I received another corporate email making sure I'm aware of the program. Since an RA is inevitable before 2015, I'm curious what the last RA severance payout was for each year of service. Does anyone know ? (I currently have 22 years of service.) I'm really looking forward to leaving IBM. It's very demoralizing working for a company driven by such extreme corporate greed and with such disrespect for its employees. -Discouraged in Littleton-
  • Comment 05/07/12: Hey anonymous - Regarding your comment, "Consider that a business needs to put workers where the work is, and for a consulting company the clients may not always be in your backyard. That was the IBM life for many IBMers in all my years there. So stop your whining. You have a job"

    Your comment was pretty darn rude and unreasonable. There are plenty of people who never applied for jobs with major travel requirements because they could NOT work that kind of job. If you have some image of IBM workers all being men with stay-at-home wives, or young single people, you may think this is just dandy, but what about single mothers? What about parents who both work for IBM and now must both travel? What about any employee with family commitments with no second person around to handle the job?

    Many people purposely never applied for these kinds of jobs because they are totally unworkable for them. Also, that "Just be glad you have a job" line has no place here, where people are struggling to keep their employer from beating them into the ground. People deserve jobs with decent wages and benefits, with stability and fair treatment. That's the purpose of the Alliance and this website. I suggest you re-THINK calling people who are looking for a fair deal whiners. -Anon-

  • Comment 05/07/12: Regarding FHA. If you retire and expect to cover children with FHA guess again. IBM has gotten permission to exclude covering children of retirees from the healthcare czars. The last year they would cover children it was $2300.00 per month for a spouse and 2 children for the best coverage. Burns the old FHA up in less then 3 years at that rate. Don't include FHA in your longterm retirement plans as it won't last long enough to matter. My humble opinion of course. -Exodus2007-
  • Comment 05/07/12: Poor management and executive management is a big issue. Family/friends put unqualified family/friends into jobs. Promotions are not based on merit or skill, but on relationships. If you complain, you become the problem. -.-
  • Comment 05/07/12: Is the "Nautilus Program" specifically moving resources only to IGS commercial travel jobs or to GBS commercial travel jobs in general? -To Anonymous-
  • Comment 05/08/12: Here's my issue with the "Nautilus Program": It is a way of screwing us out of an RA severance package. I would rather be RA'ed, but now I may instead be terminated without severance (after 26 years) because I refuse to take a travel assignment. I'm not one of those people to actively joined GBS and agreed to travel - I ended up here via ISSC transition to GBS years ago. Furthermore, many of these GBS travel assignments/contracts are notoriously unstable such that contracts implode, causing you to spend time on the bench through no fault of your own, which in turn guarantees an appraisal of "3" and/or RA, anyway. What kind of life is that? So, yeah, Home Depot is hiring you say? Sign me up. -Anonymous-
  • Comment 05/08/12: The "Nautilus Program" involves moving US resources to US GBS commercial jobs, which may or may not involve travel. You are restricted to US GBS commercial jobs, and should you get an offer from one of those, which could be anywhere in the US, if you do not take it, we have been told it's grounds for termination from IBM. No severance, no unemployment. -Anonymous-
  • Comment 05/08/12: -Discouraged in Littleton- The RA payout has traditionally been 1 week of pay for every 6 months of service up to a maximum of 26 weeks pay. Anyone that has completed 13 years of service or more is capped at 26 weeks of pay plus their unused vacation. Always use personal choice holidays first before using your vacation days. Nothing says IBM won't lower the severance in future RAs. -LowlySDM-
  • Comment 05/08/12: Worrying about a pension that has not grown since 2007 instead of worrying about saving your job by organizing is pretty silly. I would guess that less then 10 percent of remaining active employees have any claim to the frozen pension so its really not an issue anymore to IBM. They have screwed 90 percent of you out of it already and drastically reduced it for those that kept it or will collect it. For all intents and purposes you will have no medical unless you are medicare age and the medicare coverage IBM provides actually said in its description that you could buy better coverage with less out of pocket money elsewhere. The only way the retirees lot in life would ever improve is if active employees organized and forced raises or medical for retirees as part of their contracts.

    As current employees do not even seem willing or able to organize to save their own jobs I think the odds of this happening are slim to none. Its amazing that IBMers know the code names and goals of all the management programs designed to screw them over and they discuss them here like they are talking about baseball games. I wonder why they pinch hit lefty. I wonder when Ginny will close down the pension plan. Yet they do nothing to stop the oncoming personal crisis an RA will have on them and their families. Its like they are watching someone else's life unfold without caring that a disaster is coming and they see it and do nothing even though its their own life! Have all of you really become the disposable, interchangeable work widgets IBM management has always dreamed of?

    I am amazed by comments not just here but on TV and in daily conversations about corporations can't do this or that. People are confused by the difference between a union shop and an at will shop. Someone recently said their employer is getting rid of older workers. Someone else asked how many years the person had. She said 30 years. The other person said oh you should be safe. My wife said Why should she be safe? Its non union. Seniority does not help in layoffs. In fact its opposite in non union. The older more senior people are let go first because they cost more. Both the other ladies went from looking shocked to appalled when they realized she was right. Just because a Teacher gets tenure does not mean a salesman does. Just because an autoworker faces layoffs by seniority does not mean a bank teller does.

    Understand that by law you are entitled to very little from your at will employer. Severance is not guaranteed by law. Just because your neighbor has an employment contract does not mean you do. Learn what you are entitled to by law. Count on nothing that is not in writing. Wake up and get a contract before it is too late. -Exodus2007-

  • Comment 05/08/12: So you get transferred via Nautilus - and you don't get 6 months of severance. If you go to the project and relax - be professional but don't kill yourself - worst thing that happens is they terminate you after you've earned a few more months of pay, best case is they RA you and give you the additional severance. I realize you may have personal circumstances that make this undesirable but if you can make it work for as long as you can there's no downside if you are in a position to do so. -anonymous-
  • Comment 05/09/12: You have to realize that this Nautilus program is another "liquid player" action by IBM. These employees are now short term employees without being told they are. If you want to be a long term player in IBM you must try to organize and get a contract that spells out your employment and it's conditions! JOIN the ALLIANCE to do this. It is the ONLY WAY. P.S. a nautilus is squid-like with no backbone, swims in oceans. Reference made to IBM employees selected for this program perhaps is uncanny (' -da_facts-
  • Comment 05/09/12: Are there RA's going on in Canada? heard something through the rumor mill -Anonymous in the North-
  • Comment 05/10/12: So what's the deal with the new retirement snake-oil? If you don't know, here's the breakdown... The option offered is to work 18 months for 70% pay, aka: 18 months X ..7 = 12.6 months pay, (for 18 months work)and nothing more, end of story.

    So if you don't take this option and get fired some time afterwards and are an older worker you typically get 26 weeks pay: aka: 6.5 month pay plus unemployment for however many months your state provides, perhaps another 6-9months which might be another 2-3 months of former pay.

    So the choice comes down to 12.6 months with this new snake oil option and not a penny more, or 8-9 months pay (package + unemployment) and potentially years more. So not taking this snake-oil offer is risking the next 4 months income at most and potentially not getting years more of pay if you want to keep working. Of yes and as for working 60% of the time, that might be 3 days a week or more likely 4 hours a day and hr knows that if you get a beamer in his chair for 4 hours it won't take much pressure to have him working full 8 hour days for his new 70% pay scale. This is just another sleazy offer by hr scum. -ibm-snake-oil-salesman-report-

    Alliance reply: From what we have heard your 60% work time is based on what you have already been working. If you have been working 60 hrs a week your new work hours would be 40 hrs a week at 70% pay. Remember when a 40 hour work week was the norm in America for full pay?

  • Comment 05/10/12: This may be a trivial question but how does one get selected for the"Nautilus Program"? Flip of a coin. Run it by the Watson computer. Dart board. Ouija board. Which manager has more clout or is higher in the pecking order, etc. Who knows? If you don't join the Alliance does it really matter??? -trivius-
  • Comment 05/11/12: The sad thing is that I see IBM making a major mistake. The people that led the company to glory are now being treated horribly. There are certainly some quality workers in China and India, but from my experience, the vast majority are not on par with the US engineers. They lack the customer and quality focus.

    Not to mention, there is a lot more competition in the emerging countries, employees jump from company to company frequently. Personally, I've been buying IBM stock for many years, but come 2015, I'm selling all of it. This bubble can't last forever, I just need to time it right.

    The old saying that you get what you pay for applies here. While there are a few gems in the emerging countries, the bulk simply aim to please. IBM is deviating from the "Think" mentality that Watson pushed. Eventually, it will come back and bite the company. I'm saddened by this as there are some very talented engineers and scientists that gave a lot of their life to IBM. It would be very difficult for me to recommend a college grad to come to IBM at this time. Oh well, the new Republican American is upon us... Either Americans rise up and change it, or we can expect all companies to evolve into IBM... -Sad-

    Alliance Reply: You make several good points; except that IBM has been "deviating from the THINK mentality" while a Democrat is in the White House, too. It isn't just the Republicans. The president has listened to IBM as if they are doing right by America, when the opposite is true. The president, Democrats and Republicans et al; need to listen to IBM US employees, instead of the IBM Executive liars that are running the company into the ground. Visit our Twitter page to view the tweets we've been making on this topic.

  • Comment 05/11/12: This is confirmation that there was a resource action in Canada. Manager just told our team of the cuts, as the work was just assigned to the remaining US employees for the team. Also told that as RA's continue, the work will just go to those left. It was made clear the work would remain, and have to be done, no matter how few employees were left on the team. -Jaded-
  • Comment 05/11/12: -Discouraged in Littleton-: The FHA is not part of an IBM severance package. The Alliance has made it quite clear already what the FHA is..and isn't: It is a notional account (it is not real money set aside for employees in an account; it is only credits to buy health insurance through IBM). And so the FHA is also not protected by law like a pension.

    IBM can end the FHA at any time.

    To qualify for the FHA, IBM employees need to have at least 15 years of service AND are at least 55 years old that are not under the old retiree health plan.

    If you do not meet both years of IBM employee service and age you don't qualify for the FHA: you essentially lose it and don't get it upon an RA or retirement.

    Even for those that get the FHA it is only going to get you a little retiree health insurance that will not last too long.

    Let's put an end to the FHA discussion. The FHA is just a small carrot that IBM is dangling in front of employees that are hoping to hang on during the RA roadkills to 2015.

    We need to be concerned with joining the Alliance and stopping RAs now. -da_facts-

  • Comment 05/11/12: -da_facts- Thanks for your information about FHA. My understanding is that if I retired today, then I would qualify for it. However, that's not the question I asked. What I would like to know is: For those who were qualified for FHA and who were recently RA'd with a 3 appraisal rating, did they lose the FHA that they were qualified for. And were the most recent RA'd 3's given severance. I'm not asking what IBM has the right to do, I'm asking what they actually DID in the most recent RA's for those appraised as a 3. -Discouraged in Littleton-
  • Comment 05/11/12: Not sure how they are making the decision as to who is chosen for the Nautilus Program. I think upper management sends the word downward that each group has to come up with X people. As to who is chosen, it seems the 1st level makes the decision, possibly with some guidance regarding criteria for selection, but I am merely speculating now, based on what I've seen. The program would not be so bad if it did not include the part about refusal of an offer resulting in TERMINATION. To me, this means "fired for cause" with NO SEVERANCE and NO UNEMPLOYMENT. As to just taking the travel job and sitting on thumbs, this also could result in a 3 and termination, right? It seems they are putting you in a position of being forced to quit. -Anonymous-
  • Comment 05/13/12: In response to -Discouraged in Littleton-, and based on my understanding of IBM's policies, qualification for FHA is based solely on employee age and/or years of service. PBC ratings have no bearing on qualification and a "3" PBC rating would not necessarily preclude an employee from receiving FHA, if one is otherwise qualified for this benefit. Also, based on my discussions with those "selected" (and I use that term deliberately) for the most recent mass-firing in the U.S., employees being fired have continued to receive one week of severance pay for each year of service in return for signing a Covenant Not to Sue (i.e. an Agreement not to file a lawsuit against IBM over being fired). However, to reiterate what has already been said in other comments, all benefits are provided SOLELY at the discretion of IBM Management. As things stand right now, IBM Management can lock you out of their property with absolutely NO notice, and send you packing with no severance pay, medical benefits, or anything else for that matter. The only way an employee in an at-will work environment (which IBM is, at least under New York State law) has any guarantees about ANYTHING is through a contract between the employee and their employer, which is generally negotiated through collective bargaining (e.g. through Union representation). -Hope this Helps-
  • Comment 05/13/12: -Discouraged in Littleton- Actually IBM can do anything it wants. Your an At Will Employee. Repeat: The FHA is not part of a severance agreement with IBM. And severance is given only "at the will" of the corporation. From my understanding, if you are a PBC 3 and are not fired with cause (meaning your part of an RA) and you meet the criteria for the FHA, you will qualify for it at this time. If you don't meet the criteria (even if you are a PBC 1) you lose it as part of an RA. You will also typically get a severance if you are not terminated with cause. However, you might get the reduced severance package (1 weeks pay per year of service, maximum of 13 weeks). Particularly like those on the "improvement plan". Don't be so hung up on the FHA. As I mentioned it will not give you much of anything if you do get it if you decide to retire. Don't concern about whether a PBC 3 will get you a severance. Protect your present job. Get organized. Get a contract. Get it in writing. Join the Alliance NOW! Then you can rest easier if you decide to retire since your retirement benefits will be protected by a union contract. -da_facts-
  • Comment 05/14/12: Rumors has it that IBM Canada will be shipping some of it phone support platform jobs to the Middle East -fedup-
  • Comment 05/14/12: Big cuts are coming to WebSphere Commerce, second half of the year. Jobs are going to India -WC-

News and Opinion Concerning Health Savings Accounts, Medical Costs and Health Care Reform

• Nationwide Insurance: Study: Nearly half of soon-to-be-retired, high-net-worth Americans "terrified" of health care costs in retirement. Despite concern, few are discussing their fears with financial advisors. By Charley Gillespie. Excerpts: A new Nationwide Financial survey finds nearly half of soon-to-be-retired, high-net-worth Americans say they are “terrified” of what health care costs may do to their retirement plans, and nearly three in four say health care costs going out of control is among their top retirement fears. ...

  “Americans – even those who have diligently saved for their golden years – are not prepared for the reality of health care costs in retirement and don’t really understand how Medicare works,” said John Carter, president of Nationwide Financial Distributors, Inc. “Too many assume their employers will continue to pay their premiums during retirement or Medicare will cover all health care expenses.” ...

  Medicare provides health coverage to 46 million older or disabled Americans, but according to the Employee Benefit Research Institute, Medicare currently covers only about 51 percent of the expenses associated with health care services.

  “Retirees’ access to employer-sponsored health insurance continues to decline, and there are potential changes in Medicare benefits due to the program’s projected funding shortfall,” Carter said. “Americans need to realistically plan to be responsible for their own health care in retirement.”

• National Public Radio (NPR): Why Your Drug Copay Could Change. By Michelle Andrews. Excerpts: What if how much you paid for a drug was based on how much it might help you, instead of the sticker price?

  Some big employers are already taking this tack, known as value-based insurance design, by lowering copayments for medicines to manage chronic conditions like diabetes, high cholesterol and high blood pressure. It helps that many of the most prescribed pills are now generic and pretty cheap. ...

  Now some employers are thinking about adapting the approach for pricier specialty drugs, such as those used to treat rheumatoid arthritis, multiple sclerosis and cancer, according to a recent report by the Center for Studying Health System Change.

  These medicines are often very expensive and have no generic competition. So instead of charging a simple copay for these drugs, some health plans charge a percentage of the total cost, which can run to thousands of dollars a month.

• National Public Radio (NPR): Long-Term-Care Insurance: Who Needs It? By Marilyn Geewax. Excerpts: Americans routinely buy all sorts of insurance — for cars, homes, health and even pets and boats. But when it comes to long-term-care insurance, relatively few sign up. Out of more than 313 million Americans, only about 8 million have any such protection, according to the American Association for Long-Term Care Insurance. The low participation rate largely reflects the high cost of long-term-care insurance. ...

  Such care can be crushingly expensive: Just one hour of home-health-aide care costs roughly $20, while the average private nursing home room costs $87,000 a year. Neither routine employer-based medical insurance nor Medicare will pay for extended periods of custodial care. ...

  For the nation's roughly 78 million baby boomers, the time for humor about who will prepare their meals is quickly running out. Many boomers, people born between 1946 and 1964, are expected to fall so far into poverty trying to provide themselves with paid care that they will qualify for Medicaid — the medical care program for the deeply impoverished.

  A fortunate few will have long-term-care insurance, but even that option is looking sketchy as more companies exit the business. Insurance giants such as Prudential and MetLife have recently pulled back from offering long-term-care policies. Others, such as John Hancock and Genworth Financial, have turned to state regulators, seeking permission to dramatically hike premiums. Depending upon the location, the insurers' requests for higher rates have been for amounts such as 18 percent or 40 percent or, in a few cases, 90 percent.

• The Lund Report: Panel on Health Reform Focuses on Ditching the Insurance Industry. Prominent healthcare critics speaking in Portland staunchly support and defend a single payer system. By Amanda Waldroupe. Excerpts: Schoen put the United State’s healthcare system in the context of other Western, developed countries. “We are the most expensive country in the world in what we spend per person, and in our share of the economy,” she said. “And we don’t get the outcomes that you expect.” The United States, she said, spends 18 percent of its gross domestic product (GDP) on healthcare. “A very complicated system,” she said, and that complication requires time and resources to deal with certain parts, particularly the insurance system.

  The insurance system was what Relman pointed his finger directly at as the sole reason for why the country’s healthcare system has become a “fragmented” “shambles.” “We run our healthcare system as if it’s a business in the free market…and not like the social service it ought to be,” he said. “In no other country do they make that terrible mistake.” He also said that “we believe in the myth that the private market—private capitalism—can work as well in healthcare as it is reputed to work in other areas [of the economy].”

• Health Affairs: A Decade Of Health Care Access Declines For Adults Holds Implications For Changes In The Affordable Care Act. By Genevieve M. Kenney, Stacey McMorrow, Stephen Zuckerman and Dana E. Goin. Abstract: The pending Supreme Court decision on the Affordable Care Act and the fall presidential election raise concerns about what would happen if the insurance expansion promised by the landmark health reform law were to be curtailed. This paper’s analysis of national survey estimates found that access to health care and use of health services for adults ages 19–64—the primary targets of the Affordable Care Act—deteriorated between 2000 and 2010, particularly among those who were uninsured. More than half of uninsured US adults did not see a doctor in 2010, and only slightly more than a quarter of these adults were seen by a dentist. We also found that children—many of whom qualify for public coverage through Medicaid and the Children’s Health Insurance Program—generally maintained or improved their access to care during the same period. This provides a reason for optimism about the ability of the coverage expansion in the Affordable Care Act to improve access for adults, but it suggests that eliminating the law or curtailing the coverage expansion could result in continued erosion of adults’ access to care.
• The Atlantic: Beyond Obamacare: How to Fix Our Enormous, Inefficient Health-Care System. Whatever the Supreme Court decides about the individual mandate, the main battle remains to be fought: how to rein in the grotesque costs of the current system. By Philip K. Howard. Excerpts: It's hard to find anyone who defends the structure of American health care. Every incentive is misaligned. Patients have little incentive to be prudent in their use of services, or to pay the costs of their own unhealthy lifestyle. Under the fee-for-service model, doctors and hospitals get paid more the more they do. Fear of random lawsuits causes them to practice "defensive medicine," and chills open interaction with patients and other professionals. Insurance companies make more money by denying claims.

  These misaligned incentives, most experts believe, are largely responsible for the notorious inefficiency of American health care -- costing more than $8,000 per person, or twice what most other countries spend. The total tab -- $2.6 trillion in 2010, or 18 percent of GDP -- is substantially responsible for America's trillion-dollar deficits. The federal government pays roughly a third of the total national health care bill, mostly through Medicare (health care for the elderly) and Medicaid (health care for the poor). It also spends hundreds of billions -- $177 billion in 2011 -- in tax expenditures for employer-provided health insurance.

  Instead of aligning human incentives, the structure tries to contain costs through bureaucratic restrictions. Reimbursement schedules are managed through complex computer programs. In 2014, if not sooner, the federal government will add over 120,000 separate health care reimbursement categories, including 21 separate classifications for "spacecraft accidents" and 12 for bee stings. This bureaucracy is expensive, and skews incentives even more. For example, Medicare will cover the cost of a registered dietician if patients already have diabetes or kidney disease, but it won't pay for referrals to a dietician for obesity alone -- this despite the fact that obesity is a leading contributor to diabetes, kidney disease and scores of other costly ailments. Almost every aspect of health care bureaucracy is hateful. Doctors say they spend a third of their time on paperwork. Patients are driven to tears by the cold calculations of incomprehensible reimbursement guidelines.

News and Opinion Concerning the "War on the Middle Class"

"But dependency on government has never been bad for the rich. The pretense of the laissez-faire people is that only the poor are dependent on government, while the rich take care of themselves. This argument manages to ignore all of modern history, which shows a consistent record of laissez-faire for the poor, but enormous government intervention for the rich." From Economic Justice: The American Class System, from the book Declarations of Independence by Howard Zinn.

• PBS's FrontLine: Money, Power & Wall Street. On April 24 and May 1, FRONTLINE tells the inside story of the global financial crisis. (Four video episodes are available online.)
  • Yahoo! IBM Employee Issues message board: "Re: Transition to Retirement...Roadmap or 'Roadkill'" by "fhawontcutit". Full excerpt: Christopher, If you haven't watched the following, you might find this of value: PBS Frontline: Money, Power, and Wall Street http://www.pbs.org/wgbh/pages/frontline/money-power-wall-street/ Well worth your time, especially since TPTB are hellbent on destroying defined benefit pensions.
• New York Times: A Rising Tide Against Class-Action Suits. By David Segal. Excerpts: In April 2011, the Supreme Court ruled in AT&T Mobility v. Concepcion that corporations could write consumer contracts that blocked class-action lawsuits. To do so, the corporations need only draft a contract that a.) requires unhappy customers to settle disputes through arbitration, and b.) prohibits unhappy customers from arbitrating as a collective.

  When the ruling was issued, Brian T. Fitzpatrick, a law professor at Vanderbilt University, described it to The New York Times as “one of the most important and favorable cases for businesses in a very long time.” He called it “a game changer.”

  A year later, we’re starting to see how much the game has changed. On April 25, the consumer advocacy group Public Citizen released a report titled “Justice Denied” that said that since Concepcion, judges had cited the decision at least 76 times as a reason to prevent potential class-action lawsuits from moving ahead. In some of those cases, the judges made clear that they were ruling against the plaintiffs through gritted teeth, explaining that Concepcion basically made it impossible to come to any other decision. ...

  For other arguments against class actions, the Haggler spoke to a representative at the United States Chamber of Commerce’s Institute for Legal Reform, which is a big fan of the Concepcion decision. Matt Webb, a senior vice president of the organization, says the class-action system is flawed because it is designed by and for lawyers. Arbitration, he added, can work. “If you have a $30 dispute and a good arbitration system in place, one that is administered fairly,” he said, “you have the ability to get a claim resolved without giving money to a lawyer.”

  A co-author of the Public Citizen study, Taylor Lincoln, disputed that. Many well-known arbitration companies have a pro-business bias, he said, because corporations pay the arbiters. But the real agenda of Concepcion’s champions, he added, is to block collective legal action — the kind that gets a company’s attention by affecting the bottom line. Justice Stephen Breyer echoed that notion in his dissent in the Concepcion case — it split the Supreme Court 5 to 4 — when he quoted from a 2004 decision written by Judge Richard Posner of the United States Court of Appeals for the Seventh Circuit: “The realistic alternative to a class action is not 17 million individual suits, but zero individual suits, as only a lunatic or a fanatic sues for $30.”

• Bloomberg View, courtesy of the Huffington Post: Lehman Docs Show Wall Street Arrogance Led To Financial Collapse. By William D. Cohan. Excerpts: If one wants to understand the full complicity of Wall Street in the Great Recession, look no further than the voluminous package of pre-collapse Lehman Brothers documents that have been made available by the law firm Jenner & Block LLP, which has acted as the coroner in the Lehman post-mortem.

  Most important, the cache dispels the myth that Dick Fuld, chief executive officer of Lehman Brothers Holdings Inc., and his close associates were unaware of the risks their business faced in 2007 and 2008. That would be bad enough, but the more devastating reality is that Fuld and his sycophants were warned repeatedly but were blinded by their hubris.

  The records confirm, yet again, that the “forces-out-of- our-control” argument we hear from Wall Street leaders is bunk. It is the ill-advised behavior of one banker after another, day in and day out, that leads to the sort of devastating financial crisis we are only now emerging from.

  For instance, at a Lehman board meeting in September 2007, according to a copy of the presentation in the data cache, Lehman executives presented a clear summary of the brewing crisis. “The initial tremors were felt at the end of 2006,” the board was told, “when the poor loan performance of sub- prime borrowers began to be a cause for concern in the marketplace. This was evidenced by a gradual spread widening in the asset backed index.” The presentation continued: “The market continued to widen as it became apparent that the performance problems in mortgage loans was not going to abate and was no longer limited to the sub-prime market but also affecting the Alt-A product.”

• Huffington Post: The Answer Isn't Socialism; It's Capitalism That Better Spreads the Benefits of the Productivity Revolution. By Robert Reich. Excerpts: Francois Hollande's victory doesn't and shouldn't mean a movement toward socialism in Europe or elsewhere. Socialism isn't the answer to the basic problem haunting all rich nations. The answer is to reform capitalism. The world's productivity revolution is outpacing the political will of rich societies to fairly distribute its benefits. The result is widening inequality coupled with slow growth and stubbornly high unemployment. ...

  The problem comes in the distribution of the benefits of the productivity revolution. A large portion of the population no longer earns the money it needs to live nearly as well as the productivity revolution would otherwise allow. It can't afford the "leisure" its now experiencing involuntarily. Not only is this a problem for them; it's also a problem for the overall economy. It means that a growing portion of the population lacks the purchasing power to keep the economy going. In the United States, consumers account for 70 percent of economic activity. If they as a whole cannot afford to buy all the goods and services the productivity revolution is generating, the economy becomes stymied. Growth is anemic; unemployment remains high.

  That's why "supply-side" tax cuts for corporations and the wealthy are perverse. Corporations and the rich don't need more tax cuts; they're swimming in money as it is. The reason they don't invest in additional productive capacity and hire more people is they don't see a sufficient market for the added goods and services, which means an inadequate return on such investment. ...

  During the Depression decade of the 1930s, the nation reorganized itself so that the gains from growth were far more broadly distributed. The National Labor Relations Act of 1935 recognized unions' rights to collectively bargain, and imposed a duty on employers to bargain in good faith. By the 1950s, a third of all workers in the United States were unionized, giving them the power to demand some of the gains from growth. Meanwhile, Social Security, unemployment insurance, and worker's compensation spread a broad safety net. The forty-hour workweek with time-and-a-half for overtime also helped share the work and spread the gains, as did a minimum wage. In 1965, Medicare and Medicaid broadened access to health care. And a progressive income tax, reaching well over 70 percent on the highest incomes, also helped ensure that the gains were spread fairly.

  This time, though, the nation has taken no similar steps. Quite the contrary: A resurgent right insists on even more tax breaks for corporations and the rich, massive cuts in public spending that will destroy what's left of our safety nets, including Social Security and Medicare and Medicaid, fewer rights for organized labor, more deregulation of labor markets, and a lower (or no) minimum wage.

  This is, quite simply, nuts.

• Financial Times: Republican group rakes in the cash. By Richard McGregor. Excerpts: In the final weeks of the 2010 US midterm elections, Steven Law began to single out vulnerable Democrats in Congress from the Washington headquarters of American Crossroads, the Republican campaign group. From a nondescript office building near the White House, he and his colleagues helped marshal like-minded conservative organisations while tracking the areas where the official Republican campaign was light, in readiness to maximise the impact of last-minute attacks on Democrats. ...

  With $100m in the bank already for the 2012 cycle, Crossroads is the largest and most feared of the new kind of campaign group unleashed by a series of court decisions removing all limits on cash donations for spending on elections. In this year’s presidential, Senate and House elections, the super-political action committees, or super-Pacs, such as Crossroads have the firepower to swing a crucial state or seat.

  “They can get 20 guys around a table and say, ‘we can win this seat if we spend $20m, and I’d like you all to put in one million dollars each’. It changes the whole dynamic,” says a prominent Republican fundraiser. ...

  Mr Law says Crossroads is on track to meet its fundraising target of between $240m and $300m for the 2012 elections. By contrast, Priorities USA Action, the prime pro-Obama super-Pac, has raised a paltry $9m.

  When the Supreme Court handed down its 2010 decision in the Citizens United case allowing corporations to donate unlimited funds to campaign organisations, a legion of critics envisaged Fortune 500 companies taking over politics.

  But as with other pro-Republican super-Pacs, the Crossroads donors writing million-dollar cheques have been entrepreneurs, not large companies, many from Mr Rove’s longstanding Texas network.

  Of the top 10 donors to all super-Pacs so far for the 2012 elections, seven are individual businessmen, according to the Center for Public Integrity, including four billionaires.

• Smirking Chimp: Letter From Charlotte: How Bank of America Silenced a Whole Town. By Richard Eskow. Excerpts: You don't have to be good at your job to earn seven million dollars in a year. All you need is a few friends in the right places -- places like the Federal Reserve, the Justice Department and the Treasury Department. As the song says: "If I had a friend like Ben..." (Bernanke, that is.) As we've learned here in Charlotte, with friends like these covering your back, the protests of people into the street -- and of your own shareholders -- soon fade into blissful silence.

  Today was a very good day for Brian Moynihan, the Bank of America CEO whose 2011 compensation package was just approved. As they were preparing to formally approve his lavish remuneration, I stood outside in a line of shareholders with a letter naming me the official representative for an investor who owns 82,000 BofA shares. Around me were about forty investors, each of whom was about to contribute in some small way to Mr. Moynihan's payday. But our little band of investors were haughtily dismissed by bank executives after waiting, some for hours, in the wilting Carolina heat. ...

  Sounds bad, you say. But how's the share price? Asked like a true investor. In this, a modern executive's most crucial performance measurement, our friend also fails badly. The corporation's stock - which had been trading at $52 per share when our protagonist joined the senior management team - has fallen from $15 to somewhere between $7 and $8 today.

  Can you imagine any corporation but a big bank that would reward this individual with continued employment as CEO, much less with a seven million dollar compensation package?

  But then, Brian Moynihan doesn't run any corporation. He runs a too-big-to-fail bank. And running a too-big-to-fail bank means never having to say you're sorry. One of the acquisitions described above is Merrill Lynch. The other's Countrywide. And Federal investigators said that Moynihan's Bank of America is outdoing Angelo Mozilo's Countrywide in malfeasance and rascality. ...

  No wonder things went so well for Mr. Moynihan today. Activists told their stories inside the shareholders' meeting, and Moynihan and his team pretended to listen. But despite the stories they heard, despite the grumbling from their investors and the chanting in the streets, there was an eerie hush over Charlotte today. They're Bank of America. They don't have to hear anything they don't want to hear. Their friends in Washington have built an impermeable bubble around their executive suite, and that of every big bank in the country.

• Huffington Post: JP Morgan Debacle Reveals Fatal Flaw In Federal Reserve Thinking. By Simon Johnson. Excerpts: Experienced Wall Street executives and traders concede, in private, that Bank of America is not well run and that Citigroup has long been a recipe for disaster. But they always insist that attempts to re-regulate Wall Street are misguided because risk-management has become more sophisticated -- everyone, in this view, has become more like Jamie Dimon, head of JP Morgan Chase, with his legendary attention to detail and concern about quantifying the downside.

  In the light of JP Morgan's stunning losses on derivatives, announced yesterday but with the full scope of total potential losses still not yet clear (and not yet determined), Jamie Dimon and his company do not look like any kind of appealing role model. But the real losers in this turn of events are the Board of Governors of the Federal Reserve System and the New York Fed, whose approach to bank capital is now demonstrated to be deeply flawed.

  JP Morgan claimed to have great risk management systems -- and these are widely regarded as the best on Wall Street. But what does the "best on Wall Street" mean when bank executives and key employees have an incentive to make and misrepresent big bets -- they are compensated based on return on equity, unadjusted for risk? Bank executives get the upside and the downside falls on everyone else -- this is what it means to be "too big to fail" in modern America. ...

  The lessons from JP Morgan's losses are simple. Such banks have become too large and complex for management to control what is going on. The breakdown in internal governance is profound. The breakdown in external corporate governance is also complete -- in any other industry, when faced with large losses incurred in such a haphazard way and under his direct personal supervision, the CEO would resign. No doubt Jamie Dimon will remain in place.

  And the regulators also have no idea about what is going on. Attempts to oversee these banks in a sophisticated and nuanced way are not working.

• Huffington Post: FDIC Outlines Strategy To Avoid Future Wall Street Bailouts. By Mark Gongloff. Excerpts: The problem with banks being too big to fail is not necessarily their bigness, but their failure. Like a runaway train plowing through a city block, a failing big bank can destroy everything around it.

  If only there was a way to let a giant bank crash on its own without bothering anybody! Actually, it would be better to not have big banks at all. But it's anti-American to think that way. So the crafters of the Dodd-Frank financial reform act have tried to make it so that a failing big bank can be gently put to sleep while the rest of us get on with our lives, rather than panicking and shelling for a costly bailout.

  The responsibility for keeping things running smoothly the next time a giant bank gets itself in a Lehman-like pickle rests in the hands of a government regulatory agency, the Federal Deposit Insurance Corporation, whose funding Congressional Republicans are trying to slash. ...

  Meanwhile, Dodd-Frank opponents in Congress -- including Rep. Paul Ryan (R-Wis.), who has http://www.huffingtonpost.com/2012/05/09/paul-ryan-volcker-rule_n_1503209.html?ref=business that banks shouldn't be too big to fail -- are trying to strip the FDIC of its resolution power. They have already killed a provision of Dodd-Frank that would have made the biggest banks pony up $19 billion for a rainy-day fund that would provide necessary cash to keep a failed bank's subsidiaries running.

  Instead, now the FDIC has to finance its Orderly Liquidation Fund with taxpayer money first, and then try to get the money back from profits of a failing bank. It also will have the right to try to pull money out of the other big banks after a failure has already happened, in what Rolling Stone's Matt Taibbi, in a new article on financial regulation Thursday, calls "an assessment process so convoluted that you could grow a four-foot beard in the time it would take to understand it."

  What's more, as Taibbi points out, Republicans in Congress are also trying to kill even that assessment process, leaving taxpayers on the hook, just as they were before anybody had ever heard of Dodd-Frank.

• Working in These Times: Ryan Shrugs: Overlooked GOP Budget Provision Would Fuel Offshoring With New Tax Incentives. By Rober Bybee. Excerpts: Among the most pernicious provisions of Ryan’s tax breaks is a plan to halt the authority of the U.S. government to tax the foreign profits of U.S. corporations once they are brought back into the country, notes tax expert David Cay Johnston, author of Free Lunch: How the Wealthiest Americans Enrich Themselves at Government Expense and Stick You With The Bill. Known in right-wing parlance as “extra-territoriality,” this proposal would be disastrous to both U.S. jobs and tax revenues.

  “Ryan’s plan would insure that any profits created offshore by U.S. corporations would never be taxed by the U.S. government,” explains Johnston, who won the 2001 Pulitzer Prize for his work as The New York Times' tax reporter. “This would create a tremendous incentive to move more and more U.S. jobs overseas to escape taxes on the profits that foreign workers produce for them,” Johnston says.

  “Up until now, we’ve been losing good jobs because CEOs practice a kind of labor ‘arbitrage,’ seeking the most advantageous place to locate their plants based on low wages,” Johnston says. “It doesn’t take a genius to see that if your labor costs are about $40 an hour at a major unionized —$27 an hour plus benefits—you can save money if you relocate the work to China where the cost may be $4 an hour or under.”

  Right now, foreign-generated profits of U.S. firms are not taxed until they are brought back into the United States. But a huge number of multinational corporations like Apple and GE and Nike use a variety of accounting tricks to essentially launder their profits before moving money home. The key mechanism to this systematic tax avoidance is not the territory in which profits are generated, said Johnston. "Territoriality is a phony issue,” he stated “What's critical is the ability of corporations to form hundreds of corporations.”

  These arrangements permit some subsidiaries to artificially charge other parts of the corporation high fees for the use of logos and brand names, and then to place the real profits in tax havens like the Cayman Islands.

• Examiner: Major banker calls for breakup of largest banks in US. By Anthony Martin. Excerpts: One of the nation's top bankers today called for the breakup of the largest banks in the United States, in response to Thursday's disclosure by the CEO of JPMorgan Chase that his bank had lost $2 billion dollars since April and may lose another billion in the next month. ...

  Richard Fisher, president of the Dallas Federal Reserve Bank, stated in a report by Reuters that the nation's top five banks need to be split up into smaller entities due to their inadequate risk management.

• Huffington Post: JP Morgan's Loss Could Be America's Gain. By Joseph A. Palermo. Excerpts: Since the financial train wreck of September 2008, Jamie Dimon, the CEO of JP Morgan Chase, has fought tooth and nail against any new federal regulations of Wall Street. Now with his bank's recent loss of $2 billion (and counting) involving the same credit default swaps (CDSs) that played a key role in bringing down the financial system, Mr. Dimon apparently wants us all to forgive and forget and let him get on with business as usual.

  The public opprobrium directed at Wall Street throughout 2008 and 2009 met with no satisfactory reformist result. The white-collar perps responsible for plunging American society into the abyss were rewarded for their malfeasance and walked away as rich and powerful as ever. Jamie Dimon personifies the hubris of these self-anointed "Masters of the Universe" and his pathetic attempts to spin his way out of the current CDS boondoggle is another glaring reminder of the wider lack of accountability.

  In 2008-2009, two administrations, acting with Congress and the Federal Reserve, simply stuffed the big banks with taxpayer cash and let them go their merry way. When it comes to lobbying, Dimon's banking conglomerate has outspent all others in the industry, throwing down $7.41 million in 2010 alone, (and that doesn't include the wads of campaign cash and SuperPAC donations). It has become abundantly clear in recent years that neither the Obama Administration nor the Congress has the will to take on the financial services oligopoly. Dimon, with his political clout, became the poster boy for everything that is wrong with Wall Street, and through his high-profile lobbying efforts, Washington as well.

• Huffington Post: Elizabeth Warren: Jamie Dimon Should Resign From New York Fed Board. By Mollie Reilly. Excerpts: Elizabeth Warren called on JPMorgan Chase CEO Jamie Dimon to resign from his post on the Federal Reserve Bank of New York's board, citing the need for "responsibility and accountability" in the financial industry.

  Dimon, who disclosed a $2 billion loss by the banking giant last week, should "send a signal to the American people that Wall Street bankers get it and to show that they understand the need for responsibility and accountability," Warren said in a statement following Dimon's Sunday appearance on "Meet the Press." ...

  "We need to stop the cycle of bankers taking on risky activities, getting bailed out by the taxpayers, then using their army of lobbyists to water down regulations," Warren said. "We need a tough cop on the beat so that no one steals your purse on Main Street or your pension on Wall Street."