Welcome to IBM Employee News and Links
"News and links for IBM employees, retirees, ex-employees, and persons interested in pension, retirement, off-shoring and corporate governance issues."
Web This Site

Quick Links:
  Get involved!
  Press articles
  Important Links
  Insider trading
  Lou's Contract
  Total Compensation
  Add or delete ID
  Change ID
  Contact site owner
Previous Highlights:
  April 21, 2007
  April 14, 2007
  April 7, 2007
  March 31, 2007
  March 24, 2007
  March 17, 2007
  March 10, 2007
  March 3, 2007
  February 24, 2007
  February 17, 2007
  February 10, 2007
  February 3, 2007
  January 27, 2007
  January 20, 2007
  January 13, 2007
  January 6, 2007
  December 30, 2006
  December 23, 2006
  December 16, 2006
  December 9, 2006
  December 2, 2006
  November 25, 2006
  November 18, 2006
  November 11, 2006
  November 4, 2006
  October 28, 2006
  October 21, 2006
  October 14, 2006
  October 7, 2006
  September 30, 2006
  September 23, 2006
  September 16, 2006
  September 9, 2006
  September 2, 2006
  August 26, 2006
  August 19, 2006
  August 12, 2006
  August 5, 2006
  July 29, 2006
  July 22, 2006
  July 15, 2006
  July 8, 2006
  July 1, 2006
  June 24, 2006
  June 17, 2006
  June 10, 2006
  June 3, 2006
  May 27, 2006
  May 20, 2006
  May 13, 2006
  May 6, 2006
  2006 Stock Meeting
  April 22, 2006
  April 15, 2006
  April 8, 2006
  April 1, 2006
  March 25, 2006
  March 18, 2006
  March 11, 2006
  March 4, 2006
  February 25, 2006
  February 18, 2006
  February 11, 2006
  February 4, 2006
  January 28, 2006
  January 21, 2006
  January 14, 2006
  January 7, 2006
  December 31, 2005
  December 24, 2005
  December 17, 2005
  December 10, 2005
  December 03, 2005
  November 26, 2005
  November 19, 2005
  November 12, 2005
  November 5, 2005
  October 29, 2005
  October 22, 2005
  October 15, 2005
  October 8, 2005
  October 1, 2005
  September 24, 2005
  September 17, 2005
  September 10, 2005
  September 3, 2005
  August 27, 2005
  August 20, 2005
  August 13, 2005
  August 6, 2005
  July 30, 2005
  July 23, 2005
  July 16, 2005
  July 9, 2005
  July 2, 2005
  June 25, 2005
  June 18, 2005
  June 11, 2005
  June 4, 2005
  May 28, 2005
  May 21, 2005
  May 14, 2005
  May 7, 2005
  April 30, 2005
  April 23, 2005
  April 16, 2005
  April 9, 2005
  April 2, 2005
  March 26, 2005
  March 19, 2005
  March 12, 2005
  March 5, 2005
  February 26, 2005
  February 19, 2005
  February 12, 2005
  February 5, 2005
  January 29, 2005
  January 22, 2005
  January 15, 2005
  January 8, 2005
  January 1, 2005
  December 25, 2004
  December 18, 2004
  December 11, 2004
  December 4, 2004
  November 27, 2004
  November 20, 2004
  November 13, 2004
  November 6, 2004
  October 30, 2004
  October 23, 2004
  October 16, 2004
  October 9, 2004
  October 2, 2004
  September 25, 2004
  September 18, 2004
  September 11, 2004
  September 4, 2004
  August 28, 2004
  August 21, 2004
  August 14, 2004
  August 7, 2004
  July 31, 2004
  July 24, 2004
  July 17, 2004
  July 10, 2004
  July 3, 2004
  June 26, 2004
  June 19, 2004
  June 5, 2004
  May 29, 2004
  May 22, 2004
  May 15, 2004
  May 8, 2004
  2004 Stock Meeting
  April 24, 2004
  April 10, 2004
  April 3, 2004
  March 27, 2004
  March 20, 2004
  March 13, 2004
  March 6, 2004
  February 28, 2004
  February 21, 2004
  February 14, 2004
  February 7, 2004
  February 1, 2004
  January 18, 2004
  December 27, 2003
  December 20, 2003
  December 13, 2003
  December 6, 2003
  November 29, 2003
  November 22, 2003
  November 15, 2003
  November 8, 2003
  November 1, 2003
  October 25, 2003
  October 18, 2003
  October 11, 2003
  October 4, 2003
  September 27, 2003
  September 20, 2003
  September 13, 2003
  September 6, 2003
  August 30, 2003
  August 23, 2003
  August 16, 2003
  August 9, 2003
  Pension Lawsuit Win
  July 26, 2003
  July 19, 2003
  July 12, 2003
  July 5, 2003
  June 28, 2003
  June 21, 2003
  June 14, 2003
  June 7, 2003
  May 31, 2003
  May 24, 2003
  May 17, 2003
  May 10, 2003
  2003 Stock Meeting
  April 26, 2003
  April 19, 2003
  April 12, 2003
  April 5, 2003
  March 29, 2003
  March 22, 2003
  March 15, 2003
  March 8, 2003
  March 1, 2003
  February 22, 2003
  February 15, 2003
  February 8, 2003
  February 1, 2003
  January 25, 2003
  January 18, 2003
  January 11, 2003
  January 4, 2003
  December 28, 2002
  December 21, 2002
  December 14, 2002
  December 7, 2002
  November 30, 2002
  November 23, 2002
  November 16, 2002
  November 9, 2002
  November 2, 2002
  October 26, 2002
  October 19, 2002
  October 12, 2002
  October 5, 2002
  September 28, 2002
  September 21, 2002
  September 14, 2002
  September 7, 2002
  August 31, 2002
  August 24, 2002
  August 17, 2002
  August 10, 2002
  August 3, 2002
  July 27, 2002
  July 20, 2002
  July 13, 2002
  July 6, 2002
  June 29, 2002
  June 22, 2002
  June 15, 2002
  June 8, 2002
  June 1, 2002
  May 25, 2002
  May 18, 2002
  May 11, 2002
  2002 Stock Meeting
  April 27, 2002
  April 20, 2002
  April 13, 2002
  April 6, 2002
  March 30, 2002
  March 23, 2002
  March 16, 2002
  March 9, 2002
  March 2, 2002
  February 23, 2002
  February 16, 2002
  February 9, 2002
  February 2, 2002
  January 26, 2002
  January 19, 2002
  January 12, 2002
  January 5, 2002
  December 29, 2001
  December 22, 2001
  December 15, 2001
  December 8, 2001
  December 1, 2001
  November 24, 2001
  November 17, 2001
  November 10, 2001
  November 3, 2001
  October 27, 2001
  October 20, 2001
  October 13, 2001
  October 6, 2001
  September 29, 2001
  September 22, 2001
  September 15, 2001
  September 8, 2001
  September 1, 2001
  August 25, 2001
  August 18, 2001
  August 11, 2001
  August 4, 2001
  July 28, 2001
  July 21, 2001
  July 14, 2001
  July 7, 2001
  June 30, 2001
  June 23, 2001
  June 16, 2001
  June 9, 2001
  June 2, 2001
  May 26, 2001
  May 19, 2001
  May 12, 2001
  May 5, 2001
  2001 Stock Meeting
  April 21, 2001
  April 14, 2001
  April 7, 2001
  March 31, 2001
  March 24, 2001
  March 17, 2001
  March 10, 2001
  March 3, 2001
  February 24, 2001
  February 17, 2001
  February 10, 2001
  February 3, 2001
  January 27, 2001
  January 20, 2001
  January 13, 2001
  January 6, 2001
  December 30, 2000
  December 23, 2000
  December 16, 2000
  December 9, 2000
  December 2, 2000
  November 24, 2000
  November 17, 2000
  November 10, 2000
  November 4, 2000
  October 28, 2000
  October 21, 2000
  October 14, 2000
  October 7, 2000
  September 30, 2000
  September 23, 2000
  September 16, 2000
  September 9, 2000
  September 2, 2000
  August 26, 2000
  August 19, 2000
  August 12, 2000
  July 29, 2000
  July 22, 2000
  July 15, 2000
  July 1, 2000
  June 24, 2000
  June 17, 2000
  June 10, 2000
  June 3, 2000
  May 27, 2000
  May 20, 2000
  May 13, 2000
  May 6, 2000
  April, 2000

Join your fellow employees who are fighting for your benefits - Join the Alliance!

Retirees, Vendors, Contractors, Temps, and Active Employees are all eligible to become members of the Alliance.

    Highlights—October 16, 2004
  • Alliance@IBM: IBM Pension Lawsuit Frequently Asked Questions. Editor's note: Extensive coverage of the Cooper v. IBM lawsuit is available in the October 2, 2004 edition of these highlights.

  • San Francisco Chronicle: Cancer claims ex-IBM plaintiff. Moore said lawsuit was chance to talk about chemicals. Excerpts: Jim Moore, the former IBM worker who challenged the technology giant in a high-profile trial over allegations that Big Blue negligently exposed him and other employees to cancer-causing chemicals, has died. Moore died Friday after a nearly 10-year battle with non-Hodgkin's lymphoma. He was 63. Moore and another former IBM worker, Alida Hernandez, sued the company, accusing it of maintaining an unsafe workplace that caused them to develop cancer. Both had worked at IBM's disk drive factory in San Jose. ... After a four-month trial, a jury ruled in favor of IBM. Despite the defeat, Moore said the trial was an opportunity to talk about the chemicals used by IBM, such as Freon and acetone, which environmental advocates have long claimed are dangerous and carcinogenic. "One of the things Alida and I made sure was that got out in the open, the use of the chemicals and what they are," Moore said after the trial. "We lost the case, but at least people know." IBM later settled more than 40 cases in which it was accused of making workers ill by negligently exposing them to hazardous chemicals at a San Jose plant. Last week, Moore and Hernandez were honored by the Silicon Valley Toxics Coalition for their roles in advocating for a safer workplace.

  • IDG News Service: Hitachi, IBM to lay off 400 at hard disk drive venture. Excerpt: Hitachi Global Storage Technologies (HGST), the business created by the merger of the hard-disk drive manufacturing units of Hitachi and IBM, is to lay off about 400 workers. The company hopes to achieve some of the staff cuts through a voluntary redundancy program for which 450 employees are eligible. Those employees have until Nov. 29 to decide, the company said. It expects around 40 percent or 50 percent of those eligible to accept redundancy which will take the company about halfway to its reduction target. The remaining cuts will be made through firing of staff in a program due to begin on Dec. 13, it said. Staff at the receiving end of the involuntary layoff program will receive redundancy pay, medical benefits for an unspecified period and support to find a new job, said the company.

  • New York Times: A Hard-to-Swallow Lesson on Pensions, by Mary Williams Walsh. Excerpts: Hundreds of people here in western New York, all closing in on retirement, have learned a bitter lesson about pensions and the law that guarantees them. Two years ago, their employer, the oil services giant Halliburton, unexpectedly started urging them to take their pensions early, warning that they would otherwise lose their right to take their benefits in a single check. The workers signed up to receive their money right away, but the money was much less than they had earlier been told they had coming. Confused and angry, some have sought to win back the remainder of their pensions, or at least to get an explanation of how Halliburton could legally reduce their benefits. Today, what the workers find most distressing is that a law that is supposed to protect pensions has failed them. ... The case of the Olean workers is an illustration of a gaping hole in the nation's safety net. Tens of thousands of Americans are discovering, as they approach retirement, that money they were promised is not forthcoming. Some of the most prominent cases involve companies, like airlines, that are in severe financial distress and cannot keep their pension funds going. But others involve profitable companies, like Halliburton, that reduce anticipated benefits by tens of thousands of dollars even though their pension funds are healthy - and even though a 1974 federal law says pensions are guaranteed. ...

    But some companies have found a loophole in the law during mergers and spinoffs, pension advocates say. "The company cannot amend a plan to eliminate an early retirement subsidy," said Karen Ferguson, director of the Pension Rights Center, a consumer group in Washington. But if the company sells a division, then an employee of that division is no longer protected when he or she reaches early retirement. The company has, in effect, "amended the work force," she said. "This is a glaring loophole in the law, and it is truly undercutting the retirement security of hundreds of thousands of people across the country." Norman Stein, a law professor at the University of Alabama who specializes in pension issues, said "hundreds and hundreds of companies" have taken advantage of divestitures to end their obligation to pay early retirement subsidies. ...

    In August of that year, Mr. Cheney left Halliburton to join the Republican ticket. In 2001, the Economic Growth and Tax Relief Reconciliation Act was signed into law, including an obscure provision allowing an employer to consider workers legally severed from service if it sold the division where they worked. In July 2001, David J. Lesar, the new chief executive, executed an amendment to the pension plan, deleting four words: "or any successor thereof" from more than 150 pages. Until the deletion, the document barred workers from cashing out of the pension fund until they stopped working for their division, or any successor thereof. ...

    But when the workers called Halliburton to enroll for their payouts in the summer of 2002, hundreds of them were told that the benefits available in their names were significantly less than what they expected. Many of them can produce benefits statements from previous years, when Dresser Industries still ran their pension fund, showing they were due much larger amounts. They were also indignant to learn that they were being treated as if they had resigned. Most of them were sitting at the same desks, performing the same tasks, as they had before Halliburton bought and sold their company. Bill Chamberlin, a head draftsman at the division in Olean, said he was previously told he would receive about $60,000 but was offered just $28,000 by Halliburton. ... Mr. Chamberlin and others expressed particular anger that when Mr. Cheney departed from Halliburton in 2000, he was too young to qualify for retirement benefits, but was granted a package worth millions of dollars anyway, through a special vote of the board.

    If link is broken, view Adobe Acrobat version [PDF--25 KB].

  • Washington Post: No Simple Solutions to Pension Problems. Excerpt: The grim news coming out of the airline and steel industries about their pension plans and the government agency that insures them is giving Congress, along with older workers across the nation, a sudden case of the jitters. "We gotta do something" is the phrase du jour on Capitol Hill, and senators and representatives are calling hearings and wringing their hands over the problem. But as with so many issues today, there are no easy answers. There are lots of proposals and recommendations, but while many would be effective in addressing the part of the problem they are aimed at, they would have side effects -- collateral damage, to use the recently popular term -- that might outweigh their benefits.

  • Washington Post: Pension Promise No Guarantee of Security. Bankruptcies Can Mean Sharply Reduced Payouts. Excerpts: With just eight years to go, Steve Derebey had been eyeing his mandatory retirement age with something close to relief. A commercial airline pilot, the 52-year-old would not be worrying "about guys behind [him] with box cutters," he said. Just as important, his $66,000-a-year pension would leave him and his wife, Jeane, free to travel from their home in Gig Harbor, Wash., to visit the grandchild in Crystal Lake, Ill., who is due in January. But last month, in a Chicago bankruptcy court, United Airlines almost certainly changed the rest of the Derebeys' life, warning that it will likely dump its pension plan onto the federal government. Under the rules of the federal Pension Benefit Guaranty Corp. (PBGC), Derebey would be left with $22,000 a year, a third of his expected benefit. Now, he and his wife are hastily planning a second career, a long one, they say, maybe running their own public relations shop in Seattle. "Instead of being able to retire, see our kids, we're probably going to have to work until we die," Jeane Derebey said.

    Such adjustments can be particularly wrenching, said Duane Woerth, president of the Air Line Pilots Association, the pilots' union. They hit older workers, who have the most difficulty retraining for a new career and who have the least time to build up savings. Workers with defined benefit pensions may have structured their whole lives around that expected payout. "Everything you've done in your life to date, what kind of home you live in, what your wife does, where your kids went to college, it may all be built around that pension," he said. "This alteration is like an earthquake. It changes everything."

  • Reuters: SEC Eyes Possible Abuses in Pensions. Excerpts: The U.S. Securities and Exchange Commission is looking into possible accounting abuses involving companies' assumptions about employee pension funds, the SEC's top enforcement official said on Thursday. "We're looking at assumptions made in connection with pension accounting to determine whether those assumptions were reached to drive earnings results," said SEC Enforcement Division Director Stephen Cutler in an interview. Hundreds of companies last year updated key assumptions in their accounting for post-retirement benefits, Business Week magazine reported in its Oct. 25 edition. The SEC is looking into whether some of these changes were overly aggressive and made with an eye to enhancing companies' profits and balance sheet figures, Business Week said. Cutler declined to identify any of the companies targeted.

  • Socialist Worker Online: Attack on pensions. Corporate America is trying to steal our future. Excerpts: The corporate vultures who grabbed pension funds for profits in the 1990s are out to slash those retirement funds today--or abandon their obligations altogether. ... During the economic boom of the 1990s, for example, many companies found that their pensions were “overfunded” as funds’ assets on financial markets increased in value. Rather than use the extra money to increase retirement benefits, leading companies simply transferred the proceeds into their earnings. According to the Wall Street Journal, pensions boosted reported profits by 3 percent that year for the S&P 500 group of large companies. Now, however, companies are using the red ink in their pension funds to justify the reduction or elimination of retiree benefits. Earlier this year, legislation sponsored by Sen. Ted Kennedy (D-Mass.) allowed many companies to reduce their premium payments to the PBGC, which will only make the longer-term crisis worse. “A good part of this has to do with corporations essentially walking away from their obligations,” Paul Edwards, chair of the Coalition for Retirement Security, told Socialist Worker. “Since many corporations have been part of writing the legislation that effects them, it’s a cozy position to be in.”

    The steel industry has followed the same strategy of ditching pensions and has eliminated health care benefits--which aren’t insured--for some 260,000 retirees. Yet companies that can easily afford to meet pension obligations are cutting back. For example, in 1999, IBM converted its defined-benefit pension to a “cash-balance” plan, which creates virtual account for individual workers. Earlier this year, IBM employees won a class-action lawsuit, arguing that the cash-balance plan discriminated against older workers by dramatically cutting their expected level of benefits, which had been calculated on a formula based on years of service and age. IBM has agreed to pay $300 million to retiree funds now and another $1.4 billion later if it loses its appeal of the ruling. In the meantime, companies are barred from creating new cash-balance plans--which today cover some 7 million employees. ... All this ads up to a corporate abandonment of retirees, said the Coalition for Retirement Security’s Edwards. “You have to understand that this is a scheme and scam used to defraud Americans of their pensions,” he said. “We have an outrageous system, and it's getting worse.”

  • Wall Street Journal: More retirees may see health cuts, by Ellen Schultz. Excerpts: Some large employers will have greater flexibility in how they cut retiree health-care costs starting Jan. 1, thanks to a provision in the new corporate-tax bill. And the change could affect health benefits for more retirees. Lucent Technologies Inc., which has been cutting some retirees for whom it pays health-care costs, lobbied forcefully for the change in the law -- though it will affect other companies as well. The sweeping tax bill cleared the Senate this week and is expected to be signed into law by President Bush. The law applies to large companies that withdraw surplus pension assets to cover medical costs for retirees. That has been allowed since 1990. However, there have been some restrictions. Under current rules, companies can't make significant reductions in retiree health benefits for five years after a transfer. Employers must maintain the same "per-capita cost" for five years, meaning they must spend the same amount per retiree. To provide flexibility, however, they are permitted to cut the number of retirees they cover -- by 10% in any one year, or 20% over five years. That has the effect of reducing costs by 10% to 20%. (Employers are allowed to pass cost increases onto retirees). Under the new rules, employers will not necessarily have to maintain the per-capita cost. Instead, they will be allowed to cut overall benefit costs for all retirees -- by the same amount they would have saved by cutting some covered retirees altogether. In other words, they now have the option to cut their costs for all instead of cutting some people. ... Members of the Lucent Retirees Organization, in an e-mail to lawmakers, said, "It is simply unfair to allow companies who have already received the tax and other financial benefits of the pension asset transfers to renege on their commitment to maintain retiree benefits -- a commitment which was a condition of the initial transfer."

  • New York Times: Bush Health Savings Accounts Slow to Gain Acceptance, by Milt Freudenheim. Excerpts: President Bush, who is expected to discuss the plans again tonight in the domestic policy debate with Senator John Kerry, extolled them in last Friday's debate. "You own your own account,'' he said. "You can save tax-free.'' But nonpartisan health policy experts say the plans are apparently too new and untested to appeal to many employers and may simply not be financially feasible for middle-income families. "It's hard to imagine that a guy who makes $50,000 a year is going to have $2,000 for him and his family to stick in this plan," said Ira S. Loss, a health policy expert with Washington Analysis, a business consulting firm. Insurance brokers say the accounts appeal primarily to lawyers, doctors and partners in small businesses who may welcome tax-free savings accounts for themselves. Many small businesses may like the plans as a way to reduce their own outlays for employee health insurance. Some employers are offsetting their lower insurance premiums by contributing some money into workers' savings plans. ... Tom Beauregard, a health policy analyst at the benefits consulting firm Hewitt Associates, said that studies showed that the savings plans attract healthier enrollees, leaving behind sicker people in the old plans. To average out the risks, he said, an employer might ask people who move to health savings plans to pay an additional premium. Uwe E. Reinhardt, a Princeton University economist and health policy expert, said the new plans were "a bum deal" for people with chronic illnesses. But "for chronically healthy people,'' he said, "it's another 401(k) savings account, and Wall Street is licking its chops at the prospect of managing the money."

  • New York Times: Partisan Arguing and Fine Print Seen as Hindering Medicare Law. Excerpt: When he signed it into law, President Bush hailed the Medicare Modernization Act of 2003 as "the greatest advance in health care coverage for America's seniors since the founding of Medicare.'' The overhaul of the program, including the addition of prescription drug benefits, was seen as his biggest accomplishment in domestic policy and a major asset to his re-election campaign. But over the last 10 months, the Bush administration's efforts to carry out the first phase of that law, providing drug discount cards to the elderly, have been plagued with difficulties. Many health policy experts say that even greater problems loom as the government turns to the more ambitious task of providing a full-fledged drug benefit to 41 million elderly and disabled people in 2006.

  • Workday Minnesota: Health care for all is possible – and would cost less, report says. Excerpts: Even though the United States has the highest per capita spending on health care in the world, 45 million Americans lacked health insurance for all of 2003, the report notes. Nearly twice as many –an estimated 81 million – were without health insurance for at least part of the year. That includes more than 1 million Minnesota residents. “The United States is already spending far more money than is necessary to provide adequate health insurance for all its people,” states the report, issued nationally by Jobs with Justice. “It is only necessary to redirect some of the money from powerful corporate interests – like the insurance and pharmaceutical industries – to provide the high-quality, secure health care that everyone should have.” ... Joel Albers, a Minneapolis pharmacist, says administrative costs are only 2 percent of spending in the government-administered Medicare system for seniors. In most HMOs and other private insurance companies, however, administrative costs eat up 15 percent of revenue. The savings on administrative costs alone could insure 55 million Americans, the report says. ... Finally, the report says, the new Medicare prescription drug bill spends $83.6 billion by subsidizing private insurance companies who are unable to compete in the marketplace with Medicare. That includes an estimated $150 million in subsidies in Minnesota. “Rather than subsidize HMOs, we could provide health insurance for 68,000 more people in Minnesota,” Schwarz says. Beyond that, the prescription drug plan hands pharmaceutical companies an estimated $139 billion more in profits over the next eight years, the report says, because it forbids the federal government from negotiating lower drug prices with pharmaceutical companies.

  • National Public Radio: The Big Business of Health Care. Fresh Air, October 6, 2004. Investigative reporters Donald Barlett and James Steele's new book is Critical Condition: How Health Care in America Became Big Business, and Bad Medicine. Bartlett and Steel have worked together for 30 years, winning two Pulitzer Prizes. They are currently editors-at-large at Time magazine. (Editor's note: Highly recommended. Requires RealPlayer or compatible media player).

  • Minneapolis Star-Tribune: 'Consumer-driven' health plans bad for working poor, chronically ill, by Gail Shearer and Susanna Montezemolo. Excerpts: Last year Congress passed, and President Bush signed into law, legislation expanding high-deductible health insurance. This law also includes tax-advantaged "health savings accounts" (HSAs), designed to provide consumers with funds to use before they spend enough to meet the deductible. The IRS recently released guidance that is likely to make these accounts even more appealing to employers. Supporters of this approach would like you to believe that these so-called "consumer-driven" health plans are consumer-friendly. Unfortunately, the term is merely a euphemism for a policy that favors the healthy and wealthy and leaves the working poor and chronically ill to carry a greater financial burden. In fact, a more apt term for this type of medical plan is a "defined contribution health plan." Like defined contribution retirement plans such as 401(k)s, these plans replace comprehensive benefits with more limited benefits and shift costs and responsibilities to employees.

  • San Francisco Chronicle: In Critical Condition: Health Care In America. How the health care system is failing -- and why it's hard to fix. Excerpts: Some 40 years after the enactment of Medicare and Medicaid and more than a decade after the Clinton administration failed in its bid to extend coverage to all Americans, the nation's system of funding health care is on the verge of breaking down. Employers, consumers and governments at every level are straining under the burden of a health care bill that is growing at a pace five or six times the rate of inflation. Businesses, squeezed by soaring health insurance costs, are passing an increasing share of the price tag to their workers. That's forcing employees to dig ever deeper into their pockets, prompting millions to forgo coverage altogether and gamble that their families will stay healthy. The public health care system is overwhelmed by the country's 45 million uninsured who turn to hospital emergency rooms for even routine care. ... A big part of U.S. health care expenditures have little to do with patient care. Harvard Medical School researchers reported earlier this year that the United States spends $399 billion per year on health care bureaucracy, essentially the administrative costs of insurers, hospitals, doctors, nursing homes and other institutions. In California, $45 billion of the $163 billion spent on health care, or 28 percent, went to administration. ... The United States has a health care system unique in the developed world. Costs are high, employers pay most of the bills and tens of millions have no coverage. Polls show that most Americans believe the system doesn't work and want universal coverage. Some advocates argue that the only way to achieve universal coverage would be to replace the American health care system with a system in which the government pays the bills, a so-called single-payer system. Other experts argue that universal coverage could be achieved without a government takeover.

  • Vault's IBM Business Consulting Services message board is a popular hangout for IBM BCS employees, including many employees acquired from PwC.
    • "Depends" by "CONsulting_2_long". Excerpt: In terms of travel, be prepared for 100%. As a young person, or any person, the glamour can wear off quickly. It really depends on your lifestyle. If you are someone who see themselves in a suburban lifestyle someday, than consulting is hard at any age. Where do you date? Where you work 5 days/wk? or at 'home' where you visit 2 days per week? It is still hard on singles. How do you tend to mail, pets, etc. If you are a sobi type, then you may enjoy the travel. Why even have an apartment? Just rent a room from your parents or sibling. And jet around the country every weekend. NYC, SOBI, San Fran. If you are with out roots or ever wanting roots, then the travel is a blessing. Unless you staffed in some lame town for 36 months straight. It happens.
Coverage on H1-B and L1 Visa and Off-Shoring Issues
  • Agence France-Presse: India's top IT body says outsourcing, research sectors faces skills crunch. Excerpt: India's top information technology (IT) body said India's booming outsourcing and IT research sectors face a looming skills shortage and the nation's universities must train students better to fill the gap. Kiran Karnik, president of the National Association of Software and Service Companies (NASSCOM), said the body had begun talks with IT firms, universities and governments about improving study courses to equip students for outsourcing and IT research jobs. ... NASSCOM said in a recent report that India's outsourcing industry was expected to face a shortage of 262,000 professionals by 2012. "One has to trigger the government to do more. It can help by introducing foreign languages in schools and also teach communication skills to students which will help them gain jobs in the outsourcing sector," Karnik said. Karnik's statements followed comments by Gartner, a top global IT consultancy, last month. Gartner said emerging nations in Southeast Asia and central Europe could eat up nearly half of India's 80 percent current share of the booming outsourcing market if the sector failed to draft a longterm strategy to stay ahead. US and other firms have made a beeline for India, drawn by its vast educated English-speaking workforce and labour costs much lower than in the West.

  • Agence France-Presse: US to lose more than 400,000 jobs this year. Excerpt: The United States will lose more than 400,000 jobs this year to Mexico, China, India and other Asian nations as multinational corporations restructure operations and shift production overseas, a study showed. The number of jobs lost will be around double those three years ago, according to the study by Cornell University and the University of Massachusetts for the US-China Economic and Security Review Commission. The study came amid heated debate ahead of the November 2 presidential elections on outsourcing of jobs to China, India and other developing economies and its adverse impacts on employment at home.

  • Christian Science Monitor: Endangered species: US programmers. Excerpts: Say goodbye to the American software programmer. Once the symbols of hope as the nation shifted from manufacturing to service jobs, programmers today are an endangered species. They face a challenge similar to that which shrank the ranks of steelworkers and autoworkers a quarter century ago: competition from foreigners. Some experts think they'll become extinct within the next few years, forced into unemployment or new careers by a combination of offshoring of their work to India and other low-wage countries and the arrival of skilled immigrants taking their jobs. ... Although computer-related jobs in the United States increased by 27,000 between 2001 and 2003, about 180,000 new foreign H-1B workers in the computer area entered the nation, calculates John Miano, an expert with the Programmers Guild, a professional society. "This suggests any gain of jobs have been taken by H-1B workers," he says. ... The H-1B visa has been highly controversial for years. This fiscal year, Congress set a quota of 65,000 visas, which was snapped up immediately after they became available Oct.1. Now, US business is pleading for Congress to let in more such workers. The US Chamber of Commerce, for instance, wants Congress to revisit the cap "to ensure American business has access to the talent it needs to help keep our economy strong." That rationale makes no sense to the Programmers Guild and other groups that have sprung up to resist the tech visas. Since more than 100,000 American programmers are unemployed - and many more are underemployed - the existing 65,000 quota is inexcusably high, they argue. H-1B and L-1 visas are "American worker replacement programs," says the National Hire American Citizens Society.
    • Linda Guyer comments. Full excerpt: There are actually tax incentives for companies to offshore jobs. The least the federal government could do is eliminate these incentives. Taxpayers (you and I) should not be subsidizing the loss of good jobs. At the state level, as well, governments could at least require that work paid for by state taxpayers should be performed in the U.S. The feds could also tax the importation of services, similar to the tariffs we have on imported agricultural products. I doubt this will ever be done, however, because programmers don't have a powerful lobby in Washington like agribusiness does. For all you believers in "capitalism and globalisation are inevitable" - the agricultural and cotton and other industries in the US have been protected by the government from foreign competition for years. I don't see anyone complaining about that?

  • Computerworld: H-1B visa cap for FY '05 already reached. Never before has the cap been hit on the same day it went into effect. Excerpt: Vic Goel, an immigration attorney in Greenbelt, Md., said the quick closing of the cap means employers can't hire highly educated foreign professionals for nearly a year. "If we are making that educational investment, we need to reap the return of that investment," he said. But Russ Harrison, legislative representative for the IEEE-USA, said the visa program "creates a strong incentive to push down wages and discourages employment of American workers." The H-1B visa, which is heavily used by high-tech employers, allows skilled foreign workers to get jobs in the U.S. for up to six years. The number of H-1B visas was set at 195,000 for fiscal years 2001, 2002 and 2003 before dropping to 65,000 in fiscal 2004.

  • Computerworld: India outsourcing firms report surge in hiring. Growth in IT employment overseas could lead to rate increases for U.S. customers. Excerpts: In a quarterly report released today, Wipro Ltd. said its workforce rose by nearly 18%, adding 5,546 employees in the three-month quarter that ended Sept. 30, to bring its total to 37,063. For the same period one year earlier, the company reported 24,500 employees. For the same period, Infosys Technologies Ltd. said this week that its workforce grew from 27,939 employees to 32,949 employees, also an 18% increase. One year ago, Infosys had 18,580 employees. For the same quarter, Tata Consultancy Services Ltd. said its head count had climbed nearly 12%, from 36,636 to 40,948. In June 2003, Tata reported 24,000 employees. "Bangalore today is like Silicon Valley was five years ago," said Lance Travis, an analyst at AMR Research Inc. in Boston. The growth in overseas IT employment is coming from demand from U.S. companies. Stamford, Conn.-based Meta Group Inc. said the use of offshore services by U.S. companies will grow at about 20% a year through 2008.

  • UC Berkeley News: New look at U.S. employment outlook. Excerpts: The economy may be on the mend, but the strongest job growth is in positions paying the least, and long-stagnant wages are slipping, says a report released today (Thursday, Oct. 14) by a researcher at the University of California, Berkeley. Arindrajit Dube, an economist with the Institute of Industrial Relations, pored through recent U.S. household survey data to examine changes in job numbers and wage distribution in 440 employment categories in 2001, during the 2002- 2003 recovery period, and in the first eight months of 2004. In "Are Jobs Getting Worse?" Dube analyzes changes in the average wage, the distribution of wages, and the types of jobs that are increasing or decreasing. "What's growing versus shrinking in terms of jobs is important," said Dube. "Combined with a weak labor market, wages have been fairly stagnant during this recovery, and this year, they've actually fallen."He found that the growth of jobs paying at the bottom third of the market outpaced those paying at the middle by nearly 2 to 1, while there was a reduction in the number of jobs paying at the top third.

In Politics—
Note: The views expressed in the news articles and editorials in this section are those of their authors. They do not reflect the views of the Alliance@IBM. They do reflect the views of the editor of www.ibmemployee.com.


"The test of our progress is not whether we add more to the abundance of those who have too much; it is whether we provide enough for those who have too little." — Franklin D. Roosevelt
This site is designed to allow IBM Employees to communicate and share methods of protecting their rights through the establishment of an IBM Employees Labor Union. Section 8(a)(1) of the National Labor Relations Act states it is a violation for Employers to spy on union gatherings, or pretend to spy. For the purpose of the National Labor Relations Act, notice is given that this site and all of its content, messages, communications, or other content is considered to be a union gathering.