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Pension Costs: The executive also has reduced costs in the company's pension plan. IBM, which had more than 386,000 employees at the end of 2007, has projected savings of $US950 million for this year. The redesign is part of Palmisano's plan to boost profit to as much as $US11 a share by 2010.
IBM also has pursued billions of dollars in stock buybacks to add to per-share earnings. On February 26, Palmisano announced plans to buy back $US12 billion in stock this year. Today the company said the buybacks helped add 13 cents a share to first- quarter profit.
If you think Revenue Ruling 2008-7 is unfair and should be withdrawn, use our web site to send a letter to let Secretary Paulson know your concerns.
The new rule, applicable to students graduating in Science, Technology, Engineering or Mathematics has received critical attention for not including public opinion on the issue, and the blogosphere has been buzzing on the subject ever since it was announced. Ben Worthen, writer for the Wall Street Journal, posted on his business technology blog, "What's striking about the new rule is how it came about." Worthen, referring to the backhanded way the rule was formulated, added, "Instead of releasing a draft and soliciting comments from the public" - the typical process for governmental rule changes - " DHS cited a clause in the Administrative Procedures Act, which is reserved for emergencies, to make the rule effective immediately". ...
Microsoft, which has long lobbied Congress for drastically increasing the cap on H1B visas, predictably, lavished praise on DHS. The decision is, "an important step toward ensuring that American companies can continue to hire many of the world's most talented students graduating from U.S. universities," Jack Krumholtz, Microsoft's managing director federal government affairs, said in a statement. ...
The public is getting edgier with each such announcement from the government and one has to barely skim the comments on the blogs to gauge the street sentiment accurately. A comment from "SPT" on Worther's post says, "BLS reports losing 80,000 jobs through March, layoffs at Motorola, Dell, Yahoo, AMD ... The US is in a recession, Americans are getting laid off, and DHS wants to legislate via executive edict to increase the supply of the US labor pool with foreign workers? This is insane."
A major reason we’re feeling so down now is that for working Americans the boom never did come back. Job creation in the post-2001 recovery was pathetic by Clinton-era standards; wages barely kept up with inflation. Instead, corporate profits and the incomes of a tiny elite surged — sucking up so much of the economy’s growth that only crumbs were left for everyone else. ...
But my impression is that the subprime crisis — with its revelation that titans of finance were dealing in funny money and its tales of failed executives receiving hundred-million-dollar going-away presents — has resurrected the sense that something is rotten in the state of our economy. And this sense is adding to the general gloom. The question is, can the next administration end America’s malaise?
In fact, he is a former vice chairman at Goldman Sachs, the big investment bank. And in the last two years, Mr. Steel has been co-chairman of one commission that claimed heavy-handed regulation was stanching financial innovation and another that argued that hedge funds could police themselves. His apparent conversion to the merits of regulation illustrates how the laissez-faire bones of the Bush administration have been rattled by the government-brokered rescue of Bear Stearns and the trauma of the credit crisis.
The tax provisions of the Foreclosure Prevention Act, which consumer groups and labor leaders say amount to government handouts to big business, show how the credit crisis, while rattling the housing and financial markets, has created beneficiaries in the power corridors of Washington. It also shows how legislation with a populist imperative offers a chance for lobbyists to press their clients’ interests. ...
Congressional Democrats are also hearing from consumer advocates and other groups who say that the Senate bill does little to help Americans in danger of losing their homes to foreclosure. “The Senate legislation gave corporations and Wall Street billions in tax breaks,” Terence M. O’Sullivan, the president of the Laborers International Union of North America, said at a news conference on Tuesday to denounce the bill. “Tax breaks for corporate home builders won’t help stabilize the housing market, won’t create jobs and won’t prevent a single foreclosure,” he continued. “If anything, this multibillion-dollar windfall will make things worse.”
Mr. Paulson, the founder of Paulson & Company, was not the only big winner. The hedge fund managers James H. Simons and George Soros each earned almost $3 billion last year, according to an annual ranking of top hedge fund earners by Institutional Investor’s Alpha magazine, which comes out Wednesday. ...
The richest hedge fund managers keep getting richer — fast. To make it into the top 25 of Alpha’s list, the industry standard for hedge fund pay, a manager needed to earn at least $360 million last year, more than 18 times the amount in 2002. The median American family, by contrast, earned $60,500 last year.
(Editor's note: At his level of earnings, Mr. Paulson achieved the median American family income before working his first 9 minutes of the year. Fortunately for Mr. Paulson and his hedge fund manager colleagues, his earnings were taxed at only a 15% rate...not at the 25 to 40% rate [counting both income and payroll taxes] imposed on we middle-class taxpayers.) ...
Since 1913, the United States witnessed only one other year of such unequal wealth distribution — 1928, the year before the stock market crashed, according to Jared Bernstein, a senior fellow at the Economic Policy Institute in Washington. Such inequality is likely to impede an economic recovery, he said. “For a recovery to be robust and sustainable you can’t just have consumer demand at Nordstrom,” he said. “You need it at the little shop on the corner, too.” ...
And Mr. Gross, the fund manager, warned that the widening divide among the richest and everyone else is cause for worry. “Like at the end of the Gilded Age and the Roaring Twenties, we are going the other way,” Mr. Gross said. “We are clearly in a period of excess, and we have to swing back to the middle or the center cannot hold."
Executive compensation consultants know what they're there for: Making the headman super-rich, a billionaire by retirement age. They justify their findings by comparing compensation levels within a comparable peer group, making it a self-fulfilling closed-circuit club where everyone wins. ...
Management talks about total shareholder distributions of $35.6 billion, but this sum includes buybacks, which benefit management much more than shareholders. These buybacks reduce the earned surplus account, making it easier to up the return on equity (ROE), thereby justifying generous stock option grants.
In 2006, the newly appointed CEO of the credit reporting company earned a compensation package worth more than $7 million. Included were $80,000 for private club dues, $189,000 for relocation expenses, a $47,000 security system, $20,000 for life and liability insurance, and $13,000 for financial planning. The Internal Revenue Service considers such perks to be taxable income.
Equifax's directors did what many boards do these days. They awarded him yet another benefit —- "grossing up" his pay by $171,935 to cover the taxes on the perks. ...
"With the salaries and levels of compensation that these CEOs are receiving in the first place, the idea that they would need any type of tax assistance is just absurd," said Paul Hodgson, an expert on compensation issues at the Corporate Library, an independent research firm. The firm provides data and information on corporate governance issues to businesses, institutional investors, law firms and other clients. About one in five of the nation's large public companies paid part of their chief executive's tax bill, the Corporate Library found in a study of perks reported between February 2007 and February 2008. The findings are based on more detailed public disclosures aimed at transparency in executive benefits.
The union group's leaders argued that executive-pay packages are too often linked to short-term measures of performance, such as revenue growth, that can mask potentially catastrophic risks taken by a company.
A new report from Congress’s Joint Economic Committee, issued on the April 15 deadline for filing income tax returns, analyzed the Bush tax cuts that “disproportionately benefited the wealthiest Americans.” The report found that “seven years after the first tax cuts were passed, the evidence is clear that these claims were false, and in reality, these tax cuts have been bad economic policy. They have done little to stimulate the economy. The economic expansion earlier in the Bush administration was one of the weakest on record, and the economy has once again fallen into recession. While having limited economic effect, the tax cuts led to massive increases in the national debt and created an enormous windfall for the very wealthiest Americans at the expense of the middle class and future generations.”
To cut Boeing's enormous future pension liabilities, Kight said he'll propose to both the Machinists and the engineers to replace the employee pension for all new hires with a 401(k) plan supplemented by a company contribution.
"This is unbelievable," said Wroblewski, district president for the International Association of Machinists (IAM) Local 751, on hearing of the idea from a reporter. Although Kight had previously informed engineering union leaders of the proposal, he hadn't mentioned it to Wroblewski.
Wroblewski said that in 2005, when Boeing proposed taking away retiree medical benefits for new hires, "it ended in a strike ... This is unacceptable. I'm sure our members will walk again."
Editor's note: IBM employees, don't you wish *we* had had a union when IBM screwed *us* out of our long-promised pension and retiree medical benefits?
With the new pricing system, insurers abandoned the traditional arrangement that has patients pay a fixed amount, like $10, $20 or $30 for a prescription, no matter what the drug’s actual cost. Instead, they are charging patients a percentage of the cost of certain high-priced drugs, usually 20 to 33 percent, which can amount to thousands of dollars a month.
The system means that the burden of expensive health care can now affect insured people, too. ...
But the new system sticks seriously ill people with huge bills, said James Robinson, a health economist at the University of California, Berkeley. “It is very unfortunate social policy,” Dr. Robinson said. “The more the sick person pays, the less the healthy person pays.”
Traditionally, the idea of insurance was to spread the costs of paying for the sick. “This is an erosion of the traditional concept of insurance,” Mr. Mendelson said. “Those beneficiaries who bear the burden of illness are also bearing the burden of cost.” And often, patients say, they had no idea that they would be faced with such a situation.
Everyone in Japan is required to get a health insurance policy, either at work or through a community-based insurer. The government picks up the tab for those who are too poor. It's a model of social insurance that is used in many wealthy countries. But it's definitely not "socialized medicine." Eighty percent of Japan's hospitals are privately owned — more than in the United States — and almost every doctor's office is a private business.
Dr. Kono Hitoshi is a typical doctor. He runs a private, 19-bed hospital in the Tokyo neighborhood of Soshigaya. "The best thing about the Japanese medical system is that all citizens are covered," Kono says. "Anyone, anywhere, anytime — and it's cheap." Patients don't have to make appointments at his hospital, either. The Japanese go to the doctor about three times as often as Americans. Because there are no gatekeepers, they can see any specialist they want. ...
Japanese insurers are a lot more accommodating than their American counterparts. For one thing, they can't deny a claim. And they have to cover everybody. Even an applicant with heart disease can't be turned down, says Ikegami, the professor. "That is forbidden." Nor do health care plans covering basic health care for workers and their families make a profit. "Anything left over is carried over to the next year," Ikegami says. If the carryover was big, "then the premium rate would go down."
The health insurance business model "is unique in that profits depend upon goods and services not being provided," he writes, adding that, as a result, the "consequences of any insurance-based health care model" will "be progressively draconian rationing using denial of authorization and steadily rising copayments" for consumers and "massive paperwork and other bureaucratic hurdles, and steadily diminishing fee-recovery," for health care providers. Kellerman writes that, although most health care reform efforts "emphasize the need to get more people insured," such an approach makes health insurance an "important commodity," rather than a "service delivered by doctor to patient."
The system means that the burden of expensive health care can now affect insured people, too. ...
Private insurers began offering Tier 4 plans in response to employers who were looking for ways to keep costs down, said Karen Ignagni, president of America’s Health Insurance Plans, which represents most of the nation’s health insurers. When people who need Tier 4 drugs pay more for them, other subscribers in the plan pay less for their coverage.
But the new system sticks seriously ill people with huge bills, said James Robinson, a health economist at the University of California, Berkeley. “It is very unfortunate social policy,” Dr. Robinson said. “The more the sick person pays, the less the healthy person pays.”
Traditionally, the idea of insurance was to spread the costs of paying for the sick. “This is an erosion of the traditional concept of insurance,” Mr. Mendelson said. “Those beneficiaries who bear the burden of illness are also bearing the burden of cost.”
The plight of patients who have recently been hit with a huge increase in their insurance co-payments for high-priced prescription drugs was laid out in The Times on Monday by Gina Kolata. Instead of paying a modest $10 to $30 co-payment, as is usually the case for cheaper drugs, patients who need especially costly medicines are being forced to pay 20 percent to 33 percent of the bill (up to an annual maximum) for drugs that can cost tens of thousands of dollars, or even hundreds of thousands of dollars, a year.
These drugs — what insurers call Tier 4 medicines — are used to treat such serious illnesses as multiple sclerosis, hemophilia, certain cancers and rheumatoid arthritis. And since there are usually no cheaper alternatives, patients must either pay or do without, unless they can get their medicines through some charitable plan. ...
The insurers say that forcing patients to pay more for unusually high-priced drugs allows them to keep down the premiums charged to everyone else. That turns the ordinary notion of insurance on its head. Instead of spreading the risks and costs across a wide pool of people to protect a smaller number of very sick patients from financial ruin, insurers are gouging the sickest patients to keep premiums down for healthier people. ...
Employers, including the federal government, also bear responsibility. They have been pressing to reduce their prescription drug expenditures, and all health care expenditures, by shifting more of the burden to patients. One patient who had been paying only $20 for a month’s supply of a multiple sclerosis drug was shocked when the charge rose to $325 per month. (It has since been suspended.) Another patient found that his co-payment for a newly prescribed leukemia drug would exceed $4,000 for a 90-day supply, so he has deferred buying it. ...
What is not clear is whether insurers are primarily reacting to pressure from employers or are exploiting the situation to increase their profits. Congress needs to probe hard to find out how many patients are facing enormous drug bills and how best to protect them from medical and financial disaster.
In this “Frontline” report on Tuesday night, the Washington Post reporter T. R. Reid travels to five countries — Britain, Japan, Germany, Taiwan and Switzerland — that manage to provide some form of universal health coverage to their populations. In each nation, he reports, insurance premiums are significantly lower than those in America (in Britain there are none), and the waiting time to see a doctor is either tolerable (in Britain) or nonexistent.
This fast-moving and entertaining hour starts from the premise that the American health care system, with its high costs, multiple gatekeepers and failure to provide insurance for much of the population, is a failure. And Mr. Reid makes the case (in about 10 minutes per country) that other capitalist democracies have not just cheaper and more equally available health care, but also better care over all, with longer life expectancies and lower infant mortality rates. The clinics and hospitals he visits may not be as spacious and well buffed as those in American suburbs, but surveys of these countries’ citizens — the actual consumers of care — show rates of satisfaction that should make American providers blush. ...
The key factors, Mr. Reid determines, are mandatory coverage (only in Germany are the rich allowed to opt out of the national insurance system), a competitive but nonprofit insurance system and price fixing in the medical industry. One of the greatest savings created by this increased regulation is, counter-intuitively, less bureaucracy: with no combat between insurers and insured, and with no fear on the part of doctors and hospitals that they won’t be paid, these systems have dramatically lower administrative costs than in America.The Republican candidate's healthcare proposals are very similar to those of President George W. Bush. And many have been before the Congress for up to seven years without enactment. Even discussion of such reforms has been limited since the Democrats took control of both houses of Congress. Employers, as a result, are likely to have a good deal of time to evaluate proposals of a President McCain should he put them forth with sufficient detail for evaluation. It is doubtful that he will do so prior to the election.
The Alliance has been losing members due to retirement, job loss and employee financial difficulties. This web site receives an average of 40,000 visitors a month.
Tough economic times are obvious; however, we simply can not go on or take employee advocacy to higher levels if we don't build our dues paying membership. It is not just this web site: It is an office and an organization that is at stake. Our staff of 1 full time, 1 part time and volunteers/members are dedicated to building this organization; but it is up to YOU to see that we are able to keep the office open and the organization financially viable. We need to become financially independent--We can not continue to rely on being financed by non-IBM CWA members. IBM employees need to support their own organization!
Frankly if IBM employees do not see the value of this employee organization then the future of our work is in jeopardy.
Please consider joining the Alliance@IBM as a member for only $10 a month--the cost of a few Starbuck's coffees. Your dues and involvement help the Alliance with the following:
We also have the expense of keeping an office up and running: Rent, Office supplies, fax, phones internet access and mailings of organizing materials; such as newsletters, flyers and brochures.
We believe Alliance@IBM has, by its very existence; given IBM Corporate Mgmt pause, during their anti-employee actions.
The bottom line is that if we are NOT here, then IBM Corporate Management has the field. There will be some who say that employees do not want representation through an employee organization or a union. Now is the time: Prove them wrong or prove them right.
Three months after joining this team, they gutted the entire org. I was canned (May 31st) Even though they considered my skills redundant (LMAO) They kept extending me for months on end. I finally put my foot down and told them NO.. either crap or get off the pot. I had been looking internally for work for several months to NO avail.
There were tons of ops at first, but with all of the other cuts, first lines took the 3 initial jobs I had offered. That was the first 30 days, after that, no one that I applied for either responded back or would extend an offer. You have to get released by the committee of VP's to get hired on. Your position is eliminated and the cost savings for that month's stock price realized. Once you have been labeled, its over.
Now they tried to keep extending my sentence at IBM over and over. so when I was interviewing, you don't have a firm start date when you can start at a new job.. they screw with you on this as well. They threatened that they would take my severance if I didn't continue to extend my stay. I threatened IBM with a lawsuit and they let me leave and keep my severance.
I cannot state strongly enough to everyone of my former IBM'er.. get out. Polish that resume and start looking whilst your on their dime. Don't feel guilty about it either. They will screw you in a New York Second. The writing is on the wall. Kramer was right. The sucking sound you are hearing is the IBM jobs leaving America for good. There is a special place in hell for IBM management BTW.. The job market is not that bad for skilled workers. IBM's name still has some credibility in the market. I did get a lot of "I don't blame you for leaving" comments. Everyone knows just how bad IBM has become. IBM has passed the point of return. Its over. -X-IBM'er-
So instead of moving high skilled dedicated folks like me to other positrons.. they RA'd us. As far as the demand for my skills, I was approached not once but over a dozen times for different transition PM jobs with IBM after I was cut. There is ZERO merit behind the cuts.. its not like the past. They are ruining lives versus stepping up as a corporate citizen. I was very fortunate because I landed on my feet quickly for more money. Did I also mention that I am partially disabled? I brought that up to the RA counselor I was assigned to, mentioning that if there was any way to take my career length and service and consider another option as I NEEDED a home based job due to my disability... IBM's response IT's NOT MY PROBLEM That's what the RA counselor told me.
So get over yourself already and realize that busting your ass and making a great name for yourself means absolutely NOTHING at IBM anymore.. not a damn thing. So if you think that publishing the list to the managers will make a difference between getting axed, I don't think it will. It use to be the managers were immune from cuts. Guess what.. the game has changed and no one from the 3rd lines down are safe anymore. I know of 3rd lines having to take tech hands on jobs to retain employment. They were squared away with that luxury.
IBM management is INTENTINALLY creating a hostile workforce. Its forced attrition. If you have been a long term IBM'er you would realize that morale has been shit for well over 5 years. They use to address it publicly and resolve things in the past. Now management is stoking that hate so people leave on their own. IBM management fears the recoil that is building out there. Two things that they fear.. these lawsuits and organized workers.
If we organize we have more control.. PERIOD. Being a former Teamster, I know the pros and cons of a union. In the beginning of my career, I didn't think we needed a union. As I saw the abuses that we as IBM'er encounter, I know that we need a union. This is our last hope. Management has ZERO fear of its workers as we take the cuts in pay and staffing. If we don't stand up for ourselves, they will continue to make life a living hell for us.
I cannot express how much I urge everyone to polish their resume and always keep their eye on the job market. Be prepared so when you do get RA'd, it wont hit you as hard as its hit many of our fellow IBM'er. I was fortunate that I quickly landed on my feet. The severance was nice since I was basically paid to leave this hell hole. We're at will workers and they can toy with us all they want.. get organized and reduce that ability.
There is a special place in hell for joanne collins smee and the other useful idiots like sam. It's JCS how coined the current IBM upper management mantra.. The change we are inducing is like putting a square peg in a round hole.. keep pounding until it fits. The stuff that falls off as the pound that square peg is us. IMHO If our jobs were redundant.. I could some what agree, but I know for a fact that they were still hiring for my role as well as others and hiring tons of contractors. -X-IBMer-
There was such a public firestorm protesting the forced conversions, including Senate hearings. IBM was publicly embarrassed and chastised. At the hearing, because of the furor, then IBM VP of HR Tom Bouchard testified at the Senate hearings, announcing that IBM would extend the choice criteria downward, allowing more employees choice of the pension plans. People in this group were called "Second Choicers". Again, my memory is not very good, but I think they dropped the eligibility for choice down to 40 years old and 15 years of service.
But, the second choicers did not get the old retirement medical - they could choose the old pension plan, but they were still forced into the new retirement medical (FHA) plan .I may be a bit wrong with the age/years of service criteria, if so I' certain someone will correct me. Hope this helps -Second Choicer-
The stage has already been set. Millions of dollars will be save in severance packages this layoff go around as any potential package will most likely be based on a 40 hour work week, not the actual 50 hours or more that some of you work. This is just my opinion and it may be speculative but I would not be surprised that the new hires will come in sometime in June. You'll get 60 days to cross train your replacement and be out on the streets by September. Most of you will not see the six figure like buyout packages that many of the over 70,000 UAW workers are seeing and being offered right now. Good luck to you all... -spiderman
Vault's IBM Business Consulting Services message board is a popular hangout for IBM BCS employees, including many employees acquired from PwC. Some sample posts follow:
"But IBM is supposedly hiring the best and brightest out there...surely they could pick up the skills in a day or two? After all, that's what college hires do here in the US. It's not like the skills are hard to learn." "Uh, you haven't worked with these people have you? They have top CS degrees and all that, but limited drive...it'll be a lot easier if we stick to their skill set." "Are you telling me that they can't handle this? We could do this sort of thing in our sleep when I was hired." "That's what we're telling you." So what's the point of all my whining? I guess it's that we're seeing what I call "secondary effects" of IBM's hiring policies:
I guess this isn't a new story to those in the consulting groups...it's probably quite familiar by now. But to deal with the issue up close is pretty depressing. I take the optimistic view that people naturally WANT to produce great work, and that they naturally expect great work and effort from others. But to work on a project where people have such low expectations of their co-workers...that they can't or won't increase their skills...EVER. In a way, it's the worst form of drudgery.
Leave the Blue Pig at your earliest possible opportunity. It will NEVER get better because the core of people who could have helped restore IBM to it's glory are all gone... I'm still surprised that major customers are even doing business with IBM. Of course, since I retired from IBM, I'm still in IT and do business with a variety of vendors. I'm not real impressed with any of them anymore. Must be getting old...
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