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Highlights—February 27, 2010

  • The Register (United Kingdom): IBM offers voluntary redundo - two days into 'consultation'. By John Oates. Excerpt: IBM is offering staff voluntary redundancy just two days into the consultation period. The discussion period began 23 February and IBM yesterday announced a "voluntary separation programme". The offer is to UK staff at IBM's Global Services Delivery. They have until 8 March to express interest in leaving Big Blue. Managers will then notify staff of their decision and make them an offer by 16 March, and staff must make a final decision by 30 March. A source told The Register they were surprised at how quickly the process was moving, but assumed there was significant pressure to get everything done in time for the end of the financial quarter.
  • eWeek: H-1B Visa Program Again Under Fire. By Roy Mark. Excerpts: A new study by the Economic Policy Institute claims some companies are using the H-1B visa program to transfer work overseas and to take advantage of cheaper guest worker labor. Despite claims to the contrary, many tech firms are using H-1B visas to fill temporary positions and not as a pathway to permanent citizenship, according to a new study by the Economic Policy Institute. "Some H-1Bs and L-1s visa holders do make it to permanent residence, but many employers never plan to sponsor employees for permanent residence," report author Ron Hiras writes. "These employers are using the H-1B and L-1 visa programs for purely temporary purposes, and their share of the H-1B and L-1 visa numbers is large and increasing."

    Tech leaders have long championed the idea of using H-1B visas as way to bring the best and brightest to work permanently in the United States. Former Microsoft Chairman Bill Gates has repeatedly told Congress, "It's doesn't make sense to keep the smart people out." Carly Fiorina, an adviser to John McCain’s presidential campaign in 2008, current Republican candidate for the U.S. Senate and former CEO of Hewlett-Packard, recently said, "It is in our economic interest to have really smart people wanting to come here. And so what’s wrong with the H-1B visa system today, among other things, is that we curtail that program so tightly that the limits that Congress allows for H-1B visa entrance are usually filled within one week. So we have to find a more practical system for allowing smart, hardworking people to come into this country, and it should be our goal to get them to stay here forever."

    Hira, though, comes to a different conclusion after his study of H-1B and L-1 visa holders. "[Some companies are] using the H-1B and L-1 visa programs for purely temporary purposes, and their share of the H-1B and L-1 visa numbers is large and increasing" Hira writes in his analysis. "This paper [shows] that growing shares of employers never plan to sponsor H-1B and L-1 visas for permanent residence." He adds, "In fact, as this paper [shows], most of the top users of both the H-1B and L-1 visa programs sponsor very few, if any, of their workers for permanent residence."

  • Yahoo! IBM Retiree Information Exchange message board: "Cobra subsidy for pre-65 IBM retirees" by Suvas Shah. Full excerpt: I had to take involuntary retirement (30+ years of service) in Feb last year. My one year medical insurance benefit ends at the end of the month. I do not have sufficient funds in Future Health Account to cover for next 10 years when I become eligible for Medicare. Am I eligible for 65% Cobra subsidy as provided in Stimulus plan? When I called Benefit center, they told me to call back on Feb 25 to use FHA funds when my one year completes. They would not allow me to apply earlier. Any suggestions? Thanks.
  • Yahoo! IBM Retiree Information Exchange message board: "Re: Cobra subsidy for pre-65 IBM retirees -- NOT, most states, if you RETIRED". Full excerpt: Your FHA funds will cover around 4 years, if used to cover 100% of the insurance premium costs.(DO NOT USE UP 100% of FHA funds) Do this and save for future premium costs; projected to be about $1500/person/month, if current trends continue.

    The amount over 6.5% of your Taxable Income is deductible. Your retirement pay will be about 1/4 of your current pay, so your premiums will definitely exceed that. By that time hopefully some insurance reform will have taken place and any amount over 8-10% of the taxable amount, used for insurance needs, will become a CREDIT and not just a DEDUCTION.

    Under current FHA, the costs are ridiculous and getting worse each year. The lowest cost plan is only about $150/month less than the more expensive plans. If you go to the doctors a lot, the cheaper premium plans end up costing you a lot more. ($3500 deductible and lower drug coverage on the cheaper plan = more out of pocket, if you use the plan a lot).

  • Yahoo! IBM Retiree Information Exchange message board: "Re: Cobra subsidy for pre-65 IBM retirees" by "lrafalow". Full excerpt: Hi Suvas. Everyone's situation is different, of course, but I found that using COBRA until my eligibility ran out, 18 months when I retired, to be advantageous. It's real dollars but it's much cheaper than the retirement plans...and you will eventually be paying real dollars for the retirement plans (my blue dollars at 100% lasted about 3 1/2 years for me and my wife). I'm pretty sure the stimulus bill money was only for the unemployed not the retired but I'm guessing the NC Employment Security Commission can tell you how it works. Lee.
  • Yahoo! IBM Retiree Information Exchange message board: "Re: Cobra subsidy for pre-65 IBM retirees" by Suvas Shah. Full excerpt: I was able to get thru IBM benefits. They said that since I am covered under FHA, I am not eligible for Cobra subsidy. I was able to enroll in High Deductible($2500/person) PPO but premium is $1082 per month for two. At this rate, FHA will last for 4 years at best. Suvas Shah.
  • Glassdoor: IBM Global Service Reviews. Selected reviews follow:
    • IBM Global Services Managing Consultant in Chicago, IL: (Past Employee - 2009). “Reflections of an industry hire / SME.” Pros: Brand recognition; solid reputation; business units (consulting / equipment / outsourcing) are each solid and provide a balance among offerings for the company to succeed Cons: Very little concern for training / development; focus on off-shoring creates challenges for project management, team-building, and overall execution. Project teams were disconnected and would benefit from stronger senior project / client leadership. Strong focus on bottom line performance neglects the opportunities to train and develop professional / strategic leadership. Advice to Senior Management: Invest in training and development programs to broaden knowledge base and enhance business development and project management capabilities.
    • IBM Global Services Anonymous: (Past Employee - 2008) “Sharp elbows necessary to advance.” Pros: Great brand Smart, competent employees committed to driving results. Cons: Poor, inconsistent communication from senior leadership Culture rewards only those willing to be overly aggressive, resulting in poor integrity from some. Decentralized org model drives significant inefficiency. Advice to Senior Management: Focus on what made IBM great -- fostering strong thought leaders, sharing ideas, and emphasizing a commitment to excellence.
    • IBM Global Services Storage Engineer: (Current Employee) “Storage Global Services Engineer.” Pros: Global market place where business can take you to any continent in the world. With the market being what it is it's nice to work for a company which has a global market place to play off of. My skill set can be leveraged and picked up by project teams world wide. Therefore there is little down time when looking for new projects to move to. Cons: IBM is inward thinking and does not do well at focusing on what their customers want. A perfect example of this is their Lotus Notes product line. It's has 10 times the features of any e-mail client I've ever used and it's equally 10 times as hard to use. IBM needs to simplify it's software and disk portfolio and focus on giving customers value out of the box on day one of ownership. The days when product implementation and integration projects take years to complete are over (or should be for that matter). IBM's competition knows this and has risen to the occasion. This is why IBM is losing in the storage sector. Advice to Senior Management: Remove a tier or two of middle management much like GE has done in the past. IBM needs to become a more agile company focused on delivering results and not just cheap solutions.
New on the Alliance@IBM Site
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  • To Alliance@IBM supporters: The Alliance is the only organization that advocates and supports IBM employees and ex-employees. In fact, there are few like it in the Information Technology field. It is always difficult to keep an organization like this alive, but as a supporter you know how important it is that we exist. We are calling on you today to help keep us alive another year by joining as a member or associate member. See our online forms below. As our membership has dropped, it is imperative that we gain new members or this organization and web site will cease to exist. Help us keep our organizing and advocacy work alive!
  • General Visitor Comments: Due to a lack of membership growth the comment sections will be closed until we see sufficient growth in full membership, associate membership or donations. Many of you that visit our site have not yet joined, but seem to value its existence. The only comment section that will remain open will be Job Cuts Reports. If you have information that you want the Alliance to know about please send to ibmunionalliance@gmail.com. Information of importance will be put on the front page of this web site. To join go here: Join The Alliance! or here: Join The Alliance!
  • Job Cut Reports
    • Comment 2/23/10: It was around this time last year that the RA's were being decided upon for the March '09 actions. I reckon talks are well underway for this round now. I wish you folks would organize soon since this is getting all too repetitive and predictable. How much longer are IBMers going to sit and do nothing to stop the madness of these regular RAs? -anonymous-
    • Comment 2/23/10: Re: RA discussions... RA discussions probably happened late 2009 for any 2010 RAs (at least anything in the first half of 2010). What's probably happening now is FLMs are being told "start thinking of X of people to get rid of". -anonymous-
    • Comment 2/23/10: RA notifications coming on Monday, 3/1. Bank on it. -Anonymous-
    • Comment 2/23/10: "RA discussions probably happened late 2009 for any 2010 RAs (at least anything in the first half of 2010). What's probably happening now is FLMs are being told "start thinking of X of people to get rid of". I agree but what a spineless job. Why would anyone want to be a FLM? When my number is up and my spineless FLM tells me I've been selected for a resource action (like I've won some sort of booby prize) I'm going to give him the one finger salute (i.e. middle finger) and then fall on the floor and complain of chest pain. I want IBM to call for an ambulance and have EMT's come up and carry me out on a gurney. I'm going to make it as painful as possible for my FLM and for IBM. I hope someone takes some pictures of me on the gurney and sends them to the local paper too. The public needs to know about the abuse going on in IBM. -IBMer-
    • Comment 2/24/10: lots of team members in SSO Australia handed their 4 week notice today. Rumor is that its 10% across the board. -somedude-
    • Comment 2/24/10: Regarding: "A notifications coming on Monday, 3/1. Bank on it." I doubt it. IBM does RA's a few days before the end of a month to avoid paying that month's earned vacation days. They don't do things on the 1st of a month. -anonymous-
    • Comment 2/24/10: In AIM Jim Duncan having "kickoff meeting" tomorrow this is where he will ask us to "go extra mile" meanwhile he is sending jobs to india and China, has NOT given raises to MOST of his people for over FIVE years, but managers sent out note "He will be serving Ice cream" Yay!, no raise for 6 years, sending jobs overseas, the new PBC crap expects us to do 100% more? What, so his fat ass can go play golf? When he shits on us? Wants US to "transfer skills" when we do, he has plans in place to fire us so he can show profit?Jim Duncan did YOU get raise in past 5 years? Because MOST of your people did NOT! And you have the balls to say "I got Ice cream"? We are not special olympics people, my take is you plan to move stuff to China, good luck on that, and when you do, when it falls through, you are on your f'in own -Anonymous-
    • Comment 2/24/10: IF there are going to be announcements it will probably follow what they did in March of 2009. WARN talked to the 54 people laid off on March 27th - employed at East Fishkill - affecting both STG and GBS. I know STG people were caught off guard. -Internal Accounts are Dead-
    • Comment 2/24/10: Australia and NZ are being hit, rumours of around 800 across the board, and jobs being replaced from India. Four weeks notice, last day March 24. Great way to get people motivated as trainers for their replacements. -Waltzing Matilda-
    • Comment 2/24/10: I agree, I hate it when people post a damned RA RUMOR with nothing to back it, like they are playing with everyone and it is a sick damned joke to play. However, it is not illogical to lay someone off on the 1st of the month when there are 31 days in the month, it has happened before where 30 days notice is given. As many have, I listened to the Services BUI all hands call today. What a pathetic waste of time. They talk about the same hype year to year and they think they have this service pegged down to business analytics software, i.e. SAP and Oracle. When do you think they will realize that their best asset is the people and this is where there investments will actually return growth. Why does it seem the bottom fell out of this big blue can and the last few of us are hanging on the edge hoping not to fall out? -IBMer#2-
    • Comment 2/25/10: Meeting notice sent from manager to meet on 03/01-- VERY atypical. First place I checked was here--sure enough, postings about 3/1--going to be a long weekend. -boulderblu-
    • Comment 2/25/10: Here's why I am out, and don't work to change things. I think it will take too long, so long that it will not benefit me personally. I do not want to continue to work here. Basically, I went to school to get a graduate degree in IS and now am being treated like a factory employee...well, less than a factory employee. It was good while it lasted, but I am ready to move on, into health care--where unions already exist for some occupations. Any way, it's not Stockholm Syndrome, it's not "couldn't happen to me." I've been preparing for this day for about 5 years now..and am ready to leave. I don't like IT enough to stick it out...I out of 17 years, I really enjoyed about 2 of those, which is pretty sad. -BoulderBlu-
    • Comment 2/25/10: Before I was shown the door I was told by a manager that IBM was looking to do away with the rest of its negotiators and contracts staff in favor of a central contracts preparation center in India. Apparently, after the legal department did a hostile take over of the Contracts and Negotiations functions (Arthur Kentros' group) budget (legal could not work within its own budget so they did away with negotiations as a separate function and absorbed the budget) it was decided to off shore the work. I've been away for awhile. Wondering if there is any news on that. -Sad But True-
    • Comment 2/26/10: RA actions occurring now in Australia, started on the 23rd. Around 200 are being cut, I would in one of the smaller states and there have been 8 RA actions there, including killing off one whole ITS service division. Very sad for those people in a state that work is booming in. -Geoff-
    • Comment 2/26/10: To -Curious- Yes there is suppose to be a big RA on Monday. I am a Project Manager in ITD Div 07. I have been with IBM for over 21 years and am ready to get away from this abuse. In all of my years at IBM I have always been a 2+ or a 2. Family was always more important to me than kissing up and killing myself to try for a 1. This time I was rated a 3 for the first time. My manager did not want to give me a 3, but when he turned in the ratings for his department, 2nd and 3rd line managers reviewed them and made all of the 1st line managers lower the ratings.

      I have been lucky the last several years to have IBM managers that were from the good ole days. I have been able to be very open with them and they have been open with me. On our last department meeting, he was as straight with us as a manager could be with a department facing some big changes. After the call, he and I talked one on one about what was coming. He did not have all of the details on when at that time. But what was probably going to happen he was pretty sure of. He has about 30 PMs under him. Monday, if things happen as it looks like they could, most of them including me will be RA'ed.

      Also, the manager he reports to has also set him up to be RA'ed with us. He was talking with the other managers in his group and by the ratings, only one of them will probably be left and that manager will probably be assigned the PMs that are left from the other managers that were also RA'ed. When he found out the date for sure he said he would send me a cryptic Sametime as it may be monitored. He sent it yesterday that said Monday was the day.

      So, as soon as I hear more on Monday, I will post to this site. For everyone that is ready to get out of this place, like me, I say good luck. But if you got a 2 or 3 PBC (or if you got a 2+ but had a 2 as your prior PBC rating), do should not need any luck this time. For those that want to stay, good luck, you can have it. For those that have to stay, sorry I hope you can find something else to enable you to get out. Life and family is not worth this place. -sTILL dUCKING-

    • Comment 2/26/10: In Canada the RA actions will not be rumor come Monday March 1, 2010. Looks like all RA actions will be via off shoring, last date of employment is March 25th. Various areas of the business being impacted. -Time To Go-
    • Comment 2/26/10: Bay Area Lab (Foster City, CA) - Software (WebSphere Process Server development and support). Big RA on Monday 03/01. Estimated 40-50% will be RA'd in the lab.1on1s ready for Monday morning. It's really sad after a huge effort in the 4th quarter working late nights and weekends for nearly 3 months. Other labs in San Francisco Bay Area-Silicon Valley will be affected. -ToBeOrNotToBeAnIBMer-
    • Comment 2/27/10: Just renewed. As others have already said, what will you do if this site/organization goes away? You could be a 3-performer or "top/above average" contributor in an area making big cuts, walk in 3/1 and have no idea what's coming. At least you know Monday *could* be your day. - new2rchland-
    • Comment 2/27/10: It is up to us to turn around the loss of Alliance membership I joined you should too! The Alliance is too valuable an organization to lose. -IBMer- Alliance reply: Thank you and the others that joined the past couple days. We have a long way to go but we can turn this around and make the Alliance a force to be reckoned with. We understand times are tough and many IBMers have lost their jobs. The Alliance is the movement that gives voice to the concerns of all IBMers, ex-IBMers and tech workers. Help us keep it going.
    • Comment 2/28/10: -sTILL dUCKING- Thanks a lot for confirming it, and I am sorry to hear that you may be RA'ed. I also work in division ITD 7 and it has been strange how my management has been so hush hush about it, when before, I was able to squeeze out some info from them. I've always been rated as a 2+ so I'm hoping I'll be immune this time. But it will really suck if they RA someone on my team because all our projects will slip and I'm sure none of us are ready to take on more workload. Has your group been GDF'ed or GR'ed yet? I'm sure that is a major driver. -Curious-
    • Comment 2/28/10: Let's keep the postings here just for Job Cuts and RA information which is what it is intended for. The Alliance will gladly open back up the General, Raise and Salary, PBC, and the other comments sections once membership improves. -sby_willie-
  • International Comments
News and Opinion Concerning Health Savings Accounts, Medical Costs and Health Care Reform
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  • New York Times: How the G.O.P. Can Fix Health Care. By Bill Frist, Mark McClellan, James P. Pinkerton, Charles Kolb and News Gingrich. Excerpt: In a bid to reopen the debate over health care reform, President Obama has arranged a televised bipartisan meeting this Thursday. Republican leaders in Congress have been invited to bring their best ideas for slowing the growth of health care expenditures and expanding the number of insured Americans. The Op-Ed editors asked five conservative thinkers to outline what they believe those ideas should be.
  • New York TImes: The Narcissus Society. By Roger Cohen. Excerpts: Which brings me to health care: Crunch time has come on a question central to the nation’s future, where an acknowledgment is needed that, when it comes to health, we’re all in this together. Pooling the risk among everybody is the most efficient way to forge a healthier society. That’s what other developed societies do. And they don’t have 30 million plus uninsured.

    Now, as I understand it, the Tea Party movement is angry about waste, bail-outs for the rich and spiraling debt. They detest big government. But if waste and debt are really what’s bothering them, how about the waste in the more than 1,800 daily health-care related personal bankruptcies, the 25 to 30 percent of some corporate insurers’ costs going on administration (versus 6 percent for Medicare), the sky-rocketing health premiums that are undermining U.S. corporations (and so taking jobs), the endless paperwork of private reimbursement procedures, and the needless deaths?

    Americans don’t want a European nanny state — fine! But, as a lawyer friend, Manuel Wally, put it to me, “When it comes to health it makes sense to involve government, which is accountable to the people, rather than corporations, which are accountable to shareholders.”

    All the fear-mongering talk of “nationalizing” 17 percent of the economy is nonsense. Government, through Medicare and Medicaid, is already administering almost half of American health care and doing so with less waste than the private sector. Per capita Medicare costs for common benefits grew 4.9 percent between 1998 and 2008, against 7.1 percent for private insurers. Why not offer Medicare as a choice — a choice — to everyone? Aren’t Republicans about choice?

    The public option, not dead, would amount to recognition of shared interest in each other’s health and of the need to use America’s . energies and resources better. It would involve 300 million people linking arms. Or we can turn away from each other and, like Narcissus, perish in the contemplation of our own reflections.

  • Huffington Post: Health Means Life; Health Means Freedom. By George Lakoff. Excerpts: Life and freedom are moral issues. It is time for Democrats to talk about health in those terms, beyond just policy terms like health insurance reform, bending the cost curve, types of exchanges, etc. Health means life. If you get a major illness or injury and cannot get it treated adequately, you could die. And tens of thousands do. Health means freedom. If you have a serious illness or injury and cannot get it treated, your freedom will be limited in many ways. Your physical freedom: you may no longer have the freedom to move around. Your economic freedom: you may not be able to work or your medical bills may impoverish you. Your emotional freedom: you will not be free to live a happy life. ...

    Real terror is seen in the thousands of letters sent to the White House and Congress by people whose lives have been shattered or threatened by the behavior of the health insurance corporations. Wellpoint, which made $2.7 billion in fourth quarter profits in 2009, tried to raise its Anthem/Blue Cross premiums 39% in California. Wellpoint made its profits by NOT giving health care. It treated 2.2million fewer people. It found a way NOT to treat people who needed treatment, either by refusing to insure them, or dropping them as clients, or denying authorizations. If you are sick or injured and that happens to you, you face terror -- very real terror. That's when "health maintenance organizations" (HMOs) become health terror organizations. ...

    It is time to return to the moral fundamentals. Health security is deeply patriotic -- perhaps our most important form of security. Health means life. Health means freedom. Everyone can understand that.

  • New York Times: Bust the Health Care Trusts. By Robert B. Reich. Excerpts: My health insurer here in California is Anthem Blue Cross. So far, my group policy hasn’t been affected by Anthem’s planned rate increase of as much as 39 percent for its customers with individual policies — but the trend worries me, as it should everyone. Rates are soaring all over the country. Insurers have been seeking to raise premiums 24 percent in Connecticut, 23 percent in Maine, 20 percent in Oregon and a wallet-popping 56 percent in Michigan. How can insurers raise prices as much as they want without fear of losing customers?

    Astonishingly, the health insurance industry is exempt from federal antitrust laws, which is why a handful of insurers have become so dominant in their markets that their customers simply have nowhere else to go. But that protection could soon end: President Obama on Tuesday announced his support of a House bill that would repeal health insurers’ antitrust exemption, and Speaker Nancy Pelosi signaled that she would put it toward an immediate vote. ...

    Health insurers like Anthem claim they have to raise rates (as well as co-payments and deductibles) because of the economic downturn. Employers are reducing coverage and cutting payrolls. As a result, more people are buying individual policies, but they tend to be older and sicker. Younger and healthier Americans are simply going without insurance, and thus not subsidizing their costlier fellow policy-holders. This can’t be the whole story, because big health insurers are making boatloads of money. America’s five largest health insurers made a total profit of $12.2 billion last year; that was 56 percent higher than in 2008, according to a report from Health Care for America Now. ...

    More than 90 percent of insurance markets in more than 300 metropolitan areas are “highly concentrated,” as defined by the Federal Trade Commission, according to the American Medical Association. A 2008 survey by the Government Accountability Office found the five largest providers of small group insurance controlled 75 percent or more of the market in 34 states, and 90 percent or more in 23 of those states, a significant increase in concentration since the G.A.O.’s 2002 survey.

  • Jim Hightower: Greedhead Trophy Up For Grabs. Excerpts: America’s sports writers had all but ceded the coveted “Corporate Greedhead Trophy” to the Wall Street Barons this year but – Holy Cow – here come the Health Care Insurance Giants ! To paraphrase my old high school football coach, “when the going gets ugly, the ugly get going” – and our country’s five largest health insurance corporations are definitely making a run for the trophy. They recently stunned greed-watchers with an announcement that they had scored record profits in 2009, totaling $12.2 billion. Wow – that’s a 56 percent hike in profits over the previous year for United Health, Wellpoint, Aetna, Humana, and Cigna!

    Wait, that’s not all, The Insurance Giants also booted 2.7 million Americans out of their health plans last year, leaving these older and sicker customers in the corporate dust. Then, in a slick, hidden-ball play, three of the five Giants shifted more of their customers’ premiums out of providing medical care, instead siphoning more of that money into corporate profits, executive salaries, and administrative overhead. I’m telling you, these guys can play!

    Check out the spectacular “Hail Mary” pass heaved by Anthem Blue Cross, a California subsidiary of Wellpoint. Even though Wellpoint is rolling in a 91 percent increase in profits, its Anthem unit suddenly streaked toward the goal line, shocking its unsuspecting customers with a demand for a 39 percent increase in their premiums this year. This rate hike is 10 times more than the rise in the actual cost of health care. What a move!

    Still, it won’t be easy for the upstart Insurance Giants to out-ugly the more sophisticated Wall Street Barons. But the great thing about the corporate league is that competition to be the number one national greedhead is always fierce – and insurance is definitely in the running.

  • Mother Jones: Health Insurance Across State Lines. Do you really want a single state making rules for the entire country? By Kevin Drum. Excerpts: Bob Somerby takes both liberals and the media to task for not fighting back against a conservative meme:
    In recent weeks, we’ve mentioned the press corps’ failure to examine a ubiquitous GOP claim — a claim asserting the merits of letting consumers buy health insurance “across state lines.” On the various cable “news” channels, voters hear this proposal advanced again and again and again.
    ...The voters deserve to hear this explained. We have never seen this explained on cable, although we’ve endlessly heard the proposal. And we still haven’t seen this matter explained in a simple, “explainer” news report. For the most part, our big news orgs simply don’t explain things. In all candor, they rarely seem to know what sorts of claims are being made in the wider discourse
    We’ll offer one further suggestion for any newspaper which might want to do an explainer piece — a piece which might be called, “Buying across state lines for [us] dummies.” On cable, Republicans and conservatives often draw a comparison between health insurance, which can’t be sold “across state liners,” and car insurance, which apparently can. Since voters constantly hear that refrain, an “explainer” piece ought to address it. ...

    The basic problem with this proposal, of course, is pretty simple. If you allow health insurance policies to be sold across state lines, states would start competing for insurance industry business by writing ever friendlier regulations. Eventually some small state will win this contest with an absurdly lax regulatory regime, and every insurance company in America will set up shop there. Essentially, the entire country would be forced to accept whatever pro-industry rules that, say, Wyoming decides to write for the rest of us. Do the citizens of all the other states really want to cede that power to Wyoming?

    As for car insurance, if you want to sell auto policies in California, you have to abide by California laws. Ditto for the other 49 states, regardless of where your company is actually located. So the comparison is bogus. Every state does have its own auto insurance regulations, just as they do in the health insurance arena.

  • New York Times op-ed: Afflicting the Afflicted. By Paul Krugman. Excerpts: What really struck me about the meeting, however, was the inability of Republicans to explain how they propose dealing with the issue that, rightly, is at the emotional center of much health care debate: the plight of Americans who suffer from pre-existing medical conditions. In other advanced countries, everyone gets essential care whatever their medical history. But in America, a bout of cancer, an inherited genetic disorder, or even, in some states, having been a victim of domestic violence can make you uninsurable, and thus make adequate health care unaffordable.

    One of the great virtues of the Democratic plan is that it would finally put an end to this unacceptable case of American exceptionalism. But what’s the Republican answer? Mr. Alexander was strangely inarticulate on the matter, saying only that “House Republicans have some ideas about how my friend in Tullahoma can continue to afford insurance for his wife who has had breast cancer.” He offered no clue about what those ideas might be.

    In reality, House Republicans don’t have anything to offer to Americans with troubled medical histories. On the contrary, their big idea — allowing unrestricted competition across state lines — would lead to a race to the bottom. The states with the weakest regulations — for example, those that allow insurance companies to deny coverage to victims of domestic violence — would set the standards for the nation as a whole. The result would be to afflict the afflicted, to make the lives of Americans with pre-existing conditions even harder.

    Don’t take my word for it. Look at the Congressional Budget Office analysis of the House G.O.P. plan. That analysis is discreetly worded, with the budget office declaring somewhat obscurely that while the number of uninsured Americans wouldn’t change much, “the pool of people without health insurance would end up being less healthy, on average, than under current law.” But here’s the translation: While some people would gain insurance, the people losing insurance would be those who need it most. Under the Republican plan, the American health care system would become even more brutal than it is now.

  • Washington Post: At summit, Republicans prove they aren't putting America's health first. By Steven Pearlstein. Excerpts: I'm not sure what else was accomplished at Thursday's Blair House summit, but surely one result is that we learned what Republican "leaders" really think about health care and health insurance. The most important thing Republicans think is that if there are Americans who can't afford the insurance policies that private insurers are willing to offer, then that's their problem -- there's nothing the government or the rest of us should do about it.

    "We just can't afford this," said Eric Cantor, the fresh-faced House minority whip from Virginia, while John Boehner, the House Republican leader, called it "a new entitlement program that will bankrupt our country." What they were referring to, of course, was the $125 billion a year that Obama and his Democratic allies propose to spend in subsidies so tens of millions of low-income households can afford to buy health insurance and handle the co-payments. But if paying for those subsidies means raising taxes on high-income households with lots of investment profits, or capping a tax break for people with extravagant health insurance, or charging a modest fee on medical device makers that refuse to moderate future price increases, then Republicans are agin' it. ...

    Judging from Thursday's discussion, Republicans have much more sympathy for those who can afford to buy health insurance but are denied because of a preexisting medical condition. They oppose Democratic efforts to end this industry practice directly through regulation, preferring instead to refer those customers to special high-risk insurance pools where they would be guaranteed to find coverage. In some versions of the high-risk pool, the cost of a policy would be so high that households with average incomes would have to set aside a third or even half of their income to pay for it. It takes a Republican to view this as a solution -- the equivalent of giving a starving man a coupon for $2 off his next dinner at Le Bernardin.

    Or perhaps Republicans imagine high-risk pools that are subsidized sufficiently enough that the insurance policies are actually affordable. Unfortunately, the only way to finance such subsidies is through some sort of tax or fee, mostly one imposed on every insurance policy sold outside the high-risk pool. It's a fine idea but one that turns out to be the actuarial equivalent of what Democrats proposed in requiring that insurers charge pretty much the same premiums for everyone, with only modest variations based on age and health condition. ...

    Then there's the issue of what minimal level of benefits a basic health insurance package should offer. Republicans, of course, used Thursday's forum to denounce the idea that such decisions should be made by Washington bureaucrats and politicians. But as my Washington Post colleague Ezra Klein points out, Republicans apparently would have no problem if those standards were to be set by bureaucrats and politicians in Nebraska, or North Dakota or whatever Republican state decided to offer itself up as the regulatory haven from which insurers could sell their policies nationwide.

News and Opinion Concerning the U.S. Financial Crisis
Minimize "It is a restatement of laissez-faire-let things take their natural course without government interference. If people manage to become prosperous, good. If they starve, or have no place to live, or no money to pay medical bills, they have only themselves to blame; it is not the responsibility of society. We mustn't make people dependent on government- it is bad for them, the argument goes. Better hunger than dependency, better sickness than dependency."

"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.

  • New York TImes op-ed: The Bankruptcy Boys. By Paul Krugman. Excerpt: O.K., the beast is starving. Now what? That’s the question confronting Republicans. But they’re refusing to answer, or even to engage in any serious discussion about what to do. For readers who don’t know what I’m talking about: ever since Reagan, the G.O.P. has been run by people who want a much smaller government. In the famous words of the activist Grover Norquist, conservatives want to get the government “down to the size where we can drown it in the bathtub.”

    But there has always been a political problem with this agenda. Voters may say that they oppose big government, but the programs that actually dominate federal spending — Medicare, Medicaid and Social Security — are very popular. So how can the public be persuaded to accept large spending cuts? The conservative answer, which evolved in the late 1970s, would be dubbed “starving the beast” during the Reagan years. The idea — propounded by many members of the conservative intelligentsia, from Alan Greenspan to Irving Kristol — was basically that sympathetic politicians should engage in a game of bait and switch. Rather than proposing unpopular spending cuts, Republicans would push through popular tax cuts, with the deliberate intention of worsening the government’s fiscal position. Spending cuts could then be sold as a necessity rather than a choice, the only way to eliminate an unsustainable budget deficit.

  • Wall Street Journal: Wall Street Bonuses Get 17% Bounce. By Gina Chon. Excerpts: New York Stock Exchange broker-dealer firm members earned a record $49.9 billion in the first three quarters of 2009, and Comptroller Thomas DiNapoli predicted profits could exceed $55 billion in 2009 for a new record. Salaries and bonuses averaged about 40% of net revenue in 2009, compared to about 50% in previous years. ...

    The average taxable bonus in 2009 increased to $124,850, compared to $112,000 in 2008, Mr. DiNapoli said. Total average compensation at the largest investment banks, like Goldman Sachs Group Inc. and J.P. Morgan Chase & Co., was up by 31%, while overall average compensation increased 27% to more than $340,000.

  • Washington Post: Wall Street shifting political contributions to Republicans. By Dan Eggen and Tomoeh Murakami Tse. Excerpts: Commercial banks and high-flying investment firms have shifted their political contributions toward Republicans in recent months amid harsh rhetoric from Democrats about fat bank profits, generous bonuses and stingy lending policies on Wall Street. The wealthy securities and investment industry, for example, went from giving 2 to 1 to Democrats at the start of 2009 to providing almost half of its donations to Republicans by the end of the year, according to new data compiled for The Washington Post by the Center for Responsive Politics. ...

    Republicans, meanwhile, are soliciting Wall Street for donations with the argument that Democratic proposals would hurt the bottom lines of major financial institutions. House Minority Leader John A. Boehner (R-Ohio) told reporters this month that he was urging Wall Street executives to "help our team" oppose the "bizarre policies" coming out of the Obama administration. One senior Republican staff member on Capitol Hill, who discussed contributions on the condition of anonymity, said: "Democrats in Washington are clearly trying to move legislation that would be very damaging to that industry. It was almost like there was a free ride time. But now they're starting to see the real negative impact of Democratic proposals."

  • Burlington Free-Press: My Turn: Rebuild the middle class. By Senator Bernie Sanders. Excerpts: The United States is in the midst of the worst economic crisis since the 1930s. Workers in Vermont and throughout the country continue to lose their jobs, homes, pensions and ability to send their children to college. The economic pain our country is experiencing did not begin when the financial sector nearly collapsed over a year ago as a result of the greed and recklessness of Wall Street. The decline of the middle class has been going on for many years. Describing "a lost decade for American workers," The Washington Post said the past 10 years were the worst for the U.S. economy in modern times. USA Today said incomes of the young and middle-aged "have fallen off a cliff since 2000, leaving many age groups poorer than they were even in the 1970s." ...

    We need to fundamentally change the way Wall Street does business so that it invests in the job-creating productive economy, instead of the casino-style gambling that led to the largest taxpayer bailout in history. Financial institutions that are "too-big-to-fail" need to be broken up. Big banks that received a taxpayer bailout need to increase lending to small businesses. And we need to establish a national usury law to stop lenders from ripping off the middle class by charging outrageously high interest rates. ...

    Making these difficult challenges even harder is the reality that we now face record-breaking deficits as a result of the Bush administration's refusal to pay for two wars, tax breaks for millionaires, an expensive prescription drug program and the Wall Street bailout. As we begin changing our national priorities and investing in the needs of the middle class and our kids, it is imperative that we move toward a more progressive form of taxation and take a very hard look at the waste that exists in every agency of government.

  • Wall Street Journal: Bonus Blowback Bypasses Brokers Retention Pay, Signing Awards Get Thrown at Top Talent; a $10 Million Payout at Smith Barney. By Aaron Luccheti and Brett Philbin. Excerpts: Bonus has become a bad word for traders, investment bankers and top executives at Wall Street securities firms. For thousands of brokers, though, the big bucks just keep rolling in. Mark Curtis, one of the biggest generators of commissions in the brokerage giant formed last year by Morgan Stanley and Citigroup Inc.'s Smith Barney unit, got a payout in 2009 that people familiar with the firm estimate at $10 million or more.

    Morgan Stanley Smith Barney promised top brokers like Mr. Curtis 75% of certain fees and commissions generated in 2008 as part of the pay plan agreed to by both companies as a way of enticing top brokers to stick around after the merger. A team of brokers led by Mr. Curtis has brought in more than $15 million in annual fees and commissions in recent years, these people say. ...

    The retention awards and similar signing bonuses for brokers exceed $10 million in some cases across Wall Street, people familiar with the matter say. At most firms, the highest producers with retention deals also get smaller payments later on that are based on future or past asset growth or revenue. The retention payments are in addition to $3 million to $5 million that top-dog brokers earn yearly through fees and commissions.

  • Jim Hightower: Selling Political Love to Wall Street. Excerpts: Poor Wall Street bankers. They can't find a friendly port in the unrelenting storm of public outrage at their ongoing narcissism. President Obama has publicly decried their "obscene bonuses," and Congress is moving to impose new regulations and taxes to restrict their incurable greediness. It's sad – but who in the world would want to hug a banker?

    Wait – here comes a bank hugger! He's John Boehner, the Republican leader of the U.S. House. And there's Texas senator John Cornyn, the Republican's chief senatorial fundraiser, offering his soft shoulder for the Wall Street crowd to cry on. Yes, the entire Republican leadership of Congress is clucking and cooing at the Wall Streeters who crashed America's economy, offering unconditional love to them.

    Well, there is one little condition: money. The party has been wining and dining the beleaguered bankers for months, pointing out that Republicans are the ones who've been trying to prevent Democrats from cracking down on Wall Street's greed. We are your true friends and your best hope to fend off the populist demands to curb those multimillion-dollar banker bonuses, say GOP leaders. In return for being the bankers' buddies, the Republicans are merely asking for a little love in return – in the form of bigger campaign contributions from Wall Street's giants.

    Sen. Cornyn says that he's been visiting lower Manhattan about twice a month to collect love offerings from the reviled bankers, and Boehner recently had drinks at a Capitol Hill watering hole with the CEO of JPMorgan Chase, offering banker love in exchange for more banker cash.

    Aren't these same Republicans also trying to take over the tea bag movement? I wonder if those anti-establishment mad-as-hellers have heard that Boehner, Cornyn, & Company are making their bed with Wall Street greedheads, not with the good folks on Main Street.

If you hire good people and treat them well, they will try to do a good job. They will stimulate one another by their vigor and example. They will set a fast pace for themselves. Then if they are well led and occasionally inspired, if they understand what the company is trying to do and know they will share in its sucess, they will contribute in a major way. The customer will get the superior service he is looking for. The result is profit to customers, employees, and to stcckholders. —Thomas J. Watson, Jr., from A Business and Its Beliefs: The Ideas That Helped Build IBM.

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