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• IBM Chile Union and IBM sign collective bargaining agreement! On Tuesday July 12th, the IBM Chile Union SNTI, and IBM negotiated and signed a union contract. The vast majority of IBM Chile union members approved the offer and a strike has been averted. Congratulations to our brothers and sisters in the IBM Chile union for this historic event! A copy of the agreement will be emailed to Alliance@IBM CWA Local 1701 members and associate members.
• Job Cut Reports
  • Comment 7/22/11: I am in a position where it is one of those profound ironies of being stuck between a rock and a hard place. I was an IT Specialist but my work load has decreased over the past few months. I was honest enough to report this to my manager and they decided to give me more work. The work load that was introduced is in the project management arena of which I have no training whatsoever. Now, I am being forced to either learn to like project management or the alternative, because there are no other options available. I am tempted to ask the manager for a release date so I can pursue another technical position, but on the same token thinking about whatever happened to retraining the workers nowadays. Damn, a Union contract could help here. Anyone out there experience anything similar? -Former-Technical-
  • Comment 7/24/11: @ -Former-Technical- : Just go through the motions and milk the PM position, never mind if you can do it or not. I was a senior tech turned PMP certified PM in IBM. Most all the PMs I worked with were nontechnical and lame at PM as well. Seek another job, and just bide your time in IBM until you can move on to another company that actually matches people and skills. -I fired IBM-
  • Comment 7/22/11: New ILC app displays this on logon page: "ILC is a tool used by International Business Machines Corporation and its subsidiaries (collectively "IBM") to facilitate proper accounting of time spent on IBM projects by IBM employees and other resources providing services to IBM. Access to and use of ILC by any individual in no way creates and should not be interpreted as demonstrating under any circumstances the existence of an employment relationship between that individual and IBM which otherwise does not exist in IBM's official records. ILC may be used to associate your time to a project that is owned by the IBM company that you are assigned to by your employer, or based on a procurement contract, respectively, for providing services to IBM. Time charged to such IBM company's project will not create, or be considered to be a triggering element of, a possible employment relationship with that IBM company." -Current IBMer-
  • Comment 7/24/11: -Current IBMer- The ILC statement is to protect IBM from contractors suing IBM to become an employee I believe. Obviously this new statement is because IBM messed up with labor reporting, the differentiating between IBM employee and contractor (who is not an IBM employee) that can and often does the same exact work. It also signals that more and more contractors are now working for IBM. IBM is replacing employees with more contractors. Part of their"workforce rebalancing". IBM has always played fast and loose and often treats it's contractors as low paid and benefitless employees. Particularly those that they routinely renew year after year. It blurs whatever difference between IBM employee and IBM contractor. Since IBM holds the employment and labor cards and advises our government (think Sam and Evil HR director MacDonald) they get away with it. And this ILC statement only helps protect IBM more and lessens their labor law liabilities. -LaborLarry-
  • Comment 7/25/11: Hearing talk of October RA. 2% US, 5% worldwide. 13 week max severance for US, goodbye 26 weeks. Is anyone surprised. -moDaSame-
  • Comment 7/26/11: All IBM nonexempt employees in GTS organization get salary cuts of 7.5% effective immediately. Here is the story. a couple of years ago, many IBM exempt employees were forced to become nonexempt employees, also were forced to cut 15% of their base salary, as an exchange, nonexempt employees were allowed 5 hours of over time pay per week. Today, IBM just announced that the Maximum overtime pay per week is reduced to 2 hours, to all nonexempt employees , this means 7.5% cut of their previous base salary. This is sad, seems IBM is building their performance by cutting employee's salary. -May-
  • Comment 7/27/11: Software Division, Tivoli -- No cuts YET, but we're having mid-year PBC meetings. Their new divide-and-conquer tactic is to divide up everyone into three equals groups -- high, medium and low. They acknowledge that there is a strict quota and that the group has to be divided evenly into thirds. My last rating was 2+, and I have always been 2 or 2+, but I was put into the lower group. My managers claim they wanted to put me in the middle but due to the rule of thirds, I was one of the unlucky ones who got bumped down. I am a 55-year-old female software engineer with 30 years experience, two Ivy League degrees, and always excellent ratings. My father worked for IBM and I went to college on a Thomas Watson Scholarship. Naturally I know why they're doing this and I've intensified my job search..... -Anonymous-
  • Comment 7/27/11: The wheels on the bus go round and round. Round and round. Round and round. Employees get thrown under the bus all year round. And execs get richer! Sorry. Just singing the IBM song that never ends. For -May- It seems IBM is building their performance by cutting employees salary? Where have you been the past 15 years or so? They also cut pensions and benefits for the same reason, in case you didn't notice. Every year you do not get a raise or you get less raise then the cost of living you have lost ground. Period. Every year, IBM keeps your salaries flat and raises your healthcare costs and stops paying for high speed internet for home workers etc etc; yet gives execs ever larger bonus' and pay raises, is another year YOU pay for IBMs performance gains and fund Sammy's bonus with YOUR family doing without. Wake up and smell the contract people. -Exodus2007-
  • Comment 7/27/11: You <censored> <censored> misbegotten <censored>! THIRTEEN weeks max after we've put in the -Time- & *Earned* the Twenty Six!!?? You 're <censored> kidding me right? Veiled age discrimination is what it is! Sit there & tell me it isn't. Don't tell me "IBM can change the rules anytime they want", <censored>! Bait & switch! One thing to say "after this date this is the new rule" but to "auger" those that did as specified.... How many of the offshore headcount will even hang around 5 or 6 years? New contracts are written where band 6 is the highest you can go. Any *attorneys* out there with the right type of cajones want to joust with this windmill? -none-
  • Comment 7/27/11: Funding for my position in SWG support was shifted out of my brand to another brand earlier this year. Consequently, I was told I would need to find another position in IBM and my name was placed on some list of employees available for other positions within IBM. I ended up accepting a position is technical sales for System z. It seemed great at first as I was told I would the training I needed etc etc but at this point, I feel like I have been thrown into the ocean and it's sink or swim so to speak. Has anyone had a similar experience or does anyone know what the purpose of this shuffling around really is? -Repurposed-
  • Comment 7/28/11: @none - A lawyer? You want to talk to a lawyer about cuts in severance? Hahahahahaha. IBM can offer no severance at all and there's nothing illegal about that. There is only ONE thing that could keep IBM from doing this kind of crap and that's a union contract. Have you joined the union? I did. -anon-
  • Comment 7/29/11: So y'all talking about getting a lawyer to stand up for you and try and get your 13 weeks back? Why don't you work on organizing instead? It would be cheaper and more beneficial to everyone. -Left in '07-
  • Comment 7/29/11: Why I am not surprise. It seem like IBM is positioning itself to select skilled people for another resource action (as always), and not be limited to storage management organization soon. I have been getting many emails from recruiters for remote contracting position in IBM. Why can't IBM just offer these positions to the permanent employees. Well I think executives want a big bonus this years while destroy people's life. No contract ! Here is one of it I want to share and IBM need to 10 people to fill it. Here is partial extracted Job description for DBQ SANDISK Subject Matter Expert for Dubuque, Iowa (DBQ GDF service center)

    This candidate will perform an essential leadership role which includes training, work assignments and task management for entry level staff. Mentor a Group of 5+ Entry Level Admins Monitor workload and ensure trainees are challenged. I hope the best for permanent IBMers, If anyone adversely affected storage management area, take a look at TAA Decision 75087 or others from department of labor. -cannedbyblue-

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

• truthOut: Why Medicare is the Solution - Not the Problem. By Robert Reich. Excerpts: Not only is Social Security on the chopping block in order to respond to Republican extortion. So is Medicare. But Medicare isn’t the nation’s budgetary problems. It’s the solution. The real problem is the soaring costs of health care that lie beneath Medicare. They’re costs all of us are bearing in the form of soaring premiums, co-payments, and deductibles.

  Medicare offers a means of reducing these costs — if Washington would let it. Let me explain.

• New York Times op-ed: Messing With Medicare. By Paul Krugman. Excerpts: At the time of writing, President Obama’s hoped-for “Grand Bargain” with Republicans is apparently dead. And I say good riddance. I’m no more eager than other rational people (a category that fails to include many Congressional Republicans) to see what happens if the debt limit isn’t raised. But what the president was offering to the G.O.P., especially on Medicare, was a very bad deal for America. ...

  The crucial thing to remember, when we talk about Medicare, is that our goal isn’t, or at least shouldn’t be, defined in terms of some arbitrary number. Our goal should be, instead, to give Americans the health care they need at a price the country can afford. And throwing Americans in their mid-60s off Medicare moves us away from that goal, not toward it.

  For Medicare, with all its flaws, works better than private insurance. It has less bureaucracy and, hence, lower administrative costs than private insurers. It has been more successful in controlling costs. While Medicare expenses per beneficiary have soared over the past 40 years, they’ve risen significantly less than private insurance premiums. And since Medicare-type systems in other advanced countries have much lower costs than the uniquely privatized U.S. system, there’s good reason to believe that Medicare reform can do a lot to control costs in the future.

  In that case, you may ask, why didn’t the 2010 health care reform simply extend Medicare to cover everyone? The answer, of course, is political realism. Most health reformers I know would have supported Medicare for all if they had considered it politically feasible. But given the power of the insurance lobby and the knee-jerk opposition of many politicians to any expansion of government, they settled for what they thought they could actually get: near-universal coverage through a system of regulation and subsidies.

  It is, however, one thing to accept a second-best system insuring those who currently lack coverage. Throwing millions of Americans off Medicare and pushing them into the arms of private insurers is another story.

• Philadelphia Inquirer: Raising Medicare age won't work. By Theodore R. Marmor and Jerry L. Mashaw. Excerpts: Just when there seemed to be no more dopey ideas for reducing America's deficit, another one appeared.

  Raising the age of Medicare eligibility from 65 to 67, according to Sens. Joseph Lieberman (I., Conn.) and Tom Coburn (R., Okla.), would save Medicare billions over the next decade and more. This was part of a package of proposals to reduce Medicare spending, including combining hospital and doctor coverage, changing deductibles, charging wealthier seniors more, increasing premiums, and cutting hospital debt payments. But the change in the eligibility age deserves the sharpest criticism, especially given that President Obama appears willing to consider it.

  The only supposedly redeeming feature of the idea is that it would reduce Medicare spending by $7.6 billion a year, according to a recent Kaiser Family Foundation study. But that spending would only be shifted, not controlled.

  Indeed, total health-care spending would be increased as both employers and seniors paid more. The Kaiser study estimates that 65- and 66-year-olds would spend another $5.6 billion a year, while employers would spend another $4.5 billion. That's spending $10.1 billion to save $7.6 billion.

• The Commonwealth Fund: The U.S. Health System in Perspective: A Comparison of Twelve Industrialized Nations. By David A. Squires, M.A. Overview: The Organization for Economic Cooperation and Development (OECD) tracks and reports on more than 1,200 health system measures across 34 industrialized countries. This analysis concentrated on 2010 OECD health data for Australia, Canada, Denmark, France, Germany, Netherlands, New Zealand, Norway, Sweden, Switzerland, the United Kingdom, and the United States. Health care spending in the U.S. towers over the other countries. The U.S. has fewer hospital beds and physicians, and sees fewer hospital and physician visits, than in most other countries. Prescription drug utilization, prices, and spending all appear to be highest in the U.S., as does the supply, utilization, and price of diagnostic imaging. U.S. performance on a limited set of quality measures is variable, ranking highly on five-year cancer survival, middling on in-hospital case-specific mortality, and poorly on hospital admissions for chronic conditions and amputations due to diabetes. Findings suggest opportunities for cross-national learning to improve health system performance.
• New York Times op-ed: Useless Studies, Real Harm. By Carl Elliott. Excerpts: Last month, the Archives of Internal Medicine published a scathing reassessment of a 12-year-old research study of Neurontin, a seizure drug made by Pfizer. The study, which had included more than 2,700 subjects and was carried out by Parke-Davis (now part of Pfizer), was notable for how poorly it was conducted. The investigators were inexperienced and untrained, and the design of the study was so flawed it generated few if any useful conclusions. Even more alarming, 11 patients in the study died and 73 more experienced “serious adverse events.” Yet there have been few headlines, no demands for sanctions or apologies, no national bioethics commissions pledging to investigate. Why not?

  One reason is that the study was not quite what it seemed. It looked like a clinical trial, but as litigation documents have shown, it was actually a marketing device known as a “seeding trial.” The purpose of seeding trials is not to advance research but to make doctors familiar with a new drug.

  In a typical seeding trial, a pharmaceutical company will identify several hundred doctors and invite them to take part in a research study. Often the doctors are paid for each subject they recruit. As the trial proceeds, the doctors gradually get to know the drug, making them more likely to prescribe it later.

  In an age of for-profit clinical research, this is the new face of scandal. Pharmaceutical companies promote their drugs with pseudo-studies that have little if any scientific merit, and patients naïvely sign up, unaware of the ways in which they are being used. Nobody really knows how often companies conduct such trials, but they appear with alarming regularity in pharmaceutical marketing documents. In the marketing plan for the antidepressant Lexapro for the 2004 fiscal year, Forest Laboratories described 102 Phase IV trials — the classification under which seeding trials fall — in a section labeled “Marketing Tactics.”

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

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

• AlterNet: The Reason CEOs Make 350 Times More Money Than Their Workers -- And Why That's Terrible for the Economy. The top dogs have a huge interest in allocating corporate resources to jack up their companies’ stock prices, thanks to some terrible decisions by the SEC. By William Lazonick. Excerpts: In 1991, well-known compensation consultant Graef S. Crystal published In Search of Excess: The Overcompensation of American Executives in response to an explosion in executive pay that occurred in the US in the 1970s and 1980s. How, Crystal asked, did it make any economic sense for the CEOs in his sample of 200 large US corporations to be making 130 times the pay of the average American worker? And why were they making about seven times the compensation of their CEO counterparts at Japanese companies, many of which were out-competing their US rivals?

  Yet the surge in top executive pay that Crystal observed 20 years ago pales in comparison to the volcanic eruption that has occurred since then. In the mid-2000s, top executive pay in the United States was about three times higher in real terms than the levels of the early 1990s. And the ratio of the average compensation of the CEOs of the largest corporations to that of the average worker climbed as high as 525:1 in 2000 before declining to what has become the “new normal” of about 350:1 in 2010. The gains from exercising stock options represent both the largest and most variable component of top executive pay, giving CEOs, CFOs, and other top dogs a huge interest in allocating corporate resources in ways that jack up their companies’ stock prices — most notably through stock buybacks that can run into billions of dollars per year.

  Large corporations use buybacks to manipulate the stock market. And the fact that top corporate executives can sell the shares that they acquire from exercising stock options without any delay means that, avoiding any risk, they can capitalize on the short swings in their company’s stock price that their corporate allocation decisions help to create. Nice work if you can get it! And guess how they got it? A gift of the regulator of US stock markets, the Securities and Exchange Commission (SEC). ...

  Stock-buyback programs — say, $10 billion over four years — require the approval of a company’s board of directors. But, with a program in place, the company is not required to disclose the dates on which buybacks are actually done (a 2004 amendment to Rule 10b-18 only requires that a company report in its 10-Q filing repurchases in the previous quarter, well after the fact). So top executives who make decisions to do buybacks are privy to inside information that, as holders of stock options, can be very valuable to them.

• Senator Bernie Sanders (I-Vt.): Analysis: Companies churn out profits but jobs don't follow. By Steven C. Johnson. Excerpts: The sluggish pace of hiring may be hobbling the economy, but it's not been holding back big U.S. companies' profits thanks to growth overseas and cost controls at home. And that's bad news for the more than 14 million Americans without jobs. Big businesses would normally be desperate for surging job growth as it would feed into domestic demand but these aren't normal times. Massive growth opportunities overseas, especially in China and other buoyant Asian economies, have some of the largest American companies on track for record profits, even if they're businesses are mostly treading water in the U.S. ...

  What's more, workers have never claimed such a paltry share of real national income growth. Economists at Northeastern University in Boston recently found corporate profits captured 88 percent of income growth between the second quarter of 2009 and the fourth quarter of 2010. Workers' take? Slightly more than 1 percent. "The only major beneficiaries of the recovery have been corporate profits and the stock market and its shareholders," the study concludes. The high jobless rate is also keeping wage growth severely restrained in the U.S., which is also good for profit margins.

• The Smirking Chimp: Is Enforcement Bad for Business, Mr. Banker? Boehner's Boys'll Fix That for Ya, Permanent-Like. By R.J. Eskow. Excerpts: Psst! Hey, you! Yeah, you, in the expensive suit. Listen, Mr. Banker, are you worried that a little oversight and enforcement might be bad for business? I hear ya. I really do. But listen ... hey, come a little closer, pal. I won't bite ya! I got an offer and I don't want to shout it.

  What you need is somebody who can fix this problem for ya. Permanent-like, if you catch my drift. And I think you do. You don't have to get your hands dirty, neither. I know a guy who knows a guy... in fact, he knows a lot of guys. Here's his number. He'll handle it real discreet-like. I know, I know. You don't want your name drawn into this. You like giving those interviews where you play the wise statesman and complain that people aren't nice enough to folks like you. ...

  Yesterday the House passed H.R. 1315, and the normally humor-challenged Republicans showed unusual wit by naming it the "Consumer Financial Protection Safety and Soundness Improvement Act of 2011." That's like naming the German U-boat flotilla the "Improved Safety and Soundness Fleet for Ocean Travel of 1941." The bill actually weakens our economy's safety and soundness, even as it helps banks prey on consumers. U-boats were designed to sink ships, and this bill was designed to torpedo consumer protection.

• AlterNet: Social Security Isn't an Entitlement, It's a Promise. Excerpts: Williams has reason to be angry with all the talk in Washington about cutting Medicaid, Medicare and Social Security. She had to take an early retirement as an X-Ray Technician who worked hard for 24 years because of an injury. She depends on benefits to survive. But she wasn't the only person last night to tell her personal story and express her anger at official Washington's out of touch attitude toward the suffering of working people who rely on our social safety net. They paid for these benefits with their taxes and now they don't want the wealthy and the corporations to avoid paying there share of the deficits brought about by the Bush tax cuts, the needless and illegal wars he fought and the borrowing by the Treasury to fund those deficits (which Republicans approved each time it came up during President Bush's two terms). They haven't forgotten what former Vice President Dick Cheney said about deficits to then Treasury Secretary Paul O'Neill when the GOP was in control of our government:

  O'Neill, fired in a shakeup of Bush's economic team in December 2002, raised objections to a new round of tax cuts and said the president balked at his more aggressive plan to combat corporate crime after a string of accounting scandals because of opposition from "the corporate crowd," a key constituency. O'Neill said he tried to warn Vice President Dick Cheney that growing budget deficits-expected to top $500 billion this fiscal year alone-posed a threat to the economy. Cheney cut him off. "You know, Paul, Reagan proved deficits don't matter," he said, according to excerpts. Cheney continued: "We won the midterms (congressional elections). This is our due." A month later, Cheney told the Treasury secretary he was fired.

  This is our due. Well, those tax cuts that primarily benefited the wealthiest among us and major corporations, the massive and wasteful spending increases for Defense led led to the surge in deficits after Bill Clinton handed Bush a budget surplus. Furthermore, the lack of federal regulation of financial institutions and the lax policy of the Fed regarding the bubble in real estate that blew the economy to kingdom come under Bush in 2007-2008 and the huge sums of cash handed out to bailout said financial institutions.

  Now Republicans, whose corporate and wealthy "friends" made out like bandits (literally) during the Bush years, are all about "sacrifice" but the only people they want to bleed are the poor and middle class. Paul Ryan made that clear with his ill-fated budget proposal earlier this year, and Republicans in the House are counting on Democrats to go along with cuts to the safety net so they can cover their ass for that major blunder. They want Republican candidates next year to be immunized by the Paul Ryan debacle by making Democrats approve spending cuts to these programs. That way the GOP and its the corporate backed PACs that support them can run attack ads painting Democrats (again) as the bad guys who took benefits form the hands of seniors and other beneficiaries of the social safety net that Democrats created in the first place.

• New York Times: To Reach Simple Life of Summer Camp, Lining Up for Private Jets. By Christine Haughney. Excerpts: A turboprop Pilatus PC-12 carrying Melissa Thomas, her daughter, her daughter’s friend and a pile of lacrosse equipment took off for their home in Connecticut, following the girls’ three-week stay at Camp All-Star in nearby Kents Hill, Me. Shortly after, a Cessna Citation Excel arrived, and a mother, a father and their 13-year-old daughter emerged carrying a pink sleeping bag and two large duffel bags, all headed to Camp Vega in Fayette. ...

  For decades, parents in the Northeast who sent their children to summer camp faced the same arduous logistics of traveling long distances to remote towns in Maine, New Hampshire and upstate New York to pick up their children or to attend parents’ visiting day. Now, even as the economy limps along, more of the nation’s wealthier families are cutting out the car ride and chartering planes to fly to summer camps. One private jet broker, Todd Rome of Blue Star Jets, said his summer-camp business had jumped 30 percent over the last year. This weekend, a popular choice for visiting day at camps, private planes jammed the runways at small rural airports. ...

  The popularity of private-plane travel is forcing many high-priced camps, where seven-week sessions can easily cost more than $10,000, to balance the habits of their parents against the ethos of simplicity the camps spend the summer promoting. Kyle Courtiss, whose family runs Camp Vega in Maine, said that his staff was trained “to be cognizant of stuff like that” and that private planes were “not what this camp is about.” Some camps said they recognized that the parents who flew in private planes were often strong financial supporters of these camps. Arleen Shepherd, director of Camp Skylemar, in Naples, Me., said that while some of the high-profile parents whose children attend Skylemar might fly privately, some campers had never flown on a plane. ...

  But some parents have already tired of this private-plane status infiltrating the simpler world of summer camp. Nancy Chemtob, a divorce lawyer, made several summer trips to Maine in the past decade, where her children attended camp. She once managed to get on a charter plane from the airport in East Hampton, N.Y., for $750 (her husband had hung a sign in the airport seeking a ride). After listening to enough banter among parents about “who is flying, who is flying private, who they can get a lift home with,” she decided she “was done with Maine and the planes and all of the people.”

  “It’s a crazy world out there,” she added. She now sends her children to camp in Europe.

• Washington Post: Wealth gap widens between whites, minorities, report says. By Peter Whoriskey. Excerpts: The wealth gap between whites and minorities has risen to a historic high, according to new census data analyzed by the Pew Research Center, as the collapse of housing prices more severely affected the net worth of African American and Hispanic households. The report, which was to be released Tuesday, shows that the recession wreaked havoc on the wealth of all Americans but that whites lost the least amount as a percentage of their holdings. ...

  The median net worth of a white family now stands at 20 times that of a black family and 18 times that of a Hispanic family — roughly twice the gap that existed before the recession and the biggest gap since data began being collected in 1984. “The lopsided wealth ratios are the largest since the government began publishing such data a quarter century ago,” said the report, “Wealth Gaps Rise to Record Highs Between Whites, Blacks and Hispanics.”

• Washington Post: The budget deals of Reagan, Bush, Clinton and Obama, in one chart. By Ezra Klein. Excerpts: There are two ways to read the current stalemate in the debt-ceiling negotiations. There’s David Brooks’s take, which is that watching Republicans pass up “the deal of the century” should leave conservatives convinced there’s something wrong with the GOP. But you can also read it the opposite way: Democrats control the White House and the Senate, Obama is the most popular national political figure, a balanced approach to deficit reduction outpolls plans made entirely of spending cuts, and yet Democrats are still offering recalcitrant Republicans the deal of the century rather than taking to the ramparts. What’s wrong with them?

  To put some numbers to this, I asked the fine folks over at the Center on Budget and Policy Priorities to help me break down the deficit-reduction deals passed by Presidents Ronald Reagan, George H.W. Bush and Bill Clinton.

  

  As you can see on the graph, in each case, taxes were at least a third of the total, and in Reagan’s case, his massive tax cuts were followed by deficit-reduction deals that actually relied on tax increases. Today, tea party conservatives would be begging Sen. Jim DeMint to primary the Gipper. ...

  It’s safe to say at this point that the White House is starting to get the credit it wants for working hard to find a compromise even as Republicans work hard to resist one. But that’s not a triumph of messaging. It is, if anything, an understatement based on the White House’s willingness to give congressional Republicans a much more lopsided deal than Reagan, Bush or Clinton presided over. Republicans might be fools for passing on it, but if and when they finally say “yes,” a lot of Democrats are going to be wondering whether the Democrats were suckers for offering it.

• New York Times op-ed: This Is Considered Punishment? By Joe Nocera. Excerpts: Last Wednesday, nearly lost in the furor over Rupert-gate and the debt ceiling crisis, came the surprising news that the Federal Reserve has issued a cease-and-desist order against a Too-Big-to-Fail bank. The bank was Wells Fargo, which was also fined $85 million and ordered to compensate customers it had unfairly — indeed, illegally — taken advantage of during the subprime bubble.

  What made the news surprising, of course, was that the Federal Reserve has rarely, if ever, taken action against a bank for making predatory loans. Alan Greenspan, the former Fed chairman, didn’t believe in regulation and turned a blind eye to subprime abuses. His successor, Ben Bernanke, is not the ideologue that Greenspan is, but, as an institution, the Fed prefers to coddle banks rather than punish them. That the Fed would crack down on Wells Fargo would seem to suggest a long-overdue awakening.

  Yet, for anyone still hoping for justice in the wake of the financial crisis, the news was hardly encouraging. First, the Fed did not force Wells Fargo to admit guilt — and even let the company issue a press release blaming its wrongdoing on a “relatively small group.” The $85 million fine was a joke; in just the last quarter, Wells Fargo’s revenues exceeded $20 billion. And compensating borrowers isn’t going to hurt much either. By my calculation, it won’t top $20 million.

  Most upsetting of all, the settlement raises the question that just won’t go away: Why can’t the federal government prosecute financial wrongdoers? ...

  In March, for instance, I wrote about the sad case of Charlie Engle, the ultra-marathoner, who was convicted of lying on a liar loan — that is, exaggerating his income on a subprime mortgage application — even though the evidence against him was thin. Prosecuted by Neil H. MacBride, the U.S. attorney for the Eastern District of Virginia, Engle was sentenced to 21 months in prison.

  Now compare Engle’s alleged crime to the case the Federal Reserve brought against Wells Fargo Financial, which, until it was shut down last summer, was the subprime subsidiary of Wells Fargo, based in Des Moines. There were several allegations, but the one that caught my eye was that Wells employees “falsified income information on mortgage applications.” In other words, they lied on liar loans! The only difference is that the lying was done by a group of Wells Fargo brokers rather than by some poor sap like Charlie Engle.

  What’s more, this practice appears to have been quite widespread — “fostered,” as the Fed puts it, “by Wells Fargo Financial’s incentive compensation and sales quota programs.” Matthew R. Lee, the executive director of Inner City Press/Community on the Move and Fair Finance Watch, spent years bringing Wells’ subprime abuses to the attention of the Federal Reserve. “The way the compensation was designed ensured that abuses would take place,” he says. “It was a predatory system.”

  These are exactly the kind of loans — built on illegal practices — that gave us the financial crisis. Brokers working for subprime mortgage companies routinely doctored incomes to hand out subprime loans they knew the borrowers could never repay — and then, after taking their fat fees, shoveled the loans to Wall Street, which bundled them into subprime securities. This was the kindling that lit the inferno of September 2008. So again, I ask: Why is there no criminal investigation into what went on at Wells Fargo Financial?

• Investment News: Boehner, GOP bigs all voted for debt drivers they now blame on Obama. Excerpts: House Speaker John Boehner often attacks the spendthrift ways of Washington.

  “In Washington, more spending and more debt is business as usual,” the Republican leader from Ohio said in a televised address yesterday amid debate over the U.S. debt. “I've got news for Washington - those days are over.”

  Yet the speaker, House Majority Leader Eric Cantor, House Budget Chairman Paul Ryan and Senate Minority Leader Mitch McConnell all voted for major drivers of the nation's debt during the past decade: Wars in Afghanistan and Iraq, the 2001 and 2003 Bush tax cuts and Medicare prescription drug benefits. They also voted for the Troubled Asset Relief Program, or TARP, that rescued financial institutions and the auto industry. Together, a Bloomberg News analysis shows, these initiatives added $3.4 trillion to the nation's accumulated debt and to its current annual budget deficit of $1.5 trillion.

• AlterNet: Bernie Sanders: GOP Doing "Everything They Can to Protect the Wealthiest People" in America. Excerpts: You can always count on Bernie Sanders to tell it like it is. Following the President's address on the debt ceiling, the Vermont Senator appeared on the Ed Show to discuss what is exactly going down in Congress right now, and why Boehner is leading a bullheaded impasse that may very well force the country into default. After a clearly annoyed Obama called the GOP "reckless" and basically spanked them on live television (spanking, because they're acting like babies), Sanders was, too, irritated at the Republicans. After Shultz pointed out that Harry Reid's debt plan cuts more from the budget than Boehner's, noting that the "real Republican two-step is to kill the New Deal and defeat President Obama" (ugh), Sanders laid it on the line. "I think the plan of the Republicans is clear," he said. "They want to do everything they can to protect the wealthiest people in the country... They want to protect corporate America... They want to decimate Social Security, Medicare, and Medicaid." Scary stuff, but oh so true.
• Jim Hightower: Corporate thieves fear public disclosure. Excerpts: Poor Halliburton. Poor ExxonMobil, Blackwater, Microsoft, and other huge corporations that get billions of dollars each year in lucrative contracts from our government.

  These political powers are presently wailing that they're being picked on by meanies in the Obama White House who're proposing to expose one of their most sensitive corporate secrets: the amount of cash they surreptitiously funnel into our elections through such front groups as the U.S. Chamber of Commerce. The Obamacans have drafted an executive order requiring these recipients of our tax dollars to disclose how much money they're putting into which campaigns. Such honest disclosure can help us taxpayers and voters see for ourselves whether the political efforts of connected corporations might result in them receiving government contracts as payback from grateful recipients of their cash.

• Jim Hightower: Must We Eat the Bluebird of Happiness? Excerpts: Economists and politicians keep their fingers on the pulse of the Dow Jones Average, feeling every tick in this narrow measure of Wall Street wealth. But the truer indicator of America's economic health is in the Doug Jones Average – how are workaday folks like Doug and Doreen doing? After all, the experts tell us that we're now entering the third year of glorious economic recovery from the Great Recession, so surely the bluebirds of happiness are chirping again in Dougland. But, listen: silence.

  The same moneyed elites who caused America's disastrous economic crash are now doing great. Since the recession ended in June 2009, CEO pay is back in the stratosphere, corporate profits have jumped up by nearly half, corporations are sitting on a record $2 trillion in cash, and that perky Dow Jones Average has soared by a delirious 90 percent, with nearly all of that gain being pocketed by the wealthiest 10 percent of Americans who own more that 80 percent of all stocks and bonds. The sounds you hear up there are cheers, delighted giggling, and the pop-pop-pop of champagne corks.

  Yet, more that half of Americans say the recession is still raging in their zip codes, and nearly a third of them describe it as a full blown depression. What's bugging these party poopers? Reality.

  In this "recovery," those at the top of corporate America are still practicing tinkle-down economics. They're refusing to hire the Dougs and Doreens, while eliminating hundreds of thousands of other jobs, knocking down wages and benefits, and unleashing their lobbyists on Washington and state capitals to shred unemployment benefits, health care, education, job training, worker rights, and other basics that are necessary to sustain America's middle class. If a bluebird did show up in Doug and Doreen's yard these days, it wouldn’t be chirping – it'd be dinner.

• Jim Hightower: The Good Ship Goldman Sets Sail for Singapore. Excerpts: Goldman keeps striving to give greed a bad name. It was a major player in designing the taxpayer bailout of Wall Street, getting $10 billion for itself and untold billions more in backdoor subsidies from the Federal Reserve. You might recall that the public rationale for this governmental rescue of private banks was that they would then have the capital to invest in job creating enterprises. However, they took the money and ran, leaving America's workaday families mired in a jobless swamp with no relief in sight. Meanwhile, Goldman quickly returned to paying outlandish, multimillion-dollar bonuses to its top mucky-mucks.

  Now, to add insult and even more injury to the damage it has done to our economy, the banking giant has quietly informed about 1,000 of its U.S. employees that their jobs are being shifted to Singapore, where cheaper bank employees are available. This stiffing of America comes at a time when Goldman is piling up record profits, including $2.7 billion it raked in during just the first three months of this year. Perhaps the bank needs extra money to pay bigger executive bonuses.

  Goldman has, however, made one new American hire as part of its U.S. job retrenchment plan. Former Republican Sen. Judd Gregg has joined the Good Ship Goldman as an "international advisor." With 26 years in Congress, Gregg can help steer the bank through any political tempest stirred up by Goldman's latest act of greed. Presumably, he'll be able to rally his old GOP colleagues in the senate. After all, they voted unanimously last year to save a tax break that helps corporations shift American jobs overseas.

• truthOut: America Held Hostage to Two-Party Failure: Government of, by and for the Corporations. By Michele Swenson. Excerpts: Phil Angelides, chair of the Financial Crisis Inquiry Commission, notes that 24 million Americans lack work and nearly $9 trillion in household wealth has vanished since the 2008 economic crisis. The commission's January report detailed "the recklessness of the financial industry and the abject failures of policymakers and regulators that brought our economy to its knees in late 2008."

  Writes Angelides, there is "no correlation between who drove the crisis and who is paying the price." The disparity of wealth is stark, as "compensation at publicly traded Wall St. firms hit a record $135 billion in 2010." He notes that, in the face of overwhelming evidence of the causes of economic catastrophe, Wall Street and its allies are revising history, e.g., Republicans like Paul Ryan ignore the fact that "our federal budget deficit has ballooned more than $1 trillion annually since the financial collapse." Instead of confronting the real causes of the deficit, budget shortfalls are conflated with "the long-term challenges of Medicare" as an excuse to shred the social safety net. Rather than rein in widespread lending abuses, Republicans seek to weaken the authority of the new consumer Financial Protection Bureau.

  Economist Joseph Stiglitz calls out the titans of finance, who continue to make mega bonuses for their companies' mega losses, even after they set the global economy in a tailspin and shifted all risks for their unregulated credit default swaps onto taxpayers. He describes a nation of, by and for the 1 percent that enjoys 25 percent of economic benefits, largely purchased by Washington lobbyists. The Republican (Ryan) budget plan would cut $5.8 trillion from government spending over the next decade and reduce the corporate tax rate to 25 percent, while increasing next year's Pentagon budget by $17 billion. The highly touted Bowles-Simpson proposal for deficit reduction is a recipe for a weaker economy, warns Stiglitz, as it will decrease jobs, and in turn, decrease revenues. A primary means to decrease the deficit is to increase jobs, a goal that ultraconservatives wrongly equate with large tax breaks for the wealthy - so-called "job creators" - never mind that the Bush tax cuts failed to provide jobs over a decade.

• Investment News: Dynasty trusts: A way to let the wealthy duck estate, gift taxes forever? By Elizabeth Ody, Bloomberg. Excerpts: Jeffrey Thomasson, 52, may pass on more than $100 million to heirs using an estate-planning strategy for avoiding gift and estate taxes.

  Thomasson, who lives in Indianapolis, said he's funding a so-called dynasty trust set up in Delaware with $8 million of equity from the expanding financial advisory business he owns, Oxford Financial Group. Putting the assets in a trust, which he figures could be worth more than $100 million by the time he dies, means the money should go to his heirs without triggering federal gift, estate or generation-skipping transfer taxes.

  “Why would I want to pay estate taxes on some really, really big number 30 years from now, if the IRS is giving me this opportunity?” Thomasson said.

• The Smirking Chimp: The Greatest Generation speaks up: "Hands off our Social Security!". By Jane Stillwater. Excerpts: Why does the White House and Congress seem so hell-bent on killing off what is left of America's "Greatest Generation" -- by making cuts to the Social Security payments that we depend upon to stay alive?

  I consider myself to be a junior member of the Greatest Generation and I am truly pissed off that "Death Panel" legislators in Washington who are probably too young to have even served in Vietnam -- let alone in World War II -- can be monstrous enough to even consider shutting down Social Security's lifeline to all the veterans who fought in that great war to keep the world safe from corporate control of government (as Mussolini once described National Socialism), and also drastically cut payments to women and children who bravely manned up the Home Front while our soldiers were away fighting Nazis. ...

  And now folks on TV are telling us that, for the sake of balancing the federal budget, we must now give up the Social Security that we all worked so hard for, stop making a fuss, forget our proud legacy of service, die quietly and go peacefully into that great good night. Screw that.

• Wall Street Journal: My Own Private Island. Wealthy buyers are flocking to a little-known archipelago in the Bahamas, fueling an island building boom. Privacy comes at a price: Owning a personal island means importing everything from water to electricity. By Candace Jackson. Excerpts: Roughly 300 miles off the coast of South Florida is a string of mostly uninhabited small islands amid clear blue water and coral reefs on a limestone plateau. There's virtually no nightlife, no major airports, no celebrity chef restaurants. There are also no neighbors. That remoteness is attracting a rarefied group of wealthy entertainers and name-brand CEOs. In the world of high-end real estate, privacy is an increasingly prized amenity. ...

  Despite the weak economy, the number of millionaires in the U.S. and their combined net worth hit record highs in 2010, with investible assets up more than 8.4% from 2009, according to the World Wealth Report by Merrill Lynch and Capgemini. Several record-breaking real-estate sales this year have buoyed optimism in the ultra-high end of the market, including the $85 million sale of a Los Angeles estate owned by Candy Spelling earlier this month. In March, a Russian buyer paid $100 million for a home in Silicon Valley, the highest price ever paid for a single-family home. ...

  The Exuma Cays (pronounced "Keys" by most locals and regulars) have many of the ingredients for a destination for the extremely wealthy: sandy beaches, turquoise water and limited development possibilities—90% of the islands are either uninhabitable or protected as part of a 176-square-mile marine park. The growing ease of staying connected with cable and the Internet, as well as improved desalination and diesel-generator technology, have also made the islands more attractive, says Tom Lawson, a resident who has developed, owned or managed several private-island properties there. ...

  Building materials must be imported on large barges, which take about two days to make the trip from Florida, weather permitting. For islands without an existing power source, electricity comes from diesel generators, which also must be imported. According to Ed Bosarge, the principal beneficiary of the trust that owns a land-lease and building rights to Yonder Cay, just south of Mr. Depp's island, commonly used diesel generators can generate a power bill as high as $1 million a year.

• Wall Street Journal: Why Americans Are So Angry. By Bernie Sanders (I-Vt.) Excerpts: The rich are getting richer. Their effective tax rate, in recent years, has been reduced to the lowest in modern history. Nurses, teachers and firemen actually pay a higher tax rate than some billionaires. It's no wonder the American people are angry.

  Many corporations, including General Electric and Exxon-Mobil, have made billions in profits while using loopholes to avoid paying any federal income taxes. We lose $100 billion every year in federal revenue from companies and individuals who stash their wealth in tax havens off-shore like the Cayman Islands and Bermuda. The sum of all the revenue collected by the Treasury today totals just 14.8% of our gross domestic product, the lowest in about 50 years.

  In the midst of this, Republicans in Congress have been fanatically determined to protect the interests of the wealthy and large multinational corporations so that they do not contribute a single penny toward deficit reduction.

  If the Republicans have their way, the entire burden of deficit reduction will be placed on the elderly, the sick, children and working families. In the midst of a horrendous recession that is already causing severe pain for average Americans, this approach is morally grotesque. It's also bad economic policy.

  President Obama and the Democrats have been extremely weak in opposing these right-wing extremist proposals. Although the United States now has the most unequal distribution of wealth and income of any major industrialized country, Democrats have not succeeded in getting any new revenue from those at the top of the economic ladder to reduce the deficit.

  Instead, they've handed the wealthy even more tax breaks. In December, the House and the Senate extended President George W. Bush's tax cuts for the rich and lowered estate tax rates for the wealthiest Americans. In April, to avoid the Republican effort to shut down the government, they allowed $38.5 billion in cuts to vitally important programs for working-class and middle-class Americans. ...

  While all of this is going on in Washington, the American people have consistently stated, in poll after poll, that they want wealthy individuals and large corporations to pay their fair share of taxes. They also want bedrock social programs like Social Security, Medicare and Medicaid to be protected. For example, a July 14-17 Washington Post/ABC News poll found that 72% of Americans believe that Americans earning more than $250,000 a year should pay more in taxes.

  In other words, Congress is now on a path to do exactly what the American people don't want. Americans want shared sacrifice in deficit reduction. Congress is on track to give them the exact opposite: major cuts in the most important programs that the middle class needs and wants, and no sacrifice from the wealthy and the powerful.

• New York Times editorial: How the Deficit Got This Big. By Teresa Tritch. Excerpts: With President Obama and Republican leaders calling for cutting the budget by trillions over the next 10 years, it is worth asking how we got here — from healthy surpluses at the end of the Clinton era, and the promise of future surpluses, to nine straight years of deficits, including the $1.3 trillion shortfall in 2010. The answer is largely the Bush-era tax cuts, war spending in Iraq and Afghanistan, and recessions.

  Despite what antigovernment conservatives say, non- defense discretionary spending on areas like foreign aid, education and food safety was not a driving factor in creating the deficits. In fact, such spending, accounting for only 15 percent of the budget, has been basically flat as a share of the economy for decades. Cutting it simply will not fill the deficit hole.

  The first graph shows the difference between budget projections and budget reality. In 2001, President George W. Bush inherited a surplus, with projections by the Congressional Budget Office for ever-increasing surpluses, assuming continuation of the good economy and President Bill Clinton’s policies. But every year starting in 2002, the budget fell into deficit. In January 2009, just before President Obama took office, the budget office projected a $1.2 trillion deficit for 2009 and deficits in subsequent years, based on continuing Mr. Bush’s policies and the effects of recession. Mr. Obama’s policies in 2009 and 2010, including the stimulus package, added to the deficits in those years but are largely temporary.

  

  The second graph shows that under Mr. Bush, tax cuts and war spending were the biggest policy drivers of the swing from projected surpluses to deficits from 2002 to 2009. Budget estimates that didn’t foresee the recessions in 2001 and in 2008 and 2009 also contributed to deficits. Mr. Obama’s policies, taken out to 2017, add to deficits, but not by nearly as much.

  A few lessons can be drawn from the numbers. First, the Bush tax cuts have had a huge damaging effect. If all of them expired as scheduled at the end of 2012, future deficits would be cut by about half, to sustainable levels. Second, a healthy budget requires a healthy economy; recessions wreak havoc by reducing tax revenue. Government has to spur demand and create jobs in a deep downturn, even though doing so worsens the deficit in the short run. Third, spending cuts alone will not close the gap. The chronic revenue shortfalls from serial tax cuts are simply too deep to fill with spending cuts alone. Taxes have to go up.

• truthOut: America Held Hostage to Two-Party Failure: Government of, by and for the Corporations. By Michele Swenson. Excerpts: Phil Angelides, chair of the Financial Crisis Inquiry Commission, notes that 24 million Americans lack work and nearly $9 trillion in household wealth has vanished since the 2008 economic crisis. The commission's January report detailed "the recklessness of the financial industry and the abject failures of policymakers and regulators that brought our economy to its knees in late 2008."

  Writes Angelides, there is "no correlation between who drove the crisis and who is paying the price." The disparity of wealth is stark, as "compensation at publicly traded Wall St. firms hit a record $135 billion in 2010." He notes that, in the face of overwhelming evidence of the causes of economic catastrophe, Wall Street and its allies are revising history, e.g., Republicans like Paul Ryan ignore the fact that "our federal budget deficit has ballooned more than $1 trillion annually since the financial collapse." Instead of confronting the real causes of the deficit, budget shortfalls are conflated with "the long-term challenges of Medicare" as an excuse to shred the social safety net. Rather than rein in widespread lending abuses, Republicans seek to weaken the authority of the new consumer Financial Protection Bureau.

  Economist Joseph Stiglitz calls out the titans of finance, who continue to make mega bonuses for their companies' mega losses, even after they set the global economy in a tailspin and shifted all risks for their unregulated credit default swaps onto taxpayers. He describes a nation of, by and for the 1 percent that enjoys 25 percent of economic benefits, largely purchased by Washington lobbyists. The Republican (Ryan) budget plan would cut $5.8 trillion from government spending over the next decade and reduce the corporate tax rate to 25 percent, while increasing next year's Pentagon budget by $17 billion. The highly touted Bowles-Simpson proposal for deficit reduction is a recipe for a weaker economy, warns Stiglitz, as it will decrease jobs, and in turn, decrease revenues. A primary means to decrease the deficit is to increase jobs, a goal that ultraconservatives wrongly equate with large tax breaks for the wealthy - so-called "job creators" - never mind that the Bush tax cuts failed to provide jobs over a decade.

• National Catholic Reporter: Catholic bishops take stand against Boehner budget bill. By Maureen Fiedler. Excerpt: "Congress is paralyzed by toxic partisan politics while people suffer," wrote the Rev. Michael Livingston, a past president of the National Council of the Churches of Christ (USA), one of those arrested. "Our elected officials are protecting corporations and wealthy individuals while shredding the safety net for millions of the most vulnerable people in our nation and abroad. Our faith won't allow us to passively watch this travesty unfold."