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Highlights—June 23, 2012

  • Yahoo! IBM Pension and Retirement Issues message board: "Re: When to start receiving SS" by "ibmexe". Full excerpt: I am glad that at least the two of you may have a common definition of "burning cash" but am not sure that it equates to mine. My definition were I to make one would consist of the following:

    ANYTIME you withdraw even $1 from any of your savings accounts, be they 401K's, IRA's Roth's or after tax equities, CD's, checking or savings accounts etc. to increase the amount you spend to enrich or augment your retirement be that from the interest, capital gains or principal etc, you have BURNED that $1. The only dollars that I know of that are not burned are those taken from what you receive from your employer(s) in pension payments or those received from SS.

    By that definition, I am in fact burning cash...and proud of it. What I found was that my IBM pension which in fact consisted of the maximum possible amount..namely slightly above 40% of my last years earning plus my Social Security payment fell short the 70% recommended by the Harvard Business Journal which is the lowest recommendation I have found. Most others recommend 80%+. So I decided to burn some cash each and every year. Still didn't bring it up to 70%. Figure I am running at a little above 62% currently and patting myself on the back for living so frugally. Am doing this by selling my IBM stock and paying the 15% tax on the capital gains..which happily are quite large.

    So from what I gather, if you are now retired or plan to retire and not "burn cash", you either received or plan to receive a substantially higher pension than the highest percentage regular pension IBM ever paid any employee OR you are living substantially below 60% of your final years pay. In the latter case, if the happiness derived from the fact that you are NOT burning cash exceeds that which you feel you would get by living within your means who am I to complain? Just wouldn't do it for me and I feel nor for many others as well.

    If you got it, burn it cause you can't take it with you when you and your spouse die. Just leave a little for the kids. If you don't have it, lower your "happiness" quotient and live more frugally. I believe a reasonable amount of happiness is still achievable at 40% of final years salary. Hopefully every ex-IBM lifer can still achieve that target through a combination of pension, SS and 401K etc.

  • Yahoo! IBM Pension and Retirement Issues message board: "Re: When to start receiving SS" by "willbefree25". Full excerpt: True. When IBM raped and screwed the employee troops in 1999 and fired them in the 2000's, they made sure those who weren't rich or overpaid for being lying managers or paid apologists would have to make do in order to live after they were raped and screwed. These employee troops would HAVE to dip into their hard-earned retirement savings in order to make up for the three-fold formula reductions in the 1990s that most were not aware of, and the theft of the promised (not in writing) lifetime retiree medical.

    So, add me to those who are forcibly 'burning cash' thanks to being raped and screwed by IBM and fired by them in the 2000's and not sitting on a lofty perch giving advice to those who can't afford the country clubs and fancy cars that the apologists can because they were brown nosers and rewarded by IBM for being same, and happily lurk on boards for pay from IBM in order to dissuade (or so they think they are) those who were raped and screwed by IBM from thinking they were in fact raped and screwed by IBM, when in fact they were raped and screwed by IBM - that thrice 'raped and screwed' is for one of my apologist fans who has sensitive eyes.

    How's that for one grand run-on sentence?

  • Tech Republic: Indian outsourcing: Why skills shortages persist despite the graduate glut. By Saritha Rai. Excerpts: A double-digit percentage of India’s budding IT engineers could not answer this question correctly:
    Identify the smallest decimal number from the following: 0.5, 1/0.5, 0.555555, (0.5)²

    Nearly a third of the crop of graduating engineers chose ‘had’ over ‘have’ in the following question: Did you —- cereal for breakfast? (had, have, ate, having)

    India’s outsourcing boom has triggered an explosion of engineering colleges in the past decade. But only a fraction of the engineers they produce are immediately employable. The industry’s problem is no longer the quantity but the quality, and it’s an issue that’s jeopardising the growth and profitability of the sector.

    For example, in Bangalore’s neighbouring Tamil Nadu state, many engineering colleges have mushroomed in the new millennium. Companies selling coffee, sugar, beverages and jewellery - and even a producer of dhoti, the local Indian male garment - are among those organisations that run colleges, as do hordes of politicians. In an education-hungry country, running an engineering college has become something of a status symbol.

    And thanks to this proliferation, the entry threshold in engineering colleges is falling and the number of graduating engineers is rising every year. According to estimates, India’s current group of 4,000-odd engineering colleges produces some 800,000 engineers annually, a jump from 500,000 in 2007.

    Most of these engineers are drawn to the outsourcing industry, India’s largest recruiter of engineers.

    Selected reader comments follow:

    • When are we going to wake up? Hopefully one of these days, companies are going to wake up and realize that outsourcing does not save money. In fact, it wastes money.

      Not only is it tremendously difficult to find decent engineers, you must employ someone to constantly watch over their shoulder to ensure they're producing acceptable work. It has been my experience that outsource engineers largely are tremendously difficult with which to work due to language and timezone barriers and produce substandard work. The costs to find and utilize these engineers makes their cheap hourly rate not worth it. I guess they're still attractive to executives though because of where the headcount appears (or does not appear) on the balance sheet.

      Yes, I will note there are some exceptions. I've worked with a few excellent outsourced engineers. However, they've been so few and far between, it's not worth it.

      How many startups have you seen created by the founder going out and hiring a bunch of cheap outsourcers to be his initial employees? None. Why? It wouldn't work. So why do we try to hire them for important projects after our company has gotten "sophisticated?"

    • Same thing in our company... We are off shoring some of our ABAP work. The problem is the quality is horrible and we can only send off simple stuff. The quality being sent over is mediocre at best. We had a project and kicked out 20 to get 4 decent outsourced for our team. We spent more time training and discussing or correcting then we did actual work on a short time frame project. Problem is it is driven by short sighted cost views and not paying attention to longer term clean-up, training, or fixing that has to go on.
    • It is a non issue... syedSaif Lack of skills (Grammar and Maths) has not prevented Indian IT industry to achieve consistent high growth levels for many years now, which shows it is a non- issue??? ???Lack of employability??? is I.T industries pet subject and is good to talk , read and write about ..but most of the companies don???t want to invest in making a difference..All they want is someone who can start laying those golden eggs (dollars) from day one. Going back to the question of ???have/had for breakfast??? ???how many in the developed world where English is the first language would have got it right ? This article in wall street journal is an indicator..http://online.wsj.com/article/SB10001424052702303410404577466662919275448.html And for the decimal question , my guess is the percentage who got it wrong will also be no different ..
      • I disagree and have several project to back that up... See my comments above. But right now if you cannot communicate and you are taking in specifications from the developed world then you have a greater percentage to not produce what is required. If I'm expecting testing and it requires validation with mathematical measures and they cannot do the above. Why would I use them? Makes no sense, I'm sorry but real world here supports this article. When i have to kick out 20 to get 4 - that's a waste of time effort and long term support issues.
      • Dismissing this as a non issue is a serious problem. I worked in the US for over a decade and later I worked in an Indian company for a couple years. I have seen both sides. Like the article says, in the beginning people in such large numbers were not needed. The IT companies in India could do selective hiring and gave emphasis to quality of work.

        Later, to meet the growing demand the Indian education system grew 10 fold overnight. As a result the quality of education has been mediocre. At the same time the IT companies have focused solely on profits and not on the quality of work. They have been helped by the fact that American companies have been solely focused on cost savings. I am not sure for how long that is sustainable.

    • Yesterday, I coodn't spel "injuneer"... gevander Now I are one!
      The crux of the problem is that critical thinking, problem solving and the application of concepts are skills in short supply'

      I work in IT and my wife works as an accountant for a Fortune 500. Both of us have to deal with Indian contractors working in our areas of expertise and both of us see this every month. These issues should more accurately be labeled as cultural problems, not educational. Indian culture "trains" their people to follow rigid rules to accomplish assigned tasks. If the task has a component that calls for creative thought or problem solving, they will skip it! The "caste system" is alive and well in India. As long as the society expects a type of behavior that is different than what a post-secondary school teaches, the societal behavioral training will win.

    • we should understand the truth. we should understand that the government is in part responsible for opening up of more engineering colleges thereby bringing down the standards. the last decade has witnessed a change in the attitude of the Indian parents who just wanted their wards ending up with a lofty job in these so called IT companies. the government in its part spearheaded this narrow view. its time we change our attitude and start focusing on real engineering.
  • Glassdoor IBM reviews. Selected reviews follow:
    • IBM IT Specialist: (Current Employee) “Corporate scrooges and unending work processes make the IBM workplace painful to endure.” Pros: Some opportunities to work with interesting customer and projects, good colleagues. Good opportunities to learn (web based training, mostly on your own time).

      Cons: Company accountants rule everything. Cost cutting is the only rule for everything, irrespective of the cost in productivity, morale, turnover. IBM will no longer even buy a computer monitor for your desk- forcing you to use the tiny 14" screen on your "standard issue" laptop (yes they still make them that small, and no you are not allowed to even pay extra yourself to upgrade it to something reasonable). There is no coffee provided on site- not even paper/plastic cups provided for water! At one site I visit there are no rubbish bins under the desks, so IBM saves on the cost of cleaners.

      The current employee performance rating system is a "forced distribution system" which takes global performance in your division, and no matter what your local team's performance mandates to your direct manager a percentage of people in your team who *must* be rated as unsatisfactory (too bad if you did an OK job, just take your turn at being told your 60 hour weeks were "unsatisfactory"). There is a fixed "skip" percentage each quarter who must be paid none of their "at risk" pay component (note this is NOT a bonus, it is supposed to be part of your pay, this is "skipped" for the unlucky recipients of an unsatisfactory rating).

      Also be prepared to take on IBM's financial risks with a mandatory corporate credit card that is actually your personal liability- so if IBM does not pay your expense claims for some reason, it can affect your personal credit rating. If you do get the chance to travel, be happy with a "per diem" fixed expense reimbursement that has not gone up in 20 years, and might cover continental breakfast in the hotel, but won't stretch to a modest room service dinner in the hotel chosen for you by IBM. No, you'll be out walking the street in the rain searching for a McDonalds.

      Longer-term employees are gradually pushed down the salary scales due to rare/nonexistent pay increases (my previous manager told be that if I left he would be able to offer $50K extra to rehire a person of similar experience).

      Education is possible, mostly if you do web-based training in your own personal time. You will also be likely forced to go on courses that are of little practical use, in order to meet some mandatory metric of education attendance decreed globally by someone who knows nothing about what you actually need. When you ask for budget to attend a course that is actually of direct use and benefit in your role, it will be near impossible to get budget to attend.

      If you are going into sales, prepare to be micro-managed with spreadsheets and sales data to be entered for everything, the number of phone calls you make to be measured as a "success metric", and to have to review the same sales opportunities multiple times with different managers ("cadence" calls). Leaving little time to actually work with clients.

      If you choose to work at IBM, recognise that you should be in it for the short term- even though you may get a decent salary on joining to entice you in, you will not get regular pay rises, and the "on target earnings" you are promised are unlikely to be achieved, let alone over-achieved. Be prepared to be "nickel and dimed" to death, with cost savings gone mad.

      Don't treat it as a career and you will be OK- just grin and bear the idiocy of the accounting scrooges, the interminable complex processes, the unfair and randomly distributed poor performance ratings (which IBM can't/won't report on in a job reference anyway), take a few years of OK then substandard pay, then use IBM as a reference and get out and find a place that is fun to work in, where the company values you.

      Advice to Senior Management: Stop the stinginess- some minimal spending can improve morale. The constant cutbacks impact productivity (e.g. using a small laptop screen when trying to work on a large complex spreadsheet or document), or morale. You want employees to "go the extra mile", but you won't even spend the $50 a year it takes to give them a decent monitor? Or pay for a modest Christmas lunch as a thank you for hundreds of hours of overtime that year? Do you want employees to feel valued or just like robots that must work long hours without recognition (or worse being told they are rated as "poor" when they put in massive efforts, and some other part of IBM outside of their control stuffed up).

      Lose the inward-focused obsession with metrics. They are not a substitute for reality. The last time IBM was so inwards-focussed on micro-management and metrics was in the 1990s, remember what almost happened then? (hint: bankruptcy)

      Stop micro-managing. You hired the best people, or trained them. Give them the tools and education to do their job, reward them fairly, provide a decent work environment, and then instead of spending your time micro-managing (which is pretend management anyway) spend your time figuring out how to stay out of their way and let them do what you hired them for.

      Reduce the processes, the dozens of long winded, poorly implemented, hard to use processes that get in the way of us doing our jobs well.

      Value your long term employees and pay them market rates- when we leave (and most of use are looking or have left) you will have to replace us with people who don't know the products and processes, and don't have the contacts/relationships with other parts of IBM and customers. Does it make sense to lose this value and replace it with a more expensive resource without the experience/networks/knowledge?

      IBM employees can see upper management feathering their own nests with millions of dollars of options and bonuses, while there seem to be no benefits to employees- in fact things are getting worse- while the company's share price goes up.

    • IBM Technical Architect in Bangalore (India): (Past Employee - 2012) “Challenges everyday , expected to win every time without any support from the organization.” Pros: Please consider this review pertaining to IBM India Pvt. Ltd . IBM USA is still a fantastic place to work and grow one's career.

      IBM was not like this when I joined them couple of years back . The culture was friendly, the environment was pro learning and the people were excellent. The derogation started after a group of folks from TCS joined and captured all the decision making authority within the organization. They systematically ruined the organization framework such that all the good people left (or were made redundant) as is evident from the employee feedback posted here in the forum. What was left after this bitter onslaught was the devil I never got used to experiencing even to this day. The head of this pack what I heard got an all paid trip to the United States to enroll in the AMP of Harvard Business School. I do not know if he passed but I think he has given a perfect case study of the destruction of a well functioning excellent organization. I am an MBA myself and would like to present a case study at my alma mater someday of this horrific transformation and what not to do to make your organization a success. That is, I think, the only legacy he left at IBM India Pvt. Ltd.

      Apart from this , everything is good about IBM. You get to meet the most talented people existing in this industry (especially in the United States , the numbers sadly has been dwindling due to Resource Actions ) , the knowledge base of 100 years , the opportunity to be at forefront of technical excellence , the well established processes and methodology and the respect the name commands .

      Cons: Politics , poor management , employees looked as numbers and IBM India Pvt. Ltd is a glorified bodyshop , no HR policies , incompetent deadwood gloried as managers , useless meaningless processes from the brains of dumb headed folks having no idea how to run a business . Many good people have left and there is a big fall in hiring standards . As a result the quality of people is falling day by day .

      Advice to Senior Management: They are too high up in the ivory tower to listen to us .

    • IBM Senior IT Specialist: (Past Employee - 2009) “College grads, brilliant people, genius people, do not waste your career, life by joining this company called IBM.” Pros: Get your paycheck regularly. Nothing else to say. Cons: Waste of time working for IBM. Advice to Senior Management: Treat with respect and dignity. Management is only part of the work.
    • IBM Staff Software Engineer in Poughkeepsie, NY: (Past Employee - 2011) “Constant worrying about layoffs” Pros: 8% employee match 401k; True flex time; Work from home Cons: Constantly worrying if you will be part of the next set of layoffs. (I escaped it twice, but unable to the third time). Poor bonus (2-4% on avg and was a consistent 2+ on reviews.) Expectation of every single employee to either patent, publish, or create a new innovation, every year. Just not possible. Advice to Senior Management: Stop to evaluate if you are really saving money by outsourcing work to other countries. In groups that I worked in, the quality of work and/or the timeliness of completion of work from groups outside the US, did not compare equally. Often, work had to be re-done or missed target days frequently.
    • IBM Systems Administrator in Lexington, KY: (Past Employee - 2010) “Use it to boost your resume.” Pros: Legacy of industry leadership, access to peers with fantastic skills and work ethic, work at an enterprise level with a focus on best practices. Cons: Massive shift to offshore resources and Delivery Centers. New hires coming out of high school with limited background. Morale is very low. Advice to Senior Management: You are squandering the value of the brand by chasing talented people away.
    • IBM Anonymous: (Past Employee - 2012) “Survival.” Pros: An extremely ethical and value driven organization. Unparalleled scale of vision. Very process oriented. Organized and functions like a mini-nation, with similar hegemonistic ambitions! Cons: The sheer size of the enterprise prevents it from being as agile or nimble as it should. Depletion of intellectual capital in the US through the transfer of low end activities to China/India will see it lose it position of strength in the days to come. Advice to Senior Management: Depletion of intellectual capital in the US through the transfer of low end activities to China/India will see it lose it position of strength in the days to come.
    • IBM Staff Software Engineer in Bangalore (India): (Current Employee) “Worst Company to Work For” Pros: - Flexible Timings; - Some really work happens in some projects. Cons: - Your Manger's word is final & he is the god father; - No Compensation; - No Growth & if you want , get out of the company & coma back in; Very few good people left to have healthy relationship; Negativity everywhere; - I have been with this company for nearly 7+ years & can't guess that IBM could fall to such low standards (no coffee, office supplies . .etc). But they spend hell lot on Business Travels, Hertz cabs, AMEX expenditures etc.; - If complained to managers they say IBM is huge we can't have simple policies and everything you say will fall in deaf ears. Advice to Senior Management: IBM Employees (People) make it Special should be in actions not in Words . .
  • Yahoo! IBM Employee Issues message board: "Question" by "dkgafl". Full excerpt: I am new to IBM - about 18 months. When are annual raises given and what % does one normally get if they got a 1? Thanks
  • Yahoo! IBM Employee Issues message board: "Re: Question" by Paul Sutera. Full excerpt: This year there were no raises in many countries, except for 1 appraisals. So the raises were typically given June 1st or thereabouts. Unless you work in India or China, you will probably get no raise this year. Some job families have gone years without raises. Others only missed a few years like this year and 2009. For a 2 appraisal the raises have been 1.4-2.2% when there were raises. I got higher % raises when I scored a 2+. IBM USA is not a good place for the average I/T worker or even engineer. But use IBM to launch yourself into a better career, that most likely will not be at IBM. The people are great and where else can you find so many people with so many different and extraordinary skills? Use your job to build your skills in an area where opportunities are good outside of IBM.
  • Alliance for Retired Americans: Friday Alert (PDF). This week's articles include:
    • ‘Name Our Campaign’ – Alliance Summer of Action
    • Evidence of Affordable Care Act Success Comes as Supreme Court Decision Nears
    • AFL-CIO Launches Unprecedented Campaign to Protect Voter Rights
    • 60 Plus Association Distorts the Truth Again
    • Lee Saunders is elected to be President of AFSCME
  • The Detroit News: GM pension changes leave retirees' money unprotected, group says. By Melissa Burden. Excerpt: The General Motors Retirees Association is protesting GM's plan to buy out pensions of up to 42,000 U.S. salaried retirees and move other retirees to an annuity program controlled by Prudential Insurance Co. of America. The association calls GM's decision "galling" and says it threatens retirees' financial security. In a letter to GM Chairman and CEO Dan Akerson, signed by association president Jim Shepherd of Scottsdale, Ariz., and posted on its website, the group asks GM to reverse course.

    "By eliminating this large class of salaried retirees from the pension plan, you are abandoning the hard-earned benefit of an ERISA-protected pension promised to thousands upon thousands of GM retirees in return for their commitment and loyalty," the letter reads. "This surpasses basic unfairness; indeed, it is sheer irresponsibility and greed."

  • New York Times: Target-Date Funds Not Equally Safe. By Ron Lieber. Excerpts: Let’s say you’re 63 years old and trying to figure out how to invest the money you’ve managed to put aside over the years. One portfolio manager plans to put 63 percent of your retirement money in bonds. Another says that the first manager has it wrong and that a 63-year-old ought to have 63 percent of a retirement portfolio in stocks. Who’s right? And how did they come up with those wildly divergent estimates?

    This is not some kind of trick question. It’s what you’d actually be facing if you were choosing between Wells Fargo’s 2015 target-date mutual fund and T. Rowe Price’s 2015 fund. ...

  • The Detroit News: Ford salaried staff strikes in England over cutbacks. By Jaclyn Trop. Excerpts: Ford Motor Co. salaried workers in England staged a 24-hour strike Monday to protest a proposal for pay and pension cuts for new hires. White-collar members of Britain's Unite union began the strike Monday morning in response to the automaker's proposal to lower pay rates and close its defined-benefit pension plan to new employees. ...

    Ford, which faces a $15.4 billion gap in its global pension funding, is taking its lead from the private sector. Close to 80 percent of private firms in Britain have closed their defined-benefit pension funds to new hires, according to Bennett. Ford believes "its existing final salary pension provisions stand comparison with the best pension arrangements in the U.K. private sector," Bennett said. Ford's pension funds have "a significant deficit," he added.

  • Detroit Free-Press: Text of letter from GMRA President Jim Shepherd to GM CEO Dan Akerson protesting GM's pension plan. Excerpts: The following is a letter from Jim Shepherd, president of the GMRetirees Association, to GM CEO Dan Akerson, dated June 13, 2012:

    "Dear Mr. Akerson: "I am writing this letter to you on behalf of the 118,000 salaried retirees of General Motors Corporation (“GM”) to express to you our absolute consternation and disgust at the decision you have made with respect to our pension plan. By eliminating this large class of salaried retirees from the pension plan, you are abandoning the hard-earned benefit of an ERISA-protected pension promised to thousands upon thousands of GM retirees in return for their commitment and loyalty. This surpasses basic unfairness; indeed, it is sheer irresponsibility and greed. ...

    "Particularly galling about this action is that GM has benefited greatly from the pension plan, despite great risk to plan participants. In fact, GM used $2.9 billion in pension assets to make lump sum restructuring severance payments during 2008 – and ended the year with a $12.4 billion deficit ($20 billion by PBGC calculations). GM’s raid on the pension fund resulted in such a dangerous degree of under-funding that in early 2009 the Executive Director of the PBGC wrote GM management, asking them to desist from reverting plan assets for fear that such action could trigger a plan termination.

  • USA Today: Romney mum on labor unions as he works for Michigan votes. By Jackie Kucinich. Excerpts: Mitt Romney wrapped up his five-day tour of six swing states Tuesday in a state with a heavy union presence but far away from any union power centers and largely silent on the groups that could be a key foe here and in other Rust Belt states in November.

    Through photo ops and roundtables, Romney for the most part avoided using the tough rhetoric about unions that was common during the Republican presidential primaries. And the bus tour steered clear of union-heavy industrial towns, as Romney seeks to gather votes in the more Republican rural areas.

    "He won't come anywhere near Detroit," predicted Lance Adams, 40, an employee resources coordinator from Chesterfield Township who attended an event sponsored by the Democratic National Committee to counter Romney's bus tour. ...

    Romney had little to say about unions during his bus tour, but during the Republican primaries, he on several occasions blasted President Obama for putting "union stooges" on the National Labor Relations Board as payback for the help that organized labor provided for his 2008 election.

    Union members who attended a news conference Monday in Detroit said Romney's contempt for unions was particularly galling because of his roots in the Motor City.

    "It's a slap in the face, how he got up and said, 'Let Detroit go bankrupt,' " said Mark Dickow, 49, president of the United Autoworkers Local 140 in Warren, referring to Romney's 2008 New York Times op-ed piece with the headline "Let Detroit go bankrupt."

  • Yahoo! IBM Employee Issues message board: "Re: Contract?" by Paul Sutera. Full excerpt: :diatribe on. GM unions got greedy? They wanted what used to be the norm for all US corporate jobs. Secure pensions, healthcare, retirement benefits, a living wage. The rest of US corporations lost these in part because they were not unionized. That awful Middle-Class greed, that's what killed GM? Toyota had a union shop in the USA, and that particular manufacturing facility had the lowest defect rate of any US Toyota facility. Still Toyota did not like the good press that this gave to unions.

    What really tanked GM was the recession. Not middle-class greed but CEO and VP Greed. The union had little to do with the poor GM business model that went back to the 1940s - too many look-alike cars.

    Some of my friends owned 1990s vintage Saturns. They boasted 200K on their odometers and most repairs occurring beyond the 150K mileage mark.

    GM had a laser focus on cost-cutting and Saturn was forced to share the inferior components of the Chevy, Pontiac, Oldsmobile, Buick and Cadillac. This sounded the death knell for Saturn, and reliability and innovation plummeted. Even the Dodge Neon came out on top of the Honda Civic when it debuted. Sadly Chrysler became obsessed on the high profit margin SUV market.

    The Neon became the bottom-rated economy car after just a few short years of cost-cutting.

    Currently our IBM upper-management is cannibalizing the company, and angering customers in every geography. The cost-cutting at all costs has sent several large US customers fleeing to the arms of other more attentive and honest providers. The churn created by the loss of 1/3 of the US workforce in 5+ years is the result of myopic and short-term profit obsession. Contrast that to the S/360 effort in the 1960s that set the stage for nearly 50-years of Mainframe domination.

    I know a few GM retirees, and they have the same benefits as many of you on the "old-old" retirement plan. When IBM's revenues begin to suffer, I'll be happy to make the case that the greed of the rank-and-file IBM employees of the "greatest" generation are what killed IBM. After all, the benefits of those who retired by 2000 are as good or better than a GM union retiree. If you old guys hadn't been so greedy, IBM wouldn't be in such a pickle right now.

    Some of your retirement compensation is better than any union worker's full-time salary in GM's heyday. How does it feel for a middle-class IBM retiree to be blamed for flattening IBM revenues?

    Stop blaming the Middle-Class for our recession. Greed is the cause of our recession. And certainly your pensions and retirement benefits are well-deserved after a lifetime of dedication to IBM. The same is true for the GM Union worker. :diatribe off.

  • Dice: Insurer USAA Tops List of Best IT Places To Work. By Dawn Kawamoto. Excerpts: Insurance and finance company USAA captured the No. 1 spot in Computerworld’s 100 Best Places to Work In IT 2012 list, released Monday. And the best part is they’re planning to fill more IT positions over the next six years. USAA, which landed the top spot for three consecutive years, gained its notable reputation based on its supportive work environment, fantastic amenities and a commitment to innovation, says the report.

    Perks include 26 days of paid vacation a year, an 8 percent employer match on 401Ks, annual performance bonuses equal to 18.4 percent of the workforce and a holiday bonus of two weeks of base pay.

  • Computerworld: 100 Best Places to Work in IT 2012. Rankings for 2012. Editor's note: IBM is not in the top 100. Some companies that are in the list include SAS, Booz Allen Hamilton, and SAP America Inc.
  • New York Times: On Vacation and Sick? A Court Says Take Another. By Paul Geitner. Excerpt: For most Europeans, almost nothing is more prized than their four to six weeks of guaranteed annual vacation leave. But it was not clear just how sacrosanct that time off was until Thursday, when Europe’s highest court ruled that workers who happened to get sick on vacation were legally entitled to take another vacation.

    “The purpose of entitlement to paid annual leave is to enable the worker to rest and enjoy a period of relaxation and leisure,” the Court of Justice of the European Union, based in Luxembourg, ruled in a case involving department store workers in Spain. “The purpose of entitlement to sick leave is different, since it enables a worker to recover from an illness that has caused him to be unfit for work.”

  • Working in these Times: Older Workers Confront Cold New World in Harsh Job Market. By Roger Bybee. Excerpts: Leon Burzynski, president of the labor-backed Alliance for Retired Americans in Wisconsin, is someone who appreciates the steps that Barack Obama has taken to bring the economy back from the brink of disaster. But he remains deeply concerned about the plight of workers aged 50 to 64. These workers—eager to work and too young to afford retirement—remain marginalized in an economy where cash-laden corporations are still reluctant to retrain full-time employees.

    “It’s a dark time for older workers,” said Burzynski. “I don’t see the economy coming around for older people who want to work.”

    With hiring in the private sector slow and the Republicans systematically blocking each and every stimulus measure, the prospects for older workers are bleak indeed. At a point in their lives when they expected to be making their peak earnings, this group of workers finds themselves navigating a complex minefield of problems without significant social support. ...

    For decades, Americans have relied on pensions that provided a predictable source of income in combination with Social Security and savings. But various Individual Retirement Account and 401(k) plans—infinitely cheaper for employers—have taken their place. As Jacob Hacker and Paul Pierson point out in their excellent book, The Great Risk Shift, "As recently as twenty-five years ago, more than 80 percent of large and medium-sized firms offered a defined–benefit plan; today, less than a third do."

    The funds being accumulated in IRA-type accounts are hardly sufficient to provide a secure and fulfilling retirement, says Burzysnki. “The average IRA contains only $55,000 to $60,000—that’s not enough for what I what I call a quality retirement.”

    The lack of support for workers aged 50 and over is exacerbated by the unpredictable circumstances that can lead some to retire, often without the necessary savings and a solid plan. As Hacker and Pierson point out, “Four in ten retired workers today report that they left their jobs earlier than planned because of layoffs health problems, or sick family members.”

New on the Alliance@IBM Site
  • Job Cut Reports
    • Comment 06/18/12: 10-4 on that, RSS SSR. Take as much as you can, as soon as you can, including your pension, FHA, and anything else still available to you. Since there is no Labor Contract in place, IBM Management can eliminate benefits and pretty much do whatever they please. The only legal protections currently available for IBM Pensions are provided by ERISA. Also, once a benefit has been started, there is a much stronger argument that one "relied upon" the benefit. Moreover, given the ongoing cannibalization of IBM by Management, that is now becoming readily apparent to even the general public, do you really think those shares are going to go up in value (or will be worth anything, for that matter) over the long term? -All Hail Road Kill 2015!-
    • Comment 06/18/12: Yep. Got the acceptance email today. Now the 3 days/week experiment begins. My apologies to those of you who did not apply, get accepted or weren't eligible for TtoR. Sadly you will be picking up the 40% of work that will no longer be performed by those of us who got accepted. We wish you luck. -Drank the TtoR coolaid-
    • Comment 06/18/12: Response to: "Bring IBM jobs back to the US!" eBlast to Alliance@IBM members, supporters and employees.: "Help break the silence on off-shoring IBM jobs. Please post on our job cut report board where your job was or will be offshored and what your job title was/is. Post here: www.endicottalliance.org/jobcutsreports.php" My job was off-shored to Hungary. Job title was Technical Writer/Editor. Still no others from my team for this quarter, but 3/9 saw 3-4 other positions to go Hungary as well. -Gone baby gone-
    • Comment 06/18/12: You know years ago I thought it was a privilege to work at IBM, then I saw how they treated their employees...before IBM I was considered a top performer in my class now I'm barely making it as average, no raise for 10 years, one cost of living raise at 1.3 percent, and a lot of "you better get this done at the end of the sprint" or else...management by fear is a great technique, but its like yelling at a kid, sooner or later the kid will act out and ignore what is being said, no wonder the new kids coming in from school these days don't want to work hard, they have the smarts to know they are totally being taken advantage of...seems like the only ones that get ahead are managers, last year all the managers in my group got 1 pbc ratings for doing great jobs, the rest of us got crap...and the answer was "ohh well, times are tough, your lucky to be working" now pull that schedule in by two weeks...I hear tell from the contractors in the field that the software we acquire works well for about a year then when IBM gets its processes on it it turns to crap, doesn't integrate well and is impossible to debug and install...keep offshoring there BigBlue...your short term gain is your long term loss... -JustanEngineer-
    • Comment 06/19/12: Just a couple of years ago, the duty manager team transferred 25 peoples worth of workload to India. Just recently in March of this year, they transferred another 25 peoples workload to Costa Rica. There is more workload transfers that will happen. There is nowhere to hide. There is nowhere to go. A union contract is long overdue. I should have joined the Alliance when I could now that my time with IBM is now over. 23 years of dedicated service to IBM did me no good. -Stop the bleeding already-
    • Comment 06/20/12: Something legal WAS done to stop what IBM and other corporations are doing. You have the legal right to organize your workplace and form a union. This is America. This is how Capitalism works. If you do not organize you will be used and abused for maximum profit. That is what corporations do. Its not evil. Its business. So is forming a union. Its protecting your end of the business relationship with your employer. The nanny state mentality has to stop. No one is really going to take care of you from cradle to grave so stand up for yourselves. You get what you negotiate for in business. Want a seat at the table? -Exodus2007-
    • Comment 06/20/12: To demonstrate solidarity between the troops and know that we hear each other, why doesn't the Alliance call for a SameTime" orange out". Everyone go on DND for one hour and watch the switchboard turn orange before your eyes. I don't know where to go from there...but we know the msg is getting out. -Hi-
    • Comment 06/20/12: I am now working on the customer side (state government) of an account that I worked on as an IBMer for years. The people on this side, especially management, are mostly clueless about IBM's business and HR practices. A 13 - year IBM veteran on the account just quit (a better job elsewhere -- imagine) and no one on our side can figure it out...I have been trying to educate them that IBM is no longer a quality organization, either from a delivery perspective or from a employee's perspective, and it is hard for them to wrap their minds around. IBM's reputation is still very solid, and one of the best ways to undermine it is at the grass-roots level. The press, with the exception of Cringely, is unwilling to risk the ire of IBM and their big advertising bucks. If you are RA'd or leave the company, let current and potential clients know about the disaster that is IBM. It may be the only way to effectively combat Big Blue's corporate crimes. -Switcheroo-
    • Comment 06/20/12: I've worked on three accounts and my job has been sent to India once, South America once and eastern Europe once. I am lucky to still be employed but I know my time is very short. My entire department is being purged and the vast majority of the work has been sent overseas. Dozens of others in my department have been layed off. On multiple occasions I have been reassigned to do other people's jobs that were layed off. I'll be turning the lights out soon. -SysAdmin4IBM-
    • Comment 06/20/12: I was told I Was RA'd in March but have an exit date of July 31. I did very little work in April. Even less in May and nothing in June. My manager is clueless and either is afraid to say something to me or has no idea what is going on. I am not even coming to the site. Just staying home. -Invisible-
    • Comment 06/20/12: Unemployment benefits? I was part of the RA in March, 2012. I had read/heard that unemployment starts within a week or so of separation date. State of CO just informed me I'm not eligible until after severance period ends (I got nearly 6 months). Any experience with this? Thanks -Almost Happy...-
    • Comment 06/21/12: Instead of being so pacifistic and resigning to your fate of being RAed and asking questions of how much severance and whether your eligible for FHA or not DO SOMETHING NOW! ORGANIZE! You have the legal right. You need to exercise this right NOW. It amazes me sadly that most IBMers are allowing IBM management to run rough shod totally over them. It's like a dog that the master continually beats up and under feeds and the dog still comes back for in humane punishment. C'mon folks, stop the madness. You can do it! JOIN THE UNION. -anonymous-
    • Comment 06/21/12: I wouldn't be so worried of whether you get that FHA or not... I would be very afraid to lose your car(s), house (or can't pay the rent), other assets, deplete your savings, and be able to get a decent bills paying job in this crummy economy. This does happen to those RAed. Do something now to protect or preserve what you have now. The best thing you can do if you are in IBM and are non-management is join this union. This union movement in IBM has staying power and has been trying to organize folks like you since at least 1999. But you have to join to make it last and work for you. -IBMUnionYes-
    • Comment 06/21/12: -Invisible-: As Elmer Fud used to say "Be very careful". Until you sign the RA separation papers IBM can still fire you with cause and reduce or even take away all or part of a RA separation package off the table and tell you goodbye. Unless you have something in writing from IBM that says for you to stay home and do nothing you have absolutely no protection. NONE. Your still an "at-will" employee, albeit an RAed one. -da_facts-
    • Comment 06/21/12: To Almost Happy, I would check why they told you that you had to wait, most states approve you to begin unemployment immediately after your last actual day of work not the date of the end of the severance package. There may be a problem on how you submitted your paperwork. I applied the day after my March 28th date and was approved. I included my severance money in my application and they do not count that or the vacation payout. -March2012 RA Too-
    • Comment 06/21/12: To Almost Happy: At least in NY, if you got a lump sum severance, you were entitled to collect unemployment pretty much immediately. I also encourage everyone to do so if they can. Don't let pride get in the way or think you have a cushion due to the severance. You pay unemployment taxes for a reason and you are entitled to collect and use those funds until you find your next job. Take what is yours! Apply as soon as you can. Best of luck to you. -NYC Unblued-
News and Opinion Concerning Health Savings Accounts, Medical Costs and Health Care Reform
  • Milliman Insight: Lessons from Brazil: Regulatory changes in the health insurance market. By Mary van der Heijde and Daniela Rezende Furtado de Mendonça. Abstract: Both Brazil and the United States have distinct experiences with reforming their respective healthcare systems. While the two countries have different systems and have pursued different types of reform on different timetables, there are lessons to be learned by looking at the two countries side by side.

    Major healthcare reform has already occurred in Brazil over the past couple of decades. It is possible to draw relevant parallels between some of those changes and what the Patient Protection and Affordable Care Act (PPACA) includes for the United States.

    There is much discussion about what will happen in the United States if the individual mandate is eliminated and underwriting remains prohibited. Taking a look at the evolution of Brazil’s healthcare system may provide some insight into this possibility and other possible outcomes of healthcare reform in the United States.

  • New York Times: Many Americans Struggle to Pay for Health Care, Survey Finds. By Ann Carrns. Excerpts: As the nation awaits the Supreme Court’s ruling on challenges to the health care law, Americans continue to report that they struggle to pay for medical care. A quarter of Americans report problems paying medical bills in the past year, and about 60 percent say they’ve “cut corners” to avoid health care costs, according to the May tracking poll conducted by the Kaiser Family Foundation.

    The most common steps that people have taken to save money include relying on home remedies or over-the-counter drugs (38 percent) instead of going to the doctor, or skipping visits to the dentist (35 percent). ...

    Nearly half of uninsured adults reported trouble paying medical bills in the prior year. But almost a quarter of those with health insurance reported trouble as well — perhaps the result of health insurance plans with higher deductibles and out-of-pocket costs. More than half of those with insurance said they had delayed or skipped care in the past year due to cost.

  • Huffington Post: Got Health Insurance? Why You May Want To Pay Cash Anyway. By Ann Brenoff. Excerpt: Morris Pineda of Alameda, Calif., says that learning it was cheaper for him to pay out-of-pocket for his prescription medications instead of putting in a claim with his insurance company came as a "slap in the face."

    Pineda, an auto insurance claims adjuster, actually didn't believe it when his doctor advised him to fill his seven prescriptions at Costco and "don't tell them you have insurance." Heck, he pays $330 a month for that insurance and he's entitled to some reimbursement for a covered expense, he thought. But by ignoring the coverage he pays for, his drugs now cost him less than $100 a year instead of the $420 his insurance charged in co-pays for the seven generic drugs.

    How does he feel about paying an annual premium of $4,290 a year for the privilege of being charged more? Pretty angry. "You have to trust somebody," he began. "You buy insurance because you assume it is the best deal. You act in good faith. And instead you wind up getting ripped off by the people you pay money to for insurance coverage." Pineda is insured through his employer's group policy. They deduct $165 every pay period; 26 times a year. But his policy carries an annual $500 per person deductible and each of his generic prescriptions covered by the plan has a minimum co-pay of $5.

    Overpaying on prescriptions is just the tip of the iceberg, said Dr. David Belk, an internist who treats Pineda and who is the one who sent him to Costco. There's a much larger problem, Belk explained: The lack of transparency in what medical care and goods actually cost. Belk runs a website devoted to the problem. ...

    By keeping patients -- and doctors -- in the dark, insurance companies essentially have been given a carte blanche to rip people off, he argued. Many medical services -- blood work, MRIs, CAT scans, Pap tests -- also wind up costing insured patients less if they pay out of pocket rather than submit a claim to their insurance companies, said Belk. It happens frequently in the instances when people carry high deductibles on their coverage plans. The insurance won't pay for services until the annual deductible is met. Healthy patients who don't see doctors frequently rarely kick into that post-deductible period so they wind up paying out of pocket.

  • Huffington Post: UnitedHealth's Misleading Promises -- It's What the Company Didn't Say That's Most Important. By Wendell Potter. Excerpts: That episode came to mind as I read story after story in the mainstream media last week about the decision by UnitedHealth Group to "honor" some of the provisions of ObamaCare even if the Supreme Court declares the law unconstitutional.

    The Stradivarius playing I was accused of was nothing compared to the virtuoso performance turned in by UnitedHealth's PR team. I have seen a lot of masterful work in purposeful misdirection over the years, but I can't recall a PR coup to top this one.

    Here's how it was planned and executed -- with brilliance.

    It was important to have the initial stories appear on Monday, typically a slow news day. To ensure that positive stories would make it into the country's leading publications, the PR team "leaked" the news release to a few key reporters Sunday night with a strict embargo until Monday morning.

    It was clear to me that UnitedHealth "declined" to make any company official available -- at least "on the record" -- Sunday night because "rude" questions would have been asked. So the stories that appeared Monday and over subsequent days did not have answers to critically important questions about whether the company would "honor" the many other provisions of the reform law that will benefit most Americans if the Court rules against it. Since reporters obviously were not able to interview UnitedHealth CEO Stephen Hemsley, they were stuck with the quote attributed to him in the news release: "The protections we are voluntarily extending are good for people's health, promote broader access to quality care and contribute to helping control rising health care costs." That happy talk was published, verbatim in most cases, by the New York Times, the Wall Street Journal, the Washington Post, the Los Angeles Times, Forbes, CNN, MSNBC, the Associated Press, Bloomberg and Reuters, to name just a few.

    What's worse is that most reporters didn't bother to mention that what UnitedHealth said it would do would apply to just a small fraction of the 36 million people the company says are enrolled in its various medical plans. The company said that regardless of the Court ruling it would continue to allow young adults to stay on their parents' policies until age 26, offer preventive services without co-payments, eliminate lifetime coverage limits, not "rescind" policies except in cases of fraud and provide "clear and timely options for appeals." Most readers of the company's press release would probably assume that it was talking about all 36 million. I did the first time I read it. As it turns out, though, the vast majority of people enrolled in plans administered by UnitedHealth could find out that none of those assurances would be applicable to them.

    One of the few reporters who pointed that out was the Washington Post's N.C. Aizenman, who wrote that the announcement "applies to the roughly 9 million consumers in plans that they or their employer have purchased from United Health... " For the other 27 million, "it would be up to the employer to decide which provisions to continue offering voluntarily." That's because most of the people enrolled in UnitedHealth's plans work for big companies that make the ultimate decisions on what and who will be covered. If ObamaCare bites the dust, those companies could tell UnitedHealth to go pound sand, that they had no intention of "honoring" those provisions.

  • ABC News: Romneycare In Massachusetts, Six Years Later. By Elizabeth Hartfield. Excerpts: Republicans and Democrats are eagerly awaiting the Supreme Court's ruling on the Affordable Care Act, which is expected to come down any day now. And while the court could rule in many different ways, the jist of the ruling comes down to the question of the controversial individual mandate requiring most documented residents to get health insurance, or pay a penalty.

    In short a ruling upholding the individual mandate will be a victory for Obama and the Democrats, and a ruling overturning the individual mandate will be a victory for Romney and the Republicans. The irony of the ruling, as has been pointed out by Democrats, and some of Romney's opponents in his own party during the GOP primary, is that the healthcare law, including the individual mandate, was in many ways modeled after Massachusetts' health care law which Mitt Romney signed in 2006 when he was governor. ...

    Generally speaking, the health care law in Massachusetts appears to be working well, six years later. Some 98 percent of Massachusetts residents are insured, according to the state's Health Insurance Connector Authority, and that percentage increases among children at 99.8 percent and seniors at 99.6 percent. Another 439,000 residents have gained insurance since before the reform was passed.

  • ABC News: When to Pay a Higher Health Insurance Deductible. By Elizabeth Leamy. Excerpts: I learned about high deductibles as they apply to medical coverage when I started my first on-air television news job at age 23. I was a freelancer and didn't have health insurance. I was also making just $21,000 a year and didn't think I could afford healthcare coverage.

    I called my dear old Dad to ask for advice and his wise words have never left me. He pointed out that insurance is not for routine stuff. Rather, it's meant to protect you and your family from catastrophic financial loss. My Dad suggested I skip all the fancy plans that paid for lots of preventive care and instead choose an inexpensive one with a high deductible that would give me excellent protection if something awful happened, like a car accident or a major disease diagnosis. Sure enough, once I looked at plans with high deductibles, I could easily afford the premiums.

    Most families can muddle through even $10,000 worth of medical expenses, if that's the size of their deductible. It's not pretty, but it's possible. But the $250,000 bill from the family member who has a heart attack and needs critical care can bankrupt you. How do you recover from that? These days there are dozens of "mini-med" plans out there that offer next to no benefit if you have a major illness. That's why the best way to save on health insurance is to pick a plan that has a high deductible but offers generous coverage once you meet that deductible. ...

    If, however, you have a chronic medical condition that requires continuous care, or you live financially close to the edge, this advice is not for you. For people with chronic illnesses, an employer-based plan with a low deductible and generous benefits is best. If you have a low income and a high deductible would ruin you financially, you may be better off in an HMO plan with no unexpected costs.

  • Huffington Post: Health Care: Give the People What They Want. By Robert Scheer. Excerpts: The nutty thing about the health care debate that will play a prominent role in the next election is that most Americans want pretty much the same outcome: to control costs without sacrificing quality. And that's not what either major-party candidate is offering. Few think that Obamacare, a Romneycare descendant that contains the same kind of individual mandate the then-governor of Massachusetts signed into law, will get us to that desired goal. Nor would Mitt Romney, who has been reborn as a celebrant of the old, pre-Obama system with a few nips and tucks. ...

    Two dynamics doomed the experiment. First, the new Democratic president wanted to launch a bold progressive program, but rather than channel the spirit of Franklin Delano Roosevelt to address the economic crisis that he inherited, he continued the bailouts begun under George W. Bush and fixed on health care reform instead of the financial pain being suffered by average Americans.

    The second dynamic that undercut the health care bill was an overeagerness on the part of the new White House operatives to collaborate with the profiteers in the very industry targeted by reform. ...

    The email trail of cave-ins to the medical industry heavyweights is startlingly clear, and it is difficult to quarrel with the headline on a Wall Street Journal story: "Emails Reveal How the White House Bought Big Pharma." Except, as a related editorial in the WSJ makes clear, it was the pharmaceutical industry that did the buying, with "a $150 million advertising campaign coordinated with the White House political shop."

    What the industry bought was an end to the notion of a health care "public option," and a guarantee of no serious restrictions on drug prices, arranged by then White House chief of staff Rahm Emanuel, who was in close communication with the lobbyists involved. The Journal article pointed to the cynical language of the emails exchanged, quoting one incriminating note from a lobbyist: "Rahm asked for Harry and Louise ads thru third party. We've already contacted the agent." ...

    Let me humbly suggest that as an alternative to a mandatory system rejected by the majority, we return to the idea of covering most people by attracting them to quality public and private programs through consumer choice, and that one of those choices be a version of the public option we now offer seniors. It's called Medicare and it works splendidly.

  • New York Times: Many Americans Struggle to Pay for Health Care, Survey Finds. By Ann Carrns. Excerpts: A quarter of Americans report problems paying medical bills in the past year, and about 60 percent say they’ve “cut corners” to avoid health care costs, according to the May tracking poll conducted by the Kaiser Family Foundation.

    The most common steps that people have taken to save money include relying on home remedies or over-the-counter drugs (38 percent) instead of going to the doctor, or skipping visits to the dentist (35 percent). ...

    Nearly half of uninsured adults reported trouble paying medical bills in the prior year. But almost a quarter of those with health insurance reported trouble as well — perhaps the result of health insurance plans with higher deductibles and out-of-pocket costs. More than half of those with insurance said they had delayed or skipped care in the past year due to cost.

  • Kaiser Health News: What's At Stake For Women If SCOTUS Overturns The Health Law. By Julie Appleby. Excerpts: A provision in the 2010 health care law requiring contraceptive coverage for women without copays has gotten most of the press. But much more is at stake for women if the Supreme Court overturns the health care law. Starting in 2014, the law bars insurance practices such as charging women higher premiums than men, or denying coverage for pre-existing conditions that could include pregnancy, a Caesarean-section birth or a sexual or a domestic violence assault.

    Even excluding maternity coverage, the National Women's Law Center found that nearly one-third of the most commonly sold insurance plans charged women aged 25 to 40 at least 30 percent more than men for the same coverage.

    "Invariably, non-smoking women are charged more than men who smoke," said Judy Waxman, vice president for health and reproductive rights with the women’s law center.

    While about 14 states have already barred insurers from charging women more, such restrictions will be universal in 2014 if the law stands.

  • Washington Post opinion: Yes, today's Republicans really are different. By Jonathan Bernstein. Excerpts: If you’re thinking about dysfunctional government, there’s one main point that you have to know: The parties are not equally guilty. Dysfunctional government isn’t about ideological polarization; it’s about a rejectionist Republican Party that, among other things, is, while Democrats are in office, dedicated to opposing anything the Democratic president proposes — regardless of whether they have a history of opposing it or not.

    Ezra Klein has been writing a series of great items about this lately, taking as a key example the Republican history on the individual mandate. The history is pretty basic: it was their idea; many leading Republicans supported it until January 2009; and then overnight it became for them not just a bad idea, but clearly unconstitutional — and not just unconstitutional, but a grave threat to basic liberty. It’s not hard to find more: the DREAM Act, the basic idea of fiscal and monetary stimulus during a recession, TARP . . . it’s a long list. Granted, not every Republican supported these things before Barack Obama did, but quite a few did, and now practically none can be found. ...

    But the best test of all of this isn’t changes since 2009; it’s what happened in 2001. And the answer there was that George W. Bush was able to get Democratic votes for No Child Left Behind, for expanding Medicare, for the war in Iraq and for some other issues as well. There were, of course, exactly zero Democrats who flipped from supporting federal aid to education in 1999 to considering it unconstitutional in 2001.There were plenty of Democrats who considered Iraq a threat but did not vote for war, and plenty who may have supported war in the Clinton years but wound up opposing it when it turned bad, but few, if any, prominent ones who really flipped their basic position right around January 2001. The same with Medicare.

  • Washington Post: Health insurance plans owe $1.1 billion in rebates. By Sarah Kliff. Excerpts: Millions of consumers and businesses will receive $1.1 billion in rebates this summer from health insurance plans that failed to meet a requirement of the new health-care law, according to the Health and Human Services Department.

    That Affordable Care Act rule requires insurance companies to spend at least 80 percent of subscriber premiums on health-care claims and quality improvement initiatives. The other 20 percent is left for administrative costs and profits. Health insurance plans that don’t hit that threshold will send a rebate to consumers to cover the difference.

    There could, however, be one big hitch. If the Supreme Court overturns the health-care law — a decision that could come as early as Thursday morning — experts say those checks are unlikely to hit Americans’ mailboxes. “If [the Supreme Court] says the law is unconstitutional, insurers couldn’t be forced to pay rebates based on unconstitutional laws,” said Tim Jost, a law professor at Washington and Lee University.

  • New York Times: Those Already Ill Have High Stake in Health Ruling. By Sabrina Tavernise. Excerpts: The tumor grew like a thick vine up the back of Eric Richter’s leg, reminding him every time he sat down that he was a man without insurance. In April, when it was close to bursting through his skin, he went to the emergency room. Doctors told him it was malignant and urged surgery.

    His wife called every major insurance company she found on the Internet, but none would cover him: His cancer was a pre-existing condition. In desperation, the Richters agreed to pay half their hospital bill, knowing they could never afford it on their combined salaries of $36,000 a year.

    No other group of Americans faces higher stakes in the impending Supreme Court ruling on the Affordable Care Act than those with pre-existing conditions. The law, once its major provisions take effect, would prohibit insurance companies from turning people away or charging them more because they are sick. In exchange, most Americans would be required to have insurance, broadening the base of paying customers with an infusion of healthy people. Those who did not buy insurance would be subject to financial penalties.

    The Government Accountability Office estimates that 36 million to 122 million adults under 65 have a pre-existing condition. As many as 17 million do not have insurance. Many try to buy coverage on the individual market, but in most states that is either impossible or too costly.

    Experts are divided on what the ruling will bring for this group of Americans. If the mandate that everyone buy coverage is struck down, the Obama administration and the insurance industry say that the protections for people with pre-existing conditions should be, too. If the ailing pile in without the larger pool of healthy people, premiums would skyrocket, insurers say. ...

    According to a subsidy calculator provided by the Kaiser Family Foundation, the Richters’ insurance premium would be $165 a month under the new law, a sum they said they would eagerly pay. The small stone drilling firm where Mr. Richter works offers no health coverage, and the family could not afford the more than $600 a month it would have cost to buy it on their own. ...

    The Richters would benefit from the law, but in a sign of how poorly it is understood, they said their impression was that it would force people to pay for something they cannot afford. “That’s not going to go over well,” Mr. Richter said. The law includes an exemption for people who cannot afford the premium even with the subsidy.

    Currently, uninsured people with pre-existing conditions often end up getting care, but at tremendous cost to the public, hospitals, and themselves. Some divorce to have household incomes small enough to qualify for Medicaid. Others get help from hospital charities. Still others rack up large bills that go to debt collection agencies.

  • Huffington Post: Supreme Court Health Care Decision May Put Sickest Americans At Risk. By Jeffrey Young. Excerpts: The system will likely fail Americans like Lewis again and again, if the Supreme Court overturns President Barack Obama's health care reform law next week. Without its rules that will prohibit health insurance companies from discriminating against people with pre-existing conditions starting in 2014, Lewis and others who are sick or have suffered serious illnesses in the past can be shut out of the health insurance market. As many as 122 million working-age Americans have pre-existing conditions that could get them rejected by health insurance companies, according to a Government Accountability Office analysis issued in March. ...

    President Barack Obama's health care reform law aims to ease the way for people like Lewis by implementing new regulations and financial assistance. The law will forbid health insurance companies from turning away people with pre-existing conditions or kicking them out when they become ill, and established a temporary program called the Pre-Existing Condition Insurance Plan. Beginning in 2014, Obama's law will also expand coverage to about 30 million uninsured people by setting up "exchange" marketplaces where insurance companies compete for business, providing tax credits to help pay for coverage for people earning up to four times the federal poverty level, and expanding Medicaid to include people who earn 133 percent of the poverty level or less.

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

  • Washington Post opinion: A GOP bait-and-switch on disclosure. By Fred Hiatt. Excerpts: First, a confession: Though a longtime member of the Church of Campaign Finance Reform, I have from time to time been tempted by the sect of Unlimited Donations, Unlimited Disclosure. Republicans always dangled this apple in the most alluring way. Political money will find a path, they would insist. Give up! Give in! We will post every donation on the Web, instantly! We will give you transparency! Sunshine! Accountability!

    Yet now, with more secret money than ever slopping into the system, not a single Republican has signed on to bills that would provide the disinfectant Mr. Boehner claimed to favor. What’s changed?

    Sadly, only one thing, and it’s not the merits of the argument. The playing field has tilted toward Republicans, and they’re in no hurry to tilt it back. A combination of Supreme Court jurisprudence and lax enforcement from the Federal Election Commission and the Internal Revenue Service has allowed groups like Karl Rove’s Crossroads GPS (and Bill Burton’s pro-Obama Priorities USA) to take million-dollar donations, or 10-million-dollar donations, use them in political ads and never disclose the donors.

    It allows the Chamber of Commerce to run ads opposing a candidate for supporting Obamacare, say, and never disclose that the funding for the ad comes entirely (we’re speaking hypothetically now) from a single health-insurance company. Can that be in the public interest? ...

    Now Rep. Chris Van Hollen (D-Md.) and Sen. Sheldon Whitehouse (D-R.I.) have introduced legislation that would — without limiting a single act of political speech — promote disclosure, sunlight and disinfectant. Not a single Republican has signed on. ...

    McConnell complained that the bill wouldn’t affect unions. But the bill doesn’t discriminate; it’s just that unions don’t get their money in secret installments of $100,000 or $1 million.

  • Huffington Post: Jamie Dimon's 'Family Reunion' With the Senate Banking Committee. By Bill Moyers. Excerpts: In a preview of this weekend's Moyers & Company, I talk with What's the Matter With Kansas? author Thomas Frank about the friendly faces greeting Jamie Dimon when he appeared before the Senate Banking Committee this morning. Seven members of the committee were big recipients of money from the megabank.

    Frank describes the revolving door of employment between government and corporate America, especially when it comes to Congressional staffers-turned-lobbyists.

    "Staffers know they could drop what they're doing and go work for a lobby firm and make fantastic money... They want to please these companies -- even when they don't work for those companies -- because that's their future employer and everybody knows it."
  • Los Angeles Times: Average U.S. family's wealth plunged 40% in recession, Fed says. The net worth of the median American family fell to $77,300 in 2010, down nearly 40% from 2007 after adjusting for inflation, the Federal Reserve reports. By Don Lee. Excerpt: The typical American family lost nearly 40% of its wealth from 2007 to 2010 as the Great Recession reduced household net worth to a level not seen since the early 1990s. The net worth of the median U.S. family — one with an equal number of families richer and poorer — fell to $77,300 in 2010 from $126,400 three years earlier, after adjusting for inflation, the Federal Reserve said in a new report Monday. The drop, much steeper than previous Fed quarterly reports have suggested, underscores the severity of the 2007-09 recession that decimated the housing market and resulted in massive layoffs that slashed people's incomes.
  • Jim Hightower: "Financial uncertainty" good for the poor, not for the rich. Full excerpt: Outraged Republican lawmakers rise up on their hind legs and howl in protest at any suggestion that Washington should finally end the special, decade-old tax break given to millionaires and billionaires. Never mind that these privileged one-percenters are doing extremely well and don't need more taxpayer handouts, their Congressional defenders wail that any cuts in their tax benefits would spook the elites by creating "financial uncertainty" for them.

    Meanwhile, these same lawmakers howl in outrage about the meager unemployment payments going to America's hard-hit, out-of-work families who actually need a helping hand in today's jobless economy. More than five million of our fellow citizens have been unable to find jobs for half-a-year or more. To tide them over to better times, Congress begrudgingly okayed a supplement to state unemployment funds in February, supposedly allowing up to 99 weeks of jobless benefits.

    But, lawmakers, who are so sensitive to the delicate temperaments of the one-percent, struck these "99ers" with a clause that builds "financial uncertainty" right into the law. They quietly reduced the total number of weeks of extended aid available to the jobless and made it more difficult for states to qualify for the supplement.

    The result is that unemployed people in 23 states have already been stunned to find that they've lost up to five months of benefits they were entitled to. Already, about half a million jobless Americans have been cut off prematurely from payments that make the difference between hanging on… and plunging into poverty.

    Adding insult to injury, these knock downs are rationalized by the right-wing howlers as necessary. Why? To prevent the unemployed from becoming dependent on public help – a concern that is not expressed about extended tax giveaways to the super-rich.

  • Investment News: Romney tax plan would likely spell end of mortgage deduction, says Bowles. Lowering of all tax brackets will require more than just eliminating tax breaks for the rich. Excerpts: Republican presidential candidate Mitt Romney's plan to reduce tax rates would need to be financed by ending widely used benefits such as the mortgage interest deduction, said Erskine Bowles, who was co-chairman of President Barack Obama's deficit-reduction commission. Romney is “partly right and partly wrong” when he says he can cut tax rates by 20 percent and make up the money by curtailing tax breaks, Bowles said on Bloomberg Television's “Conversations with Judy Woodruff,” airing this weekend.

    “One area that Governor Romney is wrong is you can't just affect the top 15 percent” of Americans, said Bowles, whose bipartisan plan would cut spending and raise taxes. “It's just not enough money there in getting rid of the tax expenditures that only affect the upper-income people. You're going to have to affect people down through the brackets.” ...

    Romney wants to cut all individual income tax rates by 20 percent, reducing the top rate to 28 percent from 35 percent. He would lower the corporate tax rate to 25 percent from 35 percent, eliminate the estate tax and end taxation of investment income for people making less than $200,000 a year. ...

    Romney's plan would cost the government about $5 trillion in forgone revenue over the next decade on top of the cost of extending the income tax cuts now scheduled to expire Dec. 31. Romney hasn't specified which tax breaks he would limit.

  • Financial Times: Romney hedges bets on gambling tycoon. By Stephanie Kirchgaessner and Richard McGregor. Excerpts: When he became Massachusetts governor, Mitt Romney was so wary of being associated with gambling interests that he refused donations from the industry for his privately financed inaugural gala.

    He then floated a plan to keep gambling and its “social costs” out of the state, while reaping its benefits by asking casinos in neighbouring states to pay Massachusetts for instituting a permanent gaming ban.

    Mr Romney’s inhibitions are being tested in the 2012 election, however, by the businessman who is on track to become the biggest investor in the Republican candidate’s bid for the White House: Sheldon Adelson, the gambling tycoon and chairman of the Las Vegas Sands.

    Mr Adelson and his wife single-handedly carried Newt Gingrich during the Republican primaries by giving his supporters more than $20m – which paid for attacks on Mr Romney. With Mr Gingrich out of the race, they have donated $10m to the super-political action committee backing Mr Romney. The donation was made within weeks of a meeting between Mr Adelson and the candidate.

    A person close to Mr Adelson said he had not put financial limits on how far he is willing to go to support Republican candidates and causes in this election.

    For Mr Romney, the relationship with Mr Adelson is fraught with risk, as it invites scrutiny of the tycoon’s business record, especially his reliance on Beijing to sustain his profitable casinos in Macau, bordering China.

    John McCain, the 2008 Republican candidate and critic of the recent court decisions that opened the door to unlimited donations by wealthy businessmen, singled out the tycoon last week. Mr McCain said “foreign money” was being injected into the campaign in a “roundabout way”, as Mr Adelson earned most of his money through his Macau casinos. A spokesman for Mr Adelson declined to comment. ...

    Mr Adelson is keenly interested in legislation affecting his industry on Capitol Hill. He has broken ranks with other gambling entities by announcing that he is opposed to a proposal that would legalise online poker playing. One gambling lobbyist told the Financial Times that hopes for the bill were significantly diminished, given Mr Adelson’s close ties to Eric Cantor, the Republican leader who controls which legislation is brought to a vote. More importantly, Mr Adelson’s business interests rely on a strong relationship between the US and China.

  • The Fiscal Times: Political Gridlock Will Spur Another Recession. My Merrill Goozner. Excerpts: The excesses that led to America’s economic malaise had little to do with politics. Gambling on unsecured derivatives based on triple A-rated bonds composed of subprime loans? It took Wall Street to bring down the house, or more accurately, houses—millions of them.

    But the headwinds that are preventing the U.S. economy from fully recovering from the 2008-09 financial collapse are very much a product of politics. And those ill political winds are blowing from both sides of the Atlantic.

    Federal Reserve Board chairman Benjamin Bernanke went to great lengths Wednesday to avoid criticizing U.S. politicians for their failure to deal with the so-called fiscal cliff that looms at the end of this year. On January 1, 2013, the economy gets hit with a 10-year, $1 trillion cut in the federal budget and an across-the-board tax increase triggered by expiration of the Bush-era tax cuts and the short-term payroll tax cut passed in 2010 to bolster the economy.

    Most economists suggest the fiscal austerity that has already been imposed at the state and local level has shaved one percentage point off economic growth and kept the unemployment rate about one percent higher than it otherwise would be. An anti-stimulus package the size of the fiscal cliff would shave anywhere from 3 to 5 percentage points off economic growth. With the Fed predicting anywhere from 1.9 to 2.8 percent growth next year at best, that translates into renewed recession.

  • In These Times: Why The Economy Has Only Recovered for the One Percent. By Roger Bybee. Excerpts: For the fortunate few scanning America's economic recovery from luxurious penthouse suites, they are treated to the magnificent scenery of record profits, escalating CEO pay and an ever-growing share of the nation's income.

    But for the vast majority, the view remains bleak, despite the 4.3 million private-sector jobs added since early 2010. The horizon is still gray because of ongoing, pervasive wage cuts and a feeble job market. Very decidedly, this is a recovery largely reserved for the Republican-deified "job creators" and the investor class. In 2010, the richest 1% monopolized income gains, hauling in fully 93% of increased income, according to economist Emanuel Saez. As Think Progress reported:

    After dipping during the Great Recession, corporate profits have now skyrocketed past their pre-recession levels, Business Insider's Joe Weisenthal notes. After-tax profits and corporate profits as a share of gross domestic product (GDP) are now higher than they were in the middle of the last decade, after a similar vertical spike. Despite massive profit gains, however, corporations are adding more jobs overseas than they are in the United States and paying one of the lowest effective tax rates in the developed world.

    Economist Heidi Schierholz of the Economic Policy Institute explains that the relatively slow pace of hiring—although an improvement from the depths of the recession brought on by Wall Street deregulation—undermines the bargaining power of workers both individually and collectively. "We haven't seen a labor market this weak for this long since the Great Depression. This economy needs at least 10 million more jobs. Workers don't have much power individually when there is a long line of people applying for jobs extending around the block," Schierholz says. ...

    In addition, Republicans have now fiercely reversed course on the counter-cyclical strategies followed by Richard Nixon, George H.W. Bush and George W. Bush of increasing public employment during recessions. They have vigilantly fought against every attempt by President Barack Obama to stimulate the economy with increased public hiring. At the same time, Republican governors have hacked away at public employment and pay at the state and local level. In the midst of the biggest economic crisis in 80 years, "The government sector has cut 502,000 workers from payrolls" since the start of 2010.

  • Washington Post: Romney’s Bain Capital invested in companies that moved jobs overseas. By Tom Hamburger. Excerpts: Mitt Romney’s financial company, Bain Capital, invested in a series of firms that specialized in relocating jobs done by American workers to new facilities in low-wage countries like China and India. During the nearly 15 years that Romney was actively involved in running Bain, a private equity firm that he founded, it owned companies that were pioneers in the practice of shipping work from the United States to overseas call centers and factories making computer components, according to filings with the Securities and Exchange Commission. ...

    Speaking at a metalworking factory in Cincinnati last week, Romney cited his experience as a businessman, saying he knows what it would take to bring employers back to the United States. “For me it’s all about good jobs for the American people and a bright and prosperous future,” he said. ...

    Romney campaign officials repeatedly declined requests to comment on Bain’s record of investing in outsourcing firms during the Romney era. Campaign officials have said it is unfair to criticize Romney for investments made by Bain after he left the firm but did not address those made on his watch. In response to detailed questions about outsourcing investments, Bain spokesman Alex Stanton said, “Bain Capital’s business model has always been to build great companies and improve their operations. We have helped the 350 companies in which we have invested, which include over 100 start-up businesses, produce $80 billion of revenue growth in the United States while growing their revenues well over twice as fast as both the S&P and the U.S. economy over the last 28 years.”

  • National Journal: Obama, Democrats Attack Romney on Outsourcing. By Naureen Khan. Excerpts: President Obama and Democrats on Friday opened a new and potentially damaging line of attack on Republican presidential candidate Mitt Romney, claiming that he invested in firms specializing in outsourcing American jobs overseas during the years he ran the private-equity firm Bain Capital. ...

    Obama strategist David Axelrod dubbed Romney the “outsourcer-in-chief,” and Obama himself weighed in Friday afternoon. "Let me tell you, Tampa, we do not need an outsourcing pioneer in the Oval Office. We need a president who will fight for American jobs and fight for American manufacturing," Obama said at a community college. "That’s what my plan will do."

    The Romney campaign responded with a statement from spokeswoman Andrea Saul calling the Post story “fundamentally flawed” and saying it “failed to differentiate between domestic outsourcing versus offshoring, nor versus work done overseas to support U.S. exports.” She added, “Mitt Romney spent 25 years in the real world economy so he understands why jobs come and they go. As president, he will implement policies that make it easier and more attractive for companies to create jobs here at home.”

  • ThinkProgress: CEO Romney Helped Outsource Manufacturing Jobs To China, Candidate Romney Routinely Blasts Practice. By Pat Garofalo. But as the Washington Post reported, Bain Capital, the private equity firm that Romney headed, played its own part in sending jobs to low-wage countries, including China. In fact, Bain “invested in a series of firms that specialized in relocating jobs done by American workers to new facilities in low-wage countries like China and India.”

    In one example, Bain was the largest shareholder in a company called Modus Media, which “specialized in helping companies outsource their manufacturing“:

    Modus Media told the SEC it was performing outsource packaging and hardware assembly for IBM, Sun Microsystems, Hewlett-Packard Co. and Dell Computer Corp. The filing disclosed that Modus had operations on four continents, including Asian facilities in Singapore, Taiwan, China and South Korea, and European facilities in Ireland and France, and a center in Australia. [...]

    According to a news release issued by Modus Media in 1997, its expansion of outsourcing services took place in close consultation with Bain. Terry Leahy, Modus’s chairman and chief executive, was quoted in the release as saying he would be “working closely with Bain on strategic expansion.”. ...

    As one of Romney’s former partners put it,”I never thought of what I do for a living as job creation…The primary goal of private equity is to create wealth for your investors.” And that’s what Bain did, even if it meant helping companies move operations to the same country Romney now blasts for stealing American jobs.

  • Bloomberg: Romney Campaign Said To Ask Scott To Downplay Job Gains. By Michael C. Bender. Excerpts: Mitt Romney’s presidential campaign asked Florida Governor Rick Scott to tone down his statements heralding improvements in the state’s economy because they clash with the presumptive Republican nominee’s message that the nation is suffering under President Barack Obama, according to two people familiar with the matter.

    Scott, a Republican, was asked to say that the state’s jobless rate could improve faster under a Romney presidency, according to the people, who asked not to be named.

    What’s unfolding in Florida highlights a dilemma for the Romney campaign: how to allow Republican governors to take credit for economic improvements in their states while faulting Obama’s stewardship of the national economy. Republican governors in Ohio, Virginia, Michigan and Wisconsin also have highlighted improving economies.

  • AlterNet: The People Need Robin Hood': Nurses Union Leads Nationwide Campaign to Force Wall Street to Pay Its Fair Share. Economists estimate that tens of billions of dollars could be raised from a tiny tax on Wall Street trades. By Alex Kane. Excerpts: Hundreds of people in 15 cities across the country rallied on June 19 to call for a “Robin Hood tax,” a small tax on financial transactions that activists and economists say could raise billions of dollars in much needed revenue and discourage risky trades on Wall Street. The rallies were the kick-off to a major campaign led by the National Nurses Union to institute the tax.

    The union, the nation’s largest for nurses, says that a Robin Hood tax on speculative Wall Street transactions in stocks, bonds and currencies could raise money for health care, housing, jobs and education. The union and its allies are proposing a tax of around a half of 1 percent to be levied on Wall Street trades. Dozens of other organizations have signed onto the campaign, from the climate change group 350.org to Public Citizen to the Progressive Democrats of America. The campaign is global, with activists in countries from France to Canada pushing for a similar financial transaction tax.

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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