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• CWA Statement On Public Financing of Elections and State of the State. Full excerpt: The following statement can be attributed to Chris Shelton, District 1 Vice President of the Communications Workers of America:

  We commend Governor Cuomo's call to give all New Yorkers an equally important voice in the political process. Like the Governor, we believe that public financing of New York elections will help level the playing field for all candidates and ensure our members' votes matter and their voices are heard. Enacting reform this year will be a enormous step towards removing the many blocks keeping average citizens from participating fully in our Democracy.

  Over the coming weeks and months, CWA Members in New York and nationwide will be fighting back against the money in politics that is destroying our democracy; contacting their legislators and demanding reform at the federal and state levels. Corporations are not people, and should not be afforded the opportunity to manipulate the political process in their favor against the interests of middle-class Americans. We hope other leaders will follow Governor Cuomo's bold example and propose similar measures.

• Job Cut Reports
  • Comment 01/24/12: Durham/RTP NC - More PBC 3 ratings this year than ever before. If your manager told you this is just a one off and you can fix this next year, it's a load of bull. You're in the RA list. Rest Assured. -support_guy_rtp-
  • Comment 01/24/12: First "2" ever - in 20 years of being an IBMer, and I am pissed off. This is effectively a pay cut - zero variable pay. -Anonymous-
  • Comment 01/24/12: PBC 2 is eligible for the profit sharing / variable pay -Anon-
  • Comment 01/24/12: 2011 was my first year to IBM, have worked really hard, overtime, weekends more than the average employees. I had not only learn IBM systems quickly but have made many projects successful........ Got the rating of "2" today is it worthy of my days and night I have spend...? -anonymous-
  • Comment 01/24/12: Hi, can an IBM manager give you a low rating and also block you from moving to another job in IBM (if you find one)? About 1.5 years ago, I found another job in IBM but my manager blocked it saying he needed me for another six months. He gave me an average rating last year and I foolishly stayed on. This year, he has given me an even lower rating and I can't wait to leave. Could he block again if I find a job (harder though it may be this time because of my own foolishness)? -BlockedDefense- Alliance reply: Of course your manager can. Without a union contract you are at the mercy of management decisions.
  • Comment 01/24/12: First 2 in over 20 years? Certainly a statement to raise eyebrows. Statement such as this creates hope among the unsuspecting employees.PBC is a flawed process. If a senior (who can influence decisions) with whom one does not have good relationships is promoted to a manager, how can one be sure this will not affect the ratings? Is there a way to ensure "fairness"? -toFirst2-
  • Comment 01/25/12: -Anonymous- "this is a pay cut - zero variable pay" Of course it's a freaking pay cut! That's exactly the intent. Does anyone really think that the majority of ibmers are going to be rated as 1 or 2+? That's just not going to happen. Most will be rated as 2 with no variable pay, or 3 with no variable pay and no profit sharing. And while we're on the subject of pay cuts, does anyone remember the term 'total compensation' as used by management when trying to justify little or no raises? ANY reduction in your total compensation is a pay cut, whether it's a reduced pension (4 of them since '91), or having to pay more for medical coverage every year, or having your appraisal artificially lowered. The real question here is "what are you going to do about it?" -Dave G-
  • Comment 01/25/12: This is the kind of workforce American comapnies want. Beware. "Apple executives say that going overseas, at this point, is their only option. One former executive described how the company relied upon a Chinese factory to revamp iPhone manufacturing just weeks before the device was due on shelves. Apple had redesigned the iPhone's screen at the last minute, forcing an assembly line overhaul. New screens began arriving at the plant near midnight. A foreman immediately roused 8,000 workers inside the company's dormitories, according to the executive. Each employee was given a biscuit and a cup of tea, guided to a workstation and within half an hour started a 12-hour shift fitting glass screens into beveled frames. Within 96 hours, the plant was producing over 10,000 iPhones a day. "The speed and flexibility is breathtaking", the executive said. "There's no American plant that can match that. From the NY Times --
  • Comment 01/25/12: "Durham/RTP NC - More PBC 3 ratings this year than ever before. If your manager told you this is just a one off and you can fix this next year, it's a load of bull. You're in the RA list. Rest Assured. -support_guy_rtp-" Absolutely right. In fact, if you are dropped at any level (i.e. 1 to 2) you will probably be on the RA list. Don't believe what your manager says. Here is another fact. Your 2nd line is probably calling all the shots about you and your 1st line probably doesn't even know it. IBM has had a lot of time to figure out their RA strategy. They have been doing it for almost 20 years now. It all started in the early 90s when 3 finger Lou got on board. IBM is getting very good at it. -Gone from Big Blow-
  • Comment 01/25/12: Without a union, human resource and H/R director Randy MacDonald control the PBC ratings. Randy and all executives have a contract, but IBMUS employess are not respresented and have no contract, the days of respect for the individual are long gone at IBMUS. We need a union to protect from these corrupt corporate practices. Join the union. -ANA-
  • Comment 01/25/12: I heard from collegues, IBM Canada SW group is handing out 3 ratings to the majority of it's employees, their commisions have been capped by much as 40% of what was expected.. HR had to get involved because employees cried fowl, I understand managers were read the riot act by HR for not following the proper procedure for rating employees 3s; something to do with not indicating to the employees during the previous year that their performance was dropping via a mid year PBC reviews.. -Canadian-
  • Comment 01/25/12: -BlockedDefense- Absolutely your manager can hold you back. It happened to me not once but at least twice. Happens all the time. Ever hear of "Needs of the Business"? Wouldn't it be nice to be able to take a qualifying test for the job opening, pass it with great marks, and then your present manager has to release you since you are in the top 10 or so qualified for the union job and the provisions of the contract say that your management can not hold back a qualified employee from getting another job in the company? -RAed2009-
  • Comment 01/26/12: Some of us have posted about seeing a PowerPoint presentation a few years back. It showed the global workforce targets with the number of US workers as 20%. Of this 20%, 10-15% is to be landed resources (here on visas) and Americans /legal residents are to be 5-10%. Think of all the visa holders you now see on your account. That is where they are going. At best 10% of the IBM global workforce will be American. The global work force is now about 450,000, so that would then mean about 45,000 Americans is the target. The American number is currently estimated to be about 98,000, so half that will be RA'd or positions left open by attrition. ______________
  • Comment 01/26/12: How many of you PBC complainers have joined the union? It's amazing to me that people will come here and complain, and that other people will advise them to use IBM's own processes to handle things, when we all know it's a stacked deck and our ONLY chance of fair treatment is to form a union. There is absolutely no downside to becoming a member, and the potential for getting us all some help is tremendous. So discouraging to see such talented people acting so weak. This includes you, GDF employees; you're treated horribly. Do something about it before it's too late. -anon-

    Alliance reply: Thanks for your comment. To answer your question, we only gained 3 new members this month. This site gets at least 1600 visits a day, far more than the number of members we have. As mentioned before, membership in the Alliance is confidential. IBM will not get your name. Dues go to a variety of expenses in organizing and our existence, not just this web site. If we are to take on IBM we need a war chest.

  • Comment 01/26/12: I know this board is about job cuts but just one more clarification. You *can* get a raise with a PBC 2 - just not the merit based component. You can get the "MBA" (Market Based Adjustment), but you have to be well below the midpoint for your band/job family/region. -Anonymouse- Alliance reply: Here's another clarification: You can get a contract with much more than raises and benefits included, if you organize and stand together; instead of picking the nearly clean bones of the promises and needs of the business 'awards' that IBM throws at IBMers today, as their 'reward' for their excessive hours, delayed promotions, absolute disrespect, and daily fear of job loss and mistreatment through their "career".
  • Comment 01/26/12: Rumors of layoffs in TPF, a mainframe operating system. 20 out of 70 being R/A'd. More mainframe development departments training their IBM China replacements. So many seem resigned to their fate. They don't have to be. A union of technical folks can be a formidable force. If only Jane and John Beemer could focus their formidable brainpower for a few minutes a day to their own survival and join Alliance@IBM. -Anonymous-
  • Comment 01/27/12: So, let's say you have a department and people with different roles - PM, architect, developer. Let's say everyone does equally excellent work in their role. Is it fair that the highest appraisals always go to the PMs and architect since they are now required to give a "2" or worse to 60% of the department? I believe this was deliberate, and they are encouraging etrition to avoid RA payouts in preparation for offshoring of the 60%. So, this what they learn in the prestigious American MBA programs these days, huh? How to screw your fellow American for an easy offshoring buck? Deplorable and pathetic. -Anonymous-
  • Comment 01/27/12: Stand by... The 3's are being handed out and recorded by close of business today. I just got mine. Would have completed my 25th year this December. I could feel the target getting bigger on my back. Time to move on... -2015 Roadmap Roadkill-
  • Comment 01/27/12: Wonder why more PBC 3's? I have a theory: since IBM sees that not enough speak up about management abuses or join this union movement then IBM believes giving many more a PBC 3 is just peachy. Since IBM management can get away with it with no resistance. If more folks would join the union here maybe it wouldn't be so peachy for IBM management getting their way always with the employees. If you don't take up the fight then the fight by IBM management comes to you and: hello...it has. IBM employee pacifism is appalling IMHO. -anonymous-
  • Comment 01/27/12: "You can get the "MBA" (Market Based Adjustment), but you have to be well below the midpoint for your band/job family/region." The question is CAN and WILL? I can attest that I was a PBC 2+ and well below the midpoint and got no MBA. But I did get an RA instead. It also all depends which band/job family/region IBM wishes to include in an MBA. Since USA "market based pay" has been depressed most IT skill sets get no MBA. It all depends on IBM's whims. I would rather have a contract than depending on the whims of IBM whether I can get an MBA or not. -sby_willie-
  • Comment 01/28/12: There will be a BIG RA in GBS in 1Q12. This is a fact. folks will be told end of Feb and end date will be end of March. Folks in all areas will be affected. The only way to keep showing profit increase is to kill off expenses since revenue is not growing. US resources are major targets. -RA coming-
  • Comment 01/28/12: When the employees write up their PBC's it is a waste of time. Their rating is determined WAY before the manager ever reads the individuals PBC. I know - I am a manager. So the PBC process is a joke. On RA's - the list of impacted folks are created 2 months before they are told. The list has to go to IBM legal first. Once on a list it is nearly impossible to get off the list. IBM will reduce US workforce 50% by 2015 Guaranteed - I have seen the documents. - RA & PBC- Alliance reply: If you have the documents, please send to ibmunionalliance@gmail.com

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

• Washington Post: ‘Innovation advisers’ chosen for ideas to improve health care, cut costs. By Lena H. Sun. Excerpts: A New York hospital is testing a new approach to fight obesity. A Boston hospital wants to try a new nursing model. A Montgomery County primary-care clinic plans to expand its pharmacy program that gives one-on-one medication counseling to patients with chronic illnesses.

  The people who created these programs are among the first 73 “innovation advisers” chosen by federal health officials this month to experiment with ways to provide better health care and reduce costs. Funded with $6 million from the health-care overhaul act, the initiative is one of the first programs of the new Innovation Center at the federal Centers for Medicare and Medicaid Services, known as CMS.

• Kaiser Health News: A Long-Term Care Policy: Will It Cover Your Needs, Can You Pay For It And Can You Afford Not To Have It? By Caroline E. Mayer. Excerpts: Mary McClelland came to the opposite conclusion after seeing how her mother's expenses were often deemed exempt from coverage. Her mother, Ruth Mezick, purchased long-term-care, or LTC, insurance in 1990 at age 78 when she was in fairly good health, paying an annual premium of $2,827 until she died 11 years later. In her mid-80s, her health began to deteriorate, and she spent time in a nursing home, at home with help and in assisted living. But her policy -- which promised to pay $100 a day -- failed to cover much of those expenses because it kicked in only after she had been in one institution more than 100 days.

  "She was never in one place long enough to qualify. She ended up getting about 10 days' coverage, worth about $1,000," says McClelland, who lives in Falls Church, Va. "That was a lesson to me; I decided it doesn't always pay off."

• New York Times opinion: What We Give Up for Health Care. By Ezekiel J. Emanuel. Excerpts: When it comes to health care, most liberals are committed above all to ensuring that every American has insurance. In their view, the greatest achievement of the health care reform act passed under President Obama is to finally erase the moral stain of the United States’ being the only major developed country without universal coverage. But we also hold the questionable distinction of having the world’s most expensive health care system — what about cost control? For many liberals, that just sounds like a cover for heartless conservatives who care only about cutting benefits and not about helping people in need.

  But liberals are wrong to ignore costs. The more we spend on health care, the less we can spend on other things we value. If liberals care about middle-class salaries, public education and other state-funded services, then they need to care about controlling health care costs every bit as much as conservatives do.

  Over the past 30 years, health care inflation has been a major reason average wages have remained stagnant. For employers, the cost of labor is total compensation — wages plus benefits. As the cost of benefits rises, wages tend not to rise, or to rise much more slowly. According to the Bureau of Labor Statistics, as health care costs skyrocketed between 2000 and 2009, workers’ total compensation increased by 1.3 percent per year, but workers’ hourly wages alone increased by just 0.7 percent per year, significantly below the rate of inflation.

• The Fiscal Times: New Cancer Drugs: Affordable by the 1 Percent? By Merrill Goozner. Excerpts: Julie Gralow, an oncologist at the Fred Hutchinson Cancer Center in Seattle, recently prescribed an exciting new therapy for a 60-year-old woman with metastatic breast cancer. Three-and-a-half years into her battle against the disease, the patient had already exhausted three different anti-estrogen therapies, each of which only put a temporary check on the spreading tumors.

  The newly prescribed drug, Novartis’ Afinitor, is one of the recently approved targeted therapies that have generated a lot of excitement among cancer patients and oncologists in recent years. Drugs that target just the cancer cells promise the same or better results as toxic chemotherapy, but with far fewer side effects.

  There was a catch, though. Like many of the latest cancer drugs, Novartis is charging exorbitant amounts for the treatment – in this case, $10,000 per month. That quickly put an end to that possibility for Gralow’s patient. Her monthly co-payment, even after her insurance company agreed to pay its share of the off-label use the drug (the Food and Drug Administration has only approved Afinitor for kidney and pancreatic cancer, not breast cancer), was $2,900.

  “She can’t afford this, even though it’s potentially a less toxic and potentially equally effective regimen,” Gralow said. “Chemo will help her, and it’s a reasonable choice. But that choice is 100 percent driven by economics.” ...

  But an economic drama that neither side wants to confront is playing itself out in cancer wards and oncologists’ offices across the country. Unaffordable new drugs, even when they’re covered by insurance, are being rationed by price as patients, doctors and hospital officials struggle with what is likely to be the most pressing problem for the nation’s health care system over the next decade: how to pay for the spectacular rise in the cost of cancer care, especially drugs and diagnostic tests.

• Wall Street Journal: An Rx? Pay More to Family Doctors. By Christopher Weaver and Anna Wilde Matthews. Excerpts: The nation's second-largest health insurer is shaking up its approach to paying doctors, putting a major investment behind the idea that spending more for better primary care can save money down the road. Starting this summer, WellPoint Inc., which insures some 34 million Americans, will offer primary-care doctors a fee increase, typically of around 10%, with the possibility of additional payments that could boost what they get for treating the patients it covers by as much as 50%. The new approach could pour an additional $1 billion or more into primary care, which WellPoint is betting will pay off in the form of fewer emergency-room visits and hospital stays.

  Primary-care doctors, such as pediatricians and family physicians, often make less than half of what top-paid specialists like orthopedic surgeons earn, and the idea of changing how they are paid has been around for years. Insurers and government agencies are experimenting with a variety of approaches. But WellPoint, with its network of about 100,000 primary-care doctors, could have a much broader influence.

• Washington Post: The state of Massachusetts health reform, in 3 charts. By Sarah Kliff. Excerpts: Health Affairs is out this afternoon with a four-year look back at Massachusetts health reform. It has some good news (coverage has gone up!) and not-so-good news (health care isn’t getting any cheaper). With the Massachusetts reforms serving as the model for the federal law, it’s worth taking a look at what has and hasn’t worked in the Bay State reforms.

  The clearest effect is an increase in health insurance coverage, going from 86.6 percent of adults with health insurance in 2006 to 94.2 percent in 2010. As the above chart shows, most of the coverage gains came in the first two years of the health reform efforts, and have remained relatively stable ever since.

  An increase in coverage has correlated with another encouraging trend: a decrease in more costly forms of health coverage, such as emergency room visits. That turns out to be a more recent development, with rates of emergency room visits dropping 3.5 percent between 2009 and 2010.

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.

• New York Times op-ed: Breach of Trust. By Paul Krugman. Full excerpt: Since I just gave Larry Summers a bit of a hard time over that distressing Dec. 2008 memo to Obama, this is probably a good time to note that way back when he and Andrei Shleifer wrote an essay on the economics of leveraged buyouts (pdf) that is very worth reading now that Mitt Romney is running on the theme that his Bain experience means that he knows how to create jobs.

  Summers and Shleifer argued back in 1988 that buyouts are often aimed at “value redistribution” rather than “value creation”; specifically, a lot of the gains to the buyout specialists come from breaking implicit contracts with “workers, suppliers, and other corporate stakeholders.”

  They make one especially keen point: if it were really about adding efficiency, why do the same people lead takeovers in many industries, instead of people with specific expertise in each industry doing the job? Their answer is that these specialists are specialists in deal-breaking, not value creation.

  Jim Surowiecki has more about how that game is played nowadays, with an especially fruitful discussion of the Harry and David’s case. (Sorry, couldn’t help myself). He also notes that often the result of these manipulations is to put taxpayers on the hook.

• Financial Times: Private equity profits called into question. By Dan McCrum. Excerpts: Private equity has proved better at enriching its own managers than producing investment profits for US pension funds over the past decade, according to a study prepared for the Financial Times by academics at Yale and Maastricht University. ...

  From 2001 to 2010, US pension plans on average made 4.5 per cent a year, after fees, from their investments in private equity. In that period, the pension funds paid an average 4 per cent of invested capital each year in management fees. On top of those, private equity often collects a variety of other fees and a fifth of investment profits.

  “Assuming a normal 20 per cent performance fee, this would amount to about 70 per cent of gross investment performance being paid in fees over the past 10 years,” said Professor Martijn Cremers of Yale.

  Selected reader comments concerning this article follow:

  • And the PE profits come from tax breaks:

    (1) by substiuting debt for equity and leveraging up the companies the PE firms get a tax break on the debt which significantly enhances post tax returns.

    (2) If a PE investor is only paying 15% tax on the profits then he can outbid a 35% tax payer for the deal but still get a better post tax return.

    So a real 35% tax paying business who would actually invest in a target company is outbid by a PE firm who then proceeds to strip the cash and assets out to leverage it up in order to make a short term buck.

    Throw in a few pre-package bankruptices and outsourcing to India or China and no wonder the US manufacturing industry is on its last legs.

    Meanwhile the PE barons who prosper from these tax breaks (and who completely understand where their disgusting wealth comes from) have the gall to compare politicians to Nazis just because the politicians may take their 15% tax break away. (Historical note for certain PE firm heads - the Nazis are famous for the systematic murder of millions of people, not for their tax policy, and to suggest otherwise is an insult to those who lost their lives).

    If the US public elect Mitt Romney then it really would be a triumph of money politics plus gross ignorance over the US's original democratic deals. You can wave goodbye to the American Dream forever because it won't be coming back.

  • This is basically the general pattern of the American business scene in the past 30 years, here applied on the private equity industry. This pattern that I'm referring to is not at all about "rich people" getting richer and the rest getting poorer. This over-simplification of our problem may end up rather missing the actual target: yes, of course, cutting the income tax or the estate tax is beneficial to all well-off people. But under the surface, the biggest benefactor have been specifically corporate executives, finance and non-finance. This is yet another instance: the losers are the investors, rich or poor, and the winners the executives.
  • When I queried why PE managers have to charge fees based on commitment and not actual investment, the answer always is the PE managers have to do a lot of research to find the right companies before they can invest. How come we now have fund managers in the UK ie Fundsmith, Bedlam who are committed to not charging any management fee until the pooled funds produce a positive return? Have we been sold a pup?
• New York Times opinion: Taking Up Taxes on the Campaign Trail. By Andrew Rosenthal. Excerpts: Republican politicians talk a great deal about saving small businesses, and routinely play the mom-and-pop card when arguing against raising taxes, or charging a decent minimum wage, or providing everyone with access to health insurance. Last year, when the Senate was debating how to pay for a renewal of the payroll tax cut, Democrats proposed a surcharge on incomes over $1 million a year. Republicans screamed that this would hurt small businesses, and hence the economy, because small businesses are “job creators.”

  They want to conjure the image of a haberdashery passed down from generation to generation, or of a guy who had a great idea for a gizmo and built a small company to make it. Those enterprises are well worth nurturing, and they do provide jobs. But new research shows that a mere 1 percent of small business owners (there’s that pesky 1 percent again) make more than $1 million a year and only a fourth of the nation’s small businesses pay any wages at all.

  So what do those Republicans mean by “small business job creator”? They’re using a conveniently overbroad definition that includes partnerships and S-corporations – like hedge funds, accounting firms, law and lobbying practices and other often very big enterprises in terms of revenue or number of employees. Many of these would be “hurt” by higher taxes only in the sense that their very rich owners would be affected by them. The family farm isn’t on the line.

• New York TImes: A Raucous Hazing at a Wall St. Fraternity. By Kevin Roose. Excerpts: The chandelier-filled ballroom was teeming with 200 men in tuxedos — and a smattering of women — whose daily decisions can collectively make or break the global financial markets. Most were picking over a lavish dinner that included rack of lamb and crème brûlée. Others were preparing to sing bawdy show tunes. Kappa Beta Phi, an exclusive Wall Street fraternity whose members include big-name bankers, hedge fund billionaires and private equity titans, met at the St. Regis Hotel in Manhattan on Thursday night for its 80th annual black-tie dinner and induction ceremony.

  As always, the event was held in strict secrecy, with members being told that “what happens at the St. Regis stays at the St. Regis.” A reporter, however, was able to walk in unquestioned and observe the proceedings. ...

  The Occupy movement was fodder for several after-dinner skits. In one, a documentary filmed during the protests, James Lebenthal, a bond specialist, joked with a protester whose face was appeared to be tattooed. “Go home, wash that off your face, and get back to work,” Mr. Lebenthal told the protester. ...

  In another skit, William Mulrow , a senior managing director at the Blackstone Group, put on raggedy clothes to play the part of an Occupy protester. Emil W. Henry Jr., a managing partner at Tiger Infrastructure Partners and a fellow new Kappa, joined him dressed as a wealthy baron.

  “Bill, look at you! You’re pathetic, you liberal! You need a bath!” Mr. Henry said, voice full of mock indignation.

  “You callow, insensitive Republican!” Mr. Mulrow said. “Don’t you know we need to create jobs?” ...

  The night’s agenda was twofold: install officers for the coming year and haze incoming members by having them don wigs, gold-sequined skirts and skin-tight tops and put on a comedic variety show for the enjoyment of other members. Among the 21 inductees featured in the variety show were Marc Lasry, the billionaire founder of the Avenue Capital Group, Warren Stephens, the chief of Stephens Inc. and Ted Virtue, the chief executive of MidOcean Partners. ...

  While they may not want to attract attention publicly, the members of Kappa Beta Phi are privately finding humor in their vilification. As the night’s musical finale, the entire group of inductees changed into white dress shirts and dark ties to sing a parody of “I Believe,” a song from the hit Broadway show “The Book of Mormon.” In the original version of the song, a down-and-out Mormon missionary offers a passionate defense of his faith. On this night, though, the financiers turned it into a playful paean to their industry. (“I believe that the Lord God created Wall Street. I believe he got his only son a job at Goldman Sachs.”)

• Washington Post: Mitt Romney’s tax returns shed some light on his investment wealth. By Lori Montgomery, Jia Lynn Yang and Philip Rucker. Excerpts: Mitt Romney offered a partial snapshot of his vast personal fortune late Monday, disclosing income of $21.7 million in 2010 and $20.9 million last year — virtually all of it profits, dividends or interest from investments. None came from wages, the primary source of income for most Americans. Instead, Romney and his wife, Ann, collected millions in capital gains from a profusion of investments, as well as stock dividends and interest payments. ...

  According to his 2010 return, Romney paid about $3 million to the IRS, for an effective tax rate of 13.9 percent. ...

  Because the bulk of Romney’s income flows from investment profits, it is taxed at a flat 15 percent rate, far below the highest rates on ordinary wages. ...

  The returns confirm, however, that Romney continues to benefit from his association with Bain Capital, the private-equity firm he founded in 1984 and left in 1999. His earnings through Bain have drawn controversy because they are treated as capital gains rather than wages and thus benefit from being taxed at the lower rate of 15 percent.

  Critics say such income, known as “carried interest,” should not be counted as investment earnings because private-equity partners are mostly relying on the money of others rather than their own. The returns show that Romney earned more than $13 million in “carried interest” over the past two years.

• AlterNet: Mitt's Tax Returns--He Earns as Much in a Week from Investments as the 1% Does in a Year. But the sheer size of Mitt's moneypile isn't really the issue here, it's how little of that income he pays in taxes--compared to people in lower tax brackets and his own.

  As Alex Seitz-Wald at ThinkProgress highlights in his rundown of facts about the Romney tax returns:

  Romney paid a lower tax rate than many middle-class Americans: Romney’s returns reveal that he paid an effective tax rate of 13.9 percent, lower even than the low rate of 15 percent he estimated he paid last week. While this is far less than what many middle-class Americans pay, it’s also well below what wealthy people pay. The average effective tax rate for someone in Romney’s income bracket is 25 percent.

• New York TImes: Romney Tax Returns Show 2-Year Income of $45 Million. By Michael D. Shear, Jeff Zeleny and Jim Rutenberg. Excerpts: “I pay all the taxes that are legally required and not a dollar more,” Mr. Romney said during Monday night’s debate. “I don’t think you want someone as the candidate for president who pays more taxes than he owes.” ...

  Mr. Gingrich, who on Saturday won the Republican presidential primary in South Carolina, released his own tax returns last week showing that he and his wife, Callista, had an adjusted gross income of $3,162,424 from their various business ventures in 2010. They paid $994,708 in federal tax, according to the return, for an effective tax rate of 31.7 percent.

  Mr. Obama and his wife, Michelle, released their tax returns in April, showing an adjusted gross income of $1,728,096 for 2010 — much of it from sales of his books “Dreams From My Father” and “The Audacity of Hope.” The Obamas paid $453,770 in federal taxes, for an effective tax rate of 26.3 percent. ...

  In a memorandum to reporters on Sunday, Bill Burton, a former deputy press secretary to Mr. Obama, hammered Mr. Romney for his initial unwillingness to release his returns. “Even though he is worth hundreds of millions of dollars, Romney pays a lower tax rate than many middle class Americans,” said Mr. Burton, who now runs a “super PAC” on behalf of Mr. Obama. “Romney also has access to complicated legal maneuvers involving offshore accounts and retirement savings that simply are not available to everyday Americans,” Mr. Burton said.

• Financial Times: Romney feels heat from party over taxes. By Anna Fifield. Excerpts: Mitt Romney is coming under fire from both Republicans and Democrats for keeping some of his money in offshore tax havens, as the onslaught over his wealth continues to hamper his efforts to win the GOP’s presidential nomination. ...

  Newt Gingrich, the candidate with the momentum after a resounding win in the South Carolina primary and a string of positive poll numbers, has been stepping up his attacks on Mr Romney over his tax returns. “You have to live in a world of Swiss bank accounts and Cayman Island accounts and making $20m for no work, to have some fantasy this far from reality,” Mr Gingrich said during a forum in Miami hosted by Univision, the Spanish language television channel.

• Huffington Post: Warren Buffett: 'My Side Has Nuclear Bomb' In Tax Code Struggle. By Harry Bradford. Excerpts: Warren Buffett has a lot that his assistant Debbie Bosanek does not, including a figurative arsenal to fight for lower taxes. After ABC interviewer Bianna Golodryga cited claims by Republicans that the tax code debate is a form of class warfare, Buffett admitted that, while he wouldn't use that term, the tax code is inherently "a struggle." The problem, however, is that people like his assistant lack the artillery to compete.

  "If this is a war, my side has had the nuclear bomb," Buffett told ABC News. "We've got K Street and lobbyists. We've got money on our side in terms of contributions." "Deb doesn't have the lobbyists. She doesn't have anyone remotely representing her." ...

  Buffett's remark echos previous comments, such as when he described the battle between rich and poor as "a rout," his side victorious. The tax issue was highlighted again this week when Republican presidential candidate Mitt Romney released his tax returns. Romney's returns indicate that in 2010, he paid taxes at about a 14 percent rate -- even lower than Buffett.

• CBS News: Obama details "Buffett Rule," says millionaires should pay at least 30 percent tax rate. By Leigh Ann Caldwell. Excerpts: In his State of the Union speech on Tuesday evening, President Obama expanded on a tax plan he has been discussing for several months: the "Buffett Rule." In his address, he called for people making more than $1 million per year to pay at least a 30 percent tax rate.

  Taxes and tax rates have been a hot-button issue in recent years as a way to pay for an increase in government spending and a rising deficit and debt. And in recent days, tax rates have gotten even more attention due to the release of GOP presidential candidate Mitt Romney's tax returns which show he paid less than 14 percent in taxes on $21.7 million of income in 2010 because his income came from investments rather than a salary. ...

  The idea was named after billionaire Warren Buffett after he pointed out that he pays a lower tax rate than his secretary because the capital gains tax on investment income is 15 percent, far less than the highest tax bracket of 35 percent. Buffett's secretary, Debbie Bosanek, was among First Lady Michelle Obama's guests for the State of the Union speech.

• The New Yorker: Private Inequity. By James Surowiecki. Excerpts: At this point, the people who run America’s private-equity funds must be ruing the day Mitt Romney decided to run for President. His fellow Republican candidates, of all people, have painted a vivid picture of private-equity firms—including Bain Capital, where he worked for fifteen years—as job-destroying vultures, who scavenge the meat from American companies and leave their carcasses by the side of the road. Not since the days of “Wall Street” and “Barbarians at the Gate” have the masters of leveraged buyouts looked quite so bad. ..

  The real reason that we should be concerned about private equity’s expanding power lies in the way these firms have become increasingly adept at using financial gimmicks to line their pockets, deriving enormous wealth not from management or investing skills but, rather, from the way the U.S. tax system works. Indeed, for an industry that’s often held up as an exemplar of free-market capitalism, private equity is surprisingly dependent on government subsidies for its profits. Financial engineering has always been central to leveraged buyouts. In a typical deal, a private-equity firm buys a company, using some of its own money and some borrowed money. It then tries to improve the performance of the acquired company, with an eye toward cashing out by selling it or taking it public. The key to this strategy is debt: the model encourages firms to borrow as much as possible, since, just as with a mortgage, the less money you put down, the bigger your potential return on investment. The rewards can be extraordinary: when Romney was at Bain, it supposedly earned eighty-eight per cent a year for its investors. But piles of debt also increase the risk that companies will go bust.