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    Highlights—March 4, 2006

  • Philadelphia Inquirer: What you need if pension fades. By Jeff Brown. Excerpts: Pensions are in peril. Some employers are cutting benefits. Others, such as IBM, are freezing their plans so that employees will stop building benefits after a given date. Troubled companies dump their pension plans on the federal government, which may pay less than participants were promised. Even if nothing bad has happened to your pension yet, it could. Which raises an obvious question: How do you make up for the loss?
    One-third is too much for most How many people can save one-third of their income? Not many. There's no getting around it: Loss of a pension you'd been planning on can be devastating.
    • "fhawontcutit" comments. Full excerpt: Not as devastating as losing your retiree health insurance and being unable to get coverage
  • CRN: Where's 'Waldo' Palmisano Going To Be During IBM's PartnerWorld? By Robert Faletra. Excerpts: There are some things in business I just don’t get. Maybe I’m dense. Maybe I have no concept of the demands on a top executive’s time. Maybe I’m all wet when it comes to believing that the top dog ought to show up once a year to address the very partners from which his company is asking and expecting more loyalty. Hey, maybe I’m all of those, but I don’t think so, and neither do you.
    Sam Palmisano, IBM’s chairman and CEO, has decided for the second year in a row that PartnerWorld, the once-a-year gathering of the company’s best worldwide solution providers, is something he can take a pass on. So let me get this right. IBM has asked thousands of solution providers from all over the world to fly to Las Vegas for four days. To take time away from their customers in order to hunker down and learn more about IBM’s product lineup, marketing plans, strategic direction, etc., so that they can go back home and make more money for IBM. But it’s not important enough for the chief executive to summon the corporate jet, wing in for a 45-minute speech to charge up this channel and show IBM’s commitment in kind? Sounds strange. There must be a reason. [...]
    His decision to skip out for a second straight year is disheartening not only to the partners but to those inside the IBM channel organization who work extremely hard at making the IBM channel work. IBM spends millions of dollars pulling off the PartnerWorld event each year. If it’s worth that kind of time, money and effort on the part of the organization to hold it, then it’s worth a day of the CEO’s time to fly to Las Vegas, give a speech and meet with some very important customers.
  • New York Times: Two Tiers, Slipping Into One. By Louis Uchitelle. Excerpts: Caterpillar is adding a significant chapter to the labor cost-cutting that is widespread in America, particularly at old-line manufacturing companies. Until recently, cutbacks in the wages and benefits of hourly workers were limited mostly to money-losing companies: failing steel mills, for example, and struggling airlines. They have said that their survival was at stake. Now, however, even healthy and highly profitable companies like Caterpillar are engaging in the practice, and as they do so, the longstanding presumption that factory workers at successful companies can achieve a secure, relatively prosperous middle-class life for themselves and their families is evaporating.
    "Caterpillar is a powerful symbol of this process," said Harley Shaiken, a labor economist at the University of California, Berkeley. "It dominates its field. It is one of America's largest exporters, and it is very profitable. If there ever was a company that could bring back the social contract of the mid-20th century, it is Caterpillar. But it chooses not to." [...]
    ATERPILLAR, meanwhile, is prospering. It reported revenue of $36.34 billion last year, up 20 percent from 2004. That was on top of a 33 percent increase in 2004 from 2003. Net income was up 40 percent last year, to $2.85 billion; it has nearly tripled since 2003. Tens of millions of dollars have gone into research to develop a great variety of Caterpillar products that sell against those of Komatsu and Volvo, the two biggest foreign competitors. In the past, such gains would have also translated into higher wages and more generous benefits as contracts were renegotiated every two or three years. But the current, long-term U.A.W. contract at Caterpillar calls for just one general raise: 2 percent in December 2008. [...]
    Fixed monthly pensions go now only to veteran workers, like Mr. Doty, and job security is effectively canceled for new hires, who must work 12 years without interruption to become immune to layoffs. Mr. Glynn notes that the arrangement gives Caterpillar leeway to shed the new workers when demand turns down for the company's products.
  • New York Times: Graduates Versus Oligarchs. By Paul Krugman. Excerpts: Ben Bernanke's maiden Congressional testimony as chairman of the Federal Reserve was, everyone agrees, superb. He didn't put a foot wrong on monetary or fiscal policy. But Mr. Bernanke did stumble at one point. Responding to a question from Representative Barney Frank about income inequality, he declared that "the most important factor" in rising inequality "is the rising skill premium, the increased return to education."
    That's a fundamental misreading of what's happening to American society. What we're seeing isn't the rise of a fairly broad class of knowledge workers. Instead, we're seeing the rise of a narrow oligarchy: income and wealth are becoming increasingly concentrated in the hands of a small, privileged elite.
    I think of Mr. Bernanke's position, which one hears all the time, as the 80-20 fallacy. It's the notion that the winners in our increasingly unequal society are a fairly large group — that the 20 percent or so of American workers who have the skills to take advantage of new technology and globalization are pulling away from the 80 percent who don't have these skills.
    The truth is quite different. Highly educated workers have done better than those with less education, but a college degree has hardly been a ticket to big income gains. The 2006 Economic Report of the President tells us that the real earnings of college graduates actually fell more than 5 percent between 2000 and 2004. Over the longer stretch from 1975 to 2004 the average earnings of college graduates rose, but by less than 1 percent per year. [...]
    A new research paper by Ian Dew-Becker and Robert Gordon of Northwestern University, "Where Did the Productivity Growth Go?," gives the details. Between 1972 and 2001 the wage and salary income of Americans at the 90th percentile of the income distribution rose only 34 percent, or about 1 percent per year. So being in the top 10 percent of the income distribution, like being a college graduate, wasn't a ticket to big income gains.
    But income at the 99th percentile rose 87 percent; income at the 99.9th percentile rose 181 percent; and income at the 99.99th percentile rose 497 percent. No, that's not a misprint.
    Just to give you a sense of who we're talking about: the nonpartisan Tax Policy Center estimates that this year the 99th percentile will correspond to an income of $402,306, and the 99.9th percentile to an income of $1,672,726. The center doesn't give a number for the 99.99th percentile, but it's probably well over $6 million a year.
  • Yahoo! finance board message post by "respectfortheindividual". Full excerpt: Right Garce you hit it almost on the head. IBM never paid the highest wages in the old days. They got the people they wanted because they offered great benefits, great job security and a great place to work. People knew if they were loyal to the company and did their job in an exemplary fashion the Company would take care of them. Simply a great place to work. Now they are in a bidding war for prostitutes who don't care where they work, what the benefits are, what the retirement is or how they get treated. Just how much pay NOW. You end up with employees like del!!!!
  • Yahoo! finance board message post by "idoubtitagain". Excerpt: I once heard directly from a PDM, that the "policy" was for employees to not be considered long term, rather short term. What this indicates is that IBM is now a learning lab, in which inexperienced resources are hired for a short time, learn something of their job and how it relates to IBM's massive cross-towers and then are terminated within 3-5 years.
    This resource churn and loss of experience base affects all aspects of customer support, projects, product delivery, production support in a negative way. The current "theory" is that reusable work products, stored in virtual databases, can be accessed and used and that resources aka. employees and their intellectual property are expendable.
    The actuals is that entire customer and informal employee relationship networks as well as employee moral are being destroyed as the ones left following "resource actions" struggle and burn out to meet requirement deadlines and the productivity declines accordingly.
    Productivity is directly based on knowledge base and the experience level of the employee, this reduction in productivity and moral has negative impacts on profits, revenue, SLA's and thus shareholder return. As long a finance drives the resource actions this will occur.
  • Technology Marketing Corporation: Enron, IBM, ATT, Verizon Pension Victims to Describe Huge Losses, 1 p.m. Today, National Press Club, Pepper Foundation News Conference. Excerpts: The panel of pension loss victims will include an Enron worker in his 70s who had $1.3 million savings in Enron stock and wound up with $8,000; an IBM 26-year manufacturing employee, with a cash balance pension now valued at less than one-year's salary; an ATT worker receiving half the annual amount promised, and who lost promised health insurance; and a Verizon female employee who lost $300,000.
    A news forum at the National Press Club Monday, Feb. 27 on "Disintegrating Private Pensions National Crisis: Call to Action", sponsored by the Claude Pepper Foundation and Center, will include a panel of pension loss victims from across the country currently or recently employed by Enron, IBM, ATT, and Verizon, and a panel of policy experts from the AFL-CIO, the Pension Rights Center, Ernst and Young, Ameriprise, and the Claude Pepper Center at Florida State University.
  • The Nation: The Party of Davos. By Jeff Faux. Excerpts: The world's movers and shakers are convening once again in January at the annual World Economic Forum in Davos, the posh ski resort nestled in the Swiss Alps. Attendance is invitation-only, enforced by police barricades, razor wire and the latest high-tech military hardware to guard against terrorists, protesters and curious local citizens.
    Some 2,000 people will show up to discuss the world's problems as defined by those who own and manage the great global concentrations of wealth (Microsoft, Citigroup, Siemens, Nestlé, Nomura Holdings, Saudi Basic Industries, etc.). Their guests include prominent political leaders, international bureaucrats, academics, consultants and media pundits--with a few NGO and labor union officials sprinkled along the edges to demonstrate diversity. [...]
    But as domestic markets become global, investors increasingly find workers, customers and business partners almost anywhere. Not surprisingly, they have come to share more economic interests with their peers in other countries than with people who simply have the same nationality. They also share a common interest in escaping the restrictions of their domestic social contracts. [...]
    Given the influence of American elites, the model for this constitution is the North American Free Trade Agreement, conceived under Ronald Reagan, nurtured by George H.W. Bush and delivered by Bill Clinton. Among other things, NAFTA's 1,000-plus pages give international investors extraordinary rights to override government protections of workers and the environment. It sets up secret panels, rife with conflicts of interest, to judge disputes from which there is no appeal. It makes virtually all nonmilitary government services subject to privatization and systematically undercuts the public sector's ability to regulate business. Jorge Castañeda, later Mexico's foreign secretary, observed that NAFTA was "an agreement for the rich and powerful in the United States, Mexico and Canada, an agreement effectively excluding ordinary people in all three societies."
  • Washington Post: Court Blocks DOD's New Rules for Workers. Collective Bargaining Hurt, Judge Says. By Christopher Lee. Excerpts: A federal judge blocked the Defense Department from implementing much of its new personnel system yesterday, handing the Bush administration a major setback in its efforts to streamline work rules and install pay-for-performance systems in federal workplaces. [...]
    "Taken as a whole, the design of these regulations appears to rest on the mistaken premise that Congress intended flexibility to trump collective bargaining rights," wrote Sullivan, who noted that the new regulations "entirely eviscerate collective bargaining." The ruling marked the second time in six months that a federal judge has stiff-armed the Bush administration in its ambitious plans to rewrite federal personnel rules to curtail the power of labor unions, more strongly tie pay raises to job performance, and make it easier to hire, promote and discipline federal employees.
  • Communications Workers of America (CWA): The Era of Broken Promises for Workers: From New Deal to Raw Deal. By Larry Cohen, President. Excerpts: Rather than joining us in pressing Congress and the White House for a national solution to the health care crisis, nearly all employers would rather offload their mounting medical costs onto workers. And many non-union employers simply drop health coverage, as more than a quarter of a million did over the last five years.
    As stories in this CWA News describe, such employer behavior merely compounds the crisis. About 46 million Americans have no health coverage at all, and subsidizing their care continues to drive up insurance premiums for the rest of us and also hand taxpayers higher costs for state health programs. [...]
    On another front, worker retirement security is under assault as never before as corporations line up to freeze traditional defined benefit pension plans and jettison health coverage for retirees. [...]
    And now, some of America's wealthiest corporate icons like Verizon and IBM have frozen their traditional pensions – in Verizon's case, for non-represented workers with no union contract to protect them. It wasn't long before Sprint Nextel and other healthy companies joined this shameful parade.
    What you hear is the shattering of an informal social contract among government, business and labor that developed in the post-World War II years. In the spirit of the New Deal, and with organized labor representing 35 percent of the private sector – then a powerful force – employer-provided health care and pensions became a public policy model in those years. Government gave employers tax breaks to provide benefits, and workers and unions lowered wage demands in return for them.
    Now we are in the era of broken corporate promises and a government policy that it characterizes as the "ownership society," which for workers essentially means, "You're on your own."
  • bizjournals.com, courtesy of Yahoo! finance: Abt Associates buys IBM unit. Excerpt: Abt Associates has acquired an IBM Corp. unit that consults for the U.S. Agency for International Development. The companies did not initially provide financial details on the transaction. Abt provides scientific and technical consulting for government agencies and industry. The firm is based in Cambridge, Mass., and employs more than 1,000 people. BM acquired the unit in 2002 via its acquisition of PricewaterhouseCooper International Ltd.'s consulting practice. The unit consults on privatization, trade, finance, and tax reform in developing countries.
  • Fortune, courtesy of CNN-Money: Shanghaied in Florida. The story of one of the first U.S. companies to fall into Chinese hands doesn't exactly hew with anyone's vision of Chinese corporations taking over the world. Alachua, Fla. (Pop. 7,020), is an unlikely place to look for signs of Chinese global domination. But look again. Along a lush stretch of U.S. Highway 441 about 12 miles northwest of Gainesville sits a rechargeable-battery factory. Its name: Moltech, or as it's known to its Chinese owners, Motaike, a transliteration whose characters mean "magic power."
    There-and-a-half years ago--before Chinese computer company Lenovo bought IBM's PC business, before Haier bid for Maytag, before the Chinese National Offshore Oil Corp. tried to buy Unocal--Moltech was among the very first American companies, maybe the first, to fall into Chinese hands. [...]
    On a recent morning, Huston walks through what's left of the Moltech factory in Alachua. Hanging on the walls are vestiges of the company's former glory: 40 framed patent certificates and a photo of White Lightning, an electric car powered by Moltech batteries that in 1999 went 254 miles per hour, breaking the land-speed record.
    Nearly all the battery-making equipment is now in Shanghai, so the factory is deserted, and Huston is selling off what's left: 40,000-pound containers of unused chemicals that someone in Singapore wants to buy; hundreds of desks and file cabinets no longer in use. "I feel like a ghost being here," Huston says. Moltech has fewer than 20 employees remaining in Alachua. There are no full-time managers from the parent company at the site; the people who run Moltech are in Shanghai, and the company itself is embedded deep within a bureaucratic maze.
  • New York Times: Wal-Mart Critics Cite Health Insurance. Excerpts: One of Wal-Mart Stores Inc.'s most vociferous critics launched a campaign Tuesday with 17 current and former Wal-Mart workers speaking out against health insurance coverage they claim is too expensive, leaving them uninsured or on taxpayer funded programs. News conferences by the workers in eight states Tuesday and four more scheduled later this week and next are timed to help a union-backed drive for legislation that would require the world's largest retailer to pay a fixed percentage for health coverage of its 1.3 million U.S. workers. [...]
    In workers' stories collected ahead of the news conferences by the group, several current employees talk about being unable to afford premiums and deductibles even after working for Wal-Mart for several years. Dana Razaie has been a stocker at a Wal-Mart in Fridley, Minn., for about five years. She said she depends on state-funded MinnesotaCare for health coverage for herself and three children.
    According to WakeUpWalMart, Razaie's wage of $11.29 an hour at Wal-Mart and a second job at a gas station leave her with take-home pay of less than $20,000 a year. Razaie says she cannot afford Wal-Mart's health insurance plan with $300 monthly premiums and deductibles reaching over $1,000.
  • Birmingham Business Journal, courtesy of MS-NBC: Burden of retirement plan is shifting to the individual. By Tiffany Ray. Excerpts: "The days of the corporation really taking care of your retirement are well over," says John Norris, senior fund manager and chief economist for Morgan Asset Management, a subsidiary of Birmingham-based Regions Financial Corp. "It is up to young people to plan for their entire retirement," he says. "Not just some of it, all of it."
  • Physicians for a National Health Program: Insurers' Study Tries to Whitewash Truth that Skimpy Coverage Causes Medical Bankruptcy. Excerpts: The 2005 study of medical bankruptcies was among the most widely cited health policy stories of the year. Based on interviews with debtors in bankruptcy courts across the nation, the study found illness contributed to over 700,000 families’ bankruptcies annually. Most of those driven to financial ruin by illness were solidly middle class, and three quarters of the families had insurance when they first got sick, although many lost coverage when the illness caused job loss. Many who managed to keep their private insurance found that gaps in coverage - co-payments, deductibles and uncovered services - left them unprotected. [...]
    The Harvard group noted that our paper garnered public attention because it resonated with the abuse that Americans suffer at the hands of our health finance system, abuse shared by the uninsured and middle class.・ Study author Dr. David Himmelstein, a Harvard Associate Professor of Medicine commented: health insurance companies charge outrageous premiums for defective policies. Their executives and shareholders pocket vast sums, raking off money that should go for care. In 2004, insurance companies spent $95 billion on overhead and profits. Bill McGuire, CEO of UnitedHealth pocketed $124.8 million. Now they ・and the White House - want to cut coverage, pushing families into so-called Consumer Directed Plans with huge deductibles. The inevitable result will be bigger profits for insurers and more families bankrupted by illness. Americans need comprehensive national health insurance, not the ever skimpier coverage pushed by AHIP.・
  • Computerworld: Protectionism no way to counter offshoring, Bush says. He wants to see more H-1B visas for Indian engineers, scientists and physicists. Excerpt: In a news conference yesterday in Delhi, Bush said he would like more H-1B visas to be issued to Indian engineers, scientists and physicists. The current H-1B visa limit of 65,000 a year has proved inadequate for India's outsourcing industry, according to the industry.
  • The Times of India: US to boost India as health tourism destination. Excerpts: Visiting US President George W. Bush announced a contribution of $7 million for the India-US Corporate Fund for HIV/AIDS that is managed by GIVE Foundation and ICICI Bank. The India-US joint programme on HIV/AIDS began in 2000. Looking to the future, the two sides said health tourism from the US to India was an area with "enormous potential for collaboration". Given India's "world-class medical care facilities at reasonable costs, the two countries could leverage Indian expertise for their economic and social benefit". [...]
    India and the US will work to harmonise their healthcare systems and develop specialized medical insurance and legal packages for US patients to boost health tourism. Efforts will also be made for the accreditation of Indian healthcare institutions and professionals in the US.
  • IDG News Service: House Republicans push 'innovation' agenda. Move to improve U.S. competitiveness with countries such as India and China. By Grant Gross. Excerpts: Republican leaders in the U.S House of Representatives announced a plan Wednesday to push legislation designed to make the U.S. more competitive in world markets, including a bill that includes a research and development (R&D) tax credit and incentives for health care IT. [...]
    The bill focuses on providing educational incentives for math and science students and reducing "abusive" lawsuits against U.S. businesses, in addition to an R&D tax credit and incentives for health-care facilities to improve their use of IT. Neither Goodlatte's, Smith's or Hastert's offices had immediate information on the details of the bill.
  • CounterPunch courtesy of SmirkingChimp.com: 'When you can't obscure the news, buy it: How the economic news is spun'. By Paul Craig Roberts. (Paul Craig Roberts was Assistant Secretary of the Treasury in the Reagan administration. He was Associate Editor of the Wall Street Journal editorial page and Contributing Editor of National Review. He is coauthor of The Tyranny of Good Intentions.)
    Excerpts: When the US Department of Labor, for example, releases the monthly payroll jobs data, the press release will put the best spin on the data. The focus is on the aggregate number of new jobs created the previous month, for example, 150,000 new jobs. That sounds good. News reporters report the press release. They do not look into the data to see what kinds of jobs have been created and what kinds are being lost. They do not look back in time and provide a net job creation number over a longer period of time.
    This is why the American public is unaware that higher paid jobs in export and import-competitive industries are being phased out along with engineering and other professional "knowledge jobs" and replaced with lower paid jobs in domestic services. The replacement of higher paid jobs with lower paid jobs is one reason for the decline in median household income over the past five years. It is not a large decline, but it is a decline. How can it be possible for the economy to be doing well when median household income is not growing and when economic growth is based on increased consumer indebtedness? [...]
    In India, Collabnet has openings for 8 engineers, a sales engineer, a technical writer, and a telemarketing representative. In the US, Collabnet has openings for one engineer, a receptionist/office assistant, and positions in marketing, sales, services, and operations. Collabnet is a perfect example of what Lou Dobbs and I report: the engineering and design jobs move abroad, and Americans are employed to sell and market the foreign made products.

News and Opinion Concerning Health Savings Accounts and Medical Costs
  • Wall Street Journal: Health Accounts Have Benefits For Employers. By Theo Francis and Ellen E. Schultz. Excerpts: Amid the debate over whether health-savings accounts will fix America's health-care problems, another important effect has received less notice: The accounts are generating savings on payroll taxes for companies that adopt them, and they could hasten a shift of health-care costs from companies to employees.
    The growing acceptance of HSAs accelerates a transition in health-care benefits, from employers providing a safety net to employees taking on more risk. The shift parallels a similar trend away from traditional pensions in retirement benefits. Indeed, HSAs may be poised to become the 401(k)s of health care: a low-cost substitute for a once-standard workplace-provided benefit, which can offer employees greater flexibility but also can increase their financial burdens and risk.
    "I think what [employers] are really after is that they're moving the risk from their balance sheet to the employees," said Richard T. Evans, a health-care analyst with Sanford C. Bernstein & Co. in New York. "The risk is being transferred without the consumer really realizing it," he said.
    Just as the 401(k) -- invented as a supplemental benefit -- ended up supplanting pensions, HSAs could do the same to traditional employee health insurance. Already, companies with HSAs are enjoying savings on payroll taxes that mirror gains they made in the shift to 401(k)s. [...]
    Business groups generally hailed Mr. Bush's proposals, including the National Association of Manufacturers, the insurance industry and the financial-services industry, which is poised to reap billions of dollars in fees from managing money squirreled away in HSAs. [...]
    Even if they don't contribute a cent, employers still get tax benefits. And the more of their own pay employees set aside each year, the bigger their employers' tax breaks. That's because employers ordinarily have to pay a variety of payroll taxes on cash income their employees earn; these taxes fund Social Security, Medicare and state and federal unemployment programs. But under at least some HSA arrangements, employers can skip most of those taxes on employee contributions to the account, bringing the employer savings of as much as 7% to 10%, according to some estimates. If link is broken, view Adobe Acrobat version [PDF--48 KB].
  • Yahoo! message board post by "dchak6": Sorry, Boss. I'm calling in dead... (satire). Full excerpt: "Hello, Boss? I can't come in today. I'm sick, my spouse is sick, and all my kids are sick. And because you dropped my medical coverage, and we cannot afford health care premiums, we are uninsured. So the only thing we can afford now is home care, which includes chicken soup, tea, and plenty of bed rest.
    "I know the original intent of you providing me health care over the years was to keep me healthy so I can show up every day and be productive. But I guess I can understand how that is becoming less affordable for you, too. I mean after all, you've got to think of your CEO's retirement party and all. "Anyway, I should be back to work in a couple of months."

Vault Message Board Posts
Vault's IBM Business Consulting Services message board is a popular hangout for IBM BCS employees, including many employees acquired from PwC.

New on the Alliance@IBM Site:
  • Alliance@IBM: Attention IBM employees: IBM is blocking e-mail to and from the Alliance@IBM e-mail address endicottalliance@stny.rr.com from inside the company. Please send your job cut information and other correspondence from your home e-mail. You can also contact us the following ways: Phone 607 658 9285 or Fax 607 658 9283.
  • To IBM Canada employees: Concerned about pension changes, declining benefits and working conditions? Please contact the e-mail below to find out how to get involved in working for a better future for IBM Canada employees. allianceibm@tngcanada.org
  • Disintegrating Pensions National Crisis: Call to Action. Alliance@IBM Vice-president Earl Mongeon’s remarks presented at o the Pepper Foundation News Conference, National Press Club. Excerpts: Hello. My name is Earl Mongeon. I am 50 years old; I live in Westford, VT and have worked at the local IBM plant for 27 years. I am also Vice President of the Alliance@IBM / CWA Local 1701, an ongoing nationwide union organizing campaign at IBM. I am very concerned with the deterioration of the pension system in this country, not only at IBM but at all corporations. At one time IBM set the standards to follow; now they don’t even know what they are! Over the last 11 years, my pension has been slashed three times. [...]
    Earlier this year, IBM has announced that it is freezing the pension plans at the end of 2007 and will put everybody into a 401(k) plan. Now, after all the changes to my pension, or should I say my promised pension, I will only get about half of what I would have gotten under the original defined benefits plan. This means that I will have to work longer to make up for what has been taken away from me by the IBM executive crooks, and I do mean crooks. These are strong words, but what they have done is steal from the employees.
    The executives lost nothing because in 1994 they put in place a supplemental executive retirement plan known as SERP, before starting to implement the 1995 pension changes. The pension changes allowed them to add millions of dollars to their compensation due to “vapor profit”, or lowering the amount of corporate funds that had to be used to fund the pension plan. (Pension Surplus)
  • From the Job Cuts Status & Comments page:
    • Comment 3/03/06: Something big and nasty is about to occur at Rochester MN. There have been several unconfirmed rumors. One, is to expect major layoffs in April. The second is that the remainder of manufacturing is to be sold to a vendor, probably Fujitsu. The third is that another vendor (Hitachi Global Storage?) will vacate Bldg 114. Bubble, bubble, toil and trouble. Bad stuff cooking in Rochester -Anonymous-
    • Resource action for ISC Procurement happened January 19, 2006. 62 employees cut. Only 10 of these employees were under 40 years old.
  • From the General Visitor's Comment page:
    • Comment 3/2/06: My Vpay results just came in. Last year, rated a 2, it was over $3k. This year, same rating, just barely $2k. Didn't IBM have record profits? This is it. My income has declined in gross and real terms for the last 4 years. Good luck with the global outsourcing Sam. IBM won't be able to execute well for any customer. The spiral downward for this company is only gaining momentum, but the exec's are still getting bonuses. No one in management cares about stockholders or employees. Why should they, they're getting their stock for free or at such a discount that execs are raking it in. The IT job market is turning around. Everyone should do the absolute minimum until IBM compensates for the skewed life balance or until you find other employment. -Anonymous-
    • Comment 3/3/06: IBM shareholders may be given the opportunity to correct a wrong in their next proxy statement. In 1999 IBM took away medical benefits to retirees (people that worked for IBM 30 or more years). Now IBM Executive Management has also "frozen" traditional retirements benefits after 2006. The retirees looked at these benefits as the major reasons why they stayed with IBM, just to have these benefits taken away with a stroke of a pen. Most of these employees worked for 20% to 30% less in salary then what IBM pays new hires to do the same work. These older employees were continuously told by management to not just look at their salary. They were told by IBM management, "Look at the whole package which includes lifetime medical benefits for you and your spouse and your retirement pension"
      IBM executive Management has now taken both of these away leaving the older employees still earning 20 to 30 % less than new hires. All this hurts these old people soon to be living on modest fixed incomes. They are in the worst position to pay for medical benefits. This is not charity, it is a benefit employees worked hard for over 30 years to obtain. Management presents a position that other benefits are being given employees. This will not help old IBM retirees that can't afford medical benefits and now will also lose about 250 thousand additional dollars over their lifetime
      I request you contact your stock market portfolio managers and request they vote for giving medical benefits and traditional retirement pensions back to IBM retirees. Also, contact your government representatives. Join the Union. I just did all these things!
      As an IBM stockholder, I am appalled by IBM management misrepresenting the issue and not taking responsibility to change a bad decision on taking away IBM retiree medical benefits and freezing retirement pensions. Thomas Watson founded this great company on respect for the individual. I do not want to be argumentative by pointing out what appointees to IBM's board members receive in benefits with some for relative short tenure to IBM. The retirees spend 30 plus years of their lives working to make IBM successful in hard times. I believe any IBM executives should see taking away retiree medical benefits and freezing retirement pensions is not the way to treat their colleagues. Sam Palmisano stated he recognizes the contribution of IBM employees. I hope he will put actions behind his words and correct these wrongs. -Anonymous-
    • Comment 3/4/06: Per the comment on 02/27/2006. I'm having to believe IBM no longer gives raises also. My last one was back in 2003. It's been a challenge making ends meet the last few years with no raise and little or no variable bonus/pay. It's even worse now that your manager can play "favorites" since he/she gets to pick the percentage you receive in a range (thanks to the new plan). So much for standing up and voicing an opinion. Tick off your manager now and they can hold it against you come variable bonus time.
      Our Variable "Bonus" was told to us earlier in the week. I know I should be glad to be receiving anything, but after spending over 15 years at IBM, getting a 2% variable bonus is more of an insult than a compliment for all the time given to the company. I remember seeing the numbers back in 1999/2000. If you were a band 10 employee and received a PBC rating of 1, your variable pay was 47% or 49% of your yearly pay. Here I'm glad to receive enough to replace a refrigerator to help the family, where managers were being written variable pay checks big enough to buy a new luxury automobile (or probably in some cases, even a new home!).
      My cube mate has a comic on the wall, it came out many years ago (I think it's Wizard of Id). There are two hard working farmers that have just finished clearing out the barn and tending to the field. One of them says "What will we do when we can no longer perform meaningful work?" The other replies "There's always management." A little bit of humor in a twisted work environment. -Anonymous-
    • Comment 3/4/06: "If my soldiers began to think, not one of them would remain in the ranks." Frederick the Great.
  • Pension Comments page

"The test of our progress is not whether we add more to the abundance of those who have too much; it is whether we provide enough for those who have too little." — Franklin D. Roosevelt
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