The restructuring program will take place over three years and includes a workforce reduction that will streamline the combined company’s services businesses. Workforce reduction plans will vary by country, based on local legal requirements and consultation with works councils and employee representatives, as appropriate. Approximately 7.5 percent of the combined company’s workforce, or about 24,600 employees, will be affected over the course of the program, with nearly half of the reductions occurring in the United States. HP will provide employees affected by this restructuring program with severance packages, counseling and job placement services. HP expects to replace roughly half of these positions over the next three years to create a global workforce that has the right blend of services delivery capabilities to address the diversity of its markets and customers worldwide.
In addition the branch manager I worked for at the time was asked a question about COLAs during one of those 80's buy outs. He did not have an answer so he sent an PROFs message to human resources. The answer also implied COLA's existed but were not called COLA's..The response said that though it is not a part of the normal retirement plan IBM had given these increases in the past and there was no reason to believe that this would change. I started in 66 and retired in 96.
You’ll find the real answer if you spend some serious time with corporate programmers, which I do. It turns out that there’s widespread despondency out there among many pros working for Fortune 500 companies. The bugaboo can be summed up in one word: outsourcing. If I had a nickel for every corporate programmer who told me that they wish they had gone into any field other than programming, I’d have — well, a lot of nickels. The general feeling seems to be: “How can I stake a career on a job that may be gone tomorrow?” And that’s what’s affecting potential CS students as well.
I used to teach classes of 400 to 500 students in the hard sciences at Cornell, and I would sometimes ask them if they ever considered other disciplines. The most common objection to CS was just that outsourcing = death.
The tables and charts illustrate the range of program beneficiaries, from the country's oldest to its youngest citizens. In all, about 55 million people receive some type of benefit or assistance. Judi Papas prepared this chartbook. Staff of the Division of Information Resources edited the chartbook and prepared the print and Web versions for publication.
This issue has reached the point of being one of the most important national concerns and the subject of serious political and economic arguments - not only regarding how the system should be improved, but also whether it should remain being run by the private sector under a free market approach or whether it should be run by the government and made accessible to the entire population. The first option is supported by the arguments that public initiatives often perform poorly and that free-market competition should prevail. Contrarily, the other side claims that the system is only nominally a free market, that empirical evidence shows it's not working as it should, and that other successful healthcare systems are mostly government operated.
As is stands, the health care issue acquired national importance and is presented as a major component of both presidential candidates programs, yet each favoring a different approach to improve accessibility and lower healthcare costs. Republican Senator McCain relies on improving the system by maintaining its current private enterprise, free market characteristics, while Democratic Senator Barrack Obama favours providing universal coverage and lower costs through a higher government intervention in the system. This paper examines the approaches proposed by both candidates and analyses the potential impact their plans may have on the health care system. While the lack of more detailed implementation details makes difficult accessing the effective result of each policy, the comparative review of the alternative approaches presented in this paper will help the reader to to judge for him or herself which could be the more appropriate to upgrade the system and attain a higher performance level.
According to the study: “The McCain plan will force millions of Americans into the weakest segment of the private insurance system — the nongroup market — where cost-sharing is high, covered services are limited and people will lose access to benefits they have now.” The net effect of the plan, the study said, “almost certainly will be to increase family costs for medical care.” ...
The whole idea of the McCain plan is to get families out of employer-paid health coverage and into the health insurance marketplace, where naked competition is supposed to take care of all ills. (We’re seeing in the Bear Stearns, Fannie Mae, Freddie Mac, Lehman Brothers and Merrill Lynch fiascos just how well the unfettered marketplace has been working.)
Taxing employer-paid health benefits is the first step in this transition, the equivalent of injecting poison into the system. It’s the beginning of the end. When younger, healthier workers start seeing additional taxes taken out of their paychecks, some (perhaps many) will opt out of the employer-based plans — either to buy cheaper insurance on their own or to go without coverage.
That will leave employers with a pool of older, less healthy workers to cover. That coverage will necessarily be more expensive, which will encourage more and more employers to give up on the idea of providing coverage at all. ...
This entire McCain health insurance transformation is right out of the right-wing Republicans’ ideological playbook: fewer regulations; let the market decide; and send unsophisticated consumers into the crucible alone. You would think that with some of the most venerable houses on Wall Street crumbling like sand castles right before our eyes, we’d be a little wary about spreading this toxic formula even further into the health care system. But we’re not even paying much attention.
They call this the American Medicine Plan.
None of that is true, of course. I offer this nightmarish fantasy to make the point that the United States has the world's only health care system where everyone plays by his or her own rulebook.
In fact, there is no American health care system. You can talk about the British Medical Service or the German medical system or the Canadian national health plan. But when you describe American health care, there is no one system you can talk about. Medicare is different from Medicaid is different from private insurance is different from no insurance. ...
What troubles me, however, is that whenever Washington tries to overhaul something that involves a large universe of interest groups, it usually makes things not simpler, but more complex. And complexity is already one of the very worst aspects of American health care.
Has anyone been to a hospital for a procedure and not been confounded by the billing process that followed? No wonder hospitals are repeatedly asked, "Do you go out of your way to hire complete idiots for your billing office?"
In fact, just the opposite is true. Hospitals try their best to hire good people and spend a lot of time training them. But the outcomes are usually abysmal because every insurance plan has different rules, different eligibilities and different coding systems.
Not so very long ago, hospitals dealt with only a small number of organizations that paid for medical care. There was Medicare and Medicaid, Blue Cross/Blue Shield and a handful of private insurers. Recently, I asked my chief financial officer how many payers we deal with today. The number shocked even me. He said Johns Hopkins Hospital has to bill more than 700 different payers and insurers.
Nomi Prins used to run the European analytics group at Bear Stearns and also worked at Lehman Brothers. "AIG was acting not simply as an insurance company," she told me. "It was acting as a speculative investment bank/hedge fund, as was Bear Stearns, as was Lehman Brothers, as is what will become Bank of America/Merrill Lynch. So you have a situation where it's [the U.S. government] ... taking on the risk of items it cannot even begin to understand."
She went on: "It's about taking on too much leverage and borrowing to take on the risk and borrowing again and borrowing again, 25 to 30 times the amount of capital. ... They had to basically back the borrowing that they were doing. ... There was no transparency to the Fed, to the SEC, to the Treasury, to anyone who would have even bothered to look as to how much of a catastrophe was being created, so that when anything fell, whether it was the subprime mortgage or whether it was a credit complex security, it was all below a pile of immense interlocked, incestuous borrowing, and that's what is bringing down the entire banking system." ...
The meltdown is a bipartisan affair. Presidential contenders John McCain and Barack Obama each have received millions of dollars from these very companies that are collapsing and are receiving the corporate welfare. President Clinton and his treasury secretary, Robert Rubin (now an Obama economic adviser), presided over the repeal in 1999 of the Glass-Steagall Act, passed after the 1929 start of the Great Depression to curb speculation that caused that calamity. The repeal was pushed through by former Republican Sen. Phil Gramm, one of McCain's former top advisers. Politicians are too dependent on Wall Street to do anything. The people who vote for them, and whose taxes are being handed over to these failed financiers, need to show their outrage and demand that their leaders truly put "country first" and bring about "change."
The Congressional Budget Office reported on Tuesday that the government’s finances are deteriorating rapidly: the budget deficit for this year is expected to reach $407 billion, more than double last year’s shortfall, and to exceed $500 billion in 2009. The takeover of Fannie and Freddie, necessary though it is, will add to the deterioration. Airbrushing that away will only open the door to uninformed — or negligent — decisions on spending and tax cuts.
In essence, Wall Street's biggest players (which, thanks to Gramm's earlier banking deregulation efforts, now incorporated everything from your checking account to your pension fund) ran a secret casino. "Tens of trillions of dollars of transactions were done in the dark," says University of San Diego law professor Frank Partnoy, an expert on financial markets and derivatives. "No one had a picture of where the risks were flowing." Betting on the risk of any given transaction became more important—and more lucrative—than the transactions themselves, Partnoy notes: "So there was more betting on the riskiest subprime mortgages than there were actual mortgages." Banks and hedge funds, notes Michael Greenberger, who directed the CFTC's division of trading and markets in the late 1990s, "were betting the subprimes would pay off and they would not need the capital to support their bets."
Why not make investment banks and other companies pay premiums for this catastrophic risk insurance? The government already provides flood, bank and crop insurance. Unlike participants in those programs, however, the companies that qualify for “too big to fail” insurance do not pay for the privilege.
In clarifying his comments, Mr. McCain lavished praise on workers, but ignored their problems. That is the real insult.
For decades, typical Americans have not been rewarded for their increasing productivity with comparably higher pay or better benefits. The disconnect between work and reward has been especially acute during the Bush years, as workers’ incomes fell while corporate profits, which flow to investors and company executives, ballooned. For workers, that is a fundamental flaw in today’s economy. It is grounded in policies like a chronically inadequate minimum wage and an increasingly unprogressive tax system, for which Mr. McCain offers no alternatives.
As for Wall Street, Mr. McCain blamed the meltdown on “unbridled corruption and greed.” He called for a commission to find out what happened and propose solutions. His diagnosis and his cure are misguided. The crisis on Wall Street is fundamentally a failure to do the things that temper, detect and punish corruption and greed. It was a failure to police the markets, to enforce rules, to heed and sound warnings and expose questionable products and practices.
How did we get here?
That's pretty easy to answer, too. His name is Phil Gramm. A few days after the Supreme Court made George W. Bush president in 2000, Gramm stuck something called the Commodity Futures Modernization Act into the budget bill. Nobody knew that the Texas senator was slipping America a 262 page poison pill. The Gramm Guts America Act was designed to keep regulators from controlling new financial tools described as credit "swaps." These are instruments like sub-prime mortgages bundled up and sold as securities. Under the Gramm law, neither the SEC nor the Commodities Futures Trading Commission (CFTC) were able to examine financial institutions like hedge funds or investment banks to guarantee they had the assets necessary to cover losses they were guaranteeing.
This isn't small beer we are talking about here. The market for these fancy financial instruments they don't expect us little people to understand is estimated at $60 trillion annually, which amounts to almost four times the entire US stock market.
And Senator Phil Gramm wanted it completely unregulated. So did Alan Greenspan, who supported the legislation and is now running around to the talk shows jabbering about the horror of it all. Before the highly paid lobbyists were done slinging their gold card guts about the halls of congress, every one from hedge funds to banks were playing with fire for fun and profit.
Gramm didn't just make a fairy tale world for Wall Street, though. He included in his bill a provision that prevented the regulation of energy trading markets, which led us to the Enron collapse. There was no collapse of the house of Gramm, however, because his wife Wendy, who once headed up the Commodities Futures Trading Commission, took a job on the Enron board that provided almost $2 million to their household kitty. And why not? Wendy got a CFTC rule passed that kept the federal government from regulating energy futures contracts at Enron.
I believe that to get to the root of the matter, we have to address the bad side of greed. We know from Ivan Boesky and Gordon Gecko that greed can be good. Greed makes the world go around; it makes people take risks that ultimately lead to economic or scientific advances. But the greedy must also face the consequences of taking those risks.
Thus the current system of compensation at financial companies does not lead to anything good at all. If you give $10 million to random people on the street and tell them that they’ll get 20 percent of any profit they make, without any consequences if they lose it, then many of them will go into the nearest casino and bet it all on red. (The really clever ones will find a way to leverage it up first — after all, a $2 million bonus is nothing; you can’t seriously expect people to live in New York or London on less than eight figures, can you?)
Many Lehman Brothers employees received some of their compensation in Lehman shares. They aren’t feeling too happy right now. But a system run on that principle could achieve exactly what is needed: a closer link between a person’s paycheck and the longer-term success of his trading. At the moment, a trader can sell a 10-year toxic contract, pocket a nice bonus after a few months based on some theoretical valuation, and then disappear to another bank or off into the sunset, leaving nine years in which that contract could blow up.
These companies need to tie compensation to long- rather than short-term performance. This won’t be popular on Wall Street, but if we want to turn investment banking back to performing something useful and positive rather than some sort of riverboat-gambling scheme on which we are all unwitting participants, then there’s not much choice.
Last year, Mr. Fuld earned about $45 million, according to the calculations of Equilar, an executive pay research company. That amounts to roughly $17,000 an hour to obliterate a firm. If you’re willing to drive a company into the ground for less, apply by calling Lehman Brothers at (212) 526-7000.
Since the long-ago days when Jimmy Carter was President, regulation has been a dirty word in Washington. Politicians of both parties vied to see how much of the economy they could free from the oppressive yoke of government control. The deregulation movement started when Carter signed the Airline Deregulation Act of 1978. Later, as it spread from energy to trucking to telecommunications to financial services, the rallying cry was the same: Less regulation, more growth.
But the implosion in financial services—until recently seen as the shining example of U.S-style free market capitalism—is the definitive sign that deregulation has lost its allure. In areas ranging from food safety to airlines to trade, increased government supervision is becoming acceptable to business as well as to voters. "Over the past couple of years, the mood has changed," says Chris Waldrop, director of the Food Policy Institute at Consumer Federation of America. "What's possible has expanded."
The Economy and Real People. “While Senator McCain and President Bush think the fundamentals of our economy are strong, while they talk about how robust things are, the reality is that the middle class in this country is collapsing, and if we don't make the kind of bold changes we need to make for the first time in the modern history of America, our children will have a lower standard of living than we do. Since President Bush has been in office, nearly 6 million Americans have slipped out of the middle class and into poverty. Since Bush has been in office, over 7 million Americans lost their health insurance. Over 3 million manufacturing jobs have been lost. Total consumer debt has more than doubled. Median income for working-aged Americans has gone down more than $2,000 when adjusting for inflation. The typical American family is paying over $1,700 more on their mortgages, $2,100 more for gasoline, $1,500 more for child care, $1,000 more for a college education, $350 more on their health insurance, and $200 a year more for food than before President Bush was in office.”
Workers need something to feel loyal to. IBM as a corporate entity has left that need in a vacuum. Nature abhors a vacuum. Workers can fill that vacuum by joining with their coworkers in an alliance to make their corporate and personal lives better.
The greed mongers in the investment world have driven the US economy to the brink of depression. This is destroying peoples 401k's and their future retirements. Our kids will be lucky to eat when they get to retirement. The only answer to corporate greed and Wall Street running over you is to unionize America. I don't know about the rest of you, but I can not grow enough food on my property to feed myself year to year and I bet most of you are in the same boat. A decent job with a decent pension at the end is the best we can do. We need to save American Jobs and our own families future NOW. Once the jobs are gone they will not come back.
For the folks sick of hearing this message from me, too bad. Do not come to a football game and expect the home team's cheerleaders to root for the other team. By the way. I am a Republican who believes that we need strong companies to promote job growth and strong unions for employee well being and the two entities can work together to create a booming American economy once again. -Exodus2007-
Alliance reply: We are sorry for your job loss. This has been happening for more than a decade. The number of lives ruined is inversely proportional to the amount of IBMers it will take to decide that a union contract is what they really need. Many others have waited until it is too late. To those IBMers still hanging on: Organize now. We can help. Join Alliance@IBM / Alliance@IBM
The relatively small-scale rolling RAs is a clever strategy, since it seems to make it impossible to obtain U.S.-wide longer term RA'ed age numbers (which I'm sure would show blatant age discrimination, even more convincingly than the Burlington case). Joe don't worry - part of the problem (at least this was true for me) with working for IBM so long is that your job has become part of your identity. However the fact that you lasted so long indicates that you must have excellent skills (whatever your job was), not to mention experience, which should open up many new opportunities for you. Good luck! For others: it would be a good idea to read the Alliance reply to Joe's post carefully. -jtr-
I actually like my current manager, but I think he's really powerless with the entire structure he is trying to function in. I feel sorry for my manager, he's actually the best one I've had so far. Last year, I was 2% above median... this year I am 25% above median. How is that even possible to be more overpaid after 1 full year of inflation? I have no idea where they get their statistics.
A simple search on Salary.com definitely doesn't come up with the numbers they are putting in front of me. So I finally accepted a job offer and I'm about to tell my manager in the next few days about leaving. Although I have made long lasting personal friendships in my job at IBM, I know it's time for me to move on as I don't see myself growing my career while sustaining any future financial needs. Also, the new job has MUCH BETTER health care benefits, something which I was surprised given that it's a much smaller company. -Almost_Gone-
Vault's IBM Business Consulting Services message board is a popular hangout for IBM BCS employees, including many employees acquired from PwC.
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