Critics say H-1Bs help U.S. companies replace American workers with less costly foreign workers. "The report makes it clear that the H-1B program is rife with abuse and misuse," says Ron Hira, assistant professor of public policy at the Rochester Institute of Technology. "It shows the desperate need for an auditing system." However, both Presidential candidates, Senator Barack Obama (D-Ill.) and Senator John McCain (R-Ariz.), have said they support expanding the program. ...
The H-1B visa program has become increasingly controversial in recent years as groups such as the Programmers Guild and WashTech, which represent U.S. tech workers, allege it is being abused, resulting in mistreatment of foreign workers, wage depression, and the displacement of U.S. workers. The program was originally set up to allow companies in the U.S. to import the best and brightest in technology, engineering, and other fields when such workers are in short supply in America. But data released this year by the federal government show that offshore outsourcing firms, particularly from India, dominated the list of companies that were awarded H-1B visas to employ workers in the U.S. (BusinessWeek, 3/6/08) in 2007. Indian outsourcers such as Infosys), Wipro, and Tata accounted for nearly 80% of the visa petitions approved last year for the top 10 participants in the program.
There is also evidence that workers on H-1B visas are being mistreated. In a pending case (BusinessWeek, 1/31/08), H-1B workers for State Farm Insurance allege they were underpaid. Critics say such instances of abuse represent the tip of an iceberg of deeper problems with the visa program. Academics and U.S. tech worker advocates point out the requirement that even employers who abide by the law—for example by paying the required "prevailing wage"—are able to underpay workers . "We shouldn't forget that the major problem with the H-1B program are caused by massive loopholes that allow firms to legally pay below-market wages and force US workers to train foreign replacements," says Hira. "Those wouldn't show up in this investigation because they are entirely legal." Hira says that a bill proposed by Grassley and Senator Dick Durbin's (D-Ill.) bill in 2007, S. 1035, would address both fraud and legal loopholes in the program.
It would be natural, owing to such debilitating luxury, to assume that the bathroom — and the suite that surrounds it— would attract the spoiled celebrity type, but that, said Mr. Walz, is not the case at all. While he refused to reveal the names of those who stayed there, he did describe them by their jobs — as financiers, C.E.O.’s and international businessmen.
Employers may wish that they hadn't listened to the consultants who advised them to dump defined benefit pension plans for 401(k) plans, because now they are stuck with a costly workforce that can't afford to retire at age 65.
I don't care what the judges say, age discrimination exists because of economics, not bias. We geezers are expensive. We demand higher wages because we've got years of experience. We run up big medical bills and need pensions that last us a lifetime. ...
To put it another way, employers that decided to save on pensions by switching to 401(k) plans will now foot the bill for well-compensated, medically expensive baby boomers, rather than their lower-paid, medically cheaper kids. It seems like a penny-wise and pound-foolish strategy to me.
With reality now caving in on us — banks and brokerage houses falling like tenpins, a trillion dollars or so in bailout money being added to the nation’s debt burden, families by the hundreds of thousands being driven from their homes by foreclosures — it might make sense to get back to basics. And in the United States, the basic economic component of a sustainable family life is a good job.
What we haven’t paid close enough attention to for many years (a period in which we’ve been oddly obsessed with the financial lives of the rich and famous) is the fact that there haven’t been enough good paying jobs to sustain what most working Americans view as an adequate standard of living. This is a fundamental flaw in the U.S. economic system.
With the latest financial meltdown, there has been widespread outrage over the excessive compensation of top corporate executives. Where has everybody been? The rich have been running the table for the better part of the past 30 or 40 years.
Example: The after-tax income of the top 1 percent of Americans rose 228 percent from the late 1970s through 2005. The story for working families over that same stretch was one of constant struggle to just stay even. As the Pew Charitable Trusts reported last year: “The earnings of men in their 30s have remained surprisingly flat over the past four decades.”
Disaster was held at bay by the entrance of wives and mothers into the workplace, and by the embrace of colossal amounts of debt for everything from home mortgages, cars, clothing and vacations to food, college tuition and medical expenses. ...
The economy won’t be saved by bailing out Wall Street and waiting for that day that never comes when the benefits trickle down to ordinary Americans. It won’t be saved until we get serious about putting vast numbers of Americans back to work in jobs that are reasonably secure and pay a sustaining wage.
And that won’t begin to happen until we roll up our sleeves and begin the immensely hard and expensive work of rebuilding a nation that unconscionably was allowed to slip into a precipitous state of decline. We’ll end up spending trillions for the wars in Iraq and Afghanistan and another trillion, at least, to clean up after the madmen on Wall Street.
Employees' charges next year are expected to jump 10.1% from 2008, to an average of $1,880, according to a recent projection by Hewitt Associates, a benefits consulting firm. By contrast, health-care premiums are expected to rise 7.8%, after posting double-digit percentage gains in four of the last five years. In 2008, out-of-pocket costs also increased 10.1%.
The findings suggest that universities are all but incapable of policing their faculty’s conflicts of interest. Almost every major medical school and medical society is now reassessing its relationships with drug and device makers.
But a funny thing happens on the way to spending that much money. Almost all of the subsidy goes to people who have health insurance already, says Sherry Glied, a professor of health policy at Columbia University. The Tax Policy Center figures that, after 10 years, the plan cuts the number of uninsured by only 1 million, out of 45.7 million now. Barack Obama’s $1.6 trillion plan would take 34 million off the rolls of the uninsured.
This system does a fairly effective job of protecting those it reaches, but it leaves many Americans out in the cold. Workers whose employers don’t offer coverage are forced to seek individual health insurance, often in vain. For one thing, insurance companies offering “nongroup” coverage generally refuse to cover anyone with a pre-existing medical condition. And individual insurance is very expensive, because insurers spend large sums weeding out “high-risk” applicants — that is, anyone who seems likely to actually need the insurance. ...
So what should be done? Barack Obama offers incremental reform: regulation of insurers to prevent discrimination against the less healthy, subsidies to help lower-income families buy insurance, and public insurance plans that compete with the private sector. His plan falls short of universal coverage, but it would sharply reduce the number of uninsured.
Mr. McCain, on the other hand, wants to blow up the current system, by eliminating the tax break for employer-provided insurance. And he doesn’t offer a workable alternative. Without the tax break, many employers would drop their current health plans. Several recent nonpartisan studies estimate that under the McCain plan around 20 million Americans currently covered by their employers would lose their health insurance. ...
And in the process of comforting the comfortable while afflicting the afflicted, the McCain plan would also lead to a huge, expensive increase in bureaucracy: insurers selling individual health plans spend 29 percent of the premiums they receive on administration, largely because they employ so many people to screen applicants. This compares with costs of 12 percent for group plans and just 3 percent for Medicare.
In short, the McCain plan makes no sense at all, unless you have faith that the magic of the marketplace can solve all problems. And Mr. McCain does: a much-quoted article published under his name declares that “Opening up the health insurance market to more vigorous nationwide competition, as we have done over the last decade in banking, would provide more choices of innovative products less burdened by the worst excesses of state-based regulation.”
I agree: the McCain plan would do for health care what deregulation has done for banking. And I’m terrified.
Over the weekend, Mr. Obama more accurately characterized the McCain plan as a swap but one that would work to the detriment of millions. Middle-class families, he said, would “watch the system they rely on begin to unravel before their eyes.” The business leaders said that was also their fear. Despite steady declines this decade, employers still provide coverage to 62 percent of Americans younger than 65. Surveys show that they want to continue doing so to attract and maintain a productive workforce.
McCain has proposed replacing the current government health-care subsidy for employers with a tax credit that would help all individuals and families purchase coverage. Biden terms this the "largest tax increase in the history of America for the middle class." He is off by -- well, by even more than the norm of Biden hyperbole. In fact, the McCain trade-off would result in a significant tax cut for nearly everyone (except those with the highest incomes).
With employers spending on average $7,000 in health care costs per employee annually, the prospect of offering coverage for under $2,000 is something that has made limited medical plans a growth product for health insurance companies. As of two years ago, there were more than 1 million holders of these plans, and experts estimate the market to grow as much as 20 percent annually in coming years.
There is a catch, though. These plans have total annual coverage limits as low as $1,000 but more typically in the $5,000 to $15,000 range. There’s a shell game in how plans define their maximums, but in general, an employee with a stomachache or a broken leg will probably be covered by these plans. If an employee has a heart attack or a bone marrow transplant, he will quickly hit the policy limits, and will owe doctors and hospitals one heck of a lot of money.
As Phil Wheeler, president of the advocacy group Citizens for Economic Opportunity, told the Hartford Courant newspaper in 2006, "These plans are designed not to be there when you need them. It’s like having an empty fire extinguisher on the wall."
Not having enough cash to pay a medical bill has been an unpleasant reality faced by many employees on high-deductible health plans. Though banks have capitalized by offering credit, the prospect of adding to a person’s debt has troubled some employers.
"It is a restatement of laissez-faire-let things take their natural course without government interference. If people manage to become prosperous, good. If they starve, or have no place to live, or no money to pay medical bills, they have only themselves to blame; it is not the responsibility of society. We mustn't make people dependent on government- it is bad for them, the argument goes. Better hunger than dependency, better sickness than dependency."
"But dependency on government has never been bad for the rich. The pretense of the laissez-faire people is that only the poor are dependent on government, while the rich take care of themselves. This argument manages to ignore all of modern history, which shows a consistent record of laissez-faire for the poor, but enormous government intervention for the rich."
From Economic Justice: The American Class System, from the book Declarations of Independence by Howard Zinn.
''Unlike Wall Street executives, America's families don't have a golden parachute to fall back on,'' said Rep. George Miller, D-Calif., the panel chairman. ''It's clear that their retirement security may be one of the greatest casualties of this financial crisis.'' ...
A new AARP study found that because of the economic downturn, one in five workers 45 and older has stopped putting money into a 401(k), IRA or other retirement savings account during the past year, and nearly one in four has increased the number of hours he works. More than one-third of these workers have considered delaying retirement, according to the study, which also found that more than half now find it difficult to pay for basic items such as food, gas and medicine. ...
On the heels of enacting a $700 billion market bailout, lawmakers are searching for ways to help workers who are feeling the ripple effects of the financial crisis. ''What should we be doing to try to find a way to salvage the retirement position of American workers?'' said Rep. Dennis Kucinich, D-Ohio, an opponent of the government rescue plan. Congress, he added, ''rushed to protect Wall Street in hopes that some benefits would trickle down to workers.'' ...
Falling home values and now the decimation of much of their savings could plunge older Americans into period of austerity not seen in decades, Miller said: ''The fear factor is huge, and they don't see the availability of resources to them to get well.'' Orszag said the situation has little precedent in American history. ''The period that we're experiencing is arguably the greatest collapse in confidence that we've experienced since the Great Depression,'' he said.
Sarah Palin won’t have to worry that she doesn’t know what the Bush doctrine is. No one really knew what it meant. But it had something to do with the unilateral exercise of American power, and the next president’s ability to act unilaterally on anything other than vital national security issues is going to be reduced. As the old saying goes: He who has the gold makes the rules. Well, we no longer have as much gold, and until we get some, we will have to pay more heed to the rules of those who lend us theirs.
At a time when the U.S. government gets half its borrowings from abroad, at a time when the U.S. household savings rate is hovering around zero and China alone is already holding around $1 trillion in U.S. Treasury notes and Fannie Mae and Freddie Mac bonds — yes, that’s how you got that cheap subprime mortgage — it can’t be any other way.
Somebody better tell John McCain: We are all Swedes now. Forget about “Live Free or Die.” Until we get our financial act together, our motto is going to be: “Swedish spoken here — or Arabic or Chinese or German ...” ...
“The next round of capital that comes in from abroad is going to be much more demanding and move into real assets,” argued Jeffrey Garten, professor of trade and finance at the Yale School of Management. “Being a bigger debtor nation means losing even more of our sovereignty. It means conducting our economic policies with an eye toward whether others approve. It means bearing the advice and criticism that we have dispensed ad nauseam to other countries for over half a century. It means far more intensive consultations with other capitals on our fiscal policies and our monetary policies.”
In the face of Republican opposition, the measure failed. Benefits start expiring this week. So much for Main Street. ...
The Labor Department reported on Friday that 159,000 jobs were lost in September. That is the biggest monthly drop in five years and the ninth straight month of job contraction. It brings total job losses for this year to 760,000. Of the 9.5 million Americans now out of work, two million have been jobless for more than six months. Nearly 6.1 million people are working part time because they cannot find full-time work or because slack business conditions have led to fewer hours — and less pay.
It's "almost impossible now" for conservatives to mouth some of their "dogma," says Paul Waldman, a senior fellow at Media Matters for America, a nonprofit advocacy group set up four years ago to guard against what left-of-center analysts regard as conservative (alias Republican) mythology.
For instance, there's the thesis that tax cuts heavily targeted at the rich, such as those passed in the first term of President George W. Bush, will trickle down economic benefits to the middle class and poor. Rather, the rich have been getting richer and little extra income has flowed to those under the top 5 percent. ...
Last month, the Economic Policy Institute, a liberal think tank in Washington, published "Tax-Cut Snake Oil," a 21-page paper by Harvard University's Jeffrey Frankel, who considers himself a "middle-of-the-road" economist. In it, Professor Frankel takes shots at the Laffer Hypothesis, which holds that cutting taxes actually increases tax revenues and creates a surplus by accelerating economic growth.
This view, notes Frankel, has been discredited by most professional economists. But it has been endorsed by Sen. John McCain, even though disavowed by his policy director, economist Douglas Holtz-Eakin. Frankel details how the major tax cuts of President Ronald Reagan in 1981-83 and the Bush tax cuts both contributed to record federal budget deficits. He offers quotes indicating that both Reagan and Senator McCain endorsed the Laffer theory at some point in time.
George Soros, the prominent financier, avoids using the financial contracts known as derivatives “because we don’t really understand how they work.” Felix G. Rohatyn, the investment banker who saved New York from financial catastrophe in the 1970s, described derivatives as potential “hydrogen bombs.”
And Warren E. Buffett presciently observed five years ago that derivatives were “financial weapons of mass destruction, carrying dangers that, while now latent, are potentially lethal.”
One prominent financial figure, however, has long thought otherwise. And his views held the greatest sway in debates about the regulation and use of derivatives — exotic contracts that promised to protect investors from losses, thereby stimulating riskier practices that led to the financial crisis. For more than a decade, the former Federal Reserve Chairman Alan Greenspan has fiercely objected whenever derivatives have come under scrutiny in Congress or on Wall Street. “What we have found over the years in the marketplace is that derivatives have been an extraordinarily useful vehicle to transfer risk from those who shouldn’t be taking it to those who are willing to and are capable of doing so,” Mr. Greenspan told the Senate Banking Committee in 2003. “We think it would be a mistake” to more deeply regulate the contracts, he added.
That was, of course, disastrous for Lehman's employees and for its shareholders. On paper, Fuld also lost money, for his stock options were vaporized in the crash caused by his own reckless policies. Unlike regular folks, however, the CEO had long enjoyed a fat salary, banking nearly half-a-billion bucks in compensation in the years prior to Lehman's demise. Indeed, last year alone, while his company was teetering, Fuld raked in about $45 million in personal pay. That's more than $20,000 an hour. For failure!
But what about all those other Wall Street greedheads we're now being forced to bail out? No problem, say the White House and Congress, for our bailout bill contains a populist provision to limit the pay of CEOs who get taxpayer funds. Good idea! But the actual language of the bill has a couple of supersized loopholes punched in the executive pay provision. First, the limit applies only to a few banks that the government will actually take over, not those it simply bails out. Worse, the CEO pay restriction doesn't affect existing pay arrangements. So top honchos who have been wallowing in obscenely-high pay packages, complete with golden parachutes, can continue getting those riches, even as they draw bailout money from you and me.
But recreation of another Rooseveltian period of 1932 to 1940, with a new set of rules for intricate financial institutions, is not enough. We must transform our economy from one of consumption to one of production, invest much more heavily in new technologies, research, and invention, and start the process of creating a post-carbon economy. The current wreckage must not simply be put back together to recreate the old economy. It must be pushed out of the way to make space for a new, 21st century economy.
IBM executives know they did not really make their objectives despite the spin provided to the public so they will cut costs through layoffs. The problem with massive layoffs to meet the next quarter earning objectives is the jobs do not go away, just the experienced IBM employees. These talented IBM employees that are let go do not come back. There experience and skills leave with them. New hires take many months to get up to speed and when they do, there are more layoffs and the cycle starts again. This lowers IBM employee moral and real productivity with a significant portion of new hires going through massive learning curves. IBM customers do not want to pay high rates to provide IBM employees on-the-job training. -Anonymous-
Alliance Reply: If you interpret the information you read in this comment section as trending 'lower', then you must believe that people are lying about how much they make or, you are semi-isolated by your level of salary. Either way, it's possible that you are out of touch with those working in the "trenches".
Vault's IBM Business Consulting Services message board is a popular hangout for IBM BCS employees, including many employees acquired from PwC. Some sample posts follow:
IBM assumed this would be a pay decrease. They are now ramping plans to get more folks into the regions centers (Fishkill - Boulder) and off shore ASAP.. The money wont last, but please stick them for what ever you can get! Pay down your debts so when you do get axed, which you will, your in better shape that you are today.
Much more grumbling on the PM's I have posted that they would be screwed more than a year ago. This has come to fruition. All 300 of the contractors were axed. They are using freshers from India to do the PM work. These guys are PMI - PMP, but most lack common IT experience (Picture the paper MCSE - Same thing).
IBM is pushing to the same model as TCS (TaTa) where they will have a skeleton staff on US soil with the core team in low cost GR's.. sad but true. TCS is eating ibm's lunch.. they cannot compete cost wise and customers don't care anymore.. if they can save 50% by going offshore.. they will.
The good news is some companies are actually insisting on US based jobs.. lets hope that more and more boards become patriotic and realize that they are on screwing the US by offshoring all of their work. Killing off the middle class of America, thru offshoring, will have a negative effect.. lets hope the boards of these companies realize that.
Good luck to all.. especially the 08A family.. your targeted and forced attrition / corporate snipers have you in their sites. SDM's are being target in the near future as well. Cringley's 350,000 job loss was accurate!... ibm has been back peddling and redoing the plan because of all of the attention. as long as you realize ibm is no longer a career, but a sweatshop to gain experience, your fine. Don't bleed blue... unless you can get a union contract in place. -ExIBM'er-
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