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6, 2000 April, 2000

Highlights—June 27, 2009

  • The insider trading page on this site has been updated to show the latest "trading" by senior IBM management. Given IBM's huge number of firings this year, as well as its paltry raises and bonuses, it is quite enlightening to see how well our senior management is doing.
  • CNN/Money: IBM accuses former M&A exec of misusing resources. By Jim Finkle. Excerpts: IBM accused its former mergers and acquisitions chief of misusing resources, as part of a lawsuit that seeks to remove him from his new job at rival Dell Inc. The suit claims the executive, David Johnson, violated a noncompete agreement by moving to Dell and bringing trade secrets with him. Both companies are looking to acquisitions to add technologies that will differentiate their products at a time when global technology spending is slumping.

    In a separate document filed on Thursday, Johnson accused International Business Machines Corp of withholding $1.49 million from a retirement plan that he said was due to him upon his departure from the company.

  • Associated Press, courtesy of Forbes: IBM loses bid to block fmr M&A chief from Dell job. IBM Corp. won't be able to block its former mergers and acquisitions chief from working at rival Dell Inc. while a lawsuit against the executive works its way through the courts. A federal judge on Friday rejected IBM's request for a preliminary injunction against the executive, David Johnson.
  • National Academy of Public Administration: H1B and L-1 Visas or How To Put the Middle Class Back To Work. Excerpts: There are currently hundreds of thousands of H1B employees who have replaced American workers, many of whom were forced to train their replacements in order to receive their earned severance package. Many of these Americans are now hard pressed to become employed again and stay employed without losing yet another job to an H1B Visa immigrant. It is said Americans do not want these jobs or cannot be found but the truth is that the Immigrants will work for less than the Americans and are contracted for 6 years. During this time some are trying to get their green card to continue on in America after their visa is up.

    An L-1 Visa is generally for 3 years and is available to employees of an international company with offices in both a home country and the US. It allows foreign workers to relocate to the company’s US offices for at least 1 year prior to being granted L-1 status. There is no quota system and is quite devastating to our economy and the middle class white collar worker. The spouses are allowed to work without restriction in the US.

    Critics of the visa programs such as the Nobel Prize winning economist, Milton Friedman, referred to the program as a corporate subsidy because they are supposed to be paid the prevailing wages with safeguards in place. But the data from the US government OES office shows that these H1B wages are below the median for the same occupation as compared to a US worker. So this is how the corporations are being subsidized by the government. Or as Professor Norman Matloff, UC-Davis sums it up “its about cheap labor and there is no shortage of qualified American citizens to fill American computer related jobs”. He further stated that the data offered as evidence by American corporations “needing” H1B and L-1 visas to address labor shortages, was erroneous.

  • American Public Media's MarketPlace: Why more engineers are losing jobs. Even in a recession, a lot of people think tech jobs are a safe bet. But American engineers are losing their jobs faster than any other professional sector. Janet Babin reports. Excerpts: Hewlett-Packard, Microsoft and IBM have shed thousands of jobs this year, many in technology. And it's not just new hires. Civil engineer Rick Clark spent 11 years at IBM. He had experience in several departments, including real estate and manufacturing. Clark thought his job was secure. Then in January...
    Rick Clark: My manager called me into his office. Um, I expected him to say, "You're safe." But he surprised me and said, "You're included in the layoff."

    That wasn't the only surprise. Clark's manager handed him a brochure about an IBM program called Project Match. It offers laid-off employees new positions with the company. But there're in emerging markets like India and China. Engineers there typically earn less than half the salary of their U.S. counterparts. IBM transplants like Clark would earn the going rate.

    Clark: I considered it an insult. You know it's pretty common knowledge that IBM has been offshoring jobs, so this is sort of like a cold slap in the face.

    IBM wouldn't discuss the program. Companies have long outsourced jobs to save money. But that's not the only reason firms are shifting highly skilled workers overseas these days

  • MarketPlace: Selected reader comments regarding the above article follow:
    • By Sam Thiplano. 06/17/2009. Hey, wait a minute! I thought the key to U.S. economic competitiveness was technological innovation! I thought the don't-need-to-know-or-build-stinkin-nothin economy died around Q3 of 2008. Doesn't every politician say that we should goad our kids into becoming math and science wizards? For what? And this quote: "...So if you're developing products for foreign markets, you want to understand foreign customers..." : Obviously, but do I need to physically sit in that place to understand the market to build stuff for it? That sounds like a very stunted / one-sided notion of globalization to me.
    • By Indra Patel. 06/18/2009. The argument of building products where the market is - is the biggest lie. I-Phones designed in USA are selling just as well overseas. Networking gear developed here, is used throughout the world. Its all about maximizing profits. I never encouraged my kids to go into Engineering. Its a dead-end job - but not boring or dull.
    • By Bill C. From NY, 06/18/2009. American workers have become economic whores. The pimps are American CEO's and senior management whom don't know the first thing about building futures or businesses. They practice the equivalent of "kindergarten management" by simply paying themselves enormous amounts of money by slashing our country's future.

      What we as Americans fail to understand is that our present approach to offshoring can have but one end result - poverty for the American working man and woman, and future generations left holding the empty bag that will take many generations to refill, if it ever will be. Our "leaders" are breeding the next generation of whores.

      Look at our economy. CEO's, senior managers and investment bankers produce absolutely nothing tangible but make millions, while those that actually produce for the good of society are squashed economically. The current group of "business leaders" have but one mantra - cut costs by cutting workers - offshore, and then LIE about it. They simply are NOT smart enough to BUILD a business, so they resort the moral equivalent of theft to fill their own pockets.

      How about this - a NATIONAL LAW that mandates that the top 3 layers of management >$500K receives bonuses only after a 5 year vesting (w/o interest). If the business decisions earned sustained profits - they get it, if not, go away. Let's try it with sports figures too - wow, pay for performance. That's something most of Americans deal with EVERY DAY.

      It's time for the word "ACCOUNTABILITY" to actually be used in enforcement of moral standards. Otherwise, I fear there's another revolution coming.

    • By ken marsh. 06/20/2009. Kate: IBM's Project Match is a one way ticket to the country you want to apply to. The wage is in local salary and IS NOT based on your current U.S. salary. It is not a one or two year overseas assignment that IBM used to offer with your current U.S. salary and ex-pat benefits.
    • By Mike Asu From Dallas, TX, 06/24/2009. Whatever it is; the trend in the engineering sector does not encourage younger generation of Americans to study Engineering. Not with my experience. I graduated with Electronics Engineering degree in 2002 but have never had an Engineering job other than work in food operations plant. I will never encourage my children to get into Engineering but will support them in fields like Medicine, Pharmacy, Nursing and radiology.
  • The Register (United Kingdom): Wanna buy an old PC factory? Mothballed IBM plant for sale - models, balls, the lot. By Joe Fay. Excerpts: We're all used to hearing about factory closures these days, but have you ever wondered what happens to a manufacturing plant when the jobs have gone? The answer is here, where industrial auctioneer Sweeny Kincaid is selling the contents of a "Former IBM PC Manufacturing Facility in Greenock" via an online auction. ...

    Most poignantly, the scale model of the plant, which by memory lingered in the reception area, has attracted no bids whatsoever. Why bother, when you could setup a new plant in Poland for Indonesia for peanuts.

  • Watson-Wyatt: Emergency Retiree Health Benefits Protection Act Reintroduced. Excerpts: Representative John Tierney (D-Mass.) has reintroduced the Emergency Retiree Health Benefits Protection Act (H.R. 1322), which would prevent employers from reducing or eliminating health benefits for retirees or their dependents. The bill has been around for years but has attracted more attention since it appeared in a pension bill last year. Under the act, employers could not make changes to their retiree health plans that would eliminate, reduce or limit benefits, increase out-of-pocket costs or make it more difficult to obtain medical care. The law would automatically void any plan provisions reserving the right to reduce or eliminate retiree health benefits. Companies that reduced or eliminated retiree health benefits before the law took effect would have to restore them, unless doing so would create substantial business hardship or work against the interests of plan participants in the aggregate, or would not be administratively feasible.
  • Yahoo! IBM Employee Issues message board: "401k+ transition credits (1-4%) credits end on 6/30/2009" by "sby_willie". Full excerpt: FYI: 401k+ plan transitional credits end on 6/30/2009. Active employees lose anywhere from 1% to 4% company contributions to their 401k+ depending on age and years of service after 6/30/2009. Just more compensation we lose in a retirement plan offered from IBM. The IBM 401k+ is masquerading as a poor replacement for a real pension plan.
  • Yahoo! IBM Employee Issues message board: "Re: 401k+ transition credits (1-4%)credits end on 6/30/2009" by "teamb562". Full excerpt: Also ending at about the same time are the (notional) FHA credits for most second choicers.
  • Yahoo! IBM Employee Issues message board: "Re: 401k+ transition credits (1-4%)credits end on 6/30/2009" by "K-Y needed". Full excerpt: Go to Netbenefits and the select "401k" Area. Go to "Plan Info and Documents". Select the "Summary Plan Description". Then Select "Summary Plan Description", on the next screen presented. Go to "page 29" and read up on "Transitional Credits". It seems many may need to review the complete document. You must do your own "Due Diligence" or you may get some very unpleasant surprises, which should not be surprises.
  • Yahoo! IBM Employee Issues message board: "Re: 401k+ transition credits (1-4%)credits end on 6/30/2009" by "ignatz713". Full excerpt: Yup, it's there all right. As per the usual among the employees, we believed the hype on w3, didn't bother to read the fine print, and once again got screwed. We had no meetings on this, but I knew it was a royal screw, so didn't pay attention to it. What difference did it make if anyone had read the fine print? "Also ending at about the same time are the (notional) FHA credits for most second choicers." "teamb562", can you explain this?
  • Yahoo! IBM Employee Issues message board: "Re: 401k+ transition credits (1-4%)credits end on 6/30/2009" by "K-Y needed". Full excerpt: Reading the fine print allowed some of us to retire with better pay than we would have otherwise; significantly better. Next hit will be FHA and Retiree Health and the 401K. May be time to transfer funds to an IRA. If you move it to Fidelity, you get all the same options you have now, according to the Fidelity help folks for Fidelity (not the IBM support folks).
  • Wall Street Journal: The 401(k) Rollover Conundrum. By Janet Paskin. Excerpts: According to most brokers and fund companies, the best move for anyone switching jobs or retiring is to transfer their 401(k) money into a rollover IRA. How do we know? Just ask them.

    There's an expected $2.3 trillion in potential rollover money up for grabs in the next five years, and these companies—which make their money off the assets they manage—all want a piece of that. Check virtually any of their Web sites and you'll find helpful calculators or educational materials instructing investors as to why a rollover is their best option.

    Trouble is, that's not always the case. Sure, taxes and penalties make cashing out a 401(k) an unappealing option. But some companies seem to posit that rolling your balance into an IRA is always the best choice. In fact, they rarely even mention the possibility of keeping your money in your old 401(k). Fidelity's "rollover evaluator" tool, for example, asks four questions, then offers a recommendation—and regardless of the information an investor gives, the answer is always the same: "Roll your 401(k) into a Rollover IRA." (The tool has since been taken off the site "for maintenance," the company says.) Schwab's pros-and-cons grid suggests that there's little difference between rolling over your balance and leaving it in your employer's plan; T. Rowe Price's Web site highlights the comparison between an IRA and a cash distribution, with little mention of other options.

    That's just plain bad advice, says Alison Borland, a consultant in the defined contribution practice at management-consulting firm Hewitt Associates. Investors in a 401(k) plan often pay much lower fees than retail investors—sometimes half as much. That may be just 45 cents on every $100 invested, but over time those pennies add up. In fact, a 35-year-old with about $100,000 could, by the time she's 70, have paid an additional $116,250 in fees by switching to a rollover IRA, Borland says. But no one tells employees that, she adds: "There's no nice chart that pops up and says, 'By the way, you're going to pay higher fees and earn less in investment returns—are you okay with that?'"

  • New York Times: What’s Your Number? By Jeff Brown. Excerpts: The question came the other day from an old friend with a one-man business: “What’s your number?” It’s the latest way of asking, “how much money do I need to retire?” I’ve been asked this many, many times in my years as a personal-finance columnist. I used to take a deep breath, then begin a discourse on pensions, Social Security, life expectancy, plans to pass assets to children, business succession, expected rates of return, inflation …

    Then, finding that people really wanted a simple, easy answer, I came up with one: “three million dollars.” That’s what you need to retire. No matter who you are, where you live, what your expectations. Trust me.

New on the Alliance@IBM Site
  • Job Cuts Status & Comments page
    • Comment 06/20/09: Along with the comment about Sales and Distribution jobs being given to GR's ("global resources", i.e. cheap labor in India, Brazil, China or other countries) now, I just found out first hand that the CIO's office in the US is hiring GR's as well now, these are for US positions.....GO IBM!!!!! I hope this all catches up to Mr Obama who keeps saying stop offshoring but has a direct tie to Mr Palmadickhead. I hope Palmisano's children eventually feel the pain that the average American is feeling with Mortgages, Gas Prices, and what not. -EPS 11- Alliance reply: There is no evidence that Obama has any "direct tie" to IBM's CEO. Instead of complaining about IBM's CEO; why not try organizing? You may get some results, that you won't get; hoping Sam's children feel pain. Hoping for that is simply a waste of your time and energy.
    • Comment 06/22/09: to EPS11: The day after the Feb 09 RA's took place, approximately 5,000 folks across all divisions were line item transferred to CIO office. This includes, but not limited to business controls, app developers, software architects, and such. This was to centralize the BT/CIO organization structure making it a 'silo'. These people are still paid by their previous divisions, yet the divisions have no say in what the people work on. This has decimated many projects in mid course and created a bloated structure. The purpose is two fold. One to centralize work, the other more insidious is that 5,000 folks many of who do the same job will be RA'd come end of this or early next year but since they are across many boundaries. The loss of headcount will be harder to pin down. With regard to GR's, many IGS project plan spread sheets have a cost column for GR's to compare with US employees. -anon-
    • Comment 06/22/09: I'm sorry, but IBM has laid off, what, 16,000 Americans this year? And hired who knows how many in India, Singapore, et all? And it isn't in WSJ, NY Times news? Who the hell do these people know - or own - that IBM comes off as a good American company? I am so mad about this, I can barely see. I think I did OK in the RA (I was a Feb cut); I am at least getting by. But lots of folks got it up the shoot, and we fete Sam at the White House? Thanks for the space to rant, hang tough, brothers and sisters, and start looking at making your own businesses. They have fired a lot of FABULOUS people, and I bet you are one of them! Let's show them what idiots they are! -Wondering aloud-

      Alliance reply: You question about WSJ and NY Times answer is: It was news for a day or two. But IBM gets away with only a fraction of the negative coverage they should get; because they've convinced Americans and the corporate media that "they are a Global company and this kind of thing happens all the time"...BAU. Even the SEC leaves them alone, with regard to the way they report their job cuts; because it's 'Global'. Get it? It's just an excuse.

      That's why IBMers NEED to organize faster and harder than the media machine can dismiss RA's, as no news. IBMers wanting and needing change; need to do it NOW. Don't sit around ranting and raving about how IBM screwed them. It's too late by then. If you even think there may be a way for you to avoid being fired or RA'd; you're seriously BS'ing yourself. Don't wait for the Govt., the corporate press, or anyone else to come to your rescue. YOU come to your rescue. You can do this. We can do this. Contact us or email: ibmunionalliance@gmail.com

    • Comment 06/22/09: I was part of the May 15, 2009 resource action group. I had found out back in December 2008 that I would be affected by an RA as of May 15th . However, as of February I had not received the official notification of the RA in writing. I was offered a job in writing by Div 16 (Federal) back in February 2009. I informed the hiring team lead and manager that I was going to be a part of an upcoming RA. My active manager at the time had also spoken to both of them also concerning my upcoming RA announcement. My manager and I were both working to ensure that I was transferred over to the new group before the RA announcement and we had both been reassured that this was going to happen.

      The delay of my being transferred was due to the fact that I had to get a security clearance for the job. Again I was assured that I would be transferred prior to my end date of May 15th regardless of whether or not I had received the clearance.

      The official RA announcement for my team came at the end of March and my departure date was moved up to April 23rd. I immediately informed my prospective management team. Again I was reassured that everything would be fine. A few days later I received a call from the hiring manager saying that an appeal had to be submitted to get me off the RA list and transferred into the division. I asked if I should be worried and was told no. A few days after I was told that they would not be able to move forward with the job offer because the appeals board had come back saying that a band 6 could not be removed from the RA list and transferred. I was a band 7 and didn’t quite understand how that affected me. Apparently, I was going to have to be transferred into the division as a band 6 even though I was a band 7.

      Further, I was told that my being transferred in could not be justified because Div 16 had been affected by the RA as well and if anything they would have to staff the position with someone over there. I felt that I had been treated unfairly because I had received the offer in writing prior to being put on the official RA list and the hiring management team was well aware of my situation when they offered the position to me. I decided to go through corporate appeals. To date I have not signed my separation agreement. I received my decision today from the corporate appeals office stating that I had not been treated unfairly. I was told that the state of business had changed between the time the offer was made to me and when I was put on the official RA list. Further, I was told that I would not be receiving my security clearance.

      I had originally been told several times by the Div 16 management team that I would be receiving my top secret security clearance regardless of me being RA’d because the process had begun when the offer was made and this would be granted to me. Now I have been told that it was not a security clearance that I was going to receive, but some other type of background investigation. Further, the background investigation that was being done would be null and void because I am no longer an IBM employee. I have also been told that I have 48 hours now to sign the separation agreement if I want to receive my severance payment. This situation is really upsetting and completely unfair to me and if anyone has some advice on what further steps I can take, then please respond . . . Email me -Anonymous-

      Alliance reply: Throughout this whole situation, IBM was planning on giving you NO advantage. They were planning on firing you, by default; if things they had discussed with you didn't work out to THEIR advantage. I'm sorry to say, that there are no real "further steps" you can take to keep your job or get the job you thought IBM would give you. Don't be deceived into believing that IBM cared about you or that they just changed their mind at the last minute, because of 'the needs of the business'.

      You are/were an AT WILL EMPLOYEE. You have no bargaining rights, no employment rights or entitlement to a job as long as you work without a union contract. I'm sorry for your job loss and what IBM did to you. It is shameful. That's why we continue to say over and over and over and over.. ORGANIZE! Don't wait for IBM to do you any favors or tell you the truth. They won't. They never will. You work at their will, as long as you are an individual AT WILL EMPLOYEE. You have no legal standing, whatsoever. If you became a union worker; your contract would prevent 95% of the games that were played by IBM against you.

    • Comment 06/22/09: My advice as a 16 year IBMer that was RA'd... Take the sev pack and run!! The coming RA's may not get as good of a sev pack since IBM has the right to amend/change it at anytime, and I'm betting they will. BTW: The last RA calls went out on the last Friday of March. Anyone heard about the next RA... are the calls coming Friday, the last Friday of this Q? Good luck to all! -Anonymous-
    • Comment 06/23/09: >>I have also been told that I have 48 hours now to sign the separation agreement if I want to receive my severance payment. Sign the paperwork, -Anonymous-. Yours is another in the long line of painful firing stories, and IBM wins, again. They have had a target painted on your back since Dec. 2008. Sign the paperwork. Why? Simple: AT WILL EMPLOYEE. -anonymouse-
    • Comment 06/23/09: This last story by "security clearance guy" really makes it clear that you do NOT have 30 days to find another job within the company as they lie to you about. It's just something to give you false hope and keep you from getting angry until after you are out the door. I had applied for 6 posted jobs within my 30 days and nobody even responded. Now I know why. The appeal process to get you off the RA list is something they can't be bothered with. Unless you have a manager that really likes you and really wants to help you, forget it. A Union is the only way to protect your rights and dignity in a company like this. Thanks for sharing. -gone_in_07-
    • Comment 06/23/09: I'm a contractor working for STG and my contract was to be up at the end of June. Yesterday I received a call from the consulting firm informing me that the contract will not be renewed and that my last day will be Friday. That actually suits me. My tour of duty at IBM has not been pleasant. -Anonymous-
    • Comment 06/23/09: what a messed up story from Security Clearance Guy! I've heard similar f'up stories so, unfortunately you are NOT alone! I just found out today that all the IBM Employees in the ESC in Raleigh that handle separation processing/paperwork are fired effective 6/30. Not sure how many are affected. Their jobs are moving to Maylasia. -Proud Alliance Member-
    • Comment 06/23/09: "security clearance guy"- I am sorry to see that you fell for the IBM crap, and sorry to see they treated you this way. When I got my clearance 10 years ago, the cost of obtaining the clearance was a bit over 40k and took almost 3 months to get. Unfortunately if IBM knew you were on the RA list December 2008, why would they invest 40k on a person they are going to RA when they can just RA you and get a contractor that already has a clearance and they don't have to champion the cause keep you to Joanne Collins-Smee? I do think it sucks that you didn't get it though. -Anonymous-
    • Comment 06/23/09: to mr security clearance, let it go, give up. take the package and walk away from IBM. find something better, it's out there. when i was given my 30 days I too had another position lined up in another group who very honestly wanted my skill-set bad.. I was reassured by my manager up one side and down the other that there wouldn't be any problem getting me transferred before the 30 days, i just had to stay on top of it.. it quickly became apparent though that thanks to Joanne Collins-Smee, there would be no transfer.. even with 4th line managers appealing on my behalf.

      My 1st line was really quite clueless, don't think he was intentionally deceitful on the whole thing.. i just think he had no idea what an impossible task it is to be removed from the RA list.. once you're on it, forget about IBM. It's sad but the sooner you let go of this fight and look forward, the better off you'll be.. and that goes for everyone who finds themselves on an RA list. forget about transferring inside the company. take those 30 days and do something productive, shut off sametime and start job searching. -exibmer-

    • Comment 06/23/09: To the Security Clearance guy - I'm a recent RA as well. First - you should consider yourself very very very lucky that you got wind you were going to be RA'd way ahead of anyone else. The process with a massive RA is such that the Exec levels and above have to sign and return a hard-copy of a formal disclosure agreement. The agreement means they can not disclose that there WILL be an RA until one is formally announced (let alone WHO is being considered). These higher ups who signed this could lose their jobs. So you are lucky you got the heads up - I wish I did because I might have been able to transfer somewhere else (assuming even THAT was an option, usually the Execs in these divisions freeze movements in/out anyway so no one falls thru the cracks - it appears they hit those who are highest paid and/or with higher years of seniority as well as just plain get rid of as many non-billable people as they can get off the books).

      I sure would have worked a lot LESS overtime / holiday work, spent more time with my family, taken as much internal education as I could, and started looking for another job while I was still employed. Second - you can take some level of satisfaction that you definitely got one or more managers in trouble for disclosing that you were on the RA list or even that a Resource Action was forthcoming.

      Third - I had a security clearance once, but almost 20 years ago. The Federal Government pays for those clearances, and if it's not paid directly I'm sure it's passed on to the Gov thru the various overhead rates. Are you sure they started the clearance process? It involves talking to your friends and neighbors, past and present and might even involve a polygraph. If you think they started the process, I would think you should be allowed to know if it was completed - that alone is a valuable asset you can take to any other job. You should probably check with the Government agency that was handling the background checks. -scooby doo-

    • Comment 06/24/09: Remember the beginning of the 2nd Gulf War? Remember that nitwit Iraqi military leader saying "The Americans are not coming to Baghdad. The Americans have not taken over Baghdad Airport." That's IBM Management, except they're saying "IBM is fine, your job is OK. IBM is not firing people.". Look at what's become of Iraq.

      Seriously, do you REALLY want to keep working at IBM? It's been said dozens of times here - it is NOT the IBM it used to be. It's time to leave. Companies are starting to hire. IBM can't even keep GDFs staffed. No local talent, and the existing talent in IBM is refusing to relocate (I honestly think IBM expected most existing employees to relocate). This is catching IBM off guard.

      Iowa was suppose to have opened and been live, I think, this month or next. Last I heard, they have next to nobody working there, and no accounts being support out of it. I'm hearing rumors about high turnover in EFK, too. And remember the posting a few weeks back showing band levels for GDF staffing? Just wait until THAT kicks in. Salary cuts for all.

      It's an absolute mess in IBM. All accounts sooner or later will be supported by a BRIC country, or managed out of a GDF. This is the goal of IBM right now. I think it's taking longer than the VPs anticipated, but they're still pushing forward.

      Just remember this. IBM WILL meet their EPS this year of 9.x/share at YOUR expense. The easiest way to meet that EPS is to reduce cost, and YOU are costing IBM money. I really expect a relatively massive RA again in 3Q, especially if their EPS is off target for the year. Good luck to existing employees, and good luck to the Alliance. Your efforts are valiant, but I fear too late. Personally, even with a union, I don't want to work here anymore. I have resumes in to 3 different non-IBM job openings. First offer, I'm out. -anonymous-

    • Comment 06/24/09: They ARE having problems staffing Iowa. But it's because they want to pay the local talent $12.54 an hour. They're looking for students, or any others who have the skills. Since no one is available, they're going for the H1B Visa folks. As for Boulder, they are also having problems staffing. They are expecting next to none of the current employees to join. The target date for phase 2 (in Boulder) is early October. They have 1 M&L allotment, and apparently, they already have in mind who they will offer that to. What a bunch of bozos. Maybe there plan is to have everyone QUIT before the GDFs are up and running. It would definitely save on severance package $$. -caught-a-glimpse-
    • Comment 06/24/09: Does anyone know if you are part of the RA and can bridge to retirement...are you considered laid off or retired for unemployment purposes? -Sue-
    • Comment 06/24/09: Sue, many of us in the RA's were bridged to retirement if within one year of 62 or whatever, or are otherwise retirement eligible. We signed two documents as we left IBM. We are as laid off as anyone and can collect unemployment. Each state is different - in the ones I know the lump sum severance does not reduce unemployment, but if you get monthly income by electing the pension or 401K now, that probably will reduce your unemployment. -anonymous-
    • Comment 06/24/09: Sue, I bridged to retirement after an RA and am collecting unemployment in CT. -Forced into Retirement-
    • Comment 06/24/09: I'm not sure what is going on with the EFK GDF. I never see any job postings for that location. Have any of you ever been there? Its like a tomb. Horrid dark colors that are very depressing painted on cinder block walls. The folks walking around are like zombies in a fog. From what I am told there is a great deal of stress on the workers at that location. -dun-4-
    • Comment 06/24/09: In the EFK GDF on the mainframe side there has been very little turn over since that started back in February My SLM said the goal is to have all accounts either in a GDF or GR -Bill-
    • Comment 06/25/09: To anonymous- No, collecting pension from the "prior plan" should NOT reduce your unemployment (UI) benefit amount. That plan was frozen on 12/31/07 (no more IBM contributions were made) which was before your UI base period. You may have to contact the UI Pension department to explain that the plan was frozen before your base period. I am in CT and my UI benefit was not reduced due to pension although I did have to contest their first determinination. There has been lots of discussion regarding this on the RA forum. http://groups.yahoo.com/group/RAed2009/message/929 -RAed 2009-
    • Comment 06/25/09: -Idn2012- we need to spread the word about this website to the Atlanta folks. I was directed here by one of my teammates from MN after we were RA'd in January. Both of us got pbc's of 3 but were solid performers according to the people we supported. We were Div 1N CHQ-Marketing. From what I understand Marketing was hit hard in each of the RA's this year. Atlanta in particular has been hit hard as well. The Atlanta ibm.com center once employed close to 1000 and now is down around 300 people. -SLV-

      Alliance Question: Since one of your teammates pointed you to Alliance@IBM AFTER you were RA'd; Do you think finding out about this web site should happen BEFORE IBMers get RA'd? If you do, Please tell your former teammates, and tell them to tell others in your former function to visit this web site and consider joining and forming a union in their respective function or area. I'd also like to know: Do you use Twitter, LinkedIn, or Facebook? Do you know if your former co-workers use any or all of those social networking sites? Please Contact Us with your information and answers.

    • Comment 06/25/09: To RA'd 2009 in CT. Each state is different. NJ has a sliding scale of reduction of unemployment money if there is monthly income from pension and what portion are your contributions. The weekly form you fill out simply asks then if you have any monthly income from pension or other source with some questions about it. It sounds like there is an interview for those affected to determine any money reduction or not. -anonymous-
    • Comment 06/25/09: Thanks for posting the link to the exec stock option exercise. Based on a random sample of 5 transactions: It's interesting that when several execs each acquire thousands of shares at $0 (!), they only sell between 42% and 48% of that number of shares, that same day. Thus, they maintain their 'stake' in IBM. (Right.) And what's with the exec who exercised an option for OVER $100 per share, and sold at less than $5 per share more that same day? Must really need the money. I'm being a bit sarcastic, of course - this is no laughing matter. -Exec options-
    • Comment 06/25/09: I had a meeting with my Manager today regarding relocation to a GDF site, which is outside of the city I currently reside in. I live within 50 miles of GDF location, however, my commute would involve a two hour drive (one way). This is if traffic is fairly light and no inclement weather conditions. I was told by my Manager that I have until August 6 to decline or accept. If I decline, I will be asked to voluntarily resign. In previous conversations with my Manager, I was told I would be asked to "involuntarily resign". My Manager has denied making any such statement and has changed her verbiage. At any rate, I have been told I will be asked to give a two week notice and walk away with no severance if I decline IBM's offer to relocate to a new GDF site. Just an FYI to those who may be in same circumstance. -Mel B.-
    • Comment 06/25/09: Mel B - it's the distance not the commute time that determines the decision. If I recall, and I'm not with IBM any more (RA'd in Mar) so you should check with HR, but if IBM moves your work location within a 50 mile radius you are expected to report to work at that location. Now, you should find out if it's 50 miles as the crow flies or as the roads go too. Sounds like you may need to do the commute thing, maybe you can carpool, and look for something else ASAP ! Anyway, HR will have the facts, make sure you document it in writing. You may want to search the intranet too. -nobody-
    • Comment 06/26/09: IBM Consulting essentially absent from rankings. No surprise. As a 15yr Con RA'd, we were driven to follow increasingly stupid internally-focused methods, totally overengineered complex pitches, and "POV's" which left client's rolling eyes. But as long as management ticked off boxes showing compliance with acronym soup of "initiatives" (CVI, SSM, Harmony, CBM, ...), life was good. Just make sure you're following the buyer behaviors someone dreamed up or hundreds of skills on the hook to get assessed for the most complexly confusing portfolio in the world but without real education beyond endless webinars by staffers who didn't have experience or a clue. -GTS.SME.RA'd-
    • Comment 06/26/09: June layoffs were "stealth" permanent layoffs. A few hundred, not thousands. Not as big as the previous RA wave. Who knows if IBM cut projected RA's for June based on bad publicity or the actions of the Alliance to bring it to the attention of the media. If it is either of these then it is a moral victory, for now, achieved. We still have to remain vigilant. IBM will continue to get rid of employees. The question is: when? -anonymous-
    • Comment 06/26/09: Cuts are coming in July, not June. More surgical this time, not across the board. -deep south-
    • Comment 06/26/09: To those who are thinking there won't be any June layoffs. Its not the end of the month yet. There are a few more days. Even so, don't look for the large numbers of layoffs as in past few rounds. IBM is pretty much done with the big cuts. You'll see more of a trickling effect now. Smaller, less obvious numbers. The large cuts will begin again once the GR ramps up once in the fall. Mgmt is having problems staffing with the proper skills (and from the looks of the folks they've already taken on-board, they're not picky choosing people with ANY sort of skill). -miss understanding-
    • Comment 06/26/09: More cuts are coming in ITD, managers are very quickly collecting names for the RA. No word on numbers. -Frank-
    • Comment 06/27/09: As for the light number of layoffs now, recall after 1st Q when IBM held the teleconference with Wall Street, IBM said that most of the layoffs were completed in the beginning of the year. They did it up front and there will be few at this point. -anonymous-
  • General Visitor's Comment page
    • Comment 06/23/09: Anyone else notice that IBM is trying to put itself in the public eye by doing radio sponsorships and running ads encouraging people to log onto its site? -Think- Alliance reply: I've been busy trying to counter that with several Tweets about Alliance@IBM and the abuses IBM has rendered to its employees. The executives don't like it, and have actually replied to my Tweets, crying "SPAM"! I made a mistake and they get all upset. Imagine that! Here's some Twitter Ids you can Tweet: @IBM @IBMFedCyber @ibm4bloggers @ibmPulse @S4iSystems @IBMResearch @ibmtivoli @rhetorica2 @obriend @tiffwdms @crogus71 @dotteson @servicemgmt @noahgk @andypiper @delphRB @RiaHyman @ibmstorage @IBMCanSystems @ibmperformance ....to name a few; If you have a Twitter account. Ours is @Allianceibm
    • Comment 06/25/09: http://www.bloomberg.com/apps/news?pid=20601087&sid=aFcXAGUYZSVw Gerstner comments on the culture of greed on wall street. It's hard to swallow this load of bs coming from the guy that walked away from IBM with $1B and a Gulfstream....Really, is there no shame? -gadfly-
  • Pension Comments page
  • Raise and Salary Comments IBM CEO Sam Palmisano: "I am pleased to announce that we will not only be paying bonuses to IBMers worldwide, based on individual performance, but that they'll be funded from a pool of money nearly the same size as last year's. That's significant in this economy -- and especially so, given the size of the 2007 pool. Further, our salary increase plan will continue, covering about 60 percent of our workforce. As always, increases will go to our highest performers and contributors. We should all feel good about the company's ability to invest in people in these very concrete ways."
    • Comment 06/21/09: Salary = 48k or so after the 15% cut I was given last year; Band = 6; Yrs with India Business Machines = 9; Div = 07 - Global Services; Last year I was given a $99/month raise. I see that Bluepages compensation pages are now locked down so I assume I'll find out this week whether I get a raise or, more likely, not. If I do, I suspect it will be $100 or less a month again. Biggest salary movement I've ever had with IBM is the 15% pay cut to offset the O/T lawsuit payout. -Joe Random-
    • Comment 06/21/09: Pay raises anyone? Roughly translated > You clowns aren't going to believe just how much money I am going to make this year! Good luck getting yours! -Mr Ziffel-
    • Comment 06/23/09: Band Level = 07; Years Service = 10; Hours/Week = 45; Div Name = 07; Message = Had my salary chat with my manager today 1 PBC, performer and only got 2 1/2 % increase. -Tony-
    • Comment 06/23/09: 1st Line Managers were given the go ahead to discuss the pay raises today. Expect meetings this week for the news. -NotInIndia-
    • Comment 06/24/09: Band Level = 9; Location = United States; Message = Just got my raise.. if you want to call it that... I am a Band 9 with a 2+ PBC.. A whopping 1.3% but better than a poke in the eye with a sharp stick. I really expected nothing. -anonymous-
    • Comment 06/24/09: Band Level = 10; Years Service = many; Message = PBC 1; 1.5% -anonymous-
    • Comment 06/24/09: Band Level = 3; Years Service = 15; Div Name = ITS; Message = It's been 10 plus years since my last raise. I have been performing with 2's on my PBC mostly... I've been asking for a raise for over 5 years now and am not hanging on anymore. A shame I have to leave IBM because I cant afford to even stay anymore. --Lost hope in IBM-
    • Comment 06/25/09: Band Level = 8; Years Service = 6; Message = PBC 1, 3.5% putting me at 90% of band range ( according to manager provided print out ). -NotInIndia-
    • Comment 06/25/09: Salary = 69000; Band Level = 7; Years Service = 25; Hours/Week = 48; Div Name = ITD Shared Services; Location = USA Message = got a 2% raise, 2+ PBC, I am one of the lucky ones but than again look how long I've been working for IBM and how low I'm paid, been in the same band for 10yrs. At least for this month I have a job -I'm Tired-
    • Comment 06/25/09: Band Level = 8; Years Service = 15; Div Name = GTS' Location = Australia; Message = PBC = 2+ Raise = 1% -Anony-
    • Comment 06/24/09: Salary = 56k; Band Level = 07; Years Service = 09; Hours/Week = 45+; Message = Consistent 2+ performer. 1%. -Penetrated Low-
    • Comment 06/25/09: Salary = $87,000; #Yrs Since Raise = 1; Band Level = 7; Job Title = IT Specialist; Years Service = 25; Hours/Week = 40; Div Name = ITD; Message = Better than a sharp stick in the eye but not by much......I really don't feel I have a right to complain though given what\'s happened to so many others recently. I feel like I'm being "less screwed" than the average employee if that makes sense. I realize it's temporary though and my turn is coming. My morale sucks just like everyone else's these days. -grayhair-
    • Comment 06/25/09: Salary = 56000; #Yrs Since Raise = 1; Band Level = 4; Years Service = 10+; Hours/Week = 65; Div Name = 07; Location = Boulder; Message = Just got the call from my manager saying that they have been told that ONLY PCB ratings of 2+ and 1's are getting raises this year. The only reason I got a 2 this past year is because I spent some time (6 weeks) out of the country WORKING and visiting my Father who has cancer. If I had done the same job doing the same thing the same way with the same result, I would have gotten the 2+ rating and a crappy raise -Bob
    • Comment 06/25/09: Salary = 75,000; #Yrs Since Raise = 1; Band Level = 7; Job Title = Not Important; Years Service = Over 10; Hours/Week = As many as my slave owner makes me work; Div Name = Canada; Location = Canada; Message = Here's a good one for everyone. Today we learned that our raises will not come in on time in July but instead will be paid in September. The accountants are doing their shell game once again. This happened a few years ago when our raises were postponed a few months. The very next year our raises were delivered on the "new" schedule. So my calculation indicate they have gained approximately 4 months. All they need to do is do this again a couple of times and they've skipped raises for a complete year. Take this with their theft of 40-60 dollars a month from all remote workers by not paying DSL charges anymore and the big fellas are doing ok aren't they? Their bonuses should be pretty darn good this year. -IBMBS.com-
    • Comment 06/25/09: #Yrs Since Raise = 6; Band Level = 9; Job Title = Sr. Consulting IT Specialist; Years Service = 30; Message = Sigh, I think there must have been a typo in Sam's teleprompter. The 60% was supposed to be for the TOP performers.... not the top PERFORMERS. Simple semantics. NO raise for YOU...... -Tom B.-
    • Comment 06/26/09: Location = UK Message = At a recent briefing by mgmt here in the north of the UK, we were told that Sam's statement re 60% was "a mistake" and was not intended for employees but for the market (i.e. a PR exercise). So no pay rises in UK this year but at least I know who the top performers are now - they are the ones wandering around aimlessly muttering "why did I bother"... On a separate note, heard a rumour that Software Group in the UK will shed staff in 3Q -Limey-
    • Comment 06/26/09: "...At a recent briefing by mgmt here in the north of the UK, we were told that Sam's statement re 60% was "a mistake".." IBM promoting Sam to CEO was a MISTAKE. *Maybe* 60% of the entire workforce *might* get a tiny raise, mainly those 60% are in the BRIC. Typical of this Big Blew. -SlammyPalmicrapo-
    • Comment 06/26/09: "there is no salary program globally this year for executives" But more stock buybacks and options galore for them! Now that really sucks, huh? -IBMoptioneer-
    • Comment 06/26/09: Salary = $87K; #Yrs Since Raise = 1; Band Level = 7; Job Title = IT Specialist; Years Service = 25+; Hours/Week = 40; Div Name = ITD; Message = I erred in my previous post by not including: 2+ rating & 2% raise this year. This is what I was thinking about when I stated "better than a sharp stick in the eye but not by much....". I appreciate the candor of everyone posting here. Thanks.... -grayhair-
    • Comment 06/26/09: Years Service = 20+; Hours/Week = 50+; Div Name = ITD; Message = PBC = 1, +2.5% -Fred-
    • Comment 06/27/09: I HAD A DREAM. I dreamt that I had an employment contract that gave me cost of living raises. That a review board of people who actually did my job reviewed my performance and appraised me. That I got additional performance pay or not based on this stern but fair appraisal . I dreamed on that I had affordable health care and my group discount rates would still apply when I retired as I was still a member of a large group. In this dream even retirees saw raises every 5 years or so. Granted, not big ones but every little bit helps on a fixed income. In my dream I was happy with my career and knew what I had to look forward to in retirement. In my dream IBM was even more profitable because the executives could focus on improving products and market share instead of how to cheat employees for fun and profit. Life was good for all. I had a dream. -Exodus2007-
    • Comment 06/27/09: While it is nice to give raises I have a problem with Sammy's thinking regarding how he awards top performers. Top performers are defined by management. Let's say I chum up to my manager and go to lunch with him, play golf with him, and buy him a beer after work. He is going to reward me as a top performer. I guarantee it. No doubt in my mind. Is that fair? No. That is why you see so much discontent in IBM right now with the employees. -Joe Engineer-
    • Comment 06/27/09: Salary = 78,000; #Yrs Since Raise = 2; Band Level = 7; Job Title = Staff Soft. Engineer; Years Service = 6; Hours/Week = The absolute minimum to keep my job; Location = Austin; Message = You folks working 50,60 hours a week or more for a PBC 1 are fools. Better to spend that extra time working an extra gig on the side making $50-60 per hour. I've been doing that for months and have effectively doubled my income. QUIT WASTING YOUR TIME, PARTICUALARLY FAMILY TIME, TO WORK HARDER FOR IBM! -anon-
  • PBC Comments
  • International Comments
News and Opinion Concerning Health Savings Accounts, Medical Costs and Health Care Reform
  • National Public Radio: Insurers Revoke Policies To Avoid Paying High Costs. By Joanne Silberner. Excerpts: According to a new report by congressional investigators, an insurance company practice of retroactively canceling health insurance is fairly common, and it saves insurers a lot of money. A subcommittee of the House Energy and Commerce Committee recently held a hearing about the report's findings in an effort to bring a halt to this practice. But at the hearing, insurance executives told lawmakers they have no plans to stop rescinding policies. ...

    Hamm's insurance company rescinded the policy of Otto Raddatz after he was diagnosed with lymphoma. Raddatz had not told the company about a CT scan by a now-retired doctor that showed gallstones and a weakened blood vessel. That's because he didn't know about the findings, his sister Peggy Raddatz, an attorney, testified. She spent weeks on the phone and ended up at the Illinois Attorney General's office, which began an investigation. The retired doctor turned out to be off on a fishing trip. "Luckily, they were able to find the doctor, who was able to say, 'Yes, I never discussed those issues with him; they were very minor,' " Raddatz testified. ...

    One of Barton's constituents, Robin Beaton of Waxahachie, Texas, did know that her health history included acne and a rapid heartbeat. But she didn't think they were relevant to her current health and left them off her application. After she was diagnosed with breast cancer and was scheduled for a double mastectomy, her insurer cancelled her policy, leaving her devastated. ...

    Committee investigators found a total of 19,776 rescissions from three large insurers over five years. The rescissions saved the insurers $300 million. ...

    Rep. Bart Stupak (D-MI), who chaired the hearing, asked all three CEOs if they would agree to stop rescinding policies except in cases of fraud. All three said no. If they don't do something to stop it, said Barton of Texas, Congress will.

  • Wall Street Journal: The Myth of Prevention. A doctor explains why it doesn’t pay to stay well. Decoding what works, what falls short in Obama’s plans to reform health care. By Abraham Verghese. Excerpts: When President Truman had his shot at universal health care in 1949, the American Medical Association unfortunately made use of Sir Luke Fildes’s famous painting, “The Doctor,” in a negative campaign. ...

    The AMA used this image on thousands of posters, adding the caption, “Keep Politics Out of this Picture.” They hoped to convince the public (and did) that government intervention would mean the end of home visits; government intervention would eliminate what Fildes captures so well: the sacred bond between doctor and patient.

    “Sacred bond,” alas, is not among the descriptors I hear when patients tell me what they think of us or our health care system. The descriptors fit to publish include “inattentive,” “no-one-in-charge” and “money grubbing.” In fact, a thoughtful lay friend recently said to me in the context of her medical care, “Face it, Abraham, medicine is corrupt.” She stated this casually, as if it were an obvious and well-known fact, not waiting to see if I would agree. At the time I remember that I sputtered. I wanted to protest but the sounds would not come out. That word “corrupt” gnawed at me for days. ...

    President Obama pointed to the problem of “a system of incentives where the more tests and services are provided, the more money we pay.” As if to rub it in, he added, “And a lot of people in this room know what I’m talking about.” Oooo, there was that “corrupt” word again, even though he did not say it. This part of the speech drew no applause, just stony silence.

    Yes, Mr. President, a lot of people inside and outside that room know exactly what you are talking about. A skewed reimbursement scheme set up by Medicare, a system that pays generously when you do something to a patient, but is stingy when you do something for a patient, is largely to blame. Cut, poke, sew, burn, insert, inject, dilate, stent, remove and you get very well paid; if you learn how to do this efficiently, maybe set up your own outpatient center so you can do it to more people in a shorter time (which is what happened when this payment system was put in place in 1989) and you are paid even more. If, however, you are a primary care physician, and if, just like the young doctor who saw my parents yesterday, you spend time getting to know your patients, and are willing to play quarterback when your patient enters the hospital, so that you can herd the consultants and guide the family through a bewildering experience that gets surreal if you are in the intensive care unit, then you may have great personal satisfaction but you will make five to tenfold less than your colleagues in the doing-to disciplines.

    Our reimbursement system, as the president put it, “is a model that has taken the pursuit of medicine from a profession—a calling—to a business.” ...

    Poor McAllen, Texas. It happens to be the focus of a recent “New Yorker” piece by Atul Gawande, a piece that President Obama referred to in his speech to the AMA, because health care costs in McAllen are twice that of comparable cities while health outcomes are no different. The reasons are complex but probably because good physicians are ordering lots of tests, calling in lots of consultants, making good use of the equipment they own and the imaging centers they might have a stake in (and yes, they think they can be objective in ordering an MRI or CAT scan that sends the patient to their own facility); it has to do with hospitals competing with each other for the kinds of patients with conditions that are reimbursed well, and wooing patients, wooing high-volume physicians (some of whom are invited to invest in the hospital) to make full use of their PET scan, their gamma knife, their robotic-surgery facility, their cancer center, their birthing center. That was Atul Gawande’s conclusion, and I would concur. ...

    Which brings me to my problem with the president’s plan: despite being an admirer, I just don’t see how the president can pull off the reform he has in mind without cost cutting. I recently came on a phrase in an article in the journal “Annals of Internal Medicine” about an axiom of medical economics: a dollar spent on medical care is a dollar of income for someone. I have been reciting this as a mantra ever since. It may be the single most important fact about health care in America that you or I need to know. It means that all of us—doctors, hospitals, pharmacists, drug companies, nurses, home health agencies, and so many others—are drinking at the same trough which happens to hold $2.1 trillion, or 16% of our GDP. Every group who feeds at this trough has its lobbyists and has made contributions to Congressional campaigns to try to keep their spot and their share of the grub. Why not?—it’s hog heaven ...

    We may not like it, but the only way a government can control costs is by wielding great purchasing power to get concessions on the price of drugs, physician fees, and hospital services; the only way they can control administrative costs is by providing a simplified service, yes, the Medicare model (with a 3% overhead), and not allowing private insurance to cherry-pick patients (some of them operating with 30% overheads, the cost passed on to you). ...

    To come back to my favorite painting: a computer cannot take the place of the doctor in Fildes’s painting; an electronic medical record (EMR) may or may not save money (it won’t be anywhere as much as is projected) but what it will do is ensure that we doctors, nurses, therapists, particularly in hospitals will be spending more and more time focused on the computer, communicating with each other, ordering and getting tests, buffing and caring for our virtual patient—the iPatient is my term for this phenomenon—while the patient in the bed wonders where everybody is. Having worked exclusively for the last seven years or so in hospitals that have electronic medical records (EMR), I have felt for some time that the patient in the bed has become an icon for the real focus of our attention, the iPatient. Yes, electronic medical records help prevent medication errors and are a blessing in so many ways, but they won’t hold the patient’s hand for you, they won’t explain to the family what is going on.

  • New York Times: In Poll, Wide Support for Government-Run Health. By Kevin Sack and Marjorie Connelly. Excerpts: Americans overwhelmingly support substantial changes to the health care system and are strongly behind one of the most contentious proposals Congress is considering, a government-run insurance plan to compete with private insurers, according to the latest New York Times/CBS News poll. The poll found that most Americans would be willing to pay higher taxes so everyone could have health insurance and that they said the government could do a better job of holding down health-care costs than the private sector. ...

    Republicans in Congress have fiercely criticized the proposal as an unneeded expansion of government that might evolve into a system of nationalized health coverage and lead to the rationing of care. But in the poll, the proposal received broad bipartisan backing, with half of those who call themselves Republicans saying they would support a public plan, along with nearly three-fourths of independents and almost nine in 10 Democrats.

  • New York Times editorial: A Public Health Plan. Excerpts: The nation already has several huge public plans, including Medicare for the elderly (once reviled by conservatives, it is now only short of the flag in its popularity) and Medicaid for the poor. Now the issue is whether to establish a new public plan to encourage more competition among health insurers and provide Americans with an alternative. ...

    What Republicans are adamantly opposed to is the idea of adding a public plan to that exchange. They portray it as a “government takeover” of the health care system, or even as socialized medicine. Those are egregious mischaracterizations. There is no serious consideration in Congress of a single-payer governmental program that would enroll virtually everyone. Nor is there any talk of extending the veterans health care system, a stellar example of “socialized medicine,” to the general public.

    The debate is really over whether to open the door a crack for a new public plan to compete with the private plans. Most Democrats see this as an important element in any health care reform, and so do we. A public plan would have lower administrative expenses than private plans, no need to generate big profits, and stronger bargaining power to obtain discounts from providers. That should enable it to charge lower premiums than many private plans.

    It would also provide an alternative for individuals who either can’t get adequate insurance from private insurers or don’t trust the private insurance industry to treat them fairly. And it could serve as a yardstick for comparing the performance of private plans and for testing innovative coverage schemes.

  • New York Times op-ed: Health Care Showdown. By Paul Krugman. Excerpts: America’s political scene has changed immensely since the last time a Democratic president tried to reform health care. So has the health care picture: with costs soaring and insurance dwindling, nobody can now say with a straight face that the U.S. health care system is O.K. And if surveys like the New York Times/CBS News poll released last weekend are any indication, voters are ready for major change.

    The question now is whether we will nonetheless fail to get that change, because a handful of Democratic senators are still determined to party like it’s 1993.

    And yes, I mean Democratic senators. The Republicans, with a few possible exceptions, have decided to do all they can to make the Obama administration a failure. Their role in the health care debate is purely that of spoilers who keep shouting the old slogans — Government-run health care! Socialism! Europe! — hoping that someone still cares.

    The polls suggest that hardly anyone does. Voters, it seems, strongly favor a universal guarantee of coverage, and they mostly accept the idea that higher taxes may be needed to achieve that guarantee. What’s more, they overwhelmingly favor precisely the feature of Democratic plans that Republicans denounce most fiercely as “socialized medicine” — the creation of a public health insurance option that competes with private insurers. ...

    The real risk is that health care reform will be undermined by “centrist” Democratic senators who either prevent the passage of a bill or insist on watering down key elements of reform. I use scare quotes around “centrist,” by the way, because if the center means the position held by most Americans, the self-proclaimed centrists are in fact way out in right field.

    What the balking Democrats seem most determined to do is to kill the public option, either by eliminating it or by carrying out a bait-and-switch, replacing a true public option with something meaningless. For the record, neither regional health cooperatives nor state-level public plans, both of which have been proposed as alternatives, would have the financial stability and bargaining power needed to bring down health care costs. ...

    Thus Senator Ben Nelson of Nebraska initially declared that the public option — which, remember, has overwhelming popular support — was a “deal-breaker.” Why? Because he didn’t think private insurers could compete: “At the end of the day, the public plan wins the day.” Um, isn’t the purpose of health care reform to protect American citizens, not insurance companies?

  • Forbes: Obama's Doctor Knocks ObamaCare. Dr. David Scheiner took care of Obama for 22 years. But they don't see eye-to-eye on how to fix the health care system. By David Whelan. Excerpts: David Scheiner, an internist based in the Chicago neighborhood of Hyde Park, has a diverse practice of lower-income adults from the nearby housing projects mixed with famous patients like U.S. Sen. Carol Mosely Braun, the late writer Studs Terkel and, most notably, President Barack Obama. Scheiner, 71, was Obama's doctor from 1987 until he entered the White House; he vouched for the then-candidate's "excellent health" in a letter last year. He's still an enthusiastic Obama supporter, but he worries about whether the health care legislation currently making its way through Congress will actually do any good, particularly for doctors like himself who practice general medicine. "I'm not sure he really understands what we face in primary care," Scheiner says. ...

    What should the president be focused on? Scheiner thinks that a good health reform would be "Medicare for all," a single-payer system where the government would cover everyone and pay for it by cutting out waste in the system. "A neurosurgeon gets paid $20,000 for cutting into the neck of my patient. Have him get paid $1 million a year instead of $2 million or $3 million. He won't starve," Scheiner says. ...

    Scheiner thinks that Obama's "public plan" reform doesn't go far enough. He supports the idea of that option for people who don't like or can't afford their HMO. But he worries that it will be watered down or not happen at all. "It's nonsense that the private insurance companies need to be protected," he says. "Why? Because they've done such a good job?" ...

    Scheiner thinks that any health reform should involve paying primary-care doctors better so they don't have to rush through appointments to make ends meet. He says that the medical students he encounters are no longer even taught how to do a patient history and physical exam. Patients get imaging studies and lab work instead of actual work-ups. "It's like in Star Trek where Bones had the thing he would wave up and down. They don't even talk to patients," he says.

  • Wall Street Journal: Why We Need a Public Health-Care Plan. Without the government as competition, the private sector has little incentive to improve. By Robert B. Reich. Excerpts: But before we even get to this point, it's important to recognize that those terrifying CBO cost projections significantly overstate the costs. They did not include potential cost savings from the lynchpin of health-care cost containment: a so-called public option that would give people who don't get health care from their employer the choice of a public insurance plan. Why? For the simple reason that the Senate committees hadn't yet agreed on a public option. Yet without a public option, the other parties that comprise America's non-system of health care -- private insurers, doctors, hospitals, drug companies, and medical suppliers -- have little or no incentive to supply high-quality care at a lower cost than they do now.

    Which is precisely why the public option has become such a lightening rod. The American Medical Association is dead-set against it, Big Pharma rejects it out of hand, and the biggest insurance companies won't consider it. No other issue in the current health-care debate is as fiercely opposed by the medical establishment and their lobbies now swarming over Capitol Hill. Of course, they don't want it. A public option would squeeze their profits and force them to undertake major reforms. That's the whole point.

    Critics say the public option is really a Trojan horse for a government takeover of all of health insurance. But nothing could be further from the truth. It's an option. No one has to choose it. Individuals and families will merely be invited to compare costs and outcomes. Presumably they will choose the public plan only if it offers them and their families the best deal -- more and better health care for less.

    Private insurers say a public option would have an unfair advantage in achieving this goal. Being the one public plan, it will have large economies of scale that will enable it to negotiate more favorable terms with pharmaceutical companies and other providers. But why, exactly, is this unfair? Isn't the whole point of cost containment to provide the public with health care on more favorable terms? If the public plan negotiates better terms -- thereby demonstrating that drug companies and other providers can meet them -- private plans could seek similar deals.

    But, say the critics, the public plan starts off with an unfair advantage because it's likely to have lower administrative costs. That may be true -- Medicare's administrative costs per enrollee are a small fraction of typical private insurance costs -- but here again, why exactly is this unfair? Isn't one of the goals of health-care cost containment to lower administrative costs? If the public option pushes private plans to trim their bureaucracies and become more efficient, that's fine.

  • Wall Street Journal: Going It Alone When Buying a Health Policy. Focusing on Premiums Risks a Nasty Surprise When the Bills Arrive. By Anna Wilde Mathews. Excerpt: The sour economy is prodding more Americans to buy their own health insurance, a daunting task for people not prepared to navigate the possible pitfalls. Tina Smith, who owns a residential-cleaning service with her husband in Lyndhurst, Ohio, was seeking to lower her premiums when she bought an Assurant Inc. policy from an agent who visited her at home. She says the agent played up the health plan’s affordability and its $2 million lifetime coverage.

    But Ms. Smith said the agent didn’t mention that the policy had a $5,000 annual limit on what the insurer would pay for outpatient treatment, or medical care when a patient hasn’t been admitted to a hospital. She acknowledges that the limit was disclosed in the plan’s full paperwork. Last year, the 52-year-old was diagnosed with lymphoma. She quickly exhausted the $5,000 benefit and ran up an additional $86,000 in bills for imaging scans and other procedures. Ms. Smith hopes to reduce that debt to around $20,000 with aid from a nonprofit organization and other sources. “I’m not health-care savvy, and it didn’t occur to me I had to go over this with a fine-tooth comb,” she says.

  • New York Times: Obama Says Government Health Coverage Plan Would Not Hurt Private Insurers. Excerpts: “We do not believe that it is possible to create a government plan that could operate on a level playing field,” read a letter to the Senate from Karen M. Ignagni, president of America’s Health Insurance Plans, and Scott P. Serota, president of the Blue Cross and Blue Shield Association. “Regardless of how it is initially structured, a government plan would use its built-in advantages to take over the health insurance market.” ...

    “If private insurers say that the marketplace provides the best quality health care, if they tell us that they’re offering a good deal, then why is it that the government — which they say can’t run anything — suddenly is going to drive them out of business?” Mr. Obama said. “That’s not logical.”

  • Wall Street Journal: Big Health Firms Underpay Claims. By Fawn Johnson. Excerpts: Congressional investigators have discovered that large health insurers in every region of the country are relying on faulty databases to underpay millions of valid insurance claims. In a report released Wednesday, the Senate Commerce Committee said insurance companies nationwide have failed to provide consumers with accurate or understandable information about how they calculate “reasonable” or “customary” charges for out-of-network care. Insurers also signed contracts prohibiting them from disclosing information about the databases to consumers or doctors, the report said. ...

    Providers and patients have suspected for years that insurers were underpaying for out-of-network care, but they haven’t been able to prove it. Committee investigators found that Ingenix developed its payment models based on claims data provided by its customers, the insurance companies. A committee aide said those companies sometimes would “scrub” the data sent to Ingenix—throwing out outlying high costs. Ingenix then would use questionable statistical models to come to its own rate estimates. ...

    Republicans and other champions of private-sector insurers have long argued that making health care more consumer-friendly would drive down costs because patients could “shop around” for the best care. But Sen. Rockefeller and other health-policy experts argue that the lack of information in the private health-insurance market has made competition and informed consumer choice almost impossible.

  • New York Times op-ed: The Prescription From Obama’s Own Doctor. By Nicholas D. Kristof. Excerpts: As a society, we trust doctors to be more concerned with the pulse of their patients than the pulse of commerce. Yet the American Medical Association is using that trust to try to block a robust public insurance option as part of health reform. In fact the A.M.A. now represents only 19 percent of practicing physicians (that’s my calculation, which the A.M.A. neither confirms nor contests). Its membership has declined in part because of its embarrassing historical record: the A.M.A. supported segregation, opposed President Harry Truman’s plans for national health insurance, backed tobacco, denounced Medicare and opposed President Bill Clinton’s health reform plan.

    So I hope President Obama tunes out the A.M.A. and reaches out instead to somebody to whom he’s turned often for medical advice. That’s Dr. David Scheiner, a Chicago internist who was Mr. Obama’s doctor for more than two decades, until he moved into the White House this year. “They’ve always been on the wrong side of things,” Dr. Scheiner told me, speaking of the A.M.A. “They may be protecting their interests, but they’re not protecting the interests of the American public. ...

    Yet when the A.M.A. uses its lobbying muscle to oppose major health reform — yet again! — that feels like a betrayal. Doctors work hard to keep us healthy when we’re in their offices, and that’s why they win our trust and admiration — yet the A.M.A.’s lobbying has sometimes undermined the health of the very patients whom the doctors have sworn to uphold. I might expect the American Association of Used Car Dealers to focus exclusively on wallet-fattening, but we expect better of physicians. In fairness, most physicians expect better as well, which is why the A.M.A. is on the decline.

  • Governing: Health Myths An Apple a Day. Myth #6: Preventive care saves money. By Arthur Garson Jr. and Carolyn L. Engelhard. Excerpts: If you're among those who think prevention saves money, and will help reduce the overall cost of medical care, you're not alone. But while an apple a day might keep the doctor away, at least for awhile, it also might cost more than you think. Preventive medicine can help avoid costly illnesses earlier in life, only to increase the population of elderly and infirmed people who will most likely require expensive treatments for other illnesses later.

    Even worse, unhealthy habits such as tobacco smoking may actually save money in the long run as people who smoke die earlier and use fewer health care dollars. "This doesn't make sense," you say, "Smokers are less healthy than nonsmokers." That may be true, and smokers do use up to 40 percent more medical care while they are alive. A recent study from Holland showed that, on average, smokers die at age 77 and save $100,000 in lifetime medical care costs compared with non-smokers who die at 83.

    The same is true for people who are obese. While obesity-related conditions such as Type-2 diabetes, high blood pressure and heart disease are associated with high medical expenditures, the costs that are saved by preventing obesity will only be offset later in life by diseases unrelated to obesity that accompany living a longer life. In the Dutch study, obese people die at 80 and save $50,000 compared with non-obese people who die at 83.

    In fact, a recent study showed that for all preventive care, 19 percent saves money and 81 percent costs money. What is going on here? Just like the argument about quality care (discussed in last month's column), prevention is absolutely the right thing to do. It improves quality of life and increases our life span. But it doesn't always save money. ...

    Is there a business case for prevention? From the perspective of employers, prevention saves money as long as the patients stay fairly healthy while they are working or until the age of 65, when Medicare pays for the diseases that prevention delayed. For example, employers should certainly pay for mammograms, since paying for advanced breast cancer treatment is significantly more expensive. In one study, when a large employer with 24,000 employees nationwide reduced the co-pays for certain medications that would help manage their employees' asthma, hypertension and diabetes, their health costs per employee dropped 20 percent below those of comparable employers.

  • National Public Radio: Tracking The Money In The Health Care Debate. By Peter Overby and Andrea Seabrook. Excerpts: NPR is launching a new investigative series to report on these Dollar Politics. Two NPR correspondents attended the first legislative action on health care reform: a meeting of the Senate Committee on Health, Education, Labor and Pensions. We also sent a photographer to take pictures — not of the senators, but of the audience, the people watching the committee meeting, many of them lobbyists. ...

    Four decades ago, when Congress passed Medicare, the opposition was pretty much one big group: the American Medical Association. The AMA opposes a public health care plan today as well. But it isn't the only interest group involved anymore, says Zelizer. "Today health care has hundreds of different interest groups, each specialized in a different issue, each with its own war chest, each giving money and each seeking to protect its interests." And that brings us back to the room, the lobbyists, and our photos of them. Who are they? Whom do they work for? What do they want health care reform to look like?

  • The Huffington Post: Lobbyists on a Roll: Gutting Reform on Banking, Energy, and Health Care. By Arianna Huffington. Excerpts: Remember all that change Americans voted for in November? Well, there's been a change in the plans for change. The detour has come courtesy of a familiar nemesis: DC lobbyists who, this year alone, have watered-down, gutted, or out-and-out killed ambitious plans for reforming Wall Street, energy, and health care. The media like to pretend that something's at stake when a big bill is being debated on the House or Senate floor, but the truth is that by then the game is typically already over. The real fight happens long before. And the lobbyists usually win. ...

    Last year, 15,000 registered lobbyists spent more than $3.25 billion trying to sway Congress. This year has brought even more of the same. Oil and gas companies spent $44.5 million lobbying Congress and federal agencies in the first quarter of 2009 -- more than a third of the $129 million they spent in all of 2008, which in itself was a 73 percent increase from two years before. Medical insurers and drug companies are also digging deep: 20 of the biggest health insurance and drug companies spent nearly a combined $35 million in Q1 -- a 41 percent increase from the same quarter last year. All that spending has proven to be money disturbingly well spent. ...

    Which brings us to health care and the reform-killing armada currently steaming towards Washington. Their attack is shaping up to be unprecedented. For example, the U.S. Chamber of Commerce has pledged $100 million to defeat reform -- while, of course, calling it reform.

    Much of the battle will be focused on the so-called public option, which the American Medical Association has already given a cold shoulder to, telling Congress it "does not believe creating a public health insurance option... is the best way to expand health insurance coverage and lower costs." Indeed, the AMA has been steeling itself for this battle. Since the 2000 election, it has doled out almost $10 million to congressional candidates.

    And, again, this fight won't break down along Democrat vs Republican battle lines. Case in point: Tom Daschle. The former Senate Majority Leader, who came within a few unreported chauffeur-driven rides of being Obama's health care reform czar, recently hinted that Obama would have to drop the public option. "We've come too far and gained too much momentum for our efforts to fail over disagreement on one single issue," he told ABC News. Of course, as Daschle certainly understands, without that "one issue," there is no real reform. But that's the reform killer's M.O.: identify the essential element of any reform bill and remove it -- leaving behind a worthless shell. ...

    According to a recent NYT/CBS News poll, a whopping 72 percent of the public favors the public option. An NBC/Wall Street Journal poll had the number even higher: 76 percent. And yet you can already feel it slipping away. As Matt Yglesias writes, "So just keep in mind that when people talk about political obstacles to a robust public plan, they're not talking about mass public opinion as an obstacle -- they're talking about the wealth and power of relatively narrow interests."

  • New York Times op-ed: Not Enough Audacity. By Paul Krugman. Excerpts: When it comes to domestic policy, there are two Barack Obamas. On one side there’s Barack the Policy Wonk, whose command of the issues — and ability to explain those issues in plain English — is a joy to behold. But on the other side there’s Barack the Post-Partisan, who searches for common ground where none exists, and whose negotiations with himself lead to policies that are far too weak.

    Both Baracks were on display in the president’s press conference earlier this week. First, Mr. Obama offered a crystal-clear explanation of the case for health care reform, and especially of the case for a public option competing with private insurers. “If private insurers say that the marketplace provides the best quality health care, if they tell us that they’re offering a good deal,” he asked, “then why is it that the government, which they say can’t run anything, suddenly is going to drive them out of business? That’s not logical.”

    But when asked whether the public option was non-negotiable he waffled, declaring that there are no “lines in the sand.” That evening, Rahm Emanuel met with Democratic senators and told them — well, it’s not clear what he said. Initial reports had him declaring willingness to abandon the public option, but Senator Kent Conrad’s staff later denied that. Still, the impression everyone got was of a White House all too eager to make concessions. ...

    Which brings us back to health care. It would be a crushing blow to progressive hopes if Mr. Obama doesn’t succeed in getting some form of universal care through Congress. But even so, reform isn’t worth having if you can only get it on terms so compromised that it’s doomed to fail. What will determine the success or failure of reform? Above all, the success of reform depends on successful cost control. We really, really don’t want to get into a position a few years from now where premiums are rising rapidly, many Americans are priced out of the insurance market despite government subsidies, and the cost of health care subsidies is a growing strain on the budget.

    And that’s why the public plan is an important part of reform: it would help keep costs down through a combination of low overhead and bargaining power. That’s not an abstract hypothesis, it’s a conclusion based on solid experience. Currently, Medicare has much lower administrative costs than private insurance companies, while federal health care programs other than Medicare (which isn’t allowed to bargain over drug prices) pay much less for prescription drugs than non-federal buyers. There’s every reason to believe that a public option could achieve similar savings.

    Indeed, the prospects for such savings are precisely what have the opponents of a public plan so terrified. Mr. Obama was right: if they really believed their own rhetoric about government waste and inefficiency, they wouldn’t be so worried that the public option would put private insurers out of business. Behind the boilerplate about big government, rationing and all that lies the real concern: fear that the public plan would succeed.

    So Mr. Obama and Democrats in Congress have to hang tough — no more gratuitous giveaways in the attempt to sound reasonable. And reform advocates have to keep up the pressure to stay on track. Yes, the perfect is the enemy of the good; but so is the not-good-enough-to-work. Health reform has to be done right.

  • Organizing for America: Health Care Stories for America. Excerpts: These stories — told by hundreds of thousands of ordinary Americans who have watched their premiums rise faster than wages, and spiraling costs shackle American businesses — put a personal touch on the health care crisis. On this site, you can:
    • EXPLORE — Find stories near you, to see how those in your area are affected. Read stories from across the country, and see the common thread in a crisis that affects us all.
    • AMPLIFY — When you come across a particularly moving story — one that inspires you to act, or reminds us all of the human cost of the status quo — click the megaphone icon near it. You'll "amplify" the story, and increase the chances that other folks like you will come across it.
    • SHARE — If you have not already done so, please tell your own story about how our nation's health care crisis has affected you or a loved one. Your voice has extraordinary power -- please use it.
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. Sample posts follow:

  • "Raises are effective 7/1" by "bigbertha92". Full excerpt: Don't expect a raise if you're a 2 performer. Only top contributors (1 & 2+) will receive a raise. The raise will most likely be around 1%. No kidding. Executives are not getting raises this year.
  • "IBM Just don't get it" by " Toa". Full excerpt: If you get the same money for a half ar*ed effort as you do for a good effort then why bother trying to do a good job! I've even seen 2+ being downgraded to a 2 because the manager didn't believe the 2+ was valid.
  • "Let's Go Global!" by "bigbertha92". Excerpts: Everything is "global" - from EO training to forced-by-mgmt-to-take IBM learning courses. Learn when no means yes, how not to be offensive, and watch slang!

    We all have to play nice-nice with our GR (global resource) peers. and when your GR team lead sends notes to IBM US mgmt that they need MORE WORK from their US counterparts, IBM mgmt. rolls over and gives them more work. Reminds me of an old CCR song: Fortunate Son.

    And when you ask them, how much should we give? Ooh, they only answer more! more! more. What a sad, pathetic, f'ng company.

  • "The Truth Can't Be Told" by "Frank_Reality". Full excerpt: Yes, even though the GRs in India can't handle simple tasks on time, with adequate quality and within cost, they are given more and more responsibility they cannot begin to handle. And of course when they screw up and fail as often happens, it's always the US teams' fault. It is pathetic (and clueless) to reward this incompetence with more work and more responsibilities.

    What's more pathetic is how India is not held accountable since they are Sam's chosen ones and how anyone who reports problems with India are considered anti-team, racist and uncooperative.

    The sacred cows over in India aren't cattle, they're the "office boys" pretending to be IT professionals working for IBM. What a sad, pathetic f'ng company indeed.

If you hire good people and treat them well, they will try to do a good job. They will stimulate one another by their vigor and example. They will set a fast pace for themselves. Then if they are well led and occasionally inspired, if they understand what the company is trying to do and know they will share in its sucess, they will contribute in a major way. The customer will get the superior service he is looking for. The result is profit to customers, employees, and to stcckholders. —Thomas J. Watson, Jr., from A Business and Its Beliefs: The Ideas That Helped Build IBM.

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