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6, 2000 April, 2000

Highlights—September 12, 2009

  • EE Times: IBM continues to mislead. By Mark LaPedus. Excerpts: IBM Corp. has cut nearly 10,000 jobs this year, according to reports, although Big Blue still refuses to fess up to most of the layoffs. The Alliance@IBM/CWA Local 1701, an IBM union, claims IBM has implemented 17 separate layoffs for a total of 9,308 jobs this year, according to the Poughkeepsie Journal. That's been known for some time.

    Here's what is new: Big Blue is expected to cut a total of 16,000 jobs this year, many of which are in the United States, according to the union. This comes at a time when IBM is thriving despite the downturn. A spokesman for IBM dismissed those claims by that group. He confirmed that IBM has taken various ''resource actions,'' but he said the company cannot comment on the size or specifics.

    Defending Big Blue, the spokesman also made the following data points: 1) IBM is the largest hi-tech employer in the U.S.; 2) IBM has added jobs this year, including in the U.S.; 3) 60 percent of its workforce got raises; 4) IBM is not misleading the public and is transparent about its "resource actions"

    IBM also discredits the union, saying that its information is false. "When the Alliance says 10,000, that can't be accurate. People have opportunities to look at jobs elsewhere" inside the company, the spokesman said.

    IBM declined to elaborate on how many jobs are offered to axed workers. And to a degree, Big Blue still won't fess up to the size of the job cuts. This is when I believe that IBM has credibility issues. I'm not the only one. For some time, the union has charged that IBM is cutting and outsourcing U.S. jobs, while quietly hiring in India. As expected, IBM did not comment on the cuts in the most recent report. That article can be read here. ...

    But as a result of the ongoing trends, I'll take our editorial a step further. In my opinion, IBM should not only fess up to the layoffs but it must stop misleading the public. Big Blue must address the charges about outsourcing U.S. jobs. It must also become more transparent about its activities in India.

    Another issue: Over the years, IBM has received public funding to expand its fab and chip-packaging activities in New York state. However, in recent times, the company has reportedly cut jobs at the fab site in East Fishkill, N. Y. and been somewhat slow to expand the plant. Some believe that the signs point to a stunning event: IBM could go fabless one day.

  • Selected reader comments concerning the above article follow:
    • From within the Blue Walls, I have to say that IBM is nearing the point of being unable to execute our ambitious plans. The cuts have been deep and painful, and on top of the cuts we have lost some senior technical folks who've left due to low morale and a pervasive feeling that we are all on borrowed time.

      Looking at what you've been told: 60% received raises, and that there are jobs available internally. Sixty percent receiving raises does not clearly state whether that's 60% of the US workforce of 60% of the worldwide US workforce. It certainly isn't 60% of the pre-2009 workforce, since raises are awarded in June. Of the folks I've talked with, virtually everyone who received raises received symbolic raises (roughly 1%). Apparently those raises only went to 2+ and 1 performers, and that should have been about 25% of the workforce.

      There is no internal job movement. When folks are told they have 30 days, they find that the internal job bank is either empty or contains positions that are flagged "not for internal transfers." One manager said that she can tell when a layoff is coming because the internal job bank is closed up so that no one can move to a new job.

      One of IBM's principles is supposed to be "Trust and personal responsibility in all relationships." I have a hard time reconciling symbolic raises and stealth layoffs (many small layoffs that are seemingly deliberately done in a way that prevents public scrutiny) with that principle. The statements IBM representatives have made have been technically true, but misleading. Raises, job availability, hiring. Every one of them true, but not true.

    • There are three groups with an interest in what a company does: employees, customers, and stockholders. What are a company's obligations to the employees? At the minimum, telling the truth. If the company is not completely straight with the employees, why should the customers and stockholders think that they are getting the straight skinny?
    • IBM is digging its own grave in a long run. People in India are smart and love to be independent and both are a catalyst for number of today's IBM engineers in India that will in future become IBM competitors. milosb55
  • The Register (United Kingdom): IBM reaffirms bright profit picture. Sam Palmisano has to wear shades. By Timothy Prickett Morgan. Excerpts: When IBM posted its second quarter financials in July, while sales declined by 13.3 per cent to $23.25bn, net earnings were still up 12.2 per cent to $3.1bn. Given its cost controls and discipline on doing deals that bring in profits, IBM at the time raised its guidance, saying that it could hit $9.70 per share earnings in 2009.

    EPS is a bogus metric, but IBM is obsessed with it, presumably because a lot of bonuses within the company are tied to it. Real earnings growth is what matters, especially when you are talking about a company like IBM, whose share buyback programs are akin to a crack habit. Investors like to see revenue growth when they see profits because then they believe, rightly or wrongly, that the profits are not just a one-time belt-tightening that will come back and bite a company later on.

    Anyway, with its filing to the SEC today, IBM is reiterating its guidance for $9.70 EPS for 2009, which is the newsy bit. The company is even doing the math for Wall Street, showing that in the first half of 2009, the company has posted $45bn in sales, down 12 per cent, but has raised gross profits by 2.1 points to 44.5 per cent. It has also ratcheted up net income by 6 per cent to $5.4bn, and has achieved $4.02 in EPS, up 11 percent. That leaves $5.68 in EPS to go for the second half.

    Wall Street basically yawned, with IBM's shares wiggling around $118 a pop on the news. It is hard to get excited by revenue declines and financial engineering on Wall Street these days, I guess.

  • Southern Daily Echo (United Kingdom): IBM staff at Hursley and Portsmouth 'betrayed' over pension scheme shake-up. By Gareth Lewis. Excerpts: “SHOCK, anger and betrayal” are the feelings of IBM staff faced with drastic changes to their pension rights, according to confidential documents leaked to the Daily Echo from inside the IT giant, one of Hampshire’s biggest employers. Marked “IBM Confidential”, the letter to chief executive Brendon Riley from the firm’s Pensions Consultation Committee (PCC) warns that staff are flocking for union representation, hundreds of unhappy, experienced workers are being targeted by headhunters and customers are concerned about the impact on their business.

    It’s the latest indication of internal strife at IBM, which employs about 6,000 people in Hampshire at its UK research base at Hursley and its UK headquarters in Portsmouth , over plans to close the final salary pension scheme and alter the terms of its early retirement plan.

    As previously reported by the Daily Echo, the Unite union claims hundreds of angry IBM workers have been joining-up in readiness to fight the proposals which they say will have “a devastating effect” on future pensions. It calculates that people in their mid-50s could typically lose up to £200,000 as a result of the changes. ...

    “IBM UK is in danger of using pension changes as a short term lever to improve the company’s profits, while undermining the future financial security of many employees in the process and turning many of their life plans upside down.” ...

    “All trust has been lost with the company because they promised three years ago that the final salary scheme would be kept open until 2014. There are record revenues and earnings and the company is awash with cash. They’ve got billions but they want more billions. It is driven by greed.” Another worker said the row had seen even senior staff turn on each other.

    “There is widespread anger and resentment even among low level managers towards senior managers. I have never known IBM’s management break ranks before.”

  • Selected reader comments concerning the above article follow:
    • I have experience as an IBM manager and much of the following can be deduced from http://www.amipp.org .uk/phorum5. The truth of the matter appears to be that IBM UK is controlled by IBM US and the change in the pension scheme is a vehicle to save costs, increase profitability, issue the increased dividend promised to shareholders and manipulate the share price.

      No doubt that this proposed change in the pension scheme is being driven by IBM top executives so that they be will be able to award themselves more $millions in bonus payments.

      IBM top executives appear to have little interest in keeping IBM a long-term truly profitable and progressive company. Some of the current IBM top executives are here today and will be gone tomorrow. (Remember Lou Gerstner IBM CEO from 1993 to 2002. He was somewhat of a longer termer. He was appointed when IBM was an ailing company.

      However, “upon his departure from IBM, Gerstner received a 10-year consultancy contract worth up to $2 million annually, plus expenses and full use of IBM facilities and services, such as office, cars, aircraft and financial planning. He is only required to work one month out of the year.” See http://en.wikipedia. org/wiki/Louis_V._Ge rstner,_Jr.).

      It is likely that the current IBM UK top executives are in charge just for the short term and are being used as hatchet men. A shocking part of the pension scheme changes proposed is the alleged plan to increase the percentage per year that pension scheme members leaving IBM have deducted from their pension from 3% to 7%.

      So for example: Today if a 55 year old leaves IBM UK they will lose 24% of their final salary pension. The proposals will mean that they will lose 56% of their final salary pension. IBM UK is being forced to downgrade the pension provision with a linked forced scheme to lay people off and ship their jobs to less costly job markets such as China and India.

      The lay off of people will not be done by making people redundant as that will cost IBM UK in redundancy payments. It is being done by the means of artificial quotas being forced on managers to downgrade their assessments of their employees’ job performance. IBM UK will then be able to claim that those employees do not perform satisfactorily and will sack them.

    • The early comments here are out of touch with the reality on how IBM has changed in the last 10-15yrs. The latter comments are closer to the reality. Also it appears it is not the closure of the Final Pension that is the main issue here, though I am sure those who work in IBM may disagree, but the punitive terms surrounding the changes making IBM workers so angry.

      How would you like the Govt to close all forms of Redundancy payments for losing your job, or that companies can change your Pension terms as they like (which they can do now anyway) so that the situation is so bad you have no choice but to leave. Like being fired for doing a great job but as you're over 45 yrs old and you have carefully scrimped and saved for a pension you have to loose your job, or loose more of your pension if you retire early.

      How would you like to be forced to leave your job when the company you work for is not only Very cash rich, but revenues are increasing year on year. So there is no excuse other than profit at cost of employee trust, loyalty, and total loss of faith while the company tries to sell the world as being a good corporate citizen and a socially responsible company.

      Maybe this is why so many IBM employees are joining Unions. If this method of pension changes becomes the norm to increase profits (Financial crisis is a good reason to do this now) as HR executives watch what other companies do, then Redundancy payments are a thing of the past, replaced by making major punitive pension changes so you force your older and loyalty workforce out at no cost, other than eventual impact to the UK tax payer.

      Remember the Consultation process also means nothing, any company can make changes, they are required by law to listen to employees, explain the changes yet still implement as they wish, their legal responsibility is to listen and explain, hear the employees views,wishes and desires. Then do what they want. This is the reality.

    • I currently work for IBM. My father also worked for IBM, so I have known the company and the way it treats it's employees all my life. IBM and IBMers have a core set of values. The company is built upon trust and integrity. IBMers pride themselves on not just designing great products, but on the ethical way our company carries out it's business. This is what really differentiates IBM from other companies.

      Four years ago, there was a pensions shake up in IBM. At the time the IBM UK director, made a promise to employees that the 'C plan' (final salary plan) was fully funded and safe until at least 2012. A few weeks ago, the company entered a legally required consultation phase, with a mind to closing the final salary plan. The consultation phase is legally required. However IBM are not required to pay any attention to the consultation, it's just a rubber stamping process.

      The employee representatives taking part in the consultation are being denied access to independent legal advice and are not being told under what criteria IBM would decide to halt their plans to close the final salary pension scheme.

      Personally, I would benefit from the closure of the final salary scheme. I am not in the scheme, my pension would see an uplift as a result of the closure. However, I am wholly opposed to the proposal. I regard this proposal as a total betrayal of IBM's staff by senior management. It goes completely against the ethics upon which IBM was built. My views are echoed by every single member of staff I speak to.

      IBM may plead poverty, but that is not the case. I cannot disclose figures, but the company is healthy financially. Let's just say that we were rumoured to be in talks to purchase the computer company "Sun" recently (Suns yearly revenue is about $13billion). Had we gone ahead with the purchase, it is said that we would still have $6 billion of cash in the bank. That's enough to buy a cheeseburger for every person on the planet (but not fries too!). Morale in IBM UK is at an all time low. I predict that as soon as the job market improves, there will be a mass exodus of talent from IBM.

      I was once proud to be an IBMer, now all I feel is shame. Thomas Watson, IBM's founder must be spinning in his grave."

    • It's a shame that petty jealousy has crept into this. Remember that IBM has been a leader in many ways, and where IBM leads, many follow. Final Salary Schemes may be on the way out, but there are many other aspects to this that are brutal and unnecessary given the very healthy state of IBM's finances. The truth is that the company is now driven by Executives who are paid the same sort of bonuses as the Bank employees, and therefore it is in their interest to increase share price. Doing this by managing out the most loyal and experienced staff is very shortsighted.
    • IBM is not unique in this respect; I have worked for another IT Consultancy for 36 years which was taken over by Atos Origin a few years ago. As a French company, it had a company policy of defined contribution pension schemes only, so our generous final salary scheme was closed to all members last year and it was only by the strong intervention of our scheme trustees that adequate provision and compensation was made for people who stood to lose the most (principally those in their mid-late 40s with over 20 years service). At least I am close to retirement, but I find myself in a scheme which will no longer increase the pension paid in line with inflation, for which we only got a whole 5% uplift "up-front". This country has gone from having enviable private pension provision for many people to a situation where the only way to get a decent pension is to be a civil servant.
  • Bloomberg: IBM and Procter & Gamble's 21st Century Workplaces. By Rosabeth Moss Kanter. Excerpts: Job insecurity is increasingly true of all companies and in nearly every country. Statistics for employment and unemployment hardly capture the variations in employment status. Discouraged job-seekers might find refuge in self-employment, printing business cards to get short-term consulting assignments - sometimes having the ironic effect of making it easier for companies to lay off employees and replace them with contract workers, which now include senior executives. ...

    Hitting that sweet spot - keeping people employed in good jobs - is a goal of the vanguard companies I describe in my new book, SuperCorp. Companies such as Procter & Gamble, IBM, and others are trying to create innovation and profits through values and principles that enable them to have a positive social impact. They are thinking their way out of twentieth-century assumptions (e.g., that a job must be performed in a facility at specific times and assigned by a boss who observes performance) to create twenty-first century dynamic workplaces.

    The Super-corporations want to be employers of choice. Their leaders prefer not to talk about insecurity but instead invoke flexibility. That semantic distinction might be scorned by the uneasily employed, but it conveys a new reality that can have positive as well as negative consequences.

  • Selected reader comments concerning the above article follow:
    • This article is VERY misleading and completely distorts what IBM has become (in 2009) vs. what IBM WAS (before the financial crisis). Here are some facts you should consider and REVISE / ALTER your article accordingly:
      • Anyone who can work remotely, from home is now a much greater target for outsourcing. Outsourcing is where a US worker is fired (aka "laid off", "resource action-ed", early retirement) and the work is then given to someone in India or another country where the costs are significantly less.
      • IBM has laid off over 10,000 US workers in 2009. This is a CONFIRMED number based on formal documentation from IBM. See http://www.endicottalliance.org/allianceibmsimplefactsheet2.htm for details.
      • IBM has hired almost twice that amount in India alone in 2009: Asia/Pacific: 13,376; CEEMEA: 3,988; Europe: 2,923; India: 18,873; Japan: 868; Latin America: 7,112; USA: 3,514; Canada: 820
      • In 2002 there were 240,000 US employees = 80% of it's Global workforce. Today, in 2009, The US workforce has shifted from 80% to a mere 29%. Offshore jobs have reached 283,000, or 71% of IBM's 398,000 total. And IBM isn't done offshoring - the tally is estimated to grow to 16,000 by year end.
      • An overwhelming majority of the 10,000+ confirmed US workforce (there are thousands more let go for which we don't have any official, formal headcount) are over 40. Age discrimination?
    • I agree with KC's comments. I recall a senior IBM executive speaking at a conference in Ottawa, Canada a few years ago. His message was this: ANYTHING can be outsourced. I realize that some American companies have repatriated some of the production to the US, the result of such factors as rising transportation costs (due to oil), crappy quality in offshore plants, and backlash from American consumers. I would add that what needs to be realized is the new reality of skills mobility. It's less an issue of human beings being mobile but more that of work being done anywhere thanks to technology. There's a danger in falling for the sales pitch by IBM and thousands of other companies that would like to have us believe that they have the best interests of the United States (or little Canada for that matter) at heart. These are transnationals who have NO loyalty to national boundaries, and will always operate in THEIR best interests.
    • This article was obviously written with absolutely no research into reality. Re: "Hitting that sweet spot - keeping people employed in good jobs - is a goal of the vanguard companies I describe in my new book, SuperCorp. Companies such as Procter & Gamble, IBM, and others are trying to create innovation and profits through values and principles that enable them to have a positive social impact." IBM is working toward EXACTLY the opposite goal - firing highly competent Americans and hiring overseas labor, cheap and completely incompetent. People are fired (called "Resource Action") and distorts the numbers by spreading them across states, and classifying a lot of them as "retired" -- without their knowledge -- until they receive the paperwork. If any of these firings were actually due to there no longer being a need for the particular skills these people have, the company would not be hiring overseas replacements and forcing the fired Americans to TRAIN them - train them in skills the company no longer needs. And if you care for accuracy, you should also try to find out how this management-bloated business is spending US stimulus dollars - our tax dollars. Here's a hint: follow the money - to India, Malaysia, Romania....
    • Thanks to KC for posting the facts below. I think I laughed out loud when reading this article. Obviously the author didn't speak to any U.S. employee for this other than a P.R. person.
    • Okay. Classify me as the "uneasily employed" or "overemployed". I'm one of the few IBM'ers left that still has a job (for the moment). I have consistently received exemplary performance reviews but even a moron knows that won't make a difference in the grand scheme of things. Palmisano and his minions have the singular goal of removing (not laying off, but FIRING) countless stellar performing North American employees with the goal of elevating the stock price and increasing their ungodly bonuses, and to hell with the US economy or the future of America.

      As a result of IBM's settlement of the 2006 overtime lawsuit, I was saddled with a 15% pay cut in early 2008 because my duties were deemed as being consistent with those of a nonexempt factory worker (no offense intended). I now have 26 years with the company.... in order to "make up" the difference in salary I work overtime. Sure, I worked overtime before, but now I have to work even more to compensate for any vacation that I take, plus the fact that I have to accumulate as much extra savings as I can in order to compensate for everything that is based on "BASE" salary... such as retirement, or if I ever want to qualify for a loan....... Plus, at the end of the year when the 4Q results are coming up, overtime gets frozen so I have to work extra NOW to compensate for that...

      And don't even TALK to me about IBM's supposed education plans. In my experience, I can spend my own money and my own time on furthering my skills but IBM has *ABSOLUTELY NO INTEREST* in me having those skills.... If I don't already have the EXPERIENCE in these skills they will not even TALK to me if I want to be considered for a position that would actually USE these skills.

      I am just fed up with all these journalists that see the magical IBM acronym and interpret it as being the GOD of the corporate sector. Why don't they come and spend some time talking to the *REAL* IBM. Come and talk with the employees that do the real work... and talk to us about what it means to be constantly in fear of your manager contacting you via instant message "Can we talk?" Chances are, the topic of that conversation is going to be the next resource action... ummmm, FIRING...

      Some of you may ask me why I stay with this god forsaken company.... well, I'd like to last long enough collect some of that retirement that I've earned.... Oh, wait.... they took that away too.....

    • All of these posts are accurate. I work for IBM in a position where I have access to global employee survey data. Morale in the U.S., Canada, and Western Europe is in the tank. Everyone fears for the next layoff and is for the most part paralyzed in their tracks that their job will be sent to India any day now. You call this the 'sweet spot' Ms. Canter? Please.... do your homework next time!
  • Yahoo! IBM Employee Issues message board: "Re: IBM and Procter & Gamble's 21st Century Workplaces" by "bits_bytes_and_bugs". Full excerpt: OMG, if she's that clueless about IBM and she's equally confused about P&G, I think I'd better dump my P&G stock. IBM is not just a job shredder, it's a people shredder as well. This article says more about Harvard's lack of due diligence and intellectual honesty than it says about IBM and P&G.
  • Yahoo! IBM Employee Issues message board: "Re: IBM and Procter & Gamble's 21st Century Workplaces" by "ibmretiree2006". Full excerpt: Ah, I love those academics who have never worked in the real world in their lives. I wonder how much consulting she has done for IBM or the other firms in her life? Oops, just found this.

    She has received 23 honorary doctoral degrees, as well as numerous leadership awards and prizes for her books and articles; for example, her book The Change Masters was named one of the most influential business books of the 20th century (Financial Times). Through Goodmeasure Inc., the consulting group she co-founded, she has partnered with IBM on applying her leadership tools from business to other sectors; she is a Senior Advisor for IBM's Global Citizenship portfolio.

    She advises CEOs of large and small companies, has served on numerous business and non-profit boards and national or regional commissions including the Governor's Council of Economic Advisors, and speaks widely, often sharing the platform with Presidents, Prime Ministers, and CEOs at national and international events, such as the World Economic Forum in Davos, Switzerland. Before joining the Harvard Business School faculty, she held tenured professorships at Yale University and Brandeis University and was a Fellow at Harvard Law School, simultaneously holding a Guggenheim Fellowship.

  • Washington Post: Wall Street's Mania for Short-Term Results Hurts Economy. By Steven Pearlstein. Excerpts: It's been a year since the onset of a financial crisis that wiped out $15 trillion of wealth from the balance sheet of American households, and more than two years since serious cracks in the financial system became apparent. Yet while the system has been stabilized and the worst of the crisis has passed, little has been done to keep another meltdown from happening. Even the modest regulatory reform effort launched with much fanfare back in the spring is now bogged down by bureaucratic infighting and special interest lobbying. And back on Wall Street, the wise guys are up to their old tricks, suckering investors into a stock and commodity rally, posting huge profits on their trading desks and passing out Ferrari-sized bonuses. The Wall Street Journal reports they've even cranked up the old structured-finance machine, buying up claims to life insurance proceeds and packaging them into securities.

    All of which makes it particularly disappointing that so little attention was paid this week to a report by a panel convened by the Aspen Institute on the "short-termism" that has now become hard-wired into the culture of Wall Street and corporate America. ...

    Their complaint is that the focus on short-term financial performance by investors, money managers and corporate executives has systematically robbed the economy of the patient capital it needs to produce sustained and vigorous economic growth. And while their recommendations may not be as sexy as a cap on Wall Street bonuses or a ban on high-frequency trading, they get to the root cause of the financial crisis in ways that other reform proposals have not...

    The roots of this short-termism go back to the 1980s, with the advent of hostile takeovers mounted by activist investors. This newly competitive "market for corporate control" promised to reinvigorate corporate America by replacing entrenched, mediocre managers with those who could boost profits and share prices. In theory, the focus was on increasing shareholder value; in practice, it turned out to mean delivering quarterly results that predictably rose by double digits to satisfy increasingly demanding institutional investors. Executives who delivered on those expectations were rewarded with increasingly generous pay-for-performance schemes. ...

    It is all well and good to vow that compensation schemes will be changed so that executives and money managers sink or swim with their investors, but there is a limit to how far those incentives can be aligned. While these new and improved financial markets promise greater efficiency and liquidity -- except, of course, when they don't -- it's now clear that the benefits of all that efficiency and liquidity are captured largely by the Wall Street middlemen rather than their customers, or the economy as a whole.

    The more fundamental problem, as the Aspen panel reminds us, is that the components of modern finance -- the securities, the trading and investment strategies, the financing techniques, the technology, the fee structures and the culture in which they operate -- are all designed to work together to maximize short-term results. And, in such a self-reinforcing system, it is very difficult to change any one feature without changing all the rest.

  • Yahoo! IBM Pension and Retirement Issues message board: "Retirement Planner Alert" by Lee Conrad. Full excerpt: Recommend CAUTION when using the Retirement Income Planner on NetBenefits The intent of this note is to alert people who have an IBM pension as part of their retirement income to be aware of a setting in the tool that is very important.

    If you are using the Retirement Income Planner, available via NetBenefits for IBM, be aware that this tool has a default setting that sees your pension as income that will grow year to year. It assumes a cost of living adjustment for your pension unless you reset the value of the field to NO. As we know, the IBM pension does not have a cost of living adjustment.

    For people using this tool independently, this is an important field to change. But even those who use the tool with a MoneySmart Coach need to check to make ensure that the field has been updated from the default value. An employee who was working with a MoneySmart Coach had the coach set up the tool. The employee challenged the very positive numbers that the tool was generating 2 or 3 times but the Coach did not catch his error and neither did the employee. Fortunately that coach went to another job and the employee started working with a new coach who found the error.

    Check screen 3. Income, for the question: Adjust Income to future dollars? The default is yes and the current value being used is 2.3%. You can also check the "Income and Expense details" table in the tools report. The pension value should remain constant through the years.

    Note: While the heading is Fidelity NetBenefits for IBM, the tool is not customized for IBM. It is used by Fidelity for other companies as well.

    Another tip: If the tool gives you an Action Plan to purchase International Stock, be aware that it does not recognize these funds from our 401k plan as international investments: "Intl Stock Mkt Idx", "Pacific Stock Idx", "European Stock Idx". You may already have appropriate international stock in your portfolio.

  • Yahoo! IBM Retiree Information Exchange message board: "Re: United Way and other campaigns ( was Re: [IBM Retiree] Intelligence and kindness" by "Bart Bartholomew". Full excerpt: I hate to dispel a belief that some of you may be harboring. I was very fortunate and made it to third line management ... woo-woo! But I never, ever saw any secret handshake, secret 'society', wink & nod, or any other shared secrets that management at 1st, 2nd, or, 3rd level had. The decisions were all made way above us and we, like good soldiers, announced, supported, and implemented them.

    And, we also harbored the same disappointments as those not in management as we saw a deterioration of what IBM had stood for in prior years.

    As layoffs began and my organization (I was back in a staff role at the time) was hit not once, but twice, and then a third time, I related to relatives/friends outside of IBM and colleagues inside that I felt like one of the little yellow plastic ducks circling around in a water trough at a town's annual carnival as those who paid their dollar lined up BB guns to shoot me. I never did get hit ... came close but survived. Did my dedication to IBM falter then? Sure did. It was plum scary to be in my 50s and think that I could wind up on the street.

  • eWeek: How Offshoring May Be Hurting U.S. Technology Employees. By: Don E. Sears. Excerpts: Cost cutting is the name of the game. But at what price for the country? That appears to be the central argument of public policy professor Ron Hira from the Rochester Institute of Technology. Hira is an outspoken opponent to major offshoring trends in higher-paying technology and financial jobs. His argument? It's not only about low-paying manufacturing and distribution jobs. In the long run--it's about a shift from becoming a rich to poor nation. ...

    "Hewlett-Packard, when it took over Electronic Data Systems, announced it was going to lay off about 24,000 workers as part of the restructuring plan. That work is not going to disappear. At least half of those jobs will end up in low-cost countries somewhere. They'll be basically offshored."

    IBM has gone from a 6,000 headcount in 2003 in India to, they won't say exactly how many, but estimates are more than 90,000. That's a 16-fold increase in six years.

    People say these are kind of the lower-wage, lower-level jobs within IBM, within EDS. But that's not true, either. There are a number of R&D centers that are being opened up in India and China. Boeing just recently announced an R&D center opening in Bangalore (India). Google has a facility in Bangalore. Microsoft has cutting-edge basic research being done in China. The offshoring of R&D and innovation is clearly happening. Clearly, high-skill, high-wage jobs are moving offshore.

  • The Register: Axeman cometh: Microsoft lays off 27 staff. By Kelly Fiveash. Excerpts: Microsoft plans to axe 27 jobs at its Redmond and Bellevue sites. The latest cull in Microsoft’s Washington offices is expected to hit workers on 1 November, according to the Seattle Times. The software giant had notified the Washington State Employment Security Department about the job cuts. "I can confirm that part of our effort to reduce costs and increase efficiencies involved 27 job eliminations here and in other regions across the country,” Microsoft spokesman Lou Gellos told the newspaper. “While job eliminations are always difficult, we are taking these necessary actions to realign our resources against our top priorities."
  • Linked In: The Great IBM Connection (IBM's alumni program for past and present IBM employees): Why companies discriminate based on age and what to do about it. Excerpt: We know age discrimination is illegal. We know it's wrong. We know it doesn't always bring in the best candidate for the job. But let's take a look at some of the reasons why employers seek to avoid older workers. I ... Read more at Examiner.com. Selected reader comments follow:
    • Very interesting article. Being an older employee I never thought about including in my cover letter that I have no small children and willing to work whenever. I've been the oldest or one of the oldest employees for the past 3 jobs. Perhaps I am interviewing correctly but I wish this was a "non" issue.
    • Therefore (based on the article) it is better to look good than be good. Experience does not matter as long as you look and act like a supermodel. Is it any wonder beggars in three piece suits are crying for bailouts?
    • Of source looks are the most important thing, by far. MUCH more important than intelligence, technical experience, knowledge, industry contacts, ability to remain calm under pressure, ability to multitask, ability to think through complicated issues, quality education, credentials, licenses, certifications, professional demeanor, ability to communicate clearly via both verbal and written communications. So it's OK if you are not smart, overreact, are hard to understand, write poorly, use improper grammar, have little or no education or credentials in the technical material you will be managing/selling/developing, have no experience in the industry, don't use valid reasoning, Just make sure you look good and act enthusiastically.
    • This is a really pitiful commentary for major corporations. They are all guilty of age discrimination but they avoid punishment by using their high dollar legal teams to manipulate themselves around the laws. I was a victim of this (a reorganization of my department where I was the only one reorganized and asked to move across the country and also the oldest person in the group)and tried to fight it unsuccessfully.
    • I think IBM discriminates systemically buy pushing people out -- especially people who rat out bad management; that is it specialty. I ratted out some bad management, the management got the boot and I got ignored, no reward, no promotion, disrespected, and cornered into retirement at 30yrs+2wks. I'm happy to be gone but feel like a rape victim. Pharmacological induction of amnesia might help. Otherwise do your weeping and get over it. Remember that demons never die and all that you can do with them is to educate them. It may take a long time to rebuild your sanity and self esteem. Understand that you were socialized, and duped; and perhaps you trusted them. You may have lots of introspective work to do. Try to keep yourself so busy that you don't have time to think about it; and tell your wife to kick you out of bed whenever she encounters you screaming at Gerstner in your sleep. You might make it.
    • Gregory I'm sure you are right. Don't spend any more time in self doubt. Move on and let new successes be the best revenge. I'm happily retired now, but memories are bittersweet. Enjoyed working with great people, but always suspected that my final 5 years without a raise were not just because of bogus "economic" conditions. They knew I couldn't leave and or want to move to a new hill to climb, so didn't have to give anything.
  • New York Times: Pensions, 1980 vs. Today. By Catherine Rampell. Excerpts: I have an article today that discusses how a retirement system based on private savings is affecting the job market. In short, when the economy is contracting, and employers are trying to shrink their payrolls, older workers cling to their jobs because their nest eggs have shrunk. In other words, as Prof. Teresa Ghilarducci at New School put it, 401(k)’s act as a sort of “reverse automatic stabilizer” for the economy.

    This wasn’t always the case. Once upon a time, defined benefit pensions were the norm and helped employers gracefully ease more employees into retirement during downturns (potentially by sweetening the pension deal a little). It was not until 1978 that Congress first set up 401(k)’s — private, tax-favored savings vehicles intended to supplement traditional pensions. Over time, as companies decided to shake off some of the risk associated with supporting their retirees, the defined contribution pension system grew to largely replace the defined benefit system. ...

    Unfortunately for workers, having control over their own pensions doesn’t always end up so well. A recent study from the Employee Benefit Research Institute found that at the end of 2007, about a quarter of Americans ages 56 to 64 had 90 percent of their 401(k) account balances in stocks, instead of more conservative investments. (It seems English-speaking countries in general like to invest their private retirement savings in the stock market more than their non-English-speaking industrialized peers.) High administrative and investment fees can also erode privately managed retirement benefits.

New on the Alliance@IBM Site
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  • Job Cuts Status & Comments page
    • Alliance needs contact with ex-IBM employees who were RA'd while h1b visa worker remained. Please contact Lee Conrad ASAP at ibmunionalliance@gmail.com -Alliance-
    • Comment 09/06/09: AFAIK, it means that someone will be brought on from overseas to be a first line, someone who is paid less, MUCH less, housed here, works like a dog, makes sure the rest of the dept. works like dogs, is kept here for a month, then if he/she is good, brought back again for another month, and is then sent back, unceremoniously, to whatever awaits him/her in whatever country he/she came from. Or, if he/she is especially 'nice' (read kiss-up) to upper management, he/she will be made a U.S. employee, at a third of the salary of deserving longtime U.S. employees, and so will not be part of the firings that occur this year and next so that the number of U.S. employees dwindles to zero. And what will the U.S. employees who get fired by this 'non-resident' first line do about all this? Exactly. Then again, I could be wrong, and IBM could be the most wonderful altruistic caring employee-centric non-mercenary company in the world. NB: AT WILL EMPLOYEES. Unionize or be screwed. -anonymouse-
    • Comment 09/08/09: Hearing from a reliable source that there will be 4000-5000 additional IBM US firings before year end 2009. -Work-For-Sub/Pizzamaker- Alliance Reply: I hesitated to post this because "a reliable source" can be claimed by anyone; however, because we have posted rumors in the past that have proved to be true many times over, I felt this one was worthy. I will caution you that if you intend to post these kinds of statements here, it will draw criticism and doubt; Even though, in light of IBM's past behavior, the number of jobs lost could reach 16,000 as Alliance@IBM has said publicly. Next time, get more specific information from 'reliable sources', i.e. locations or job type, etc; if at all possible.
    • Comment 09/11/09: One probable source of the 4-5K cuts will be in the BT/CIO organization. That is roughly the figure of the number of I/S function people that were transferred by the stroke of a pen from divisions across the board the end of March. Their cost (salary) was to be borne by their original entities till the end of the year. As there is a new CIO and the BT/CIO office is not revenue producing there is no way for it to maintain this base of people dozens of which have overlapping skills for each position. It was expected that by year end or 1Q next year there would be a massive RA. Because they are spread world wide and can be viewed from either a reporting, or a cost basis. It would be hard to pin numbers to actual organizations. -Anon-
    • Comment 09/11/09: For those questioning the source of 4-5K Layoffs, something telling?
      8/24/2009 7:00 PM CIO Colleague,

      The organization has recently undertaken a Talent Study; a clean-sheet approach to look at the talents, skills and competencies needed and to identify the best options to move the organization forward with an enhanced talent model for the future. Our goal is to continue building a world-class BT/IT organization. The Talent Study links directly to the learning plan for the organization so that we know where we must provide development activities to close gaps and build employees' competencies and skills.

      Career growth and development are IBM priorities and IBM has made significant investments in tools and resources that provide you personalized career guidance and learning recommendations. When you understand your skill and development needs, it provides an environment where you and your manager can work together to identify development activities to help you grow in your career. This includes updating your skills profile in the Expertise Assessment (EA) tool. You can begin your EA update starting August 31 and should plan to complete it by September 25 .

      Complete your skills assessment in order to: Take an active role in your career development; Get a clear view of the skills our organization believes you need to perform well in your current job; Have an in-depth discussion with your manager about your assessment; Identify your skill gaps and the learning offerings IBM has to help you close those gaps; and Use your assessment results to create or update your 2009 Individual Development Plan (IDP).

      Even if there has been no change in your skill level, every employee is required to update the expertise assessment yearly. The tool will display the skills associated with the profession, job roles and skill sets you select allowing you to assess those skills. There are three steps to the assessment process: Review and edit your current profile to ensure that all the information is complete and accurate. This includes verifying your line of business, profession and job role(s) and selecting appropriate skill sets related to the job roles you selected. Assess all skills for the profession, job roles and skill sets you selected. Identify your current skill level for each skill. Assess the target levels for all your skills. Identify the desired skill level. The difference between the “current” and “desired” skill levels for any skills in your record might indicate gaps or areas for potential growth to be included in your IDP. Log on to Expertise Assessment using either Firefox or Internet Explorer as your browser. [Note: Firefox does not support hover text, so some help text might not be available. To ensure access to certain materials (i.e., User Guides) via links provided in EA, you will need a recent version of the Adobe Viewer.] Upon login: If you are prompted to Register as an employee,see steps 1 and 2 in the EA Quick Reference Card. You will be making these selections initially rather than reviewing and updating as noted in the Guide. If you are at the Expertise Assessment Home, follow the steps provided in the EA Quick Reference Card.

      The Quick Reference Guide provides tips and suggestions to help ensure you complete the assessment correctly. Frequently Asked Questions, as well as additional information and links to reference materials, can be found on the Learning Community of the CIO wiki. Contact your manager if you have questions about the Expertise Assessment.By taking time to complete this process, you can open up new IBM career opportunities by enhancing your skill level based on your assessment. Thank you for making your career development an ongoing priority. Regards, Pat Toole Vice President and Chief Information Officer.

      I rest my case. -InsideOut-

    • Comment 09/11/09: I certainly believe in the value of organizations INVESTING in their employees. That is, in fact, a big part of my expertise and 'calling' (sorry if you don't agree with the idea of a calling - no problem!) However, when I read this: "By taking time to complete this process, you can open up new IBM career opportunities by enhancing your skill level based on your assessment. Thank you for making your career development an ongoing priority." ... I get a bit skeptical. Perhaps this CIO org is looking to develop careers for their current workforce. Or, perhaps - this being IBM, after all - they are looking to identify skills to offshore. I'm just saying. : ) -RA'ed already-
    • Comment 09/11/09: "Career growth and development are IBM priorities" what a joke. The STG education budget has been frozen for so long, no one here remembers what taking a class feels like. Think: are they lying to us? The only priorities IBM has now is to lay you off unless you are willing to work for shiny beads. -Joe Punchclock-
    • Comment 09/12/09: "...By taking time to complete this process, you can open up new IBM career opportunities by enhancing your skill level based on your assessment..." WTF. ...new IBM career opportunities? Having increased skills in IBM doesn't mean ANY career development in this IBM for the overwhelming majority of the employees since management doesn't know the skill sets needed since most management now are technical dummies. Mr Pat "dull Toole in the box" is clearly talking out of both sides of his mouth! Go ahead folks do this new but not improved flavor of skills assessment and give the CIO's henchmen more rope. They will not tie you up with but might snuggly fit it for your neck soon though. -anonymous-
    • Comment 09/12/09: I'm not an IBM employee and probably never will be but the letter from your CIO seems to tell me that this Talent Study is going to be a weeding out tool for the IBM workforce. -anonymous-
    • Comment 09/12/09: "You should count yourself as fortunate to have not been selected as one of the over 20,000 U.S. employees eliminated in 2009, and if you wish to have any hope of remaining with IBM throughout 2010 you must prove every day that you can compete and are competitive in a global marketplace. In all honesty, on a global basis you are grossly overpaid, so it would behoove you to ensure you are working at least 60 hours per week, foregoing as much vacation time as possible, and not expecting an increase or (worse yet) a promotion that would simply make you a target for the next round of reductions.

      Even then, if we determine that we can easily shift your work to someone half as skilled who lives in a 'low labor cost' country such as India, China, Brazil, or Pakistan, then we will give you at least 30 days notice so you can begin making plans to work elsewhere -- and, rest assured, will offer you the same option (via Project Match) that we offered the IBMers 'resourced' during the past year to relocate to one of these other countries where you could, at local wages, once again become 'competitive' with others in the global market. Thank you for your loyalty at a time when you know you are not valued, and you know we are aggressively looking for ways to eliminate your U.S. based position."

      I drafted the statement above as a suggested, no-holds-barred, brutally honest introduction to the 2010 Base Pay Planning Cycle for U.S based employees. I wrote this after having spent nearly 25 years with IBM, with over 10 years in management, and having been dumped in February 2009 just three months shy of my 25th anniversary -- as I found myself wondering how IBM managers would handle the "messaging" being delivered to employees during the upcoming base pay planning cycle.

      In years past, IBM HR prepared "team" presentations for IBM managers' use in which workers were advised that IBM was focused on ensuring employees were paid competitively when compared with employees in similar jobs at other "like" companies. On the whole, prior to 2009, the "we focus on paying our employees competitively" statement rang true. Over the past two years, however, the focus has turned to ensuring IBM can compete in a "global marketplace", with the quick fix being a nearly insane focus on drastically and rapidly reducing the cost of labor (with quality taking a back seat, or having no seat, in the process).

      As a benefit, IBM's profits (2008 was a record/banner year), IBM's stock price, and IBM senior executive compensation are all on the rise while "employee satisfaction" and "employee morale" are rapidly declining, are no longer valued, and are no longer even measured.

      So I began to wonder what kind of "spin" IBM HR (and in turn, IBM managers) would be putting on the "competitive pay" story during the upcoming (early 2010) base pay planning cycle. If they were to be brutally honest, IBM HR would encourage U.S.-based managers to advise their teams that for some time now IBM has been (as stated specifically by Sam Palmisano) laser-focused on "moving work to where it can be done best," with "best" in this context meaning "at the lowest cost, regardless of quality." As such, the focus is no longer on ensuring U.S. based employees are being competitively paid, but on whether or not each employee is themselves "competitive" in a global marketplace. If they aren't, they will be quickly advised that their work has been "offshored," to the benefit of IBM, its stockholders, and the senior executive team. -Former IBM Manager-

      Alliance Reply: Thank you for the brutally honest assessment from your perspective as a former manager. The lie that US IBMers skills are not competitive in the Global Market, is obviously, still alive and well. It is very sad that the current employees continue to be fired under those circumstances, without fighting back harder and at the very least, are not repeating the truth publicly, as much as IBM repeats the lie. We've always believed and still believe that there are a number of current IBMers that truly want speak up and organize. We will continue to be here as long as possible, to prove to IBMers with that spirit, that organizing and fighting back is the ONLY answer.

  • General Visitor's Comment page
    • Comment 09/05/09: Sam Palmisano seems to be systematically eliminating all jobs in the US. What a freak. He must have some weird psychopathic reason for doing this. It is CEOs like Sam Palmisano that have got the US into the mess it is in with unemployment figures approaching 10%. Obamas "cash for clunkers" is just a temporary fix. How about a "cash for jobs" program? A program to create jobs in the US, not destroy them as Sam Palmisano is doing. -A concerned American-
    • Comment 09/06/09: >>Sam Palmisano seems to be systematically eliminating all jobs in the US. What a freak. He must have some weird psychopathic reason for doing this. Weird? Not at all. It's called greed. It's called money. Lots and lots and lots and lots of money. Sam and his executives and his managers and his team leaders get money in the form of bonuses and thirty pieces of silver for every employee FIRED. So? Who's going to do anything about it? Who's going to stand up to Sam and his henchmen and his first line managers and his team leaders who threaten and outsource and FIRE and ruin lives? Exactly. NB: AT WILL EMPLOYEE. Unionize or be screwed. -anonymouse-
    • Comment 09/08/09: So where are the Job Cut "Tea Parties" ??????? This country has gone nuts! They are making mountains out of mole hills, like for example Obama's talk to school kids, yet jobs are being off shored by the millions and nobody seems to care.... Does everyone own stock and have some kind of obsession with the bottom line? IOW send the jobs to China to improve the profit of the company. I just don't get it. States like Ohio and Michigan should be at the revolt stage by now but all I hear from the lipstick gang on Fox News and the drones on CNN is Obama's talk to the kids.... Will somebody please explain this to me? -quimby-
    • Comment 09/08/09: Sam Palmisano will go down in history as worst CEO in America who destroyed IBM. The great American IBM, who developed the computers who put the man on the moon, who believed in respect for the individual, is going down in flames under Sam's watch. What a shame. Sam will have his millions but his conscious will get the better of him. He will repent his sins on his death bed and be sorry for all the grief he has caused American families of IBM employees he has fired and trashed. Join the Alliance and support a Union before it is too late. -Sam Will Pay for his Sins-
    • Comment 09/12/09: As a former IBM manager with nearly 25 years with IBM who was "resourced" in February 2009 just three months shy of my 25th anniversary because my team's work was transitioned to a team in India, I was at first a little bothered, but am now rather fed up at the fact that over the past few months over 30 IBMers in India, 2 in Brazil, and 1 in Pakistan, none of whom I know, have sent me requests to "link up" on LinkedIn (where my profile indicates I did work for IBM until recently). Every request comes in with the generic, "Since you are a person I trust, I wanted to invite you to join my network on LinkedIn," message -- and every time I reply with, "Thank you for your invitation, however, I only connect with people whom I could personally recommend based on my experience working with them, and who could also recommend me based on their awareness of my capabilities -- in line with LinkedIn's recommendations found at http://www.linkedin.com/static?key=pop%2Fpop_more_invite_accept FYI . . . IBM laid me off on 2/23/09."

      Someone must be telling these new, non-U.S. IBMers to "link up" with IBMers in the U.S. so they can enhance their LinkedIn profiles -- and to simply scan LinkedIn for any and all U.S. based IBMers and fire off an invitation. When I check I find that most of them have only one or two "connections", so I know they're just starting out and are apparently following someone's instructions to "build their network".

      I am considering going back now to all of the invitations and using the "Report as Spam" link (I'm been holding off to be nice up to now) to see if I can get these people to stop trying to "connect" with IBMers they don't know just because they're U.S. based -- and especially stop sending invitations to someone like me who lost their job to workers in a "low cost-of-labor" country and really isn't interested in "connecting" with them. Are any of you also being bombarded with LinkedIn connection requests from IBMers you don't know who work in India, Brazil, and Pakistan? If so, what are your thoughts? -Former IBM Manager-

  • 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."
  • PBC Comments
    • Comment 09/06/09: Years Service = 2; Prior Yr PBC = 2; This Yr PBC = 2+; This Yr Bonus = FO; Prior Yr Bonus = FO; Message = There is no point of working for IBM, if your looking for a better CTC and good life... -Anonymous-
    • Comment 09/11/09: Band Level = 4; Years Service = 2.5; Message = Many years ago I worked for IBM as an administration contractor. One day one of the bosses told me to write the PBC comments next to the grades he had given each person to justify the scores. I did not know these people and was up all night trying to think of things to write. This opened my eyes and I would like to apolog for the things I was forced to write. -Anonymous-
    • Comment 09/12/09: Attention USA employees: If you are presently a PBC 2 you stand a real chance this year of getting a PBC 3. The number of PBC 3 will increase through at least YE 2010. IBM thinks you are just not competitive in the global marketplace. -anonymous-
  • International Comments
    • Comment 09/11/09: Salary = £20,000; #Yrs Since Raise = 7; Band Level = 6; This Yr-PBC = 6; Job Title = Server Specialist; Years Service = 10; Location = UK; Message = My husband has not had a salary increase in more than 7 years. In that time he has moved roles twice from desktops to servers, got a degree in IT (self funded), passed ITIL and many Microsoft courses and scored well in feedback. He has programming skills and knows Linux. He is also on a final salary pension. He has been told by his managers he is 25% below market rate. I believe he has been blacklisted due to his final salary pension. The last time he asked for an increase he was told he could not have one due to his pension, but now they are taking that away as well. So does that mean he will get a payrise. He has also been waiting for his band 7 for over 1.5 years and doing a band 7 role. He gets paid about £20,000 and has more than 10 years experience, and a grad starts at £26+. -Anonymous-
News and Opinion Concerning Health Savings Accounts, Medical Costs and Health Care Reform
Minimize
  • New York Times: Groups Back Health Reform, but Seek Cover. By David D. Kirkpatrick. Excerpts: The top lobbyists for every major sector of the health care industry publicly insist they are squarely behind the Obama administration’s health care reform. But as the debate gets down to the details, the lines dividing friend from foe are getting blurry. Each industry group is also working quietly to scuttle or reshape some element of the administration’s proposals that might hurt profits — usually some measure aimed at cost control.

    The drug industry, for example, struck a deal with the Obama administration and is now waging a major advertising campaign to help push the health care overhaul. But the drug makers also abhor one of its cost-cutting components: a government initiative to study the effectiveness of treatments that the companies fear could mean lower payments for certain drugs. So drug lobbyists have enlisted the help of Tony Coelho, a former Democratic congressman who cites his battle with epilepsy to make their case. ...

    The American Medical Association, a pivotal player because of its credibility with patients and voters, has made the most sweeping endorsements of the administration’s efforts, restating its support in a letter released Wednesday before President Obama urged Congress to pass a bill this year. But the A.M.A.’s lobbyists are also working to extinguish the idea of a government-run insurer, which doctors fear could eventually push down their fees. The lobbyists are also using the organization’s support as leverage to persuade Democrats to roll back steep cuts in future Medicare payments to doctors (the House bills eliminate the cuts, and the A.M.A. is still at work on the Senate).

  • Wall Street Journal: Who Stands to Win. By Jane Zhang. Excerpts: Hospitals, doctors, insurers and drug makers may end up gaining from an overhaul of the nation's health-care system. The White House and Democrats in Congress have either cut deals with or made promises to these groups, fearing that without their support they might face a repeat of President Bill Clinton's failed health-care reform effort in the 1990s.

    The industries have made some concessions to help slow the nation's health-care spending. But analysts say they may come out on top eventually -- gaining new, paying customers from a government-funded effort to expand coverage to the country's 46 million uninsured. "They all cut the deals that they wanted to cut, and they minimized their losses," says Robert Laszewski, a health-policy expert and former insurance-industry official.

  • Wikipedia: Operation Coffee Cup. Excerpt: Operation Coffee Cup was a campaign conducted by the American Medical Association (AMA) during the late 1950s and early 1960s in opposition to the Democrats' plans to extend Social Security to include health insurance for the elderly, later known as Medicare. As part of the plan, doctors' wives would organize coffee meetings in an attempt to convince acquaintances to write letters to Congress opposing the program. The operation received support from Ronald Reagan, who in 1961 produced the LP record Ronald Reagan Speaks Out Against Socialized Medicine for the AMA, outlining arguments against what he called "socialized medicine". This record would be played at the coffee meetings.

    Alaska Governor Sarah Palin quoted Ronald Reagan from the 1961 album during the 2008 Vice-Presidential debate, "It was Ronald Reagan who said that freedom is always just one generation away from extinction. We don’t pass it to our children in the bloodstream; we have to fight for it and protect it, and then hand it to them so that they shall do the same, or we’re going to find ourselves spending our sunset years telling our children and our children’s children about a time in America, back in the day, when men and women were free."

  • The Carolina Curator: Operation Coffeecup and Socialized Medicine. Excerpts: Health care reform is today foremost in the minds of the public and politicians alike. It is, however, not a new concern, as evidenced by a new exhibit at the UNC Health Sciences Library which features the American Medical Association’s 1961 campaign, Operation Coffeecup. Led by the Woman’s Auxiliary to the American Medical Association, Operation Coffeecup was “an all-out effort to stimulate as many letters to Congress opposing socialized medicine and its menace as proposed in the King bill (HR 4222).” ...

    “The Problem,” as described by Operation Coffeecup on the album's inside cover, was:

    The legislative chips are down. In the next few months Americans will decide whether or not this nation wants socialized medicine . . . first for its older citizens, soon for all its citizens. The pivotal point in the campaign is a bill currently before Congress. The King bill (HR 4222), another Forand-type bill, is a proposal to finance medical care for all persons on Social Security over 65, regardless of financial need, through the social security tax mechanism. Proponents admit the bill is a “foot in the door” for socialized medicine. Its eventual effect—across-the-board, government medicine for everyone!

  • YouTube: Ronald Reagan Speaks Out Against Socialized Medicine (audio)
  • Yahoo! IBM Employee Issues message board: "Re: HR3200 - Keep your Insurance? Maybe?" by "ibmretiree2006". Full excerpt: Ah Joe! Plenty of competition? Yes, and in my area there is plenty of competition between Mercedes, Lexus and Infinity. HOWEVER, most of my family and friends cannot afford them. Same holds true for many with health care coverage. I pay almost TWELVE THOUSAND DOLLARS a year for coverage as an IBM RETIREE! And that is just me and my wife. How about a family of 5 making $55K a year? Hey, if you can't afford health care, just go and die! But then, doesn't Joe have some REALLY good coverage
  • Yahoo! IBM Employee Issues message board: "HR3200 - Keep your Insurance? Maybe?" by Kathi Cooper. Full excerpt: How about we toss out HR3200 and replace it with this 3 sentence bill? 1) Everyone is on Medicare, supported by premiums. 2) Those over 64 no longer pay premiums. 3) Medicare (like the VA) can negotiate with pharmaceuticals. The only detail left is determining the premium price that everyone pays.
  • Yahoo! IBM Employee Issues message board: "Re: A New Health Bill" by "cybertramp66". Full excerpt: "Medicare for Everyone", a three word bill that would solve everything. Premiums for people under 65 would drop five fold. Govt would negotiate with Big Pharma on drug costs and set reasonable costs on medical procedures. The predatory health insurance industry would go to hell. And since Medicare is already a working program, they could implement this in months rather than years. If people want to call that "social medicine", fine, let me have social medicine. Makes perfect sense Kathi. Actually, this was a conclusion presented in the Taibbi piece. And if congress wasn't filled with corporate whores (both parties), such a bill probably would have been passed already.
  • Yahoo! IBM Employee Issues message board: "Re: A New Health Bill" by "ibmretiree2006". Full excerpt: But wait!!! Won't the far right say we will put thousands out of work (you know, the folks who create all the paperwork and the others who deny benefits for no reason). It was not an issue when those same folks said "let the big three go under". Those hundreds of thousands of employees and those in related industries can go scratch. And won't you have to wait 11 years to get a colonoscopy and 20 years for bypass surgery? As to pharms, if they can sell it for $10 in the UK, why does it cost $199 in the US?
  • Yahoo! IBM Employee Issues message board: "Re: HR3200 - Keep your Insurance? Maybe?" by "cybertramp66". Full excerpt: Two months until you qualify for Medicare, that's great. Congrats. Now the people who are still employed are in for a rude awakening if/when they get RAed. FHA will cover 5 years at most, then you are on your own -- maybe Scientology is the best approach at that point. Fun fact: IBM has laid off 100,000+ US workers in the past 5 years. Only 100,000 left to go.
  • The Christian Science Monitor: Obama faces a generation gap on healthcare reform. Older Americans worry that healthcare reform will affect Medicare. Younger Americans, who often lack good health insurance, are more supportive. By Mark Trumbull. Excerpts: Younger working Americans are the most likely to be unemployed or to have jobs that lack full health benefits. They are the only group that strongly backs the president in this poll. Those in mid-career tend to be among the most job-secure, and they exhibit weak support for Obama’s plan. Opinion is closer to neutral in the 50-to-64 age range. In this group, workers aren’t yet eligible for Medicare and generally face higher insurance costs than younger Americans if they lose work-related coverage. That may explain much of the difference between their opinions and those of surrounding age groups. ...

    Many Americans still say major reforms to the system are needed, but the number has shrunk – from a majority down to 45 percent of the public – as details have been debated this summer. Still, many economists say doing nothing is a poor option. The trend line of the status quo is this: millions of Americans lacking coverage they would like to have, and a soaring healthcare tab in tax dollars and private spending. That rising cost burden will be borne chiefly by those now young, which may also explain part of the generational divide. It’s not clear that any legislation this year will do much to rein in the price of care, but it is clear that the current system has allowed runaway costs.

News and Opinion Concerning the U.S. Financial Crisis
Minimize "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.

  • New York Times: A Year After a Cataclysm, Little Change on Wall St. By Alex Berenson. Excerpts: One year after the collapse of Lehman Brothers, the surprise is not how much has changed in the financial industry, but how little. Backstopped by huge federal guarantees, the biggest banks have restructured only around the edges. Employment in the industry has fallen just 8 percent since last September. Only a handful of big hedge funds have closed. Pay is already returning to precrash levels, topped by the 30,000 employees of Goldman Sachs, who are on track to earn an average of $700,000 this year. Nor are major pay cuts likely, according to a report last week from J.P. Morgan Securities. Executives at most big banks have kept their jobs. Financial stocks have soared since their winter lows.

    The Obama administration has proposed regulatory changes, but even their backers say they face a difficult road in Congress. For now, banks still sell and trade unregulated derivatives, despite their role in last fall’s chaos. Radical changes like pay caps or restrictions on bank size face overwhelming resistance. Even minor changes, like requiring banks to disclose more about the derivatives they own, are far from certain. ...

    But even some senior Wall Street executives acknowledge the lack of change surprises them, given how poorly the industry performed last fall and the degree of government support necessary to keep it from collapsing. “There was a general feeling that an enormous amount of additional regulation should be put in place to prevent what happened that weekend from happening again,” said Byron Wien, vice chairman of Blackstone Advisory Services and the former chief investment strategist for Morgan Stanley and Pequot Capital. “So far, we haven’t seen a lot of action.”

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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