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Highlights—April 10, 2010

  • When Fridays Were Fridays: The Galleon Case Revisited. Excerpts: It’s been nearly six months since the first six defendants were charged in the Galleon insider trading scandal and six months before the last of those six defendants, Bob Moffat (formerly of IBM), entered a plea. When I posted my first article on this topic titled When a Senior Leader is Charged With a Crime, I was both dismayed and outraged that something like this could happen in the IBM family. When I posted the news that Moffat had entered a guilty plea, this forum received a record number of hits. The consensus of the readers here (based on comments and on forums) is that justice is being served, but also that this is a sad situation for IBM and the IBM family.

    Moffat has admitted he was wrong, and according to statements by his lawyer Kerry Lawrence, Moffat is “deeply sorry for the embarrassment his conduct has caused to his family and to his former employer, IBM”. ...

    The big remaining question is “why?” It doesn’t appear that greed was the motive in Moffat’s case. From what we know of the charges, he did not profit financially from any of the trading based on the information he provided. It has also been suggested that perhaps Moffat had a more-than-professional relationship with Danielle Chiesi. Indeed, she was the link between him and Rajaratnam.

    We may never know the details, but I think it’s possible that the motivation behind this was neither money nor sex. I think it’s very possible that Moffat may have simply gotten carried away with the need for power and prestige – that being a Senior VP at IBM and a contender for the CEO job was simply not enough for him.

  • Comments concerning the above article:
    • Arrogance? A little "strutting" for Danielle? The betrayal of the ethical standards held by his company by a person in his position is overwhelming. His "loyalists" must have been overcome.
    • Mr Moffat, like the rest of IBM's employees, annually signed "business conduct guidelines" which he clearly severed when he shared info with Ms Chiesi. There is no doubt in my mind that he knew what he was doing was wrong. He routinely warned his underlings about not sharing quarter-end results, even with with IBMers who did not (and should not) have access to that information. I would guess that his relationship with Ms Chiesi was not just a platonic friendship. However, that doesn't mean he did this for sex. I think he clearly did this as a way of strutting to show how powerful and important he was at IBM - I've heard him numerous times brag about being privy (as a result of his high position in the company) to the most confidential information. The man has an ego that can fill the prison where he'll spend his 6 months.
    • Greed, arrogance, cash, sex, feed the ego, who cares. This is a guy who had no problem laying off thousands and violating IBM COE's (conditions of employment). IBM should investigate when these violations of COE took place and sue him for all earnings, bonuses etc he received after the date of the first violation. If this date of violation predated the date he was eligible for retirement revoke that as well. If it is not apparent, I have no compassion for this low life.
    • Anonymous - thanks for bringing up the Business Conduct Guidelines. You are absolutely right - he surely broke many of those rules.
  • Wall Street Journal: U.S. Steps Up Probe Of Hiring In Tech, By Thomas Catan and Brent Kendall. Excerpts: The Justice Department is stepping up its investigation into hiring practices at some of America's biggest companies, including Google Inc., Intel Corp., International Business Machines Corp., Apple Inc. and IAC/InterActiveCorp., people familiar with the matter said. The inquiry is focused on whether companies, particularly in the technology sector, have agreed not to recruit each others' employees in ways that violate antitrust law. Specifically, the probe is looking into whether the companies' hiring practices are costing skilled computer engineers and other workers opportunities to change jobs for higher pay or better benefits. ...

    Such agreements are "very close to the line," said Melissa Maxman, an antitrust lawyer at the law firm Cozen O'Connor. "They're not agreeing on price, but they're kind of agreeing on costs." Skilled computer scientists with some management responsibilities, for instance, often make base salaries of $180,000 to $210,000. Compensation for the most sought-after workers typically soars far above that and includes bundles of stock options and bonuses. ...

    "IBM is one of many companies that have been contacted by government officials in a broad-ranging inquiry of technology and nontechnology companies regarding hiring practices," said company spokesman Edward Barbini. "We are collaborating with the government's inquiry."

  • Yahoo! IBM Retiree Information Exchange: "Considering early retirement in 2011" by "remerkner". Full excerpt: Hello everyone, I'm new to the forum and am trying to gather information that will help me decide whether or not I can retire next year. I believe I have a good handle on all my expenses with the exception of medical premiums. Like many others, I have a sum of money in the IBM future health account which can only be used if the IBM insurance coverage is used. I'm hearing all kinds of numbers out there that range from $400 a month (out of pocket) to pay for COBRA to $800-1000 for the IBM policy coverage. I'd appreciate hearing of your experience and please don't be bashful about pointing out the holes in the pavement, since I'm sure there are quite a few. Also, any other lessons learned that you're willing share are most welcome. Thanks to all that reach out to help. Ruth.
  • Yahoo! IBM Retiree Information Exchange: "Re: considering early retirement in 2011" by "madinpok". Full excerpt: If you would like to know the current rates for the various FHA plans, you can see them here: http://finance.groups.yahoo.com/group/ibmpension/files/IBM%20Retirement%20Benefits%20Info/. You will have to be a member of the ibmpension group to get to the files section.

    Scroll down through the list of files and open the file titled "IBM 2010 Retiree Medical Plan Costs." Note that these costs are for non-medicare retirees.

    COBRA is about half the cost of the FHA plans, but you can't use FHA money to pay for it. With $40,000 in your FHA account, you can expect to be able to pay for your medical coverage for about 2 years for you and your spouse, or 3-4 years for just yourself.

    Another strategy is to withdraw less money from the FHA account each year and pay the rest out of your own pocket. That makes the money last longer, but you should be aware that IBM could take it away at any time. So many people feel it is better to spend the FHA money as fast as you can and not risk losing it. The money you leave in the FHA account earns only trivial interest these days. You might be able to invest your own money in something better and come out ahead in the long run.

  • Yahoo! IBM Retiree Information Exchange: "Re: considering early retirement in 2011" by "thekanck". Full excerpt: Ruth: I agree with everything Madinpok said ... he's one smart cookie. Let me just point out a couple of possible landmines...
    • If you do not take the IBM insurance immediately @ retirement, you must be sure that you can document continuous medical insurance coverage with no lapse when you do later apply for the IBM insurance otherwise IBM can deny you coverage.
    • I do think that "using up" most of your FHA dollars as soon as reasonably possible is a good idea, I would however leave a non-trivial balance in the "account" say $100 or $200 to prevent IBM from closing the account since it was "depleted" anyway.... if you catch my drift ... just kind of a CYA thing...
  • Yahoo! IBM Retiree Information Exchange: "Re: considering early retirement in 2011" by "real_goose". Full excerpt: My strategy was to stay on COBRA for the full 18 months because it is better coverage than the retiree plans and I wanted to stretch my FHA. Once the FHA is depleted, the costs will be much more expensive so 18 months of COBRA gives me a total lower out of pocket cost for healthcare since the FHA will be gone before I make it to Medicare.

    Right now I an using the FHA at 100% because of some fear it could go away. Those of us with the FHA are not the folks IBM is worried about keeping happy. Hopefully some sort of new healthcare "exchange" option will be less costly than IBM insurance. I am waiting to see options for us in 2014 since we will have to wait til 2018 for both of us to be old enough for Medicare.

    But I am truly lucky to have an actual pension and healthcare. My wife was diagnosed with breast cancer and the surgeries, chemo, and drugs are very expensive. The cancer center said many women can't get their insurance to cover the best anti-nausea drugs because they are so expensive. I picked up her prescription yesterday and the co-pay was $7.43. So in IBM's defense, this could also be a case of "you get what you pay for". (But I have no trouble believing the rumor that IBM make money on retiree healthcare once the FHA is gone.)

  • Yahoo! IBM Retiree Information Exchange: "Re: considering early retirement in 2011" by "remerkner". Full excerpt: That's what my friend did.... paid the out of pocket for Cobra (less costly) for the 18 month allowable period, and then plans to go to the FHA account. I have no trouble believing anything things these days on the lengths the company may go to in it's efforts to cut costs. For those of us that were around for a while, it definitely is a new shade of blue. Thanks for your post and comments.
  • Yahoo! IBM Retiree Information Exchange: "Re: considering early retirement in 2011" by "fstephens". Full excerpt: If you are planning to retire in 2011, plan on a minimum of $1000 per person for 1 using the FHA. If on the OLD OLD PLAN, then it will probably be half that amount for 1, for the high deductible plan. If it is more than just you, that amount will increase exponentially for all plans. Under FHA for only the retired employee, I am currently paying over $700 for the EPO plan, no deductible. The so called cheapest high deductible would have been almost $600 per month. Add another $30-$40 per month for dental. I used the discount card only, as the other plan are almost worthless, if you get other than the standard plastic black frame with single strength lenses, no special coatings. FHA will last about 4-5 years for only one, 100% coverage from FHA. Do FHA 100% and then utilize the available deductible for coverage from your taxes.
  • New York Times: Bargain Rates for a C.E.O.? By Devin Leonard. Excerpts: Last year may have been unnerving for chief executives accustomed to all of the familiar ornaments of corporate life: eight-figure pay packages, corporate jets, memberships in select clubs, and on and on. ...

    So if you were the typical American C.E.O., you may have found some of the pay czar’s prescriptions startling. For instance, he thinks you should pay golf club dues out of your own pocket. He also would like you to take less of your pay in cash and more of it in stock. In fact, the White House set a limit on how much cash top executives of the biggest TARP companies could get as part of their annual compensation: $500,000 a year. That sum that may seem princely to the average American worker but, alas, doesn’t buy much for a crowd used to Fifth Avenue triplexes, third and fourth homes, top-drawer health care and lavish private schools for their children. ...

    IF ever a C.E.O. would have seemed impervious to the administration’s calls for pay reform, it is Lawrence J. Ellison of Oracle, the highest-paid chief executive in the Equilar survey. He made $85 million last year — more than the combined pay of the second- and third-ranked C.E.O.’s, J. Raymond Elliott of Boston Scientific, with $33 million, and Ray R. Irani of Occidental Petroleum, with $31 million. Mr. Ellison took all but $6 million of his pay in stock options. A billionaire many times over, Mr. Ellison has never been afraid to flaunt his wealth. Yet he made a sacrificial gesture last year that is a sign of the times: this year he plans to decline his $1 million base salary and take just $1 instead. (Oracle declined to comment on Mr. Ellison’s pay.) ...

    As usual, some C.E.O.’s in the Equilar survey seemed to have done more to earn their pay than others. For instance, Samuel J. Palmisano of I.B.M. made $21 million after he delivered a 9 percent net profit increase and helped oversee total shareholder returns of 58 percent. Jeffrey L. Bewkes of Time Warner made $19 million last year as he undid the disastrous AOL-Time Warner merger by spinning AOL off as a separate public company. Mr. Bewkes got $14 million of his pay in cash. He might wish he had received more Time Warner shares, though. The total return on his company’s stock was 21 percent in 2009.

  • The Register (United Kingdom): Forrester calls time on IT downturn. It's over. Unofficially. By Timothy Prickett Morgan. Excerpts: Forrester Research today upped its forecasts for spending on IT wares this year, thanks in large part to a slightly faster recovery in the United States than the market prognosticators expected when they did their initial projections back in January. At the time, Forrester called an "unofficial" end to the technology downturn of 2008 and 2009, saying that global IT spending would rise by 8.1 per cent in 2010, surpassing $1.6 trillion when reckoned in US dollars. Because of the severity of the recession last year in the US and the faltering recovery as 2009 came to a close, Forrester only projected a 6.6 per cent rise in IT spending across hardware, software, and services this year, to $568bn.

    But today in a blog posting, Andrew Bartels, the vice president and principal analyst at Forrester who is responsible for economic and IT spending modeling, didn't just make an unofficial call on the end to the downturn, but he said more emphatically that the "tech recovery of 2010 is underway."

  • Wall Street Journal: AT&T Fights Pension Suit/ Potential Liability for Retirees' Plan Conversion Is Estimated at $2.3 Billion. By Ellen E Schultz. Excerpts: AT&T Inc. is seeking to dismiss a long-running pension case alleging age discrimination that seeks $2.3 billion in damages, according to documents filed this week in a federal court. The suit alleges a 1998 pension change effectively froze the pensions of 40,000 older management employees at AT&T, in some cases for years, but not those of younger employees. AT&T said the pension didn't discriminate against older workers. ...

    The suit, filed in 1998, has received little attention despite the number of plaintiffs—24,000 current and former employees—and the size of the potential damages, one of the largest ever in pension litigation. Legal papers filed Monday in federal court in Newark, N.J., include the first publicly disclosed estimate for potential damages. ...

    AT&T was one of dozens of big companies including International Business Machines Corp. and Xerox Corp. that changed their traditional pensions to "cash-balance" plans in the 1990s. The change saved companies money because instead of calculating benefits by multiplying years of service and salary—which produces rapid pension growth in later years—the companies converted the pension to a cash-out value. This "balance" would then grow at a flat annual rate, say 4% of pay. ...

    Many companies established opening "account balances" for older employees that were lower than the cash-out amounts they had earned. For example, a worker might have earned a pension that, if converted to a lump sum, would be worth $150,000. But its opening account balance would be set at $100,000. The balance would be effectively frozen until the worker received enough annual credits over the years to restore it to $150,000. Only then would the pension begin to increase again

  • New York Times: Taxes and Salaries, County by County. By Catherine Rampell. Excerpts: Syracuse University’s Transactional Records Access Clearinghouse published its annual Internal Revenue Service report on Wednesday. It includes some intriguing statistics on income and tax data for each of the country’s 3,000 counties. Some of the findings based on tax data from 2008:
    • When it comes to exemptions claimed per taxpayer, Utah County (Provo), Utah, has the highest rate in the country, at 2.76. Residents of New York County (Manhattan) in New York claim the least number of exemptions on average, 1.54 per taxpayer.
    • Average wages and salaries were highest in Loudoun County (Round Hill), Va., at $85,028. They were lowest in Catron County (Glenwood), N.M., with an average of $14,289.
    • Combining all sources of income, Teton County (Moose), Wyo., was No. 1., with an average of $142,048 in adjusted gross income. Adjusted gross income was lowest in Douglas County (Ava), Mo., reporting an average of $18,262.

    An app that sorts the tax and income data by state and county can be found here.

New on the Alliance@IBM Site
Minimize
  • IBM: The information services company that refuses to divulge information. Excerpts: It is ironic that a company that advertises itself as an information services company and wants to build a smarter planet refuses to divulge crucial information and wants the planet kept in the dark. But that is the case with IBM. Take job cuts. Last year IBM cut an estimated 10,400 jobs. This information came from Resource Action documents sent to the Alliance. The true number, which is probably higher, is only known to corporate executives. On March 1st another 2900 jobs were cut. Probably higher. Once again only IBM knows the true number and appears to be violating the intent of the WARN Act.

    The jobs were cut all across the United States and some in Canada. What locations and communities had job cuts? Nobody knows because IBM no longer gives out that information. Now IBM has decided that it will no longer inform employees, the government, communities, the media, or stockholders how many employees work at IBM in the United States.

    From now on only the global headcount number will be reported. It is clear why IBM is doing this. The US employee population is shrinking due to off shoring. IBM is also displacing US workers with foreign workers (at lower pay) brought in to work on US client accounts. Meanwhile headcount in India and other countries is increasing.

    In fact, IBM India had an employee population of 94,000 in 2008. At the end of 2009 IBM USA had an employee population of 105,000, down 30,000 in just a few years. But with IBM no longer giving out headcount by country we will not know when IBM USA goes below IBM India in headcount. Is this important?

  • To Alliance@IBM supporters: The Alliance is the only organization that advocates and supports IBM employees and ex-employees. In fact, there are few like it in the Information Technology field. It is always difficult to keep an organization like this alive, but as a supporter you know how important it is that we exist. We are calling on you today to help keep us alive another year by joining as a member or associate member. See our online forms below. As our membership has dropped, it is imperative that we gain new members or this organization and web site will cease to exist. Help us keep our organizing and advocacy work alive!
  • General Visitor Comments: Due to a lack of membership growth the comment sections will be closed until we see sufficient growth in full membership, associate membership or donations. Many of you that visit our site have not yet joined, but seem to value its existence. The only comment section that will remain open will be Job Cuts Reports. If you have information that you want the Alliance to know about please send to ibmunionalliance@gmail.com. Information of importance will be put on the front page of this web site. To join go here: Join The Alliance! or here: Join The Alliance!
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  • Job Cut Reports
    • Comment 4/01/10: IBM MBPS eliminates positions without replacing the person. This does not mean the person RAed was not needed. It is just that IBM figures they can risk not replacing the person and hope "all continues okay with what resources left" to make sure the job gets done. This is fact. My former job was never back filled as a server administrator. The servers, though, remain running unsupported and unadministered: unattended. I bet other IBM divisions or LOBs do the same. I bet IBM customers wonder what is really going on. Well this practice is going on. I figure they should know. -da_facts-
    • Comment 4/02/10: I got mail from my manager that I have been identified for RA ,the termination date being June 30th.Does that mean I am RAed with effect from June 30th or I am in the RA ed list from March 31st itself when I got this info. I am in the GBS. -Anonymous-
    • Comment 4/02/10: My last day was 4/1 after 33 years. My manager told me on 3/2 and I did not hear another word from him. I finally called HR and asked about an exit interview, where to hand in my laptop, badge, etc. He finally left a message for me. Guess the hardest part was leaving without any human interaction. All my retirement stuff was handled over an 800 number. The only people still left in my location/productivity center that I cared to say goodbye to were the security guard and mailroom staff. They all cried...guess more are leaving than I even knew. Yes, I was very angry at first. Now, I'm looking forward to finding something else and making IBM pay for their actions. Not the best attitude but our leadership has devolved to the point where its laughable to be seen as a US based company! Sam is something like the third highest paid exec and his success comes at our expense. Time to move on. -Gone but not unhappy-
    • Comment 4/03/10: Royally unhappy here! My role was made redundant and offshored in February....although i was told i had unlimited time to search, on the bench for another role. Have since been dumped in a temporary role getting told it was one thing and am now sinking. My Manager asked me was a redundancy something that i would ever "consider".....i have since been told that severance pay in Australia has been FURTHER reduced to 2 weeks per year of service and then only 1 week for the remainder. Does anyone have any idea whether this is true or how redundancy payouts are calculated in Australia? -sydneyworker-
    • Comment 4/03/10: I heard a rumor that IBM is going to keep abusing employees. Firing them whenever they feel like it. Taking away benefits and overcharging for the few remaining until the employees band together in a union to stop them or the company folds in America whichever comes first. I first heard this rumor in 1999. So far it has been true. -Exodus2007-
    • Comment 4/04/10: I was a victim of the March 1st Resource Actions. 3 in my department. Yet, my manager had 3 open hiring tickets out, on the Global Opportunities Marketplace. My title: Channels Technical Sales Specialist -Anonymous-
    • Comment 4/04/10: -Marked-, if IBM can hire someone with a lower up-front cost to replace you, they will. You are never safe. With a contract, you could be safer. We're losing two and gaining more than that in other geographies. -CDI_Drone-
    • Comment 4/05/10: According to Blue Pages, US employee counts decreased by 3390 between 3/1 and 4/4. So, I think your estimates as to how many were laid off in this last round were low. -Anonymous- Alliance reply: Thanks for this information. We went by the numbers on resource action packages we received. Obviously we did not get all of them.
    • Comment 4/05/10: Dues paying Alliance member here. Just noticed that Forbes named Sammy one of the "30 Best CEOs". Their only metric seemed to be (not surprisingly) Earnings Per Share. Guess this will reinforce to Sammy and his band of thieves their overinflated opinions of themselves, and confirm their conviction they are doing the right thing by offshoring the company. -Gone in 96-
    • Comment 4/05/10: Jobs cut on Disney account. IBM moving work to India. -anon- Alliance Reply: Do you know how many jobs were cut? Do you know the division? Do you know the location?
    • Comment 4/05/10: TO: IB eMbarassed et al.: Exit dates can be extended for non-business reasons too. My exit date was extended from 3/31 to 4/7 simply because I was on vacation when the RA was announced and could not be reached. No impact on severance or other terms as far as I can tell. -Anonymous-
    • Comment 4/05/10: Just warning those who were RA'ed in 3/1 you might want to check your bennies... they shut everyone off on 3/31 without telling you anything... The only way for you to make sure you have coverage is to call into the ESC and talk to them to reinstate your bennies.. Its not seamless... and it is slimy what they did... only way I found out was a friend told me when he checked.. I called and they dropped me... -Screwed and Tattooed-
    • Comment 4/05/10: Never been happier. Always a top performer for 6 solid years with ratings of 1 to 2+ never lower and this is how they repay you. I sleep better and wake up clear headed. I am sure of getting a job soon and not having to work at crappy IBM where IDIOTS BECOME MANAGERS and now it should be renamed as INDIAN BUSINESS MACHINES. BTW, I am INDIAN. -terminated-
    • Comment 4/06/10: Attention front line managers whose employees are off-shore. It won't be long now until managers are trained in China and India to take your place. If engineering employees are cheaper in India and China, management is cheaper too. -Peter ClearCase-
    • Comment 4/08/10: I posted a comment yesterday in the Bob Evans article yesterday. They were not posted, although subsequent posts have appeared. I am thinking it is heavily edited with some mildly opposing viewpoints permitted to give an impression of a balanced view. My posting was along these lines:
      "IBM is projecting a false financial situation and going on resource actioning valuable employees. A honesty about the financial situation will help. In the Toronto lab, during the past one year, IBM has eliminated colour printer, cut the number of BW printers by 1/3, eliminated OT, eliminating pager pay, no pay raise even for those youngsters who are coming off probation, no Christmas lunches, telephone calls are being monitored with login id, minimal AC, almost anything that can be cut is being cut.
      Can this be an indicator of a well managed company. If Sam were a good executive he would come clean with employees and explore ways to rectify the situation. Instead thousand of valuable employees are being resource actioned indiscriminately by poor managers. IBM's future is being mortgaged by Sam for immediate benefit to him and all those with stick options."

      Now I know in US many of the cited items were gone a while ago but I do not wish to insult anyone. Plus this is something that we in Canada feel the loss immensely. -IBM Canada-

    • Comment 4/08/10: Received my separation notice 8 days after my exit interview. My ex-manager did not have it ready at my exit interview. Also, after getting the notice by Fed Ex. Saw that my ex-manager did not enter the"DOL account number". Contacted my ex-manager for the information. Now being ignored. -Anonymous-

    Editor's note: Many more job cut comments resulting from the March 1st firings are available in the highlights from these weeks:

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 op-ed: Making Financial Reform Fool-Resistant. By Paul Krugman. Excerpts: The White House is confident that a financial regulatory reform bill will soon pass the Senate. I’m not so sure, given the opposition of Republican leaders to any real reform. But in any case, how good is the legislation on the table, the bill put together by Senator Chris Dodd of Connecticut? Not good enough. It’s a good-faith effort to do what needs to be done, but it would create a system highly dependent on the wisdom and good intentions of government officials. And as the history of the last decade demonstrates, trusting in the quality of officials can be dangerous to the economy’s health. ...

    I know that getting such things into the bill would be hard politically: as financial reform legislation moves to the floor of the Senate, there will be pressure to make it weaker, not stronger, in the hope of attracting Republican votes. But I would urge Senate leaders and the Obama administration not to settle for a weak bill, just so that they can claim to have passed financial reform. We need reform with a fighting chance of actually working.

  • New York Times op-ed: Throw Out Skybox Tax Subsidies. By Richard Schmalbeck and Jay Soled. Excerpts: Until the 1970s, Major League Baseball was a populist sport. Bleacher seats cost as little as a dollar, meaning middle- or even working-class fans could afford to take their families to a game a few times each season. But in the years since, tickets to baseball games — along with other professional sports events — have skyrocketed in cost. Over the last two decades, the average ticket price for a Chicago Cubs game has increased 265 percent, more than four times the inflation rate. Add in parking, concessions and souvenirs, and a family trip to one of this week’s opening day games could easily cost a few hundred dollars.

    There are many reasons for the price explosion, but a critical factor has been the ability of businesses to write off tickets as entertainment expenses — essentially a huge, and wholly unnecessary, government subsidy. These deductions have led to higher ticket prices in two ways. On the demand side, they have fueled competition for scarce seats, with business taxpayers bidding in part with dollars they save through the deductions. On the supply side, the large number of businesses bidding for expensive seats has driven the expansion of luxury skyboxes and a reduction in overall seats in new ballparks. ...

    Ideally, Congress would get rid of business-entertainment deductions altogether — after all, they are little more than an excuse for corporate executives to consume luxury items at a discount, distorting markets and cheating the public out of substantial tax revenue. Given corporate America’s passionate attachment to sports-related perks, a blanket elimination may be unrealistic, though. A more feasible but still effective approach would be to limit deductions for luxury skybox tickets to a low, fixed amount — say, $50 per seat, per game. Such a limit would be fair, unambiguous and easy to enforce. But above all, it would help baseball return to its roots, when average folks — not corporate entertainers — were the ones filling the seats.

  • Wall Street Journal: Traders Beat Wall Street CEOs in Pay. By Stephen Grocer and Aaron Lucchetti. Excerpt: Many Wall Street chief executives took a big pay cut for 2009. But their real value may have been in deflecting attention from their troops—who enjoyed the largest collective payday on record. Across Wall Street, leading firms paid out $140 billion in compensation and benefits, the highest number in history, based on a final tally of the pay disclosures at 38 financial-services firms. That figure, which was projected earlier by The Wall Street Journal, represented an increase from $123 billion earned by financial professionals in 2008 and $137 billion in 2007.
  • Jim Hightower: A Public Official Who Stands For Us! Full excerpt: The first thing you need to know about Elizabeth Warren is that the big shots of Wall Street despise her. And isn't that refreshing?! Again and again, grassroots America has had to watch in dismay and disgust as our Washington officials (both Republicans and Democrats) have rushed to pat the hands and soothe the fevered brows of the very banksters who stole the American dream from millions of ordinary folks. Isn't anyone on our side?

    Meet Ms. Warren, presently the head of an independent agency set up by Congress to monitor the government bailout of Wall Street bankers. "Dang gummit," she says in her Oklahoma twang, "somebody has to stand on behalf of middle-class families." Not only has she been doing that by fearlessly grilling Gucci-clad bankers and weak-willed treasury officials, but also by conceiving of and pushing hard for a new regulatory agency that would protect us consumers against banker greed. Wall Street profiteers shudder in fear at the very mention of Warren's proposal for a totally-independent Consumer Financial Protection Agency, and they're lobbying ferociously to kill it and demonize her.

    Coming from a working class family, she knows what it is to face financial crisis and feel the crushing power of uncaring banks. "I learned early on what debt means, how vulnerable it makes people," she recently told the New York Times. Despite her success as a lawyer, she hasn't forgotten her populist roots and purpose. Warren is Wall Street's worst nightmare: a middle-class champion who gives a damn about workaday people, is smart and tenacious – and can't be bought. Arrogant and avaricious bankers are right to fear her, and we're right to be cheered by her advocacy. To support Warren's push for a real consumer agency, call Americans for Financial Reform: 202-263-4533.

  • New York Times: The Well-Off Are Spending Again — but Carefully. By Geraldine Fabrikant. Excerpts: The wealthy are cautiously opening their wallets again. “People are fed up, and they want to have a good time,” said Rina Anoussi, a Manhattan travel agent who handles high-end clients. They don’t want Italy 101. They want more exotic destinations like Kenya and Tanzania.” ...

    Business is also creeping back for hotels, yacht rental companies, jet brokers and jewelry stores — purveyors of the luxury goods that once seemed immune to a downturn but then took a megahit with the economy.

    “Everybody has cut back somewhat,” Ms. Webster said. “Even people who rented a 225-foot boat are saying, ‘Can I get something that is 50 feet shorter?’ “

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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