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Highlights—August 28, 2010

  • Washington Post: Obama administration targeting ineffective contracts in an effort to trim costs. By Kate Andersen Brower and Todd Shields. Excerpt: The Obama administration said Monday that it plans to review 26 government information-technology projects worth a total of $30 billion as part of an effort to trim back or cancel contracts that aren't meeting goals. ...

    IBM's portion of a $4.5 billion cargo-tracking system for the Department of Homeland Security was identified for review, as was Raytheon's $251 million contract for the patent-processing project. ...

    AT&T spokesman Michael Balmoris declined to comment. Lockheed Martin spokesman Jeffery Adams, Computer Sciences Corp. spokeswoman Marian Herbst Kelly, IBM spokesman Clint Roswell, and Raytheon spokesman Jon Kasle all said they couldn't immediately comment.

  • ZD-Net Australia: IBM concludes union negotiations. By Luke Hopewell. Excerpts: IBM and the Australian Services Union (ASU) have concluded critical discussions, resulting in a number of formerly displeased IBM employees accepting common law contracts offered by the company. IBM confirmed that it had concluded negotiations and that the "interests of employees remained central throughout the negotiation process". ...

    The controversy centred around IBM's Baulkham Hills facility, after unionised staff demanded better working conditions and protested at the plans to offshore staff. Staff also expressed a desire to be represented by a union in employment negotiations. At one stage, the ASU proposed an indefinite strike if the demands of staff were not met.

  • Yahoo! IBM Pension and Retirement Issues message board: "Life Insurance Issues for those looking to retire from IBM" by "Robert". Full excerpt: To whom it may concern: I am writing this note to help other IBMers avoid a serious mistake I made concerning life insurance. The IBM Group Life policy can be continued after you retire but the first fact to emerge immediately after you retire is that you are put into a new risk pool for retirees, no longer working with higher rates, regardless of your age.

    The policy was then managed by Marsh McLelland for several years with dramatic rate increases. The plan was taken over by Prudential who immediately lowered rates about 5 years ago but there are still some "gotchas" due to my own ignorance I was unaware of. My policy for $170,000 and has been in effect since 1999. Rates are now adjusted each August 1 and my current rate is going up about $70 per month per year. Also, there is zero cash equity build up in the account and the policy is automatically terminated at age 100.

    If I had it to do over again I would learn about other options like annuities etc and not be locked into a poor financial plan with no desirable options.

  • Yahoo! IBM Pension and Retirement Issues message board: "Re: Sept 1st announce/non-announce (fair and balanced reporting -ha)"

    by "art_vandalay". Full excerpt: In one of my earlier posts I showed how the number is probably ranging from 3,000 to 4,000 who have not qualified for the 30 year target and are still not 55 years old. I also estimated that canceling those IBMers from the annuity bump could be worth $1B to IBM. I'm sure the accountants in IBM lick their chops on that type of dough.

    One manager also mentioned that health care is a factor in this move to get rid of older employees. I was told that every year IBM negotiates with the insurance companies and the higher percentage of older workers, then the higher rates they are charged.

    Too bad there are so many of us that are doing valuable work for this company, otherwise I am sure some accountants (taking their orders from the execs) would love to ship us out tomorrow, if possible.

  • eWeek: H-1B Visa Fee Increase Unpopular Across the Board. By Don E. Sears. Excerpts: Supporters, detractors and reformers of the latest law that will place a $2,000 increase on H-1B visas is not expected to impact American jobs or curtail companies from seeking to use temporary, foreign workers. The measure is expected to sting U.S. and India trade relations.

    The measure to increase fees on H-1B visas that was attached to the $600 billion border security bill by Sen. Charles Schumer (D-NY) passed both houses of Congress was signed in to law by the president on Aug. 13. What proponents and advocates on all sides of the debate have to ask themselves is whether this measure will have any impact on American jobs and will close loopholes that allow companies to abuse wages for temporary technology workers .Critics and supporters of H-1B visas are finding the measure to be wholly inadequate and ineffective. “The actual impact [of the fee hike] will be negligible, since the amount of the fee is minuscule in comparison to the wage savings employers accrue by hiring H-1Bs,” said a leading H-1B visa reformer and computer scientist, Professor Norman Matloff of the University of California, Davis, in an interview with eWEEK. “Those savings are in the tens of thousands of dollars each year, multiplied by the (up to) six-year life of the visa.” ...

    “The mainstream U.S. firms abuse the H-1B visa just as much as the Indian firms do,” stated Matloff. “All of them use the visa for saving on wages. The mainstream firms tend to hire a higher class of worker than the body shops do, but still the mainstream employers pay the H-1Bs below-market wages. (And as I've said before, this is done in full compliance of the law, which is full of loopholes.)”

  • The Register: Moshe Yanai has left IBM. By Chris Mellor. Excerpt: Moshe Yanai, the founder of EMC's Symmetrix product, storage company XIV and co-founder of Diligent, has left IBM. An IBM spokeswoman said: "Moshe Yanai left IBM to pursue other interests. IBM appreciates Moshe's contributions to the company. XIV is an important part of IBM's storage portfolio. In fact, XIV added more than 130 new customers to the platform in the second quarter, and revenue more than doubled year to year."
  • Wall Street Journal SmartMoney: 6 Expenses to Ditch in Retirement. By Catey Hill. Excerpt: Nearly half of all baby boomers will face a cash crunch in retirement, according to a recent study by the Employee Benefit Research Institute. Boomers’ net household assets – 401(k)s, pensions, homes and other investments, minus their total debt – have lost 18% of their value since 2007 and today average roughly $171,000 a person, the EBRI study found. The upshot of these losses is that boomers between the ages of 56 and 62 now have a 47% chance of falling short on funds to pay for basic retirement costs, according to the EBRI study. Boomers between the ages of 46 and 55 have a 45% chance. ...

    Here are six more expenses retirees should consider ditching to help close the gap...

  • Glassdoor IBM reviews. Selected reviews follow:
    • IBM Systems Engineer in Seattle, WA: (Past Employee - 2010) “Not what it used to be.” Pros: Looks good on a resume. Often get to work on new technologies. There are still many, many great folks there.

      Cons: Full disclosure: I was laid off. However, I am not a bitter and angry ex-IBMer. I was elated to get my layoff package (very reasonable) and found a new, much better paying job before my severance ran out. IBM was very good to me for many, many years (and my tenure started long after the golden years before the early 1990's) and I'm too young to have been personally affected by the pension shenanigans. My review comes from working in the Server group.

      It is no secret that IBM's "strategy" has been to reduce its US workforce. They're achieving this by two methods: small but continuous layoffs spread throughout the company and by making it more unpleasant to work there to encourage attrition. The unpleasantness ranges from big things (most people haven't had a raise in years) to the petty (no coffee, no soap in the kitchens, etc.). Meanwhile, the senior executives are making millions upon millions. Consequently morale throughout the entire company is extremely poor.

      Training? Only if it's free and local (no travel expenses).

      Raises? Small and non-existent. IBM redefined their salary ranges a few years ago. We used to hear you've got lots of growth left in your salary range. Now you hear, "well, you're near the mid-point of your range, so you're paid what you should be paid. It's like jumping halfway to a wall - you'll never reach it.

      Salaries? When I worked there, I thought it wasn't bad, but three of us have left my team in the past two years and we've each received pay increases at our new companies in excess of 30% and that's been in this terrible economy.

      Working Conditions? Varies widely throughout the company depending on your local mgmt and location. It was generally pretty good where I was in the Pacific NW.

      Career? At the big sites, there's plenty of places to transfer or try new jobs. Smaller remote sites are more limited. And there's no way IBM's paying for anybody's relocation.

      Promotions? Still possible if you're on the right projects or working with the right customers. Pay raises are minimal with a promotion, but at least the halfway point in your salary range is a little further away after a promotion.

      IBM's always been beauracratic, but local management always had flexibility to take care of their people. That's gone now, First and Second line managers are now probably the worst jobs in IBM. They're reduced to just implementing the new and often petty people policies dreamed up by the execs.

      Advice to Senior Management: A company can't thrive by continually driving costs towards zero. Eventually you reach diminishing returns. Ultimately top line revenue has to grow to increase profits. It is the executives' jobs to come up with strategies to grow. Since IBM's top line revenues haven't grown in the better part of a decade, the failures are yours.

    • IBM Manager: (Current Employee) “True Janta Company... Worst HR.” Pros: Flexibility - very flexible... Women friendly - I conduct PDM interviews... I keep hearing women want to join because IBM is very women friendly. This is absolutely true. If you give a poor rating to a woman employee she can report to diversity commission. If you appraise the employee can't stay and fulfill her delivery commitments...the manager is most likely to get fired. Good work culture. Scope for professional development for technical stream. Cons: Newer services contracts are bordering slave labor. A truly horrible HR. Everyone thinks the manager is responsible for everything. However, the truth is a manager is empowered to give hike of min of X and max of y percent. Too much of bongs have filled the top management and it is becoming regional. Senior management up to directorial level are just cutting time till retirement...making matters worse. I think IBM as an organization wants move on from India given the challenges...but there are no alternatives yet...they are looking at Philippines. Advice to Senior Management: Conduct serious performance appraisal from band 8 on...fire the low performers at band 8 to D to instill vigor. Look in to the gap in salary between the person newly hired vs person staying more than 5 years.
    • IBM IT Specialist: (Past Employee - 2010) “Great benefits, but frustrating administration.” Pros: IBM pays well and has great flexibility when it comes to work location and schedule. Cons: Large amounts of unpaid overtime are expected. Far too often, jobs are sent overseas to save money, but at great detriment to the existing project. Advice to Senior Management: Remember that IBM was built on its people.
    • IBM IT Specialist: (Past Employee - 2008) “When Good Goes Bad.” Pros: The severance package that I got when I was laid off. Cons: No to very little raises and a large pay cut. Management that was out to make themselves look good at all cost including their employees. 1st line managers are not monitored in behavior and action. People don't leave companies; they leave managers. No clear direction for Senior Management. No focus on customer satisfaction. Advice to Senior Management: Don't lie to customers to land contracts and then expect employees to deliver on unrealistic expectations.
    • IBM Software Brand Specialist: (Current Employee) “Meh” Pros: Perks, IBM Brand, Resources to get the jobs done and marketing support. Cons: Negotiate hard in regards to salary, or it will NOT go up. Maybe 2% to 4% per year and that is a maybe. Do not go in with an attitude, "do it and if I am wrong, I will get my hand slapped later," because people will get fired for that. Extremely rigid. Very high pressured and very management top heavy. Huge Websphere presents in the management chain, so they push transactional sales and not solution selling. As a result, no room for developing territory. They continually change and move territory every year. Commission plan, you will not get paid until you hit 55% of your target and the draw you get if you choose to get it is very low. Advice to Senior Management: Look outside the box. You will continue to lose people to the point you will wash down the value of the software brands except Websphere because none of the quality software reps will be employed by IBM...unless, you buy the company where they all went.
    • IBM Senior Software Engineer in Pleasanton, CA: (Current Employee) “If you are in a good group or active project it's a great place to be. Otherwise, it's a grind.” Pros: IBM is committed to making alternative work situations available to employees: work at home, work in the nearest office, etc. When your company is worldwide, this makes sense. -- I work with some very intelligent people who are genuinely interested in what they do. -- Depending on your product/project, you get to work on what interests you (within reason, of course). I'm going to work on some new technology that I've been wanting to work on for a while now. -- My pay is better than any other place I have worked. -- They take the annual review process very seriously, from the writing of goals to regular review of your progress towards your goals. I haven't been here long enough to know what the annual review itself is like. -- The people I have direct contact with are very helpful and a pleasure to be around every day. People have a lot of respect for their coworkers and immediate management, but there seems to be a general contempt for the bigger company and its processes and policies, however.

      Cons: This is an enormous company. There's a lot of stuff going on, and it's very easy to tune out the rest of your division. As a result, personal and career growth tools and advice are about as generic and non-specific as possible, and therefore not all that useful. -- Size makes finding useful information on the company intranet almost impossible. Pages are frequently out of date, and you seem to be redirected to 2-3 other pages before you find anything of use. -- No two groups seem to use the same technology for source control, access management, requirements management, or just about anything else. -- For some, it's such a good place to work that it's impossible for anyone else to advance into a technical leadership role, so you end up leaving or creating something new and esoteric to make your mark, which makes it even harder for someone new to figure out what's going on. -- Benefits (primarily health care) are not as good as other places I've worked. -- Can be very hard to figure out who your customer really is, or who is using what you work on.

      Bottom line: It's almost impossible to describe the 'good and bad of IBM', because it's such a huge company. IBM has acquired so many other companies in the past few years that you can't really describe the culture of IBM anymore. There are a few unifying pieces, like benefits and the review process, but if you want to work at IBM you will want to talk to a lot of people during your interview to find out more about the specific site you want to work at.

      Advice to Senior Management: There seems to be a huge disconnect between the big 'making a smarter planet' mantra and what we do on a daily basis. The attitude seems to be "someone else does that. We work on what we work on, big corporation be damned." Every purchase of a company just reinforces that feeling further, and leads to cynicism in the ranks. Short of breaking up the company into more cohesive groups, I don't know how you would go about fixing that. Change HR/training/etc. to stop assuming we're all sales people that meet with 'customers' on a regular basis, or that advancing up the bureaucracy is the only form of success.

    • IBM Anonymous in Somers, NY: (Past Employee - 2009) “Don't stay too long (<7y) - it's a short cycle to attain skills, contacts and move on to brighter career futures.” Pros: Great and reliable research sources, very intelligent workforce. Excellent IT resources - no end to what you can have to enable a data deluge A place to make a few great friends outside of the corp culture. Diverse enough so you're not always talking to "the man." Cons: In an effort to bring operation costs down, down, down (and show profits)- employment in the US is almost non-existent. Too much management (un-actionable.) Too much cross functional decision-making, makes projects and success long and protracted still too siloed, GBS vs. S&D vs. SWG - no single face to the customer; groups work against each other, and there is no hesitance to throw folks under the bus with lots of blame-gaming. Advice to Senior Management: Flatten hierarchy, stop outsourcing.
    • IBM Senior Security Specialist/Lead in Denver, CO: (Past Employee - 2008) “Use IBM as a last choice if you cannot find work anywhere else.” Pros: All of the best reasons to work at IBM are gone. They used to have great benefits. Management used to care (somewhat) about their employees. I have heard the stories from IBM-ers who worked for IBM starting in the 1960s. All of them say that it's not IBM any more. It is an empty shell of what it used to be. Outsourcing has turned a once-great computer manufacturer into a services-only based business.

      Cons: Education is why I left IBM. I was set to take a Masters Degree, and asked my manager if there would be any time considerations for my education. The manager said 'no.' Now mind you, I had given IBM hours of free overtime to the tune of 18 hour workdays very often in order to fulfill client needs and meet deadlines. The manager was adamant, he absolutely would give me NO TIME CONSIDERATION for a Masters Degree. IBM *used* to brag about how they supported employees' educational pursuits by paying for schooling. PSHAW.

      They stopped paying for low-class employees' educations in 2001, after 9-11-2001. Then, they stopped paying for Team Leads' education in 2003-2004. They might still pay if you are a manager or Sr. Manager, but now their former boast rings hollow.

      Anyhow, I quit IBM in order to take my degree and finished in the top of the class. I will only go back to IBM if all other opportunities dry up for me. IBM is like one of the Pyramids in Egypt. There was once greatness there, but all that is left are archaeological ruins. And, the ruins are not great wonders of the world, they are just ruins of a once-great business that had values.

      Advice to Senior Management: Bring back the greatness. Care for your dedicated employees and they, in turn, will care for you. Loyalty works BOTH ways.

    • IBM Anonymous: (Past Employee - 2008) “No longer US focused.” Pros: Some of the most exceptional co-workers around. Cons: No respect for work/life balance. Advice to Senior Management: You seem to have forgotten who made it possible for you to make your multi-million dollar salaries/bonuses/perks.
    • IBM Sales Specialist: (Current Employee) “IBM is great.” Pros: respect for the individual is truly an IBM value. Makes working there worthwhile. Cons: If you are not 6 feet tall and spend $$$$$$ on clothes you won't go that far. Advice to Senior Management: value performance
    • IBM Advisory Consultant in Gurgaon, Haryana (India): (Current Employee) “OK place but reward and recognition is poor.” Pros: Global Opportunities. Wealth of Knowledge. Diverse Experience. Excellent work life balance. Cons: Internal Politics. Poor Pay. No reward for hard work. Pathetic hikes No Distinction between high and low performer. Too much power with the people manager. Non existent HR. Advice to Senior Management: Work to Reduce Office Politics. Reduce overheads, let employees focus on work. Better hikes and reward recognition. HR should be available to personally interact with the employees
    • IBM Sales Representative: (Past Employee - 2010) “Sales.” Pros: Flexible working hours. Training and personal development opportunities Innovative solutions and highly competent people advancement opportunities if you are willing to wait. Skilled top management. Cons: beaurocratic low compensation organisation and positions shuffled around too often before you get on a management track it takes forever (6-8+ years) to get promoted. Not much pay raises (if any except the ones legislation and such mandates) internal politics lot of incompetent mid management (and 1st level managers). No real leadership just number reporting low scores in employee satisfaction. Advice to Senior Management: read the book "the leadership pipeline" and start growing real leaders from the bottom up.
    • IBM Consulting IT Specialist in Cincinnati, OH: (Current Employee) “IBM is OK place to work.” Pros: Manager doesn't bother our team or get involved with day to day activities - we are all professionals doing our jobs and supporting each other. Team work is pretty good at IBM. Cons: Lots of long hours. Expected to do whatever it takes to keep customer happy. Expected to know everything! Advice to Senior Management: Stop laying off people with "resource adjustments" - we can't afford to loose anyone else. Hire more people so we can take our vacation and not have to be on calls and checking emails while trying to relax with family! Put some $$$ into giving folks at top pay range at least a small raise. What happened to stock options - haven't seen any of those in years!
    • IBM Anonymous in Beaverton, OR: (Current Employee) “Empower people to do their jobs: short term gain --> long term pain.” Pros: Huge opportunities to try a wide variety of tasks and technology. Cons: Like working for government or a big union. Advice to Senior Management: Start recognizing those who go above and beyond. If a developer needs tools/technology to be effective/work efficiently there should be no resistance to providing these.
New on the Alliance@IBM Site
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  • 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!
  • Job Cut Reports
    • Comment 8/24/10: Good source for the rumors that major benefit changes are coming in Sept. Get your wallets ready as costs for medical coverage are going to skyrocket. Other companies are already socking it to their employees and bigBlew won't hesitate for a second to shove every extra cost right down their compliant employees' throats come new plan time so that the executive slime bonus earnings plans get covered. Of course layoffs might also be needed for executives to meet bonus targets so expect some of those also as the economy grinds down even further this fall. The sheep will get sheared so the master can afford his usual bonus. Any wish they had a contract yet? Keep ducking, you'll figure it out eventually if you even survive the next go round. -anonymous-
    • Comment 8/26/10: BPD making cuts across the board with end date of 9/22 -anonymous-
    • Comment 8/26/10: It's been too long since IBM has made an announcement that will adversely affect its USA employees: the USA economy is still a train wreck, companies are not hiring, and domestic earnings in all sectors of the economy are weak. IBM customer satisfaction has got to be low now as well. IBM is going to do something to offset this. The question is when. -IFeelit-
News and Opinion Concerning Health Savings Accounts, Medical Costs and Health Care Reform
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  • Harvard Business Review, courtesy of Bloomberg BusinessWeek: Why Innovation Thrives at the Mayo Clinic. Three conditions in particular formed the climate that has made the institution successful since its founding by William and Charles Mayo in 1889. By Uri Neren. Excerpts: Start listening for guidance on innovation and you tend to hear a lot about Apple, Google, and other high-tech pioneers in Silicon Valley, Boston, or Seattle. You rarely hear about hospitals, especially those that operate closer to farm fields than oceans. Yet in the extensive research my team has done to uncover the mystery of successful innovation, we've found few track records to rival that of The Mayo Clinic, in decidedly non-urban Rochester, Minnesota. ...

    Just as important as these initial conditions was the Mayo brother's resolve to constantly re-invent their enterprise. They were dedicated to being the best in their field and, more importantly, to moving the entire field of medicine forward. Perhaps the best example was their decision to place doctors on salary, which would allow them to focus on health outcomes rather than volumes of health-related transactions, and give them the space for creativity, education, and research. This was a decision so controversial it nearly shattered the Mayo family, but one that helped to create one of the world's greatest medical centers.

  • The Washington Independent: With Loss of COBRA Subsidy, Newly Unemployed Face Tripling of Insurance Costs. Stimulus Help for Health Insurance Program Ended May 31, Leaving Many Families Without Affordable Options for Health Care. By Annie Lowrey. Excerpts: In the first week of July, Andie Davis’ husband, who worked in manufacturing, lost his job, as hundreds of thousands of Michiganders have since the onset of the recession. Soon after, he started collecting unemployment insurance benefits that might last the family of four as long as 99 weeks. Davis hopes that the benefits will keep the family afloat — the mortgage paid, school lunches made, the electricity on — without forcing her to tap into the family’s savings.

    But to keep the family financially stable while both she and her husband look for work, she has decided to forgo health insurance. The Davis family looked at how much COBRA would cost them, thinking the government would help pay for it. Had her husband lost his job just six weeks earlier, Washington would have footed about two-thirds of the premium bill. But since Davis’ husband lost his job after May 31, the young couple is on their own.

    The change has gone little-noticed, both by the press and by the laid-off persons impacted by it. But a popular stimulus provision, the federal subsidy of COBRA benefits, expired for newly unemployed workers as of the first day of June. That means, for the average worker who has lost her job since May 31, the cost of COBRA has tripled. ...

    For the Davises, under COBRA, coverage might have been a manageable $400 a month. When Davis looked into enrolling her husband and herself, she found it would cost more than $1,100 a month — leaving the family just a few hundred dollars for the mortgage, utilities, gas and food. She sought information on other private plans, but considered all of them too expensive. For now, the Davises are purchasing barebones coverage that will help pay hospital bills in case they are in an accident.

  • Yahoo! IBM Employee Issues message board: "Re: Loss of COBRA subsidy -- insurance costs triple" by "Tony". Full excerpt (sarcasm alert!): There are so many technology jobs in the US that are open and unfilled they have to have H1B Visa holders come to the US by the thousands come to fill them. It might take you a few weeks to find a job, but at higher pay for sure.

    And of course if you retire - that generous (non contributory) pension and benefits that IBM promised you for decades is there to help you live a comfortable retirement.

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: Now That’s Rich. By Paul Krugman. Excerpts: We need to pinch pennies these days. Don’t you know we have a budget deficit? For months that has been the word from Republicans and conservative Democrats, who have rejected every suggestion that we do more to avoid deep cuts in public services and help the ailing economy.

    But these same politicians are eager to cut checks averaging $3 million each to the richest 120,000 people in the country. What — you haven’t heard about this proposal? Actually, you have: I’m talking about demands that we make all of the Bush tax cuts, not just those for the middle class, permanent.

    Some background: Back in 2001, when the first set of Bush tax cuts was rammed through Congress, the legislation was written with a peculiar provision — namely, that the whole thing would expire, with tax rates reverting to 2000 levels, on the last day of 2010. Why the cutoff date? In part, it was used to disguise the fiscal irresponsibility of the tax cuts: lopping off that last year reduced the headline cost of the cuts, because such costs are normally calculated over a 10-year period. It also allowed the Bush administration to pass the tax cuts using reconciliation — yes, the same procedure that Republicans denounced when it was used to enact health reform — while sidestepping rules designed to prevent the use of that procedure to increase long-run budget deficits. ...

    The Obama administration wants to preserve those parts of the original tax cuts that mainly benefit the middle class — which is an expensive proposition in its own right — but to let those provisions benefiting only people with very high incomes expire on schedule. Republicans, with support from some conservative Democrats, want to keep the whole thing.

    And there’s a real chance that Republicans will get what they want. That’s a demonstration, if anyone needed one, that our political culture has become not just dysfunctional but deeply corrupt.

    What’s at stake here? According to the nonpartisan Tax Policy Center, making all of the Bush tax cuts permanent, as opposed to following the Obama proposal, would cost the federal government $680 billion in revenue over the next 10 years. For the sake of comparison, it took months of hard negotiations to get Congressional approval for a mere $26 billion in desperately needed aid to state and local governments.

    And where would this $680 billion go? Nearly all of it would go to the richest 1 percent of Americans, people with incomes of more than $500,000 a year. But that’s the least of it: the policy center’s estimates say that the majority of the tax cuts would go to the richest one-tenth of 1 percent. Take a group of 1,000 randomly selected Americans, and pick the one with the highest income; he’s going to get the majority of that group’s tax break. And the average tax break for those lucky few — the poorest members of the group have annual incomes of more than $2 million, and the average member makes more than $7 million a year — would be $3 million over the course of the next decade. ...

    ...we’re told that it’s all about helping small business; but only a tiny fraction of small-business owners would receive any tax break at all. And how many small-business owners do you know making several million a year? ...

    Or we’re told that it’s about helping the economy recover. But it’s hard to think of a less cost-effective way to help the economy than giving money to people who already have plenty, and aren’t likely to spend a windfall. No, this has nothing to do with sound economic policy. Instead, as I said, it’s about a dysfunctional and corrupt political culture, in which Congress won’t take action to revive the economy, pleads poverty when it comes to protecting the jobs of schoolteachers and firefighters, but declares cost no object when it comes to sparing the already wealthy even the slightest financial inconvenience.

  • truthout: Wall Street's Connected Lobbyists. By Jim Hightower. Excerpts: Congress finally passed a moderate reform package to tighten regulations on the banksters of Wall Street. Of course, the banksters howled, protesting even the meekest of reforms -- but the package is now the law, so that's that. Right? Uh ... no.

    What Congress passed is a 2,300-page compendium of concepts, leaving the real decision-making about the details of financial regulation in the hands of the Federal Reserve, the SEC, the Commodity Futures Trading Commission and other regulatory agencies. In other words, the game is still on for Wall Street lobbyists! So they're presently mounting a furious blitz on the rule-writing regulators, still trying to weaken or even kill many of the reform ideas passed by Congress.

    To weasel their way inside, the financial giants have reached into the agencies themselves to hire away nearly 150 regulators, luring them with fat salaries to switch sides and become industry lobbyists. For the banking powers, these insiders-turned-outsiders are well worth the big bucks, for former regulators have long, personal relationships with those in the agencies who're filling in the blanks left by Congress. If nothing else, these newly minted lobbyists are much more likely to get their phone calls returned by their former colleagues than a stranger would.

    A New York Times reporter asked one of the switcheroos who's now working for the dark side if he felt this old-buddy connection gave him a lobbying edge. This regulator-turned-lobbyist bluntly said, "If it didn't, I wouldn't be able to justify getting out of bed in the morning and charging the outrageous fees that we charge our clients, which they willingly pay." He added that "you have to work at an agency to understand the culture and pressure points, and it helps to know the senior staff."

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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