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Highlights—January 22, 2011

  • Associated Press, courtesy of Forbes: IBM's net tops Street; outsourcing deals pick up. By Jordan Robertson. Excerpt: IBM says its net income and revenue were stronger than expected in the fourth quarter amid a pickup in services signings, a key part of IBM's revenue stream and an area of concern for some analysts. Net income rose 9 percent to $5.26 billion, or $4.24 per share, topping analysts' projections for $4.08 per share. In the year-ago period, IBM earned $4.81 billion, or $3.65 per share. Revenue rose 6 percent to $29.02 billion. Analysts expected $28.18 billion. ...

    In further good news, IBM's Global Services behemoth saw a huge increased in signings, IBM's Software Group was up smartly, and other server and storage product lines did well. So for those on Wall Street who tuned in to the conference call with Mark Loughridge, IBM's chief financial officer, it looks like the 52-week high share price that Big Blue hit before the numbers came out can be justified. (Well, at least as much as any over-rated stock in the IT sector.)

    "We completed an outstanding year, with record profit and free cash flow, and exceeded the high end of our 2010 earnings per share roadmap objective," said Sam Palmisano, IBM's president, chief executive officer, and chairman in his traditional statement. (Palmisano doesn't attend quarterly calls with Wall Street.) "We also capped a decade in which our shift to high-value businesses, our global integration of IBM, our investment in research and development of almost $60 billion, and our acquisition of 116 companies have helped us to nearly triple our EPS and return more than $100 billion to shareholders.

  • The Register (United Kingdom): IBM (nearly) hits $100bn in 2010 sales. By Timothy Prickett Morgan. Excerpts: It looks like there was a lot of pent up demand for IBM's System zEnterprise 196 mainframes. At least for the large banking, insurance, and manufacturing companies that tend to buy this big iron. In the fourth quarter of 2010, IBM's mainframe sales were the best that company has seen in six years. and they helped drive the company's sales up to $99.9bn, an increase of 4 per cent compared to the year before.
  • Courthouse News Service: Another Guilty Plea in Huge Inside Trading Case. By Nick McCann. Excerpt: Danielle Chiesi pleaded guilty Wednesday in what prosecutors call the largest hedge fund insider trading case in history. Chiesi, a consultant for the hedge fund New Castle Funds, traded on tips from a former IBM executive. Chiesi made at least $1.7 million by trading on secrets that former IBM executive Robert Moffat admitted he leaked to her. Moffat was sentenced in September to 6 months in prison. ...

    Transcripts show that Chiesi had expressed concern to her co-conspirators about being caught in the scheme. "You put me in jail if you talk," she said in one conversation. "I'm dead if this leaks. I really am ... and my career is over. I'll be like Martha fucking Stewart."

  • Yahoo! IBM Employee Issues message board: "more job cuts on the way after 4th QTR report" by "trexibmer". Full excerpt: $8,000,000,000 in "productivity" initiatives over the next 5 years means continued RAs, mainly for USA employees. Count on more unwarranted PBC "3"'s and managing out tactics by the elite, entitled IBM management. LIFE IS NOT GOOD for the average Joe and Jane Beamer now.
  • Yahoo! IBM Employee Issues message board: "Re: more job cuts on the way after 4th QTR report" by "teamb562". Full excerpt: Agree/confirmed on both points: 1) I and many others are receiving unexpected 3's. 2) heard via good source that a 1Q2011 RA is expected to net about 10k heads, comparable with past two hunting seasons. The additional 3's ensures plenty head-lighted deer for easy shots and profits.
  • Yahoo! IBM Employee Issues message board: "Re: more job cuts on the way after 4th QTR report" by "trexibmer". Full excerpt: It is curious that there is no push on any front to get IBM to release how many employees it has, say, at YE2010. Since IBM is a master obfuscator, the real number of the employees involved in any resource action is never publicized by the mass news media (TV, radio, satellite) save some mentions by the Alliance in some mainly local newspapers.

    IBM hints at permanent firings and never announces or confirms them when they do occur. IBM does this so they can skate around their offshoring push.

    So IBM "allocating" $8B for "productivity" initiatives in the next five years is not only totally vague, one cannot even come up with a real ballpark figure of those IBMers today that will be gone in the five year time period. By using fuzzy math: if IBM considers that it cost them about $100,000 for each employee, on average, in severance benefits, then 80,000 IBMers could be gone in five years. LIFE IS NOT GOOD for those IBMers! Of course the bulk of these severed employees will be USA based.

    It would be nice if Lou Dobbs would take this up. Then maybe IBM would be forced to come clean, or at least to curb further RAs they have in mind to execute.

  • Yahoo! IBM Employee Issues message board: "Re: more job cuts on the way after 4th QTR report" by "nyjints5". Full excerpts: $8,000,000,000 in "productivity" initiatives over the next 5 years means continued RAs, mainly for USA employees.

    Very nice job on your interpretation/translation of the above "executive-speak". I particularly hated exec-speak because the employees never knew the hidden meaning behind the words. Maybe the words were innocent enough, and maybe they weren't.

    In the early 1990's, I attended a town hall meeting at my site. The speaker was an exec (IBM VP) known to me only by his name. During his pitch, he presented/talked to a slide that had the words "affordable structure" on it. In true executive double-speak fashion, he glossed over the slide so that I (and I'm sure many others in the room) had no idea of what he was specifically talking about. During the Q&A session, someone asked him about that particular slide, specifically those two words; affordable structure . "Could you possibly expand on that a little bit further?" the exec was asked.

    I was shocked by the frankness and candor of his answer. He said "The slide would be better worded if it said an affordable COST structure." And then he further said "All costs are subject to scrutiny and cutting, including those related to people." The room had been very quiet all through the Q&A, and there were no low murmurs or sigh's that went through the room when he made that remark, so I couldn't help but wonder if the audience had actually comprehended what he said, or was everyone simply in flat-out denial about what he meant. I didn't have to wait long to find out. Many employees found out the hard way what an "affordable structure" is/was.

  • Yahoo! IBM Employee Issues message board: "Forced to Accept Individual Separation Allowance Plan (ISAP) or Be Terminated" by "gedgem". Full excerpt: I received a second consecutive PBC 3 yesterday which I do not believe was rated fairly due to outstanding circumstances noted below. (My first was received on 1/22/10).

    In May 2010, I was put on STD with multiple physician's documentation through the MTR process that quite clearly stated I was unable to function appropriately in the workplace, which said condition was cause for the first bad PBC, and due to time lapse of being out on medical leave and under doctor's care for 6 months, from Jan through May 2010 is what they used to rate my last "performance" on, as I only started back to work full time after the holidays. Prior to this condition, for over 10 years, I always received at least a 2/2+ rating.

    During yesterday's PBC conversation with management, not only was I given a 3 rating, but I was "offered" the opportunity to voluntarily leave IBM with a Minimized Separation Payment(ISAP), or be monitored under a stringent Performance Improvement Plan (PIP), which contains items that are not realistic to meet, especially since we were re-orged into a new team, processes, databases and roles had been modified during my leave.

    It appears they have already made their decision about me, and one way or the other, they have decided they no longer want me employed. I also have been denied the option to seek an alternate position within IBM.

    I have not signed my PBC as of yet and I have the following questions and concerns:

    • Is the above considered entirely legal? In the state of Illinois (where I reside), employees are presumed to be "at will." At-will employees may be terminated for any reason, so long as it's not illegal.
    • I know there is a comment field in the PBC, but what is that really worth.. does anyone really look at that?
    • If I accept the package which is quite minimal in pay and duration (at least I wouldn't have the "your fired" tattoo on my forehead), will I still be able to collect un-employment if I have not found a job?
    • Is it worth my time to attempt to even contest the issue, or do I just cut my losses and move on.

    I would appreciate any helpful feedback to this issue. Thank You.

  • Yahoo! IBM Employee Issues message board: "Re: Forced to Accept Individual Separation Allowance Plan (ISAP) or Be Terminated" by Susan Crayne. Full excerpt: Since management has admitted that you got a 3 because your illness prevented you from performing up to par, I would think that would be a violation of the Americans With Disabilities Act.
  • Yahoo! IBM Employee Issues message board: "Re: Forced to Accept Individual Separation Allowance Plan (ISAP) or Be Terminated" by "Tony". Full excerpt: Not sure the ADA covers illnesses. I have seen a few people let go in the past 2 years because they had been off a significant part of the time with STD. The worst one to me personally was a guy with 30+ years that was on STD - with terminal cancer - that they let go so he could 'retire'. The guy died a few months later anyhow, I guess they didn't want to pay out that 2X salary insurance benefit to his wife.

    I guess if I look at it from a management side - how am I going to get the work done in my territory so I can meet MY goals? Am I going to get it done with people that are out sick half the time and can not perform the full job ? If I have to operate with fewer resources than I really need then they better be the best people , and at the end of the day if you are not working you are not the best person on the team. You get no extra head count allocation when you have people out ill or on STD they are still counted in your group headcount. Somebody else is doing their work - is that fair to the team?

  • Yahoo! IBM Employee Issues message board: "Re: Forced to Accept Individual Separation Allowance Plan (ISAP) or Be Terminated" by Susan Crayne. Full excerpt: When I was in a similar situation, a lawyer told me that the ADA applies. People used to have to work insane hours, without days off, so that managers could meet their goals. Now we have laws that protect workers. The ADA is one of these. Susan.
  • Yahoo! IBM Employee Issues message board: "Re: Forced to Accept Individual Separation Allowance Plan (ISAP) or Be Terminated" by "madinpok". Full excerpt: Unfortunately, what IBM is doing to you is probably legal, unless you can find proof that they are discriminating against you in some way that labor laws say is illegal. The best thing to do is consult an attorney with experience in labor law.

    What you write in the PBC form probably will have no effect, but might provide some documentation if you did file a lawsuit.

    In Illinois, I believe you will be able to collect unemployment, even if you receive a pension from IBM and severance pay. The IL unemployment regs are here: http://www.ides.state.il.us/pdf/pubs/uilaw/handbook.pdf

    See item 5 on page G-46 and item 3 on page A-44. The key on the pension is that you did not earn any pension benefits during the "base period" (which is the last 5 quarters) since IBM froze the pension plan on 12/31/2007.

    Only you can decide if you think it is worth fighting. IBM will do everything it can to win this fight. Your chances of getting your PBC changed are probably slim. And if you do win, you can be sure your management will not forget and will try again in the future. Do you really want to work in a place where your work is not appreciated?

  • Yahoo! IBM Employee Issues message board: "Re: Forced to Accept Individual Separation Allowance Plan (ISAP) or Be Terminated" by "phrl2009". Full excerpt: I don't know your personal financial circumstances, but you can try to negotiate a better separation package. I assume you're being offered 1 week for every year of service? I'd ask for the standard 2 weeks/year, and in exchange you'll go quietly. Otherwise, tell your manager you'll contact the local newspapers. They'd love to run a human interest story like this one... I can see the headline already, "Giant software company makes record profits, and forces out an employee on medical leave."

    I was a manager just before Gerstner took over, and left the company in 1993. Even back then, we were told to downgrade folks who were out on medical leave. The rationale was, "if you are not at work, you cannot contribute, ergo your contribution is less than your peers'". And once you're put on the "measured mile" it's extremely difficult to get off.

    IBM doesn't want its name dragged into the papers, esp. now that management is a collection of money-grubbing cowards who just want to be able to line their pockets. So I think management will be willing to buy your silence with a better separation package. Good luck, and please keep us posted.

  • Yahoo! IBM Employee Issues message board: "Re: Forced to Accept Individual Separation Allowance Plan (ISAP) or Be Terminated" by "makeyourignorancework4u". Full excerpt: The only real recourse is to appeal this through the OPEN DOOR. If you do this ask for the panel option. Do not accept the "investigator" option. What you must appeal is the 2nd "3". It is too late to appeal the first one.

    What you must then demonstrate through co-worker and "team leads" testimonials is that your performance placed you somewhere in the 30-50% percentile of your peers' performance. If you can't get these testimonials in your behalf, you will lose in the panel. Do not even consider going alone to the panel. You must bring reliable witnesses.

    In your own testimony, you can then bring up your past performance rating of 2/2+ and the fact that what dragged you down in 2010 from the usual 50-70% range was your illness which you have now no longer suffer from.

  • Yahoo! IBM Employee Issues message board: "Re: Forced to Accept Individual Separation Allowance Plan (ISAP) or Be Terminated" by "netmouser". Full excerpt: I would not threaten IBM in any manner, like saying you will contact the media. You are in effect burning any bridges you may have left and it'll just make your journey more painful in any event. IBM will win on this one, as I have to believe it has been done many times before so they know what they can do. I'd also be very careful if making comments on your PBC as this becomes part of you personnel record. Note that nothing goes on management's record, just yours. I understand if for example you apply for a government job they can do a security check and your records should be an open book.

    About downgrading those out on medical leave. I get it. I was downgraded one year during the early 2000's when contracts were vastly less and my utilization was low through no fault of my own. The logic is that you are billing less, which is the number one factor for your PBC. That is just the way it is.

    Keep your nose clean. In the long run it'll be better for you. The only time to consult an attorney is if you believe some law was violated, but IBM is now an expert at all this. Move on.

  • Yahoo! IBM Employee Issues message board: "Re: Forced to Accept Individual Separation Allowance Plan (ISAP) or Be Terminated" by "phrl2009". Full excerpt: Oh I agree. I would not "threaten IBM" in any way, but I'd simply state to the manager, in a very courteous manner, that this may make it into the news. Sometimes what you imply can be more effective than what you say outright.

    Burning bridges: with all due respect, I don't think the OP has any bridges left. IBM management has decided to get rid of him, and it will happen. Most IBM managers now are too busy feeding at the trough, so no one is going to lift a finger to defend the OP and risk being kicked off the gravy train by going against upper management's edict.

    IMO, the OP can't "fall off the floor", by taking the current ISAP offer and leaving. Anything else would be icing on the cake.

    OP: Again, I don't know your individual circumstances nor your work history with IBM. If you're going to retire, I suggest you fight for a better package.

  • Yahoo! IBM Employee Issues message board: "Re: Forced to Accept Individual Separation Allowance Plan (ISAP) or Be Terminated" by "stillgotajobtoday". Full excerpt: Wow - your situation sounds oh so familiar. I haven't received my PBC yet for 2010 so perhaps there's an ISAP waiting with my name on it too.

    I had a very similar situation where I was placed on an APPROVED MTR restriction of no travel for 18 months due to a severe injury which left me bed-ridden but otherwise functional. At the end of 2009 I was given a PBC rating of 3 stating that I didn't meet my objectives and "compared to the other's" I underperformed. Well, of course that would be the case since I was in pre-sales and wasn't allowed to travel to customers.

    I argued with my management (up to 3 levels above me) that I could not be compared to the others as they have an obvious unfair advantage. Their argument was that no matter how good my work was that I was doing from home, it still had "lesser value" compared to those employees traveling to customers and closing deals and I should EXPECT a 3 rating in 2010 as well. At that point I quickly put out my feelers to find another job within the company. (Which has worked out very well so far).

    Anyway, I opened up an HR case for investigation. After 8 months the verdict came back stating "It was a toss up so we are siding with IBM instead of the employee". I asked for a written statement for the verdict and was denied. Can you say hiding incriminating evidence??

    I have also considered legal action and should I be terminated due to this, I will be pursuing it further.

    That being said, I've also accepted the fact that IBM is not the IBM it used to be and I'm playing a game with people without a heart.

    My advice to you is to do what feels right to you and your family. Perhaps try to negotiate for a better package, but don't try to salvage a spoiled relationship with the company. They have a crack team of attorneys dedicated to ensure IBM always wins. Best of luck to you.

  • Yahoo! IBM Employee Issues message board: "Re: Forced to Accept Individual Separation Allowance Plan (ISAP) or Be Terminated" by "gedgem". Full excerpt: I would like to thank everyone for all the feedback, it has been quite helpful and appreciated. I see a lawyer down town next week for counseling and advice. I know I am now "marked" so fighting to keep the job is useless. All I can do is hope to find new employment in a minimal amount of time, which will be quite the challenge in the current job market. Thank you all,it's nice to know there are others out there! New name is hope4better2011 what else is there? :-)
  • Yahoo! IBM Pension and Retirement Issues message board: "Re: Retirees' health care suit gets class-action status" by Kathi Cooper. Full excerpt: I can vouch for lifetime medical because I've seen in an employee's file. When I was manager, I had an employee that was to celebrate her 50th anniversary with IBM. Yes, 50 years with IBM. She and TJ Watson were friends and she wanted TJ to come to her party. I called TJ's office in Armonk and they passed my invitation to him but he sent his regrets because he was yachting off 'the islands' and couldn't make it to Austin in time for her party. True. And her lifetime medical was in her file, written, with 50 years of awards, letters, appraisals, and pension promises. If I only had that file today...
  • Yahoo! IBM Pension and Retirement Issues message board: "Re: Retirees' health care suit gets class-action status" by "teamb562". Full excerpt: For sheets and grins, I searched and found the latest benefits information: (uploaded to the Files section - 2011benefits.pdf). IBM Benefits Program – 2011. For Employees Hired in 2011. December 12, 2010.

    Check out page 34: Post Employment Medical (Access). If certain age and service requirements are met, employees will have access to post-employment health care coverage. Eligible if you leave IBM at age 55 with at least five years of service, AND if age plus service equals 65. For example: 55 years old + 10 years of service 58 years old + 7 years of service 60 years old + 5 years of service. Can continue IBM health care coverage for yourself and eligible dependents. Pay full retiree group rates.

    I guess if I were 25 I'd gloss over this and say this is great. There is no reference what the "full retiree group rates" will be or what it represents. Who at 25 knows what "Access" means. And of course, there's that same nasty disclaimer on page 39. We "boomers" were "had". Hope this new generation wises up a bit.

  • Yahoo! IBM Pension and Retirement Issues message board: "Re: Retirees' health care suit gets class-action status" by "suvas98". Full excerpt: I am looking at 1986 Personal Benefits Statement booklet on page 5 as follow: "Survivors Medical/Dental Coverage: If you die and were 55 years of age or older and had 15 or more years of service or if you had 30 years of service regardless of your age, your spouse will receive lifetime medical and dental benefits. One year of coverage will be provided in other cases of death of an active employee or retiree."
  • Yahoo! IBM Pension and Retirement Issues message board: "Re: Retirees' health care suit gets class-action status" by "thekanck". Full excerpt: I have those same booklets / wording. I also have an(undated)1 page flyer that was given to me when I joined up in the 80's The title is: "Survivors' Benefits" Under the "Eligible to Retire but still working" column and the "Retired" co lm it says "Life Time Medical/Dental Benefits (Required 15 years service).

    Management always talked about how comparing salaries at other companies to IBM salaries was not apples-to-apples due to the far superior "total compensation" + full employment + respect for the individual + all that other crap we don't do any longer :-/

  • Yahoo! IBM Pension and Retirement Issues message board: "Re: Retirees' health care suit gets class-action status" by "suvas98". Full excerpt: In past, IBM Retirees and IBM employees were treated same way. Before, hospitalization was free and major medical for 80/20. Then, hospitalization required employee to cover 50% of 1st day room cost etc.

    Main thing is that retirees and employees were treated the same way until retirees moved to medicare. Once FHA was introduced, funding did not cover thru age 65. I am a retiree but will use up my FHA funding by age 58. After that, I will have to pay in today's $$ at $1100 per month for high-deductible insurance for two.

    Since retirement benefits was part of compensation and IBM used to claim that they take of their retirees, it is/was expected that IBM will continue with the same trend. Retirees from 5 years or 10 years ago will be treated same as current retirees. When IBM changed the plans, it was based on age and not based on years of service. An employee with 10 years of service and 50+ age was treated better than an employee with 20 years of service and few days/months to age 50.

    What was promised for 20 years to someone was treated worst then what was promised to someone for 10 years of service because of age difference. Expectation is that retirees are treated same as employees with same cost structure and deductible. No one is asking for free medical for life.

  • Yahoo! IBM Pension and Retirement Issues message board: "Re: Retirees' health care suit gets class-action status" by "fhawontcutit". Full excerpt: From April, 2010: http://www.usatoday.com/money/industries/technology/2010-04-27-ibm-dividend_N.htm: IBM, based in Armonk, N.Y., also said its board has authorized the use of another $8 billion for buying back its stock. The company now has $10 billion available for that purpose. IBM has bought back more than $100 billion of its stock since 1995.

    More than $100 B-I-L-L-I-O-N since 1995. How much healthcare would that buy?

  • Yahoo! IBM Pension and Retirement Issues message board: "Woo Hoo !! $1000 stock bonuses" by "Tony". Full excerpt: In Palmisano's letter to the troops this week: I want to thank you for everything you did to achieve these results, in the fourth quarter and over the past four years. Our long-term success is the product of the work, innovation and superior execution of more than 400,000 IBMers. In recognition of this, I am delighted to announce that all non-executive IBMers who performed consistently over the 2010 Roadmap period will receive a grant of $1000 of IBM stock, where permitted, which will vest at the end of the next roadmap, in 2015. Terms will be forthcoming from your leadership team.

    It will be interesting to see the terms and conditions and what that really means. Cheers

  • Yahoo! IBM Pension and Retirement Issues message board: "Re: Woo Hoo !! $1000 stock bonuses" by 'dogbreath127k". Full excerpt: To me it means don't hold your breath. How much you want to bet that if you are RA'd over the next 5 years you can kiss the stock goodbye? Probably not $1k of stock in today's money but what $1k will buy you 5 years from now. Perhaps same T's & C's as "free" lifetime retirement health care, we never said that, subject to change without notice.
  • Yahoo! IBM Pension and Retirement Issues message board: "Re: Woo Hoo !! $1000 stock bonuses" by "jonatha1". Full excerpt: A more interesting question is whether they'll use this $1000 grant as an excuse to make bonuses less than they otherwise would be as a consequence of this record-breaking year.
  • Yahoo! IBM Pension and Retirement Issues message board: "Re: Woo Hoo !! $1000 stock bonuses" by "netmouser". Full excerpt: Just IBM's new manipulation of those left as employees to get them to work harder to keep the profit, and stock value, up. May mean they see they are losing their ability to keep increasing profits by cutting cost via RA's. Eventually there is no one left to cut. So give them stock and they will jump on this carrot to keep the stock price rising.
  • Yahoo! IBM Pension and Retirement Issues message board: "Re: Woo Hoo !! $1000 stock bonuses" by "mr_quarkwrench". Full excerpt: So, Sammy's gonna reward you for work done the last four years but you have to wait five more years to collect? Frankly, I would consider $250/year an insult, not a reward.
  • Yahoo! IBM Pension and Retirement Issues message board: "Re: Woo Hoo !! $1000 stock bonuses" by "ghstudio". Full excerpt: I am not sure how motivating $1000 in four years is to employees who know that their only value is the project they are working on...and they have no confidence that they will still be employed by IBM in 2015. It seems like a minimally disguised way to reduce salary increases.....sort of reminds me of the promise of "medical insurance for life" that we all thought we had. Typical IBM shell game...perfumed to look like a nice incentive.

    My cynical side says that in 2014, employees should expect a resource action to assure that payouts of even the $1000 are reduced. It will be interesting to see the details of the plan which someone, hopefully, will post here.

  • ZD-Net: Apple may be poisoning Chinese workers and doesn't seem to care. Should we? Summary: One of the reasons it’s so cheap to employ foreign workers is that American standards for health and wellness can be flagrantly disregarded outside the United States.
  • Glassdoor IBM reviews. Selected reviews follow:
    • IBM Managing Consultant in Edison, NJ: (Current Employee) “IBM consulting arm is more like offshore company.” Pros: A lot of resources and global opportunities. Cons: Too big a company and individual to get recognized. Advice to Senior Management: Need to re-establish IBM as a company that employee is the most important assets. Not just earning dollars or utilization
    • IBM Appl in Bangalore (India): (Current Employee) “Never ending process, too much relevance to not so important things. Not always a planned approach.” Pros: Work from Home option. Move internally on different roles. Cons: Not a structured approach to management. Never ending process. Too much relevance to not so important things. Employees are considered as metrics or parts of machines which are dispensable. Advice to Senior Management: Micro managing is not good. Rating process needs to redesigned as it leaves a lot of disgruntled employees. Too much dependence on Lead model may not work in the long run or at least this should be customized for each dept to support the nature of work.
    • IBM Product Marketing Manager: (Current Employee) “So much for the hype...IBM will bore you and frustrate you after 6 months.” Pros: Flexible working hours. Good work life balance. Stable financials.

      Cons: Process, Process and Process that kills you even for simple needs of an employee. No exposure to anything at all outside your team or customers. Collaboration only exists on intranet portals and internal messenger. Hierarchy kills - Management is scared if you reach out to anyone in the top and they will kill you. Crazy people get promoted - if you lick backs, you will grow fast and fat within IBM. If you are honest and critical, sorry bro, you will be killed. Boring work place, everyone repeats the same thing for years! No new challenges, if you are happy with a constant never changing work style, this place is for you.

      Advice to Senior Management: Please go around cubicles and meet your employees every day. Don't just listen to your immediate reportees, also make it a point to speak to 3 levels below. Walk and speak, don't just work on internal messenger and telephone chats. Do something cool internally and stop the hype about IBM being the one and end of all greatness in technology!

    • IBM Advisory Software Engineer in Research Triangle Park, NC: (Past Employee - 2009) “Stay Away.” Pros: Big company, easy to fly under the radar and keep your job if you're a mediocre employee. Lots of different projects to move around to. Cons: Exceptional employees are not rewarded well. Upper management has no respect for employee concerns. Benefits get worse every year. Merit raises and bonuses are pathetically small. Advice to Senior Management: Fire Sam P... Fire 50% of the managers. Offer better incentives for exceptional employees. Look at the top 100 companies list for ideas on how to better treat employees.
    • IBM Finance Manager: (Current Employee) “Going to keep making their numbers until it all blows apart.” Pros: Global experiences, global reach and influence, traditionally a place of high ethics and integrity, above average benefits including a very good 401K. Cons: If you work in Europe or North America, there is a high likelihood that they will find a way to cut your pay/level of replace you with lower cost labor from "global resource." If you are looking to develop cutting edge products, you'd be better off in a lot of other places.
    • IBM Anonymous: (Past Employee - 2009) “Good for entry level experience in the IT industry but compensation is low.” Pros: IBM has many technologies and projects so it's a great place to learn new things especially if you're just starting out. Cons: Unending layoffs and downsizing keep morale very low. In addition, they keep offshoring work and cutting benefits / salaries / rates to workers. Way too much matrix management. Advice to Senior Management: Get rid of the matrix management and retain smart people who matter by offering them comparable contract rates and salaries / benefits that INCREASE commensurate with experience and value brought to the company.
    • IBM Senior Software Engineer in San Jose, CA: (Past Employee - 2009) “Very rewarding experience.” Pros: Great company, culture, work environment, internal training programs, opportunity to grow. Cons: They keep moving jobs offshore. Advice to Senior Management: They lay off great talented people here and move jobs offshore. Not a great strategy but does save cost
    • IBM Anonymous: (Current Employee) “Great place to work, good for career progression.” Pros: flexible hours, work from home, global company, a lot of sharing and collaboration. Cons: Compensation for long term employees is below the market average. Easier to have a significant salary increase if one leaves the company and comes back or if coming from the market. Advice to Senior Management: Keep up good communication
    • IBM Anonymous: (Current Employee) “Good and Bad.” Pros: Good compensation and benefits. Lots of work opportunities. Cons: Too big. Too focused on billing. Lack insight as to developing the skill sets. Advice to Senior Management: Focus on the quality of the work assignment not the degree to which you can bill the client
    • IBM Anonymous: (Past Employee - 2010) “If you want the IBM name on your resume, then prepare yourself...” Pros: Name recognition to put on your resume. Good software solutions to resolve business problems. Great match on the 401k. Good training when done in a classroom setting. Peers are generally eager to assist when needed. Cons: Abysmal senior management at the Business Unit Executive level and just above. Career growth is touted but nonexistent. Software Sales Reps are generally weak and act more as farmers. Most don't understand what they sell and/or how to position a solution. Culture has become very abrasive, demeaning and arrogant over the last few years. The performance review system is flawed and unfairly benchmarks employees without taking into account personal contributions. Most training done through web seminars to save costs is very ineffective. Advice to Senior Management: Change the horrendous culture now, retire and maybe in 10 years people will once again want to seek a job at IBM.
    • IBM Advisory IT Architect in Bangalore (India): (Current Employee) “Lot of opportunities but only on paper unless you can be really assertive.” Pros: Lot of opportunities, collaboration between technical peers is excellent, availability of learning materials are immense on anything from leadership, management , technology or industries. Cons: Management is arrogant, some technical leaders withhold information and do not share, walls between departments causes movement difficult, information not shared between projects, help is given only if it effect your appraisals, too much impetus on intellectual capital and patents, quantity over quality. Advice to Senior Management: Be human, lead by example, straight direct talk, sit and talk with reportees, allows movement between teams and department. Movement should not cause appraisals to be changed (as he/she does not work with you anymore)
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 1/17/11: To -feeling the blade-, Yeah, they are planning their Feb RA's, however, I have a feeling it will be the in the next week to avoid paying out any bonus. Or am I wrong here? Any Takers? -The-Gist-Of-RAs-
    • Comment 1/17/11: Exodus2007: "IBM will only acknowledge that you worked for them from x date to x date. Anything else would open them up to lawsuits." - Incorrect information. If you are applying for Gov't security clearance, part of the background check will allow investigators to request and IBM to grant access to your jacket including past PBC's. -Anon-
    • Comment 1/17/11: -feeling the blade- The numbers are already done. In November when the initial request for PBC's to be completed was made we were informed that for our overall department of ~150 people there were only 3 1's and 3 2+'s allotted. This was before submissions or any roll up discussions. Any additions to the above would require an exemption. Anther department was informed that nothing higher than a 2 would be allowed for anyone. -anonymous-
    • Comment 1/17/11: Just had my review. Given a 2 b/c the mgr just couldn't convince the up lines I was worth more than that. I was told that we, the mature market people (slang for American workers), need to find our own opportunities which will most likely be an overseas assignment. They just do not value the American worker anymore. -Anonymous-
    • Comment 1/18/11: "Free at last. Free at Last". That's all I can say since being RAed from the bondage of IBM employment. You folks still enslaved and treated as dirt in IBM. Band together. Speak up together. Think twice together. Protest together. Organize and unionize. -MLK-
    • Comment 1/18/11: I was with IBM for close to 10 years, never receiving worse than a 2+ (or 2 before they split that category). Every quarter I would wonder if this was the quarter when I'd get the axe. In 10 years I'd had 8 managers and met exactly 3 of them. As an IBMer I was expected to be available at any hour of day or night on a moments notice. I was expected to anticipate the customer's needs going forward and head them off yet my last 4 managers had no earthly idea what skills I possessed or even really what I did. I'd seen my compensation cut 15% to reclassify me as non-exempt.

      Once the real cost of all that 'give back' dipped into IBM coffers I had my OT capped - the work still needed to get done, I just had to find a way to do it with no OT and a team that grew leaner in skilled workers. Finally I got sick of waiting, knowing that whatever was coming would benefit 'the company' at my expense and took a job with another company

      I lost a few perqs, mostly tied to tenure and the 401k isn't as nice but I make 20% more with room to grow in my band. I sit 30 feet from my manager who not only helps when I need her but actively works with me to develop skills.

      As an exempt worker I am expected to work OT only when there is an absolute requirement, and then I am expected to flex that time. My co-workers are baffled that I get up every morning and log in remotely to make sure everything is running smoothly before the customers arrive. They're thrilled that I volunteer for work without cherry picking the choice assignments.

      I'm not trying to redboard or gloat but IBM has taught many of us well. We have skills and habits borne of what this company used to be. If you feel the path is to join the union and try to restore IBM's past, more power to you. I hope you're successful. But if you've had enough, there is hope. Don't wait for the end to catch up to you - get out there and dig. It took me a year but there are hiring managers out there who value and respect the IBM reputation even as the monkeys at the top tear it apart. -Gonegonegone-

    • Comment 1/18/11: "Will this PBC rating 4 affect my job application process in other companies. Will IBM inform my future employer of my latest PBC rating which is politically motivated and spoil my chances elsewhere. Is it possible for me to file a workplace harassment suit or appeal the PBC rating within the next 30 days? " Exodus 2007 summed it up well. I would add that you are pretty much screwed trying to find another job with another company in the same area of expertise. If you find a similar job with another company they will want to know your prior work experience and talk to your previous manager. IBM's policy is that they will just verify your employment and say nothing about your job performance. You could have been a stellar 1 performer with IBM but your previous management will say nothing except that you worked there.

      IBM management will not give you a job reference. So, getting RAed is really like getting fired. IBM ruins your life and your career and most likely you will have to start over and find a new occupation if you are lucky to find someone that will hire you. This is good reason why the Alliance and a union is so important. You need an advocate to protect your rights as an employee. Do you think IBM's HR is looking out for you? Think again. The way it is now IBM throws you out like a piece of garbage and forgets about you like you never existed. Don't let IBM destroy you and ruin your life. Stand up and organize! -I Got Screwed by IBM-

    • Comment 1/18/11: I have been a dues paying member of the Alliance for over 8 years, and have been an IBM employee in good stead for over 15 years. I just received my first negative (3) PBC rating ever, and I am wondering if it is acceptable to have this rating assigned to me without ever having communicated anything negative to me about my job performance prior to this rating assessment. I cannot say that I was surprised, given how poorly ITD is performing as a whole, but my manager has never once provided me with any negative feedback, ever. -CJin Texas-
    • Comment 1/18/11: Heard about lots of 3's being handed out in my area (Software Group) then I got one today, totally unexpected. -screwedByBlue-
    • Comment 1/18/11: To screwedByBlue: Ditto, was 2 at midterm, apparently 3 was dictated by upper mgmt, if I had to guess, another RA is in the works. Funny, been 2 or better my whole career. Whatever, I'm so tired of it all... I think this year global services will be spared and development will take the hit. Chinese can replace developers but not services. -SWG dude-
    • Comment 1/18/11: "Incorrect information. If you are applying for Gov't security clearance, part of the background check will allow investigators to request and IBM to grant access to your jacket including past PBC's. -Anon- " Where they will look for things like did you steal from the company, Break laws or otherwise do illegal things. They could give a rat's ass about how well you did or didn't do your last job. Job performance has NOTHING to do with a security clearance. In case you're wondering an employer is only told you passed or you didn't. No reasons are given if you fail. Any crimes uncovered during the investigation CAN be prosecuted by the way.

      Anyone else care to offer a correction or an obscure viewpoint that may matter one time in a million?? Lets not nitpick things to death here and make things seem worse for these folks . Most employers these days use an online application with an online personality test. You should actually search online for how to answer the questions to get past the first automatic rejection screening. A lot of people apply for jobs online and never hear back because some automated robot rejected them because of a wrong answer to a mundane question. The young college kids are aware of this and search online for correct answers. Level the playing field and do the same. -Exodus2007-

    • Comment 1/18/11: In Sam's email to employees announcing the great earnings report he added this: "In recognition of this, I am delighted to announce that all non-executive IBMers who performed consistently over the 2010 Roadmap period will receive a grant of $1000 of IBM stock, where permitted, which will vest at the end of the next roadmap, in 2015." The key part I see is the vesting in 2015. Will there be anyone working for IBM by then? How many people contemplating leaving will hang around 4 more years just for 1000 bucks? -CJ-Roc-
    • Comment 1/19/11: I've been at IBM for over 15 years, with lots of 1's and 2's in my PBC past. Last week I was given a 3 from my previous manager (there was a reorg just before the end of the year). This fellow would always complain about how "inconsequential" my work was but somehow could never find the time to understand what I did, yet he was now saying how sad he was that I might leave. He also said my new manager wanted to talk to me. Haven't seen her since but she did email her condolences. I do believe there are good managers in this company who want to do the right thing; sadly, I haven't worked for one in a while. Thankfully, I had 2 interviews in the week I was given my 30 days, and I have several more on the horizon. Can't wait to work for non-idiots. -Running for the door-
    • Comment 1/19/11: All you folks that got a PBC "3", especially those who got it the first time and without any warning notices prior by your manager: what are you going to do about it? I don't mean coming to this comment section and venting. It does no good. What will do good is to band together all your PBC "3"'s and make noise by organizing and get your union NOW.

      How to start the organizing: go to the cafeteria during lunch hour and make a comment that you find it unfair and unacceptable that good, hard working employees that have made the IBM stock rise to $150 a share on record profits are now being targeted as PBC "3" performers. (If IBM has a record stock price and profits then how can there be more underperforming workers than ever before?) IBM Management cannot tell you to shut up or leave the cafeteria. The cafeteria is you best area to begin organizing. You are protected by National Labor Relation Board law if IBM tries to take any action against you if you start and do it in the cafeteria (or snack shop/vending machine area) Then you can end this IBM travesty once and for all and before it is too late when you get RAed. -IBMUnionNOW-

    • Comment 1/19/11: All the 3 and 4 ratings are making more sense to me after reading the Sam P letter. "All non executive IBMers WHO PERFORMED CONSISTENTLY...will receive $1K stock grant" i.e. you don't have a 3 or 4 rating. Oh and those who DO get it, will probably be RA'd before it's vested anyhow. And so it goes on, until we organize. -Critical Mass-
    • Comment 1/19/11: "Will this PBC rating 4 affect my job application process in other companies?": IBM employees can request a free employment verification package once per year from a business called "The Work(R) Number". Look on the IBM HR website under employment verification, fill out a request form, and look what IBM (and other companies) report about you. It took about 2 weeks to receive the report in the mail (in March 2010). This could be one of the only freebies left at IBM. -GotMineMarch10--
    • Comment 1/19/11: Do not worry or fear or be alarmed by your lower PBC ratings this year. It is across the board. I tell you the truth; for if Jesus Christ himself worked at IBM, at best he would be rated is a "2" as they continue to "raise the bar" to establish a "high performance culture". Yes friends, turning water into wine, or being the salvation of humanity, or even generating record revenue and profit growth can never satiate the greedy and lustful appetite of our executive leadership. They again scheme to skin-flint you out of any possible raise or promotion, or any thought of job security. Just be grateful you have a job, while you train your cheaper offshore replacement and they laugh their way all the way to the bank on your backs. Your worth consists of what you are and not what you have, or in what arbitrary number they choose to rate you in order to cut costs. -Joe Punchclock-
    • Comment 1/20/11: And let's all not forget, $1000 in IBM stock is going to be around 7 shares, give or take. And I would suspect these will be given in the form of RSUs, which, when they they vest, are reduced by 1/3 for withholdings (this may be an option). I just know my RSUs that vested a while back went from 150 to 100. So if you survive the next 4 years, you'll end up with about 3-4 shares of IBM stock. I would have rather had a $1000 check -anonymous-
    • Comment 1/20/11: Guys, seriously don't hang round for the $1000 share insult. I left IBM a few years ago, I was given 30 times that as sign on bonus from my new firm and have accrued additional shares ever since. Perhaps Sam should only be given a $1000 bonus, though I think he'd fail if it only vested post 2015. -anonymous-
    • Comment 1/20/11: Director level mgmt in SWG says while there are "budget challenges", there will be no layoffs. For what it's worth. -qtr century-
    • Comment 1/20/11: The PBC rating means little during an RA. Your immediate manager has little input. It is your 2nd level manager who puts you on the RA list. 3rd level managers and above probably don't even know who you are. So you better start kissing your 2nd level manager's butt. If you are on his/her shit list you are all done. Having a union could give you an advocate. Don't be short sighted. If you still work for IBM join the Alliance and support a union. -been there-
    • Comment 1/21/11: To -GotMineMarch10-: What IBM reports as employment verification is not secret and its not much. This is all that will be supplied by IBM: Employees can choose to make available to the 3rd party either type of verification letters: Verification of Employment (No salary), Employee Name, Division, Social Security Number, Employee ID, Status, Most Recent Start Date, Original Hire Date, Job Title or you can choose this option: Verification of Income, Employee Name, Division, Status, Most Recent Start Date, Original Hire Date, Job Title, Base Pay, Overtime, Commission, Bonuses, Other Income, Total Pay, Displays three (3) years earnings. No other form of verification will be provided. -Beat Up -
    • Comment 1/21/11: @qtr century - - heard the same thing today at my PBC meeting ....expense control, with contractors taking any layoff hits...this is in GTS. -Don't Care-
    • Comment 1/21/11: Ok guys - here's the scoop: As we all know, IBM does not give anything away for free. Anytime an employee thinks they are being generous - think again. You know that wonderful $1000 stock bonus they are giving out? Well - that's not really an sweet little extra, In reality they are moving monies around into different buckets. That's why so many of you got lower appraisals this year. They give you $1000 in stock bonus (which you may or may not get in 5 years) and they lower your appraisal so that you will not qualify for the March Variable Pay bonus (or get a greatly reduced sum because of the lower appraisal). This is how IBM saves money folks. A piddle stock amount on the one hand, and they take away your variable pay that would have been a few thousand dollars. This is THEIR company. They make the rules and you suffer. Organize or leave for greener pastures. Those are your options. RIght now we all just : "Work at ibm at our own peril".

      There are a few folks in my dept complaining about PBC ratings this year. Seems the persons who are saying anything are grumbling because their ratings were lowered. If you were a 2+ last year, this year you are a 2. If you were a 2 last year, you're now a 3 and pretty soon out the door. No telling who else was affected. Lots of folks just suffer in silence. I am beginning to hear rumors of a imminent RA soon to come. (February time frame). The managers are setting their accounts in order. Jettisoning accounts to the GDF and trying to wash their hands of all supplemental DOU work. I am in GTS. -Miss Understanding-

    • Comment 1/22/11: I was RA'd in March 2009 a week after burying my father, after 20 years of service and sacrifice. My manager called me at home to give me the news. I cannot tell you how horrible I felt, how desperate I was at that time in my life. That manager is still with IBM, still canning people year after year, still handing out appraisals that are manipulated to the lowest level possible. Why I am writing is to give my support to all who are threatened, who feel desperate knowing another RA is around the corner. Start on your resume today, seek assistance from those who love you, take inventory of your skills and abilities. I landed on my feet quickly, although I am not going to tell you it was easy. Starting over at 53 was not something I had planned, but knew was inevitable once I started to understand what IBM was becoming. To those still at IBM wondering when your time will come, join the union, support your co-workers, try and make a difference, I wish I had. -Sagemeister-
    • Comment 1/22/11: Can't give location - there has been an abnormally high number of IT employees leaving to take better jobs elsewhere. They're fed up with IBM. -Fred-
News and Opinion Concerning Health Savings Accounts, Medical Costs and Health Care Reform
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  • Washington Post: With House debate set, up to half of people under 65 have preexisting conditions. By Amy Goldstein. Excerpts: As many as 129 million Americans under age 65 have medical problems that are red flags for health insurers, according to an analysis that marks the government's first attempt to quantify the number of people at risk of being rejected by insurance companies or paying more for coverage. The secretary of health and human services released the study on Tuesday, hours before the House began considering a Republican bill that would repeal the new law to overhaul the health-care system. ...

    The study found that one-fifth to one-half of non-elderly people in the United States have ailments that trigger rejection or higher prices in the individual insurance market. They range from cancer to chronic illnesses such as heart disease, asthma and high blood pressure. ...

    The study is laced with reminders about provisions of the 2010 Patient Protection and Affordable Care Act - as the health-care law is formally known - that are designed to eliminate insurance problems for such people. The most significant is scheduled to take effect in 2014, when the law will, for the first time, forbid insurers to charge sick patients more or reject sick applicants. Last year, two smaller changes took effect: a rule that insurers cannot reject sick children, and temporary subsidies until 2014 for a federal high-risk pool and new state ones. In their early months, the pools have not proved popular. ...

    The new report says that, of those Americans who are uninsured, 17 percent to 46 percent have medical conditions, depending on the definition used. Such health problems, the study found, are especially common among adults ages 55 to 64 - a group long recognized as a problem spot in the health-care system, because people of that age tend to have higher medical expenses but do not yet qualify for Medicare, the large federal insurance program for the elderly.

  • Washington Post editorial: Yes, repeal health-care reform -- on one condition. By Matt Miller. Excerpts: Fine. I'm willing to repeal Obamacare. On one condition.

    Republicans need to pass a law that the Congressional Budget Office certifies will cover the same number of uninsured as the Democratic health reform does - 30 million. And it has to do it at lower cost. ...

    The logic is simple. If Republicans are serious, they have to accept that it's a national priority to make sure that every American has basic health coverage. Thirty million isn't enough, of course, because the ranks of the uninsured still hover around 50 million. But since Democrats could only muster the will to cover 30 million, that's all we can expect the GOP to match as a measure of seriousness. (Though I'd be happy to see them shame Democrats with a plan to cover more).

    The reason Obama should frame the debate this way is that there is no chance the Republican House will pass such a bill. That's because the GOP does not view the presence of 50 million uninsured in a wealthy nation as an issue that needs to be addressed. Why not? Largely because, as the late Daniel Patrick Moynihan once told me (channeling the Republican mind on the uninsured): "Those folks never vote for us and we have our priorities for the money." ...

    Right now the "debate" over Obamacare is a symbolic ruse. Republicans are blaming health reform for all manner of ills even though the thing doesn't even get off the ground until 2014. If the president said, "Okay, John Boehner, you bet, now that you're in power, as soon as you pass a version that covers the same number of people for less, I'll be happy to put my approach aside and cut a deal," he'd remind Americans about the discussion Republicans refuse to have. ...

    And for no good reason. After all, Obama made Romneycare - adapted from the conservative Heritage Foundation's (sensible) ideas - the centerpiece of his reform. He stiff-armed the left by leaving single payer off the table. In case no one got the message, Obama tossed the public option overboard in health care's legislative endgame. Any reasonable Martian would thus conclude that Obamacare - that is, Romneycare for the rest of us - is a centrist scheme. ...

    ...I still think the best model to emulate is mighty Singapore's, a savvy blend of private responsibility and public provision that leaves that nation with world-class outcomes at 4 percent of GDP (vs. our 17 percent). It's a breathtaking achievement that would give our overpaid medical industrial complex a heart attack. ...

    To those who say we should get costs under control before extending coverage to the uninsured, I say: that's a perfectly reasonable argument . . . that only a well-insured person would make. No doubt I'm guilty of what President Bush, in another context, called "the soft bigotry of low expectations." So to atone, here's my pledge: If the House passes a plan the CBO says will cover 30 million people, I'll not only eat my words; I'll eat the bill itself.

  • Wall Street Journal: Republicans Look Beyond Repeal Vote. By Naftali Bendavid. Excerpts: House Republicans began a push Thursday to pick apart the Democrats' sweeping health-care law, an undertaking carrying possible risks alongside political rewards. ...

    Today is Day One of our efforts to replace Obama Care with something better—a lot better," said Rep. Fred Upton (R., Mich.), chairman of the House Energy and Commerce Committee. The chairmen provided few details but said they would pursue such longstanding Republican priorities as limiting medical liability lawsuits and allowing consumers to buy insurance across state lines. ...

    Republicans are setting no deadlines for coming up with health-care proposals and said they would most likely offer piecemeal measures rather than a single sweeping bill. Democrats mocked them for having no alternatives.

News and Opinion Concerning the "War on the Middle Class"
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.

  • truthOut: The Myth of "American Exceptionalism" Implodes. By Richard D. Wolff. Excerpts: One aspect of "American exceptionalism" was always economic. US workers, so the story went, enjoyed a rising level of real wages that afforded their families a rising standard of living. Ever harder work paid off in rising consumption. The rich got richer faster than the rest, but almost no one got poorer. Nearly all citizens felt "middle class." A profitable US capitalism kept running ahead of labor supply. So it kept raising wages to attract waves of immigration and to retain employees across the 19th century until the 1970s.

    Then everything changed. Real wages stopped rising as US capitalists redirected their investments to produce and employ abroad while replacing millions of workers in the US by computers. Women's liberation moved millions of adult US women to seek paid employment. US capitalism no longer faced a shortage of labor. US employers took advantage of the changed situation: they stopped raising wages. When basic labor scarcity became labor excess, not only real wages but eventually benefits too stopped rising. Over the last 30 years, the vast majority of US workers have in fact gotten poorer when you sum up flat real wages, reduced benefits (pensions, medical insurance, etc.), reduced public services, and raised tax burdens. In economic terms, American "exceptionalism" began to die in the 1970s.

    The rich, however, have gotten much richer since the 1970s, as every measure of US income and wealth inequality attests. The explanation is simple: while workers' average real wages stayed flat, their productivity rose (the goods and services that an average hour's labor provided to employers). More and better machines (including computers), better education, and harder and faster labor effort raised productivity. While workers delivered more and more value to employers, those employers paid workers no more. The employers reaped all the benefits of rising productivity: rising profits, rising salaries and bonuses to managers, rising dividends to shareholders, and rising payments to the professionals who serve employers (lawyers, architects, consultants, etc.). ...

    The richest 10-15% -- those cashing in on employers' good fortune from no longer rising wages -- helped bring crisis by speculating wildly and unsuccessfully in all sorts of new financial instruments (asset-backed securities, credit default swaps, etc.). The richest also contributed to the crisis by using their money to shift US politics to the right, rendering government regulation and oversight inadequate to anticipate or moderate the crisis or even to react properly once it hit. ...

    The trillions spent to save the banks and other select corporations (AIG, GM, Fannie Mae, Freddy Mac, etc.) were mostly borrowed because the government dared not tax the corporations and the richest citizens to raise the needed rescue funds. Indeed, a good part of what the government borrowed came precisely from those funds left in the hands of corporations and the rich because they had not been taxed to overcome the crisis. With sharply enlarged debts, all levels of government face the pressure of needing to take too much from current tax revenues to pay interest on debts, leaving too little to sustain public services. So they demand the people pay more taxes and suffer reduced public services so government can reduce its debt burden. ...

    In the US, capitalism has stopped "delivering the goods." It now brings long-term painful decline for its working class, the end of "American exceptionalism," and rising social, cultural, and political tensions. The reality of ever-deeper economic division clashes with expectations built up during the century of rising wages before the 1970s.

  • Christian Science Monitor: Campaign finance ruling: Should Supreme Court justices have recused themselves? By Warren Richey. Excerpts: The liberal advocacy group Common Cause announced on Thursday that it has asked the Justice Department to investigate whether two US Supreme Court justices should have recused themselves from consideration of a major campaign finance reform case last year. Common Cause President Bob Edgar said the group has asked Attorney General Eric Holder to examine whether Justices Antonin Scalia and Clarence Thomas should have stepped aside rather than vote in the Citizens United case. The case, handed down a year ago on Friday (Jan. 21), struck down a portion of the McCain-Feingold campaign finance reform law that had barred corporate expenditures for political advertisements during campaign season.

    Reform advocates denounced the ruling as opening the way for a flood of corporate money and corporate influence in US politics. Supporters of the decision praised it as recognizing that corporate officials have a free speech right to engage in public discussion of political issues of importance to the company.

    Mr. Edgar said the justices were featured speakers at invitation-only retreats sponsored by Koch Industries, a private company whose officials have played an active role supporting Republican candidates and conservative causes. He also said Justice Thomas may have had an undisclosed financial conflict of interest through his wife’s work as founder and CEO of a conservative advocacy group, Liberty Central. Edgar said the group stood to benefit from the Citizens United decision through easier fundraising and easier political spending. [Ms. Thomas has since stepped down as CEO of the group.]

  • Washington Post: Corporate contributions have surged for new Republican leaders in House. By Dan Eggen and T.W. Farnam. Excerpts: The new Republican leaders in the House have received millions of dollars in contributions from banks, health insurers and other major business interests, which are pressing for broad reversals of Democratic policies that affect corporations, according to disclosure records and interviews.

    Much of that money flowed to the GOP chairmen overseeing banking, energy and other key committees - leaders who will play a central role in setting the House agenda over the next two years.

    The impetus behind such largess is simple: Many companies and industry groups hope House Speaker John A. Boehner (Ohio) and other Republicans will succeed in rolling back Democratic policies they find objectionable, including environmental and Wall Street regulations.

    GOP lawmakers took their first step in that direction Wednesday by voting to repeal President Obama's health-care overhaul law. Major health-care firms and their employees gave Republican leaders at least $5 million over the past two years, including well over $2 million to Boehner and Majority Leader Eric Cantor (Va.), according to a Washington Post analysis of contribution data.

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