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6, 2000 April, 2000

Highlights—January 29, 2011

  • Wall Street Journal: IBM to Build Big Data Center in China. By Owen Fletcher. Excerpt: International Business Machines Corp. agreed to cooperate with Chinese network services provider Range Technology Development Co. on the construction of a cloud computing data center in China, which IBM said will be Asia's largest in terms of floor space. Construction of the center is likely to generate about $200 million worth of contracts for IBM over the next five years, a person familiar with the situation said. IBM said Tuesday it expects the data center in Langfang, Hebei province, to be completed in 2016 and to have a floor space of more than 620,000 square meters.

    All production support/technical support for IBM on the Hertz account has been moved to India," states an application for TAA assistance filed with the Department of Labor on behalf of IBM's Hertz contract workers on Nov. 12, 2010. The application specifies the total number of workers affected as 50. It identifies IBM service delivery manager Kelly Thomas and production services manager Sandra Robinson as verification contacts.

  • InformationWeek: IBM Moves Hertz' IT Support To India. About 50 jobs shipped from Oklahoma to the Asian subcontinent as the car rental company looks to pare costs. By Paul McDougall. Excerpts: Two years after winning a contract to provide IT services to Hertz, IBM has moved much of that work from the debt-laden car rental giant's technology center in Oklahoma City to India. About 50 former IBM employees who worked on the Hertz contract in Oklahoma are now seeking assistance under the federal government's Trade Adjustment Assistance program, according to documents obtained by InformationWeek.
  • Charlotte News & Observer: IBM CEO's incentive pay nearly doubled in 2010. By David Bracken. Excerpt: IBM reported in a regulatory filing today that its CEO, Samuel Palmisano, nearly doubled his incentive pay in 2010. Bloomberg News reported that Palmisano, who has led the company for the past eight years, received $9 million in incentives compared to $4.75 million the prior year.
  • 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 "bits_bytes_and_bugs". Full excerpt: Sounds to me that the T&Cs will vary a bit across divisions, but I can't imagine every employee will get the award. I'm guessing if at any time in the last 5 years you got a PBC of 3, you won't get it. Perhaps even a single 2 rating in the last 5 years may disqualify you if they really want to get cheap.

    As QW stated, it is an insult. It certainly isn't enough to motivate anyone to work harder, nor is it enough to retain anyone who wants to leave for better jobs. It certainly isn't generous enough to give IBM good PR.

    There has to be another motive for this - perhaps a tax avoidance scheme. At the rate that IBM is dumping US employees, a majority may not be around in 2015 to collect it anyway.

  • Yahoo! IBM Employee Issues message board: "Re: Pension details - 2nd choicers" by "lastdino1." Full excerpt: If I had to drop down to the $54K pension it would put an impact on my life style until my 401K kicked in. It would be livable but I would need to readjust my spending plan. I'm not to (sic) worried based on my savings strategy so this would only be a blip on the financial charts. Life is Good"
  • Yahoo! IBM Employee Issues message board: "Re: 2nd choicers" by Paul Sutera. Full excerpt: 54K pension - I'm glad you got yours, the corporate world has changed radically. With no pensions, what will nursing homes look like in 30 years? Worse than today! We'll be back to the gilded age, where old folks just wandered off on a cold night rather than be a burden to their kids. :-)

    Well all things happen for a reason. Sam Palmisano and the CEO's of his ilk will someday be the subject of history books. Reaganomics will be seen for what it is, the biggest shift of wealth away from the middle-class to the wealthy who then spent it on Asian investments and German cars.

    Many second choicers will retire on the same pension their dads got from IBM 25 years earlier. When I moved into the office of a man forced out in 1994, I said - this will happen to me one day and I will save money for that rainy day.

    Meanwhile, we never give up trying to reform the American corporation, even if we won't experience the results in our lifetime. Hearing that some companies have suffered because when they outsourced - they lost decades of "tribal knowledge"...and a few, a very few, relocated factories back to the USA. - That warms my heart!

  • Yahoo! IBM Employee Issues message board: "Re:Pension details - 2nd choicers" by "netmouser". Full excerpt: Many would kill for a $54K pension. Consider yourself very, very lucky.
  • Yahoo! IBM Employee Issues message board: "Re:Pension details - 2nd choicers" by "scall0way". Full excerpt: Many? I'd say most. Or at least most IBMers. I can't speak for other companies. But I know lots of retired IBMers, and not one has a company pension that comes even CLOSE to $54K. Mine sure doesn't! And even if I had not been RA'ed last year, and worked a few more years as planned, it would not have come close. I can't even imagine what sort of salary one must have to earn a $54K pension from IBM - certainly way higher than anyone I've ever worked with. :D
  • Yahoo! IBM Employee Issues message board: "Re:Pension details - 2nd choicers" by "lastdino1". Full excerpt: More then 160 and less than 180 over the last 5 years of employment.
  • Yahoo! IBM Employee Issues message board: "Re:Pension details - 2nd choicers" by "In Focus". Full excerpt: Dino, What Band and Job Family where you in? First line, 2nd, or ?
  • Yahoo! IBM Employee Issues message board: "Re:Pension details - 2nd choicers" by "lastdino1". Full excerpt: 10 , 2nd Life is Good.
  • Yahoo! IBM Employee Issues message board: "Re:Pension details - 2nd choicers" by "lastdino1". Full excerpt: With good planning anyone can do it. Some luck plays into it but sacrifice plays a major role. Life is Good"
  • Yahoo! IBM Employee Issues message board: "Re:Pension details - 2nd choicers" by Kathi Cooper. Full excerpt: Luck, personal planning, sacrifice, the grace of God, and working for a company that doesn't screw it's employees at the last minute. That would have made my retirement what I planned for."
  • Yahoo! IBM Employee Issues message board: "Re:Pension details - 2nd choicers" by Lee Conrad. Full excerpt: And a negotiated union contract!"
  • Yahoo! IBM Employee Issues message board: "Re:Pension details - 2nd choicers" by "mr_quarkwrench". Full excerpt: They managed to screw me even after the last minute. One of the selling points of the RTO (buyout) was lifetime company paid medical. Yeah, I didn't get it in writing, just the HR presentation in the company auditorium. Then the payments kicked in three years after my bridge and I was drawing retirement. Life is NOT good. -- Don
  • Yahoo! IBM Employee Issues message board: "Pension" by Paul Sutera. Full excerpt: Yes life can be NOT GOOD, unlike under my parents' retirement plan. Trex, I'm sorry to hear of your financial and health woes. 2 years ago as I ate dinner for my 25th service anniversary on IBM's dime, I remarked to my small gathering that luck can change and my continued presence here at IBM has been my good fortune. I saw people RA'd (fired) in 2008 that were truly stellar, even 30-somethings who graduated from technical colleges with really high-grade point averages - sent packing. I see from time to time an old friend who got a generous pension from IBM, and yes he's having the time of his life, so much so his wife doesn't have to work either. Great, I'm glad IBM is paying him for decades of service. For our corporate landed-gentry, our stolen retirements are providing some really nice stock options, but we can be proud that WE did the right thing, even when others did not.
  • Yahoo! IBM Employee Issues message board: "Re: Pensions" by Paul Sutera. Full excerpt: I've lived in 960 square feet house and never owned a fancy car. My friends used to laugh at my 1987 couch and my 1950s kitchen with the yellow 1970s oven. And yet, having once had a reasonable livable pension, and having it frozen to nearly 1/2 the original amount, (assuming I make it one more year), I still *spent* some of my money.

    Had I known my pension would be frozen all those years when I was a second choicer with a fully-restored pension, I would have saved more. Yes in the last 3 years I saved half my pay. Now I'm renting out a room in my house. We of tiny pension will survive, but the ego, greed, and hubris of our executives knows no parallel, save for maybe Ghengis Khan.

  • Yahoo! IBM Pension and Retirement Issues message board: "Re: And another one..." by "thirtyyearibmer". Full excerpt: The devil is always in the details and as far as "statistics" proving anything... my father's favorite quote was, "figures don't lie, but liars figure." We have gotten too far away from thinking for ourselves. We seem to be a society of "who has the latest data to prove my point" people. We really need to really think through the in's and out's of anything for ourselves. I love folks that say, "let me see the real data and do my own figuring!" Even after looking at the hard data there will always be winners and losers in any decision.

    Nothing is perfect, but some things are fundamentally imperfect and unethical and the 1999 Pension Plan changes were unethical no matter how you looked at them for some set of folks. Case in point anyone that was 39 years of age with 20 years of service. They should be retiring with me but won't be able to...all that had to happen was allow a choice. Pretty simple.

    Personally, I will always thank Kathi and others for jump starting the "wake me up" bandwagon in 1999. I was a short distance away from taking the buy out until I wondered what all the commotion was about the "new better plan".

    I thank you. My wife thanks you. My children thank you.

    PS - I think because of this and other actions, a whole host of companies were prevented by the IRS from converting for a period of time which means a lot of folks outside IBM, in some part, owe her lawsuit a debt of thanks.

  • Yahoo! IBM Pension and Retirement Issues message board: "Re: And another one..." by "dogbreath127k". Full excerpt: My parents and grand parents enjoyed a retirement filled with traveling, spending time with friends and family, hobbies, and volunteering for community service. What allowed them to live this lifestyle was a combination of fair pension, medicare, and social security along with modest personal savings.

    Instead I see myself working till I die, much like my great grandparents did in the late 1800's, burned out and dying in industrial accidents. We have to take care of ourselves today or risk joining the lines at the soup kitchens in our old age.

  • Yahoo! IBM Pension and Retirement Issues message board: "Re: And another one..." by "thirtyyearibmer". Full excerpt: Great discussion. A different perspective. I will be "retiring" in March. Today I find that my kids say they couldn't see working for one corporation for thirty years like I have. They too - think mobile, uncommitted to any corporation other than for a paycheck. They envision a thirty-year person on an assembly line putting a wheel nut on a car and the Enron leadership of poor quality, self-centered, self-focused and out for their own and personal gain. They locked their employees into their own stock that was a Titanic sinking with only the leadership provided with lifeboats and they were the first in line to get off.

    Sad examples of true leadership.

    I have to sit down with them and explain my thirty year career at IBM. First off "The IBM" was a corporation based on trust and confidence in its leadership. Ethics trumped legalities. Thos. J. Watson Sr. and Thomas J. Watson Jr. were leaders unlike what we are seeing rising to the surface today. We need more like them. I would sign on again with a corporation of the ideals and quality they started 100 years ago and bet my life and future on a DB plan with them. Hundreds of thousands made that bet and won. It takes men and women of integrity, leading corporations with a future to inspire men and women to commit their lives and future livelihood to a company.

    I started at IBM as an administrator cutting commission checks for IBM typewriter salesmen and moved up to become a first line administration manager; in sales I was one of the first IBM salesman for the IBM Credit Corporation and one of the last worldwide IBM salesman on quota for OS/2 Warp; in technical sales I was an IBM Systems Engineer on System 36, System 38 and AS/400's; at the IBM Worldwide level, I have served as the Worldwide Brand Manager for OS/2 Warp Server and Worldwide Market Manager for Tivoli Configuration Manager and Tivoli Provisioning Manager; I will be ending my career at IBM as a Worldwide IBM Tivoli Sales Evangelist and Sales Education Specialist for Tivoli Provisioning Manager and IBM Tivoli Monitoring and a Product Manager for the Netcool product set.

    "The IBM" was a corporation of mobility which many don't talk about today. Prove yourself and move where you wanted to.... I could not have made it thirty years with most any other corporation or without similar philosophies.

    I would challenge anyone to move between companies and achieve the financial stability I will have when I retire. That is not a boast. I am lucky to have seen the best of a corporation and have been part of the "second choicers"... grateful for what I have, sorry that my children may never experience a "Watson lead IBM" equivalent company in their lifetimes. I have friends that tell me "everyday" they realize what they lost in the Pension changes of 1999 - one was 39 years of age with 20+ years of service. I can't even talk of my retirement without thinking of him and his family and children and how much he lost. I want to cry for them "everyday".

    All I can think is "but for the Grace of God.... go I".

    I made all the movements above within one company. I did that without a single lost paycheck and continuous earnings. That was "The IBM". We weren't "lifers" (I guess you have to have been in the military to have that initial knee-jerk reaction to the term "Lifer" .. after Vietnam it was one of the most derogatory terms a person could ever use of anyone else... maybe folks don't realize that if you didn't serve... from the 70's Army it was as derogatory a term as you can think of..... so be careful with using a term that can have so much emotion attached to it - sometimes semantics and emotion around a word needs to be explained so we all learn)

    I never met an "IBM lifer"... in that sense of the term. We were just folks like any other, inspired by a leadership of the Watsons that many don't understand or comprehend except through the glasses of today's leadership - poor glasses to look through in my humble opinion!

    In a nutshell, I tell my children to go 401K and be glad for it because today's leadership isn't the type of leadership that I would envision working thirty years for like "The Watson's IBM". They will most likely "be mobile workers" because they will encounter an Enron like leadership and in that case, a 401K / 403B is the "best of the worst options" they have today - sad but I fear true.

    It is the underlying loss of trust and confidence we all have in our business leadership of today that causes discussions like this...

    Be glad that the 401K was brought into existence by chance or we wouldn't have anything today for our children. What we need is a real retirement plan for the future.

    I can only speak for myself, but I will tell you that I was a single parent raising three children for years on my own while at IBM. If I had had a 401K instead of a pension I couldn't get at - I wouldn't have anything today. I would have dug into my 401K to give them more at the time not realizing I would have been sacrificing my retirement. As it turns out - everything turned out OK. They had a little less at the time for me to have more...and maybe they won't have to support me in my old age.

    There are so many sides to this discussion. We need more views, but more than anything we need true leadership in Washington and more leadership like the Watsons in business to inspire those discussions and long term fixes.

    Just one humble opinion, grateful for what I have, sad for what my deepest of friends have lost and realizing that my children may never have what I have or experience what I have in thirty years with IBM.

  • Yahoo! IBM Pension and Retirement Issues message board: "Re: And another one..." by Khadijah bint Muhammad. Full excerpt: I've also considered the possibility that the pension angst is not as much about either the pension or the 401K, but the fact that good people were forcibly transitioned.

    This was clumsy and avoidable. IBM could have chosen a number of different mechanisms to avoid cutting off long-tenure employees (I had no idea that 'lifer' had a negative connotation to anybody). They would have cost incrementally more money, but that tells you more about management than anything else.

    Change of Topic: Watching IBM stock flying high, does anybody (like me) think about how much of this earnings-driven stock performance is driven on the backs of employees now working 50-60 hours per week while commission and bonus plans are being underfunded? And how many of these (often disgruntled) employees will fly the coop when the job market changes? Last year our bonus plan was funded at 55% only, so the average OTE for the job role was decreased on the sly by full bonus * .55?

    Seems like there's a time in here for a short sale......and if you subscribe to the theory that the best time to short is when all the market analysts are incredibly bullish, it's getting close. Last quarter, of the major analysts that follow IBM (acc. yahoo finance), 8 had "strong buy", 7 had "buy", and 7 had "hold". This quarter, it's 8-7-8 (a push).

  • Yahoo! IBM Employee Issues message board: "Re:Separation" by "sby_willie". Full excerpt: From my personal and last experience with IBM: IBM can have you selected for an RA when you are on a medical disability. It is all legal no matter how you might feel how fair it is.

    The Family Medical Leave Act (FMLA) which is part of a medical leave only gives you some protection for you for the 12 weeks you are eligible for in a rolling calendar year. It does handle temporary work leaves for medical reasons for chronic and acute medical issues, of course including cancers. The FMLA doesn't protect your job per se, only that you are able to return to a comparable work position assignment if you old job position or assignment is no longer or is no longer available.

    I found out I was to be RAed about 5 months before I returned from IBM short term disability (IBM STD) based on the RA separations papers I received the very hour I was healthy enough and came off the disabled list after 5 1/2 months and returned to work. The separation package had the past departure date on it. You have no protection from being separated via an RA when on either IBM short term or long term disability. The only thing is IBM can execute the RA until you come off of the disability plan you are on.

    And we got lots of folks working in IBM, disabled medically or not, that still don't what protections from this happening by getting a union contract!?!

  • Yahoo! IBM Employee Issues message board: "2nd PBC of 3 - Performance Package Presented. Now what?" by "lunarfla". Full excerpt: Hi, Just wondering if anyone has heard of someone accepting the Performance Improvement Plan, and actually pulling themselves out to a 2? Or is the Performance Plan a completely unachievable goal? Would love to hear from anyone out there. Thanks,
  • Yahoo! IBM Employee Issues message board: "Re: PBC 3 to a 2" by Paul Sutera. Full excerpt: It has happened to a coworker of mine. They got a 3 and in the subsequent year their appraisal improved to 2 or above. But sometimes I think the management hides a 3 in an area less likely to be hit by an R/A wave to protect another area. Of course some RAs have been applied to people with 2+, so it really depends. One manager was quoted as saying 2/3rds of all people receiving 3's do not make it. One out of 3 people getting a 3 manage to pull it back up to a 2. There are no statistics on the health effects of receiving a 3 or being threatened with a 3.
  • Yahoo! IBM Employee Issues message board: "Re: PBC 3 to a 2" by "moonlady0623". Excerpt: I moved from a 3 in 2009 to a 2 in 2010 but was RAd 3/31/10 anyway. My work was good but........I had a manager who had been brought in from PWC and had never done the job in IBM that she was managing....plus I had spoken my mind once too many times, so it wasn't hard for them to put me on the list. I miss the paycheck and that is IT! Good luck to those of you left wearing the badge.
  • Yahoo! IBM Employee Issues message board: "Re: PBC 3 to a 2" by Michael Nalasco. Full excerpt: I know what you mean. When I first started with ibm, (in 1981) I loved it. When I was RA'd in 2001, I hated it, and the only thing I missed was the paycheck. I certainly did not miss the outrageously unfair PBC system.
  • Yahoo! IBM Employee Issues message board: "Re: PBC 3 to a 2" by "nyjints5". Full excerpt: Someone reading this board who does not have inside access to IBM'ers could easily think everyone who posts here is a disgruntled employee. Nothing could be further from the truth.

    Every time I come in contact with former IBM co-workers, the conversation is basically the same. Everybody comments about how bad it sucks to work for IBM. They cant leave because they have too many years of service invested in IBM, but they don't yet have 30 years. The people closest to 30 years are the ones who usually are the most anxious about making it to 30. The people I'm talking about rarely, if ever, post here.

  • Yahoo! IBM Employee Issues message board: "Re: PBC 3 to a 2" by "nyjints5". Full excerpt: There are other very subtle indicators that reveal the quality of employment as an IBM'er these days isn't very good.

    As was recently posted here, Fortune magazine's list of 100 top companies to work for does not include IBM, and hasn't for many years. Why is that? What does Fortune know about working for IBM that excludes IBM from that list? There once was a time when IBM enjoyed a reputation as a company everybody wanted to work for. IBM was the most admired and respected company anywhere.

    Then, there's retention of outstanding employee's. Why is IBM having a hard time retaining outstanding employee's? (Even though IBM really doesn't want any long term employee's!) Sure, back in the day, I saw exceptionally good IBM employee's voluntarily resign from the company. But not to the extent that it happens in today's IBM. What's driving that?

    Before I retired, I was aware of a very bright young man who was a technical team lead in the dept in which he worked. His manager took another assignment, and the bright young man was named manager of the department. Not too long after being promoted to dept manager, the bright young man resigned. Not to worry though! His former protege, a woman who in her own right was very smart, and had been named to replace the bright young man as the dept team leader, was made manager of the department. Just this week, I heard she too recently resigned from IBM. That says a lot to me.

  • Yahoo! IBM Employee Issues message board: "Re: PBC 3 to a 2" by "teamb562". Full excerpt: "That says a lot to me." I agree and have been wondering the same for a long time in regards to treatment of their employees. Does it possibly say that IBM is in more financial trouble then any of us realize. Some have posted hints to this in the past. Is it possible they are manipulating the quarterly numbers? Even the recently announced $1000 employee stock option plan is being laughed at internally. Can they really be that stupid and out of touch?
  • 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 Lee Conrad. Full excerpt: A news article from last year on this http://www.computerworld.com/s/article/9169678/IBM_stops_disclosing_U.S._headcount_data. The alliance contacts every news org when there are job cuts. Then it is up to them to report it. Generally it is the big cuts that grab their attention. In regards to the non-disclosure of headcount, the alliance faxed/contacted congress and certain local government officials on this. we are also working with a congressional rep on legislation that requires disclosure. Lee.
  • Yahoo! IBM Employee Issues message board: "Re: more job cuts on the way after 4th QTR report" by "nyjints5". Full excerpt: $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: "Re: more job cuts on the way after 4th QTR report" by "scall0way". Full excerpt: >>>I didn't have to wait long to find out. Many employees found out the hard way what an "affordable structure" is/was.<<<<

    Just like my department, when we were moved into a new reporting structure (ITD? how quickly one forgets) in the summer of 2009. We got a little sideshow presentation of our new organization, and every single one of us picked up on the so-called "motto" of the new organization: "To provide the best possible service at the lowest possible cost."

    We all knew it was the beginning of the end at that point. We provided good service to our customer, at a reasonable cost. But we all knew it was not "the lowest possible cost". It was all we could talk about for days. I guess the word filtered up the management chain, so that our new third-line manager came up from Raleigh to have a talk with us.

    "I hear that you all have a lot of worries here that you are going to get laid off", he said. "I just wanted to put your minds at ease. We have absolutely no plans to lay anyone off. We want to work with all of you."

    But then he added the kicker, "Certainly there are no plans in place for any layoffs to happen in 2009. There are no plans for anything to happen in 2010 either, but you can never see into the future."

    That was in July of 2009. In October we were all called into another meeting with the same manager - this time he did it via a telephone conference call, he didn't have the nerve to face us in person! And he told us that almost all of were going to be laid off and replaced by Indians. By May 2010 we were gone (three people from the department were actually kept on.)

    So yeah, never trust a word from upper management. :-)

    But maybe I was better off anyway. I got an email just yesterday from one of the three guys in our department who was kept on. The subject line he gave the email was: "Shoot me now - it would be a kindness" Apparently things have gone to hell at the customer location since the Indians took over, and he's right in the middle of it.

  • Yahoo! IBM Employee Issues message board: "Re: Retiring Soon Under the Old Plan - Maybe Some Suggestions" by "llizbutler". Full excerpt: Hi, Can I ask a simple question. I read these posts and am confused at what is a basic concept I guess I should understand. What is a "second choicer"? Obviously I am not, because I do not know what it is. I was 39 on June 30, 1999 with 19 years of service. I expect to be forced to retire this year at 50 yrs old and 30yrs of service with no access to healthcare, but I do qualify for a small pension and my 401k. Thanks for the clarification.
  • Yahoo! IBM Employee Issues message board: "Re: Retiring Soon Under the Old Plan - Maybe Some Suggestions" by "madinpok". Full excerpt: When IBM rolled out the Cash Balance plan in 1999, at first, they said only employees who were within 5 years of being retirement eligible would have a choice to stay with the old retirement plan or go with the C-B plan. Everyone else would be forced into the C-B plan.

    Several months later, due to the great uproar that resulted over the C-B plan, IBM said that they were changing the rules and anyone who was 40 years or older with at least 10 years of service as of July 1, 1999 would now have a choice as to which plan they wanted to be in. This group of employees became known as the "second choicers."

  • Glassdoor IBM reviews. Selected reviews follow:
    • IBM Senior Consultant in Washington, DC: (Current Employee) "Good company, good work opportunities, not enough pay." Pros: Free schedule: as long as you get the work done, it doesn't matter as much as other companies where or when you do it. Entry level graduates can accelerate quickly in the first 3 years before stalling out. Good benefits. Fully vested in 401k from the start. Cons: Pay less than competitors Too big of a company. Mandatory 44 hour work week. Expectation to do Human Resource roles and other 'give back' to compete with your peers for year end ratings. Advice to Senior Management: Keep the good employees you have by giving appropriate raises. Rather than maintaining the same consultant plan as every other company for which the only way to get a decent raise is by switching companies. After X many years of increasing profits: 1% raise... is that a joke?
    • IBM Business Intelligence Software Development in Boulder, CO: (Current Employee) "Heavy emphasis on solving day-to-day problems with some work developing solutions to future problems." Pros: IBM name and the wide range of experience with front end development and heavy SQL programming. Cons: Contracting atmosphere - no job security. Number one priority is keeping the customer happy, not your technical skill set. Advice to Senior Management: IBM just posted a record earnings quarter, yet cut back on services or outsourced it to India. They are trying to keep up with Google and Apple, instead of Oracle and SAP. Seniors run with the 50+ age group in marathons, not the 20ies crowd; why not IBM run with their own age group...not the young kid?. Just like a senior who doesn't accept their age, IBM may pay for their aggressive actions with the equivalent of an economic "heart-attack"/
    • IBM IT Architect in Baltimore, MD: (Past Employee - 2010) "Good place to start." Pros: Training for 1st 2 or 3 years, many co-workers with knowledge & experience, interesting projects, working from home is prevalent. Cons: continuous layoffs that don't account for performance, benefits below average and dwindling, overwork is normal, management is harsh toward any discontent in the ranks. Advice to Senior Management: Value your technical people and give them time and training to grow their skills. Stop the continual layoff mill. Listen to the workers, even when you don't like what they have to say.
    • IBM Anonymous: (Current Employee) "Hardly no training or preparation for work." Pros: Company's reputation...who doesn't know about big blue? Cons: No proper training/preparation for new hire. Low payment with rare/no increase. Unclear career path and no appraisal. Advice to Senior Management: Need to focus on human resource and company culture, do not just to look at figure.
    • IBM Project Manager: (Current Employee) "Long hours, good place to get into I.T. but unable to grow career after short period of time." Pros: Access to new technology, exposure to client work environments if in Services division. Cons: Global Resourcing is key to the success of the company. Need an MBA to get in, but the old guard creates a glass ceiling so there is no room to move up, and the salary/comp is reflective of this state. There is the constant quarterly chase to make the Wall Street expectations, which is getting more and more difficult to attain. Advice to Senior Management: Short term tactics to keep the stock price up is resulting in talent drain. Soon enough the old guard will retire and the workforce that has been adapted to being treated like contractors will no longer provide a pool of leaders to draw from.
    • IBM Technical Support Engineer in Dublin, County Dublin (Ireland): (Past Employee - 2009) "Great people, Bad Management." Pros: People are great with very different skills and knowledge, always ready to help out. Good company to have on your CV but... Cons: Too many useless managers and middle-management. You are squeezed for everything (clocking time, holidays requests...). Most of managers do not know how to deal with employees and do not treat them very well. No recognition in your work and not a place for careers growth.. Advice to Senior Management: Treat people with more respect and appreciate the time they spend solving customers problems. Salary is very low when starting at the very bottom where you have to filter all the angry etc.. customers before escalation..
    • IBM Anonymous: (Current Employee) "Great for career development, but not entire career." Pros: Great career development, learning opportunities, and networking! Cons: Easy to get lost in the maze and bureaucracy. Difficult to advance and the yearly raises and overall compensation are relatively poor. Advice to Senior Management: Streamline processes and focus on retaining good employees.
    • IBM IT Specialist Advanced in Saint Louis, MO: (Past Employee - 2010) "Good and bad. The offshore of jobs causes undue stress in one's life." Pros: Working from home. Many accounts to move around to. Very limited contact with management if you are performing your job well. Satisfaction of performing your job well. Customer contact. There are a lot of very good people to work with that you run across within IBM even though it is mostly in conference calls.

      Cons: The fact is IBM has a plan to get rid of everyone in the USA that support customers and sending their jobs overseas to lesser skilled workers who barely speak English which irritates the customers. Then IBM turns around and tries to re-hire you back as a consultant without any benefits (no medical, retirement or vacation) at a reduced rate. IBM has built datacenters and hire in young college kids without experience for dirt cheap (based on what they pay offshore) and keeps the average overall salaries low which pulls your salary down going in as a contractor. IBM then expects us to support and train the kids they hire. Once the kids have gained some experience and since you're a contractor they terminate you without notice. IBM is a ruthless employer and is only concerned about the profits for the CEO, board and upper management. They care less about the people on the frontline building the company by keeping their customers happy and working endless overnight and weekend hours (offshift) that lessens the customer impact and again keeps the customer happy. A salaried systems administrator works on average 60 hours / week with no consideration from IBM. You're expected to do the work at night and attend the planning meetings during the day.

      Advice to Senior Management: First line managers should be aware that they will be next once all the US workers are gone. They should be fighting for their people and not submitting to Sam's very poor policies. Everyone just under Sam is a "yes man" kissing his ass and will step on lower management just like they are doing to the front line SA doing the real work. The buy back of IBM stock is so obvious as to artificially inflate IBM stock price so management can cash in on their stock options maturing. Eventually it will catch up with you.

    • IBM Software Engineer in San Jose, CA: (Past Employee - 2010) "too much politics and policies, less actual work." Pros: you may be lucky to work on real products and real customers, occasionally interesting challenges to solve. nothing left, used to have great technologies but marketing is bad. the company is too big and not flexible. Cons: too much politics and policies, less actual work everything is getting off-shored, no young talents working in the company. professionals are leaving. lack of motivation. management is seeking every possibility to cut cost and transfer all jobs to India or China. Advice to Senior Management: stop off-shoring and raise your own talents, motivate people and let them grow. respect their interests and work-life balance. market and populate your products, make them simpler/cheaper to start using and understand real benefits.
    • IBM Senior Systems Management Professional in Sydney (Australia): (Current Employee) "It's a complex place to work." Pros: The management has been trained to do things political right. Cons: Very bureaucratic in most places. It's hard to make a change for anything. Advice to Senior Management: Less meetings and more time on technical issues.
    • IBM Anonymous: (Current Employee) "Intellectually Challenging, but Highly Fragmented." Pros: Great coworkers, intellectual challenges, ability to engage the breadth and depth of the IT industry. You can spend a career at IBM and never be bored. Cons: It's become harder to move across groups and divisions at IBM. The financial objectives drive everything, which reduce motivation in the workplace, as layoffs and cutbacks become less influenced by individual effort and capability and more on "wrong place, wrong time". Advice to Senior Management: Need to step back and rethink HR policy and practice. The simplicity of managing employees via numbers may make it easier to hit earnings numbers from New York, but it doesn't bolster the sort of culture an organization needs to succeed in a Knowledge Economy.
    • IBM Anonymous: (Current Employee) "I believe our business is no longer living up to the values to which we aspire." Pros: The people are great and are one of the main reasons attrition is not much higher in the current climate. Cons: We have lost our way with the values that IBM clearly set the public image by. Sadly this is no longer reflected behind closed doors. The constant and ongoing withdrawal of benefits and bonuses is killing the company on its quest to reach the new share price. Advice to Senior Management: We need to go back to treating people fairly and equitably. Everyone understands the harsh market and the drive to a share price, but we are now doing this by steam rollering over the good will of employees. This current goodwill will not last and should not be taken for granted
New on the Alliance@IBM Site
  • 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 1/22/11: Read the fine print on the $1000 stock bonus they are giving out: "all non-executive employees who performed consistently during the execution of the company's 2010 strategic plan, covering the years from 2007 to 2010, would receive the IBM stock." If your PBC ranking dropped at any time between 2007 and 2010, you will not be getting it. -Anonymous-
    • Comment 1/23/11: perf rating: 2 performance: 100% partner/sat. Results: You have just given me permission to slow down and do marginal work. By racheting down my PBC rating you control how much output this resource provides. --an IT commodity-
    • Comment 1/24/11: 10% across the board RA in AS on March 31. Also huge push to offshore in division 7 will put a bunch more people on the bench. Spot on the person who said RAed resources are selected by 2nd lines. This sucks. -Anon-
    • Comment 1/24/11: "perf rating: 2 performance: 100% partner/sat Results: You have just given me permission to slow down and do marginal work. By racheting down my PBC rating you control how much output this resource provides." Actually, by racheting down your output, you're probably self-selecting for a PBC 3 next year, and RA selection. Just so you know. I'd use the time intervening to either help organize the union, or look for a better job elsewhere. Because IBM as an employer is not going to improve without the former, and if you're not trying that, the only real option to you is to either take with a grin the abuse they give you, or find another job. -irRational-
    • Comment 1/25/11: Here is the game management plays during an RA. The 2nd line is told from his manager that he has to create an RA list. He will form his RA list by his opinion of his employees and the opinions of his managers. Of course the first lines want to save their employees so they will turn on the other first lines. They will suggest employees from the other departments. Here is where making enemies in management can really hurt you. You are screwed if you have a new or weak manager who can't defend you. It is really a game folks. If you had a union you would have someone on your side to defend you. Right now management makes all the rules to the game. -management sucks-
    • Comment 1/25/11: "Mark Loughridge leaked it at the results call: In the first quarter of 2011, we expect a gain on asset sale, which will be largely offset by workforce rebalancing predominantly in Europe". Loughridge, lets start the rebalancing where it belongs. We could get rid of 3/4 of second line managers and above. People who do nothing all day That would cut down the resource actions. Join the union. -Ana-
    • Comment 1/25/11: "all non-executive employees who performed consistently during the execution of the company's 2010 strategic plan, covering the years from 2007 to 2010, would receive the IBM stock." PBC 2+ for as long as I can remember but got RAed in December 2009 and gone before 2010. No stock for me. I bet myself and others were added to make this carrot not a big hit to obscene record profits and to obtaining and exceeding the EPS. But my IBM second line and director that did my execution will sure get their additional stock. Greed is good. Power corrupts. Any RESPECT FOR THE INDIVIDUAL: my a$$. -anonymous-
    • Comment 1/25/11: Just received first bad rating ever in many many years of employment. Anyone have confirmation that all these devalued ratings are for a layoff or due to the pretend bonus thing? Time to be worried and start looking??? -Screwed-
    • Comment 1/25/11: @management sucks- You are absolutely right! As a former 1st line manager (who graded at 100% on the management survey the year before), I fiercely defended one of my employees when she was put on the list by the 2nd line. As a consequence, my whole department was RA'd and the work transferred to Canada from the US, where you can get 3 Canadians for the price of 2 American software engineers. So what happened to my employee that was on the list? Well, she got a job the day after receiving her severance pay from IBM, then made senior a year later, and now she is in the PhD program at the local university. In retrospect, I am very proud of standing up for her, even though it may have cost my department its mission! As for me, I am working for a late stage start-up (reporting directly to a billionaire CEO), and enjoying my work more than ever! In my second month on the job I received an award equal to the highest award I received at IBM in over 20 years of service. There are opportunities out there, though it may not appear so at the beginning. So keep your chin up and move on; it's the best thing you can do! -former1stlineRA2009-
    • Comment 1/26/11: Director level mgmt in SWG says while there are "budget challenges", there will be no layoffs. IBM Directors are liars. RAs are all about politics. Join the union. -ANA-
    • Comment 1/26/11: I was RAed in 2009 due to budget challenges: even with my PBC was 2+. for years and the decision was made by my IBM Director. IBM Directors will do anything and everything now to make sure they have a shot to make their profit numbers. It affects their bonuses. They don't care who they affect, well maybe, their inner circle and favorites fare better. So what if trimming some good, loyal, even lower paid in band employee (I was in IT as specialist as a band 8 for over 13 years and never cracked 80K base (for NE region USA pay despite the PBC 2+'s) is done to fudge a profit or lessen a deficit?. EVERYONE is just line expense items to IBM Directors, except themselves! -sby_willie-
    • Comment 1/27/11: ""Director level mgmt in SWG says while there are "budget challenges", there will be no layoffs." What an oxymoronic statement for the IBM director to make. This IBM Director is clearly a liar. Most are. -anonymous-" I have to defend the executive. Layoff is a term used for people who usually have a labor contract who when business improves will be called back to work. To my knowledge no one has ever gotten their job back at IBM with same pay , Benefits, Job title etc. What IBM does is FIRE you flat out. Therefore you are not laid off implying you may be called back to work, you are FIRED with no chance of returning as a regular full time employee. Workers at IBM are at will employees. They can leave at will, Theirs or IBM's without violating any labor agreements because there are none. You can expect nothing better. Its all defined in your contract. Or lack of one -Exodus2007-
    • Comment 1/27/11: That $1000 stock bonus is laughable. What is the strike price? IBM won't be under for it because employees will let the options expire. It's bad paper. Just another way for IBM to cut costs on the backs of it's employees. I was laid off in 2009. I found a job in 1 month. $10k more salary. Quarterly bonuses that each exceed my IBM yearly variable pay. $40k in stock as a sign on and $10k more in 2010. Those of you at IBM need to keep looking and interviewing. IBM doesn't want you. -2009layoff-
    • Comment 1/27/11: To Curious: I was RA'ed in 2009 after going through cancer surgery in 2008. I was on Medical Leave in 2008 and returned to find out in 3 months that I would not have a job after April 2009. IBM showed me what I was worth after 28 years of service................NOTHING, my job given to someone from India. -RA'ed in 2009-
    • Comment 1/28/11: To Screwed: First bad rating? Time to be worried and start looking? Are you kidding? Seriously? Are you an Alliance member pushing to get others to join or do you just read this site to see if you are next? I am so amazed at how many people are still numb. PBC ratings mean nothing. Your job performance means nothing. More dollars in IBM's pocket is what matters to them. Billions in profits but it's not enough. Who else can we cut this year. Wake up and smell the coffee. You have two options...Organize and Unionize or look for a job some place else, because you ARE on the chopping block. It's just a matter of time. -Gone_in_07-
    • Comment 1/28/11: A very good source on pension changes has leaked out, not what they will be, that's not too hard to guess though. An inadvertent hint from a exec T.A. about the 'pension changes' that was mistakenly commented on was quickly dropped like a hot potato. What changes can they make? Will it be an incentive, take a little now and leave or a forced, take the old pension and leave or take the cash balance and stay? If you take the old and try to come back as a contractor, they win, cutting costs and medical/vacation/sick time etc... If you take the cash balance they skim hundreds of thousands from you, dammed if you do, dammed if you don't. Your dealing with the scum of the earth, sending people to an early grave minus retirement pay.... Maybe the ceo's moniker should be: sammy-the-slayer! -pension-roulette-on-the-table-
News and Opinion Concerning Health Savings Accounts, Medical Costs and Health Care Reform
  • Spencer's Benefits Reports, courtesy of CCH Incorporate: Repealing Health Reform Law Would Leave One In Two Non-Elderly At Risk. Excerpts: Without the provisions of the Patient Protection and Affordable Care Act (ACA), as many as 129 million non-elderly Americans who have a preexisting health condition would be at risk of losing health insurance or be denied coverage altogether in 2014, according to a new analysis from the Department of Health and Human Services (HHS). ...

    The HHS analysis found the following:

    • Between 50 and 129 million (19% to 50%) of Americans under age 65 have some type of preexisting condition such as heart disease, high blood pressure, arthritis, asthma, and cancer. The highest rates of those with preexisting conditions, ranging from 21% to 54%, are among those with employer-sponsored insurance. However, 32 to 82 million people with both health problems and job-based coverage would be vulnerable without the ACA, which lifts limits on annual and lifetime benefits.
    • Older Americans between the ages of 55 and 64 are at particular risk of preexisting conditions; 48% to 86% of people in that age bracket have a pre-existing condition.
    • Of those under age 65 currently in good health, 15% to 30% report that they are in very good or excellent health with no chronic conditions. However, they are likely to develop a preexisting condition over the next eight years.
    • Up to one in five Americans under age 65 with a preexisting condition–25 million individuals–is uninsured.

    Prior to the ACA, in the vast majority of states, insurance companies in the individual market could deny coverage, charge higher premiums, and/or limit benefits based on preexisting conditions. Surveys have found that, due to preexisting conditions, 36% of Americans who tried to purchase health insurance directly from an insurance company in the individual insurance market encountered challenges purchasing health insurance

  • Mother Jones: Who Wants to Repeal Healthcare Reform? By Kevin Drum. Excerpt: I see that the New York Times decided to go the extra mile and do more than simply ask people if they support or oppose the healthcare reform law. They first asked them if they wanted the law repealed, and if so, what part they wanted repealed. The basic result was 48% in favor of keeping the law as is, 18% who wanted to repeal part of the law, and 20% who wanted to repeal the whole thing. The details look like this (PDF).

    So 8% are opposed to everything and 11% are opposed to the individual mandate. And that's about it. Not a single other provision was opposed by more than 1% of the respondents. Not even higher taxes! Hell, a full 14% were supposedly in favor of repeal but couldn't name even a single provision they disliked.

  • AlterNet: Insurance Company Drops Cancer Patient, Veteran, Because He Accidentally Underpaid By Two Cents. Excerpts: One of the worst abuses of the private health insurance industry is the practice of denying claims to pay for necessary care or revoking the coverage of policyholders for frivolous reasons. A Vietnam veteran from Thornton, Colorado, is the latest victim of this practice.

    Vietnam vet Ronald Flanagan has been battling cancer for more than two years. Two weeks ago, Flanagan was getting prepped for a bone biopsy at the local Exempla Rock Creek Medical Center. But at the last minute, his wife called the hospital and told them to stop the procedure because she had just received notice that they no longer have insurance. The reason why? The couple had accidentally underpaid their insurer by two pennies and it decided to drop them from their plan:

    Two pennies. That's the difference between a potentially life-saving surgery, and a dropped insurance plan. Those two cents could cost Vietnam veteran Ronald Flanagan everything. "Everybody we talk to is very surprised that two cents is enough to do this," said Flanagan.
    It was an innocent enough mistake, according to Ron's wife, Frances Flanagan. "If I only had just hit the nine instead of the seven," Frances said. When she was paying their monthly health insurance premium online in November, Frances swapped a 7 for a 9, leaving their $328.69 payment two cents short.

    In a statement provided to a local news station, the couple's insurer, Ceridian Cobra Services, explained, "Since the payment was not full, it fit into the definition in the regulations of an 'insufficient payment' … Ceridian understands nothing is more important than one's health." Local station ABC 7 interviewed the Flanagans about their plight. "I felt that it was all my fault," said Mrs. Flanagan, who made the accounting error, choking back tears. Watch it:

    The recently passed health care law — which congressional Republicans are unanimously trying to repeal — includes a whole host of protections that would rein in the ability for health insurers to drop patients for frivolous reasons like this. If Republicans are successful, these protections would disappear.

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.

  • New York Times op-ed: The Competition Myth. By Paul Krugman. Excerpts: But let's not kid ourselves: talking about "competitiveness" as a goal is fundamentally misleading. At best, it's a misdiagnosis of our problems. At worst, it could lead to policies based on the false idea that what's good for corporations is good for America.

    About that misdiagnosis: What sense does it make to view our current woes as stemming from lack of competitiveness? ...

    But isn't it at least somewhat useful to think of our nation as if it were America Inc., competing in the global marketplace? No. Consider: A corporate leader who increases profits by slashing his work force is thought to be successful. Well, that's more or less what has happened in America recently: employment is way down, but profits are hitting new records. Who, exactly, considers this economic success?

    Still, you might say that talk of competitiveness helps Mr. Obama quiet claims that he's anti-business. That's fine, as long as he realizes that the interests of nominally "American" corporations and the interests of the nation, which were never the same, are now less aligned than ever before. ...

    The financial crisis of 2008 was a teachable moment, an object lesson in what can go wrong if you trust a market economy to regulate itself. Nor should we forget that highly regulated economies, like Germany, did a much better job than we did at sustaining employment after the crisis hit. For whatever reason, however, the teachable moment came and went with nothing learned.

  • New York Times: Mortgage Giants Leave Legal Bills to the Taxpayers. By Gretchen Morgenson. Excerpt: Since the government took over Fannie Mae and Freddie Mac, taxpayers have spent more than $160 million defending the mortgage finance companies and their former top executives in civil lawsuits accusing them of fraud. The cost was a closely guarded secret until last week, when the companies and their regulator produced an accounting at the request of Congress.
  • Huffington Post: Colin Powell: Defunding NPR Won't Solve Deficit Problem, Congress Should Look At Cutting Defense. By Amanda Terkel. Excerpt: Former Secretary of State Gen. Colin Powell disagreed with current proposals to cut the deficit on Sunday, saying that going after small programs one by one -- and not touching military and entitlement spending -- won't be effective in solving the country's long-term budget problems.

    Last week, the Republican Study Committee, a conservative House GOP caucus, announced that it aims to return non-defense spending to 2008 levels and non-security spending to 2006 levels. It would cut funding for veterans programs, scientific research at the Department of Energy, Homeland Security, transportation, housing, education, legal services, foreign aid and the arts. The RSC proposal would save an estimated $16.1 billion by rolling back federal Medicaid funding, putting the burden for those patients on state and local governments.

  • Washington Post op-ed: In the GOP's budget, a surplus of spite. By Eugene Robinson. Excerpts: Republicans who feign attacks of the vapors and fainting spells over the big, scary deficit would be more convincing if they didn't begin with the insane premise that defense spending should be sacrosanct. The House leadership in the past few days has begun to signal retreat from this indefensible position, but it's unclear how much of the hyper-conservative GOP majority will follow. ...

    The Republican "Pledge to America" promised to cut "at least $100 billion in the first year alone," notwithstanding "exceptions for seniors, veterans and our troops." This was never a serious proposal, given that defense, plus entitlements and other mandatory spending, consume about four-fifths of the budget. But it was a nice round number that sounded good. ...

    The conservatives want to end funding for the Corporation for Public Broadcasting, the Legal Services Corporation, the National Endowment for the Arts, the National Endowment for the Humanities, the Energy Star program, the United Nations' Intergovernmental Panel on Climate Change . . . you get the picture. Put together, these expenditures would not begin to pay for, say, the $13 billion Marine Corps landing craft that Gates plans to kill because we are no longer fighting World War II.

    You'd think that Rep. Howard P. "Buck" McKeon, the new chairman of the House Armed Services Committee, would have applauded Gates's frugality. Instead, he described himself as "not happy" and vowed he will "not stand idly by and watch the White House gut defense when Americans are deployed in harm's way." In other words, it's perfectly fine to waste money on defense. What's not acceptable to GOP conservatives, apparently, is spending on agencies or programs that they oppose philosophically. Don't believe in climate change, despite wide scientific consensus that it's real? Just cut off funding for the U.N. panel that disagrees with your view.

  • truthOut: GOP's State of the Union Responder Would Set Higher Taxes on Middle-Class Than Millionaires. By Pat Garafalo. Excerpts: According to an analysis by Citizens for Tax Justice, the Roadmap would raise taxes on 90 percent of Americans, while dramatically lowering them for millionaires. In fact, a new analysis from the Economic Policy Institute found that Ryan's plan would ultimately translate into middle-class tax rates being higher than those for millionaires:
    • The Roadmap would lead to the wealthiest Americans paying a lower average tax rate than most Americans. Eliminating taxes on capital gains, dividends, and interest, as the Roadmap proposes, would overwhelmingly help taxpayers at the top of the income distribution, who receive most or all of their income from capital. For example, Wall Street financiers could shelter all of their income as tax-free stock options or carried interest.
    • Middle-class families earning between $50,000 and $75,000 a year would see their average tax rate jump to 19.1% (from 17.7%) under this plan—an increase of $900 on average [...]
    • Millionaires would see their average tax rate drop to 12.8%, less than half of what they would pay relative to current policy ...

    Next week, on the same day that Obama delivers his address and Ryan gives his response, House Republicans will vote to endow Ryan with "stunning and unprecedented" powers to set discretionary spending levels that are binding on the House. The levels that Ryan has laid out, if actually enacted, would result in significant reductions to vital and popular programs like Pell Grants, the FBI, and the National Institutes of Health. This week, House Majority Leader Eric Cantor (R-VA) also called for "elements" of the Roadmap to be in the first GOP budget.

  • New York Times: Financial Crisis Was Avoidable, Inquiry Finds. By Sewall Chan. Excerpts: The 2008 financial crisis was an "avoidable" disaster caused by widespread failures in government regulation, corporate mismanagement and heedless risk-taking by Wall Street, according to the conclusions of a federal inquiry. The commission that investigated the crisis casts a wide net of blame, faulting two administrations, the Federal Reserve and other regulators for permitting a calamitous concoction: shoddy mortgage lending, the excessive packaging and sale of loans to investors and risky bets on securities backed by the loans.

    "The greatest tragedy would be to accept the refrain that no one could have seen this coming and thus nothing could have been done," the panel wrote in the report's conclusions, which were read by The New York Times. "If we accept this notion, it will happen again." ...

    "The crisis was the result of human action and inaction, not of Mother Nature or computer models gone haywire," the report states. "The captains of finance and the public stewards of our financial system ignored warnings and failed to question, understand and manage evolving risks within a system essential to the well-being of the American public. Theirs was a big miss, not a stumble."

  • TruthDig: Hogwash, Mr. President. By Robert Scheer. Excerpts: What is the state of the union? You certainly couldn't tell from that platitudinous hogwash that the president dished out Tuesday evening. I had expected Barack Obama to be his eloquent self, appealing to our better nature, but instead he was mealy-mouthed in avoiding the tough choices that a leader should delineate in a time of trouble. He embraced clean air and a faster Internet while ignoring the depth of our economic pain and the Wall Street scoundrels who were responsible—understandably so, since they so prominently populate the highest reaches of his administration. He had the effrontery to condemn "a parade of lobbyists" for rigging government after he appointed the top Washington representative of JPMorgan Chase to be his new chief of staff. ...

    His references to education provided a convenient scapegoat for the failure of the economy, rather than to blame the actions of the Wall Street hustlers to whom Obama is now sucking up. Yes, it is an obvious good to have better-educated students to compete with other economies, but that is hardly the issue of the moment when all of the world's economies are suffering grievous harm resulting from the irresponsible behavior of the best and the brightest here at home. It wasn't the students struggling at community colleges who came up with the financial gimmicks that produced the Great Recession, but rather the super-whiz-kid graduates of the top business and law schools.

    What nonsense to insist that low public school test scores hobbled our economy when it was the highest-achieving graduates of our elite colleges who designed and sold the financial gimmicks that created this crisis. Indeed, some of the folks who once designed the phony mathematical formulas underwriting subprime mortgage-based derivatives won Nobel prizes for their effort. A pioneer in the securitization of mortgage debt, as well as exporting jobs abroad, was one Jeffrey Immelt, the CEO of GE, whom Obama recently appointed to head his new job creation panel.

  • Wall Street Journal: Rich Open Wallets in the Hamptons. By Josh Barnbanel. Excerpts: The rich are different than other home buyers, both in the Hamptons and in the most affluent neighborhoods on Long Island's north shore, market reports show. A recovery in sales of the most expensive Long Island properties pushed up median and average prices last year, as well-compensated Wall Street executives regained confidence, according to the reports. At the same time. prices continued to sink in less affluent neighborhoods across Long Island. ...

    Rick Hoffman, who oversees sales at Corcoran Group on the east end of Long Island, said there was more buyer confidence in the Hamptons, though prices remain subdued and inventory is above the level of a year ago, He noted that 26 listings by brokers in the Hamptons sold for more than $10 million last year, compared with only 13 the year before. The highest price sale of the year was the $43.5 million purchase by David Tepper, the hedge-fund manager, of a 6,200-square-foot house on a dune overlooking the ocean in Sagaponack.

  • New York Times op-ed: Their Own Private Europe. By Paul Krugman. Excerpts: President Obama's State of the Union address was a ho-hum affair. But the official Republican response, from Representative Paul Ryan, was really interesting. And I don't mean that in a good way.

    Mr. Ryan made highly dubious assertions about employment, health care and more. But what caught my eye, when I read the transcript, was what he said about other countries: "Just take a look at what's happening to Greece, Ireland, the United Kingdom and other nations in Europe. They didn't act soon enough; and now their governments have been forced to impose painful austerity measures: large benefit cuts to seniors and huge tax increases on everybody."

    It's a good story: Europeans dithered on deficits, and that led to crisis. Unfortunately, while that's more or less true for Greece, it isn't at all what happened either in Ireland or in Britain, whose experience actually refutes the current Republican narrative.

    But then, American conservatives have long had their own private Europe of the imagination — a place of economic stagnation and terrible health care, a collapsing society groaning under the weight of Big Government. The fact that Europe isn't actually like that — did you know that adults in their prime working years are more likely to be employed in Europe than they are in the United States? — hasn't deterred them. So we shouldn't be surprised by similar tall tales about European debt problems.

    Let's talk about what really happened in Ireland and Britain...

  • truthdig: Michele Bachmann: Welfare Queen. By Yasha Levine. Excerpts: Michele Bachmann has become well known for her anti-government tea-bagger antics, protesting health care reform and every other government "handout" as socialism. What her followers probably don't know is that Rep. Bachmann is, to use that anti-government slur, something of a welfare queen. That's right, the anti-government insurrectionist has taken more than a quarter-million dollars in government handouts thanks to corrupt farming subsidies she has been collecting for at least a decade. ...

    But Bachmann isn't the only welfare recipient on Capitol Hill. As it turns out, there is a filthy-rich class of absentee farmers—both in and out of Congress—who demand free-market rules by day and collect their government welfare checks in the mail at night, payments that subsidize businesses that otherwise would fail. Over the past couple of decades, welfare for the super-wealthy seems to be the only kind of welfare our society tolerates. ...

    Chuck Grassley, the longtime Republican senator from Iowa who warns his constituents of Obama's "trend toward socialism," has seen his family collect $1 million in federal handouts over an 11-year period, with Grassley's son receiving $699,248 and the senator himself pocketing $238,974. Even Grassley's grandson is learning to ride through life on training wheels, snagging $5,964 in 2005 and $2,363 in 2006. In the Grassley family they learn early how to enjoy other people's money.

    Sen. Grassley railed against government intervention in the health care market, telling The Washington Times, "Whenever the government does more ... that's a movement toward socialism." As the top Republican on the Senate Finance Committee, he ought to know, especially because the government has done more for him and his kin than for Americans struggling with high medical bills and mortgages. Even the free-market think tank the Heritage Foundation criticized Grassley on his deep connections to farming interests and his stubborn lack of transparency.

  • New York Times op-ed: The Big Tank That Couldn't. Excerpts: The Republicans' fervor for saving the taxpayers' dollars doesn't extend to one of the Pentagon's costlier failures — the Marine Corps' new Expeditionary Fighting Vehicle, a hybrid landing craft and battle truck. Twenty years in the making, the vehicle had so many breakdowns and cost overruns — and was based on such outdated war assumptions — that Secretary of Defense Robert Gates terminated it this month for a savings of $14.4 billion. This was after the project had eaten $3.3 billion, driving the cost per vehicle from $5 million to $17 million, with prototypes still stumbling through tests.

    Mr. Gates, of course, instantly ran into the new Republican chairman of the House Armed Services Committee, Howard McKeon, who believes that defense spending is much too sacrosanct to be included in the full-scale slashing Republicans promise for the rest of federal discretionary spending. Hold off "precipitous action," Republican appropriators advised the defense secretary as they began hearings into the E.F.V. and other worthy chunks of the $78 billion in savings Mr. Gates aims to effect across the next five years. ...

    The Pentagon budget has doubled in the past decade and now represents more than 50 percent of discretionary federal spending — and that doesn't include the cost of two wars. How can it be off limits? If Congress tries to revive the wasteful E.V.F. project, the secretary warns its ballooning price tag will swallow most of the Marine Corps' future procurement and maintenance budget across the coming years.

    The E.F.V. is a classic in the excesses of the military-industrial complex, with entrenched politicians promoting hometown pork and reeling in political contributions from weapons developers. Republicans are particularly devoted, but this is a bipartisan way of life. Among the Tea Party House freshmen — sworn to root out waste and the rest — only one has dared to say "everything needs to be on the table."

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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