She is seeking $1.1 million in compensation for IBM's failure to act on her repeated complaints of sexual harassment and bullying. She alleges the manager rubbed himself against her repeatedly and made sexual remarks in front of her at office events. ...
"He used to scream at me every day. I did nothing wrong and no-one did anything about it, nobody," the statement said. "I was always called the social butterfly and was really outgoing. Since that all happened I just became a hermit. I don't go out now. I've just been home for so long thinking. It's just been really hard. As much as I try to go out I just can't. "I just feel worthless. I feel I have no future now. I can't get a job. I feel I'm not worth anything anymore. I was put down for so long, told I was incapable. I put IBM on a pedestal. I was proud of my job but now nothing."
The woman says she was a top-performing employee, earning in excess of $150,000 a year at IBM. She says all that changed once the manager in question took over. She says he subjected her to all manner of sexual harassment. The woman says he repeatedly rubbed himself against her as he walked by her work station. She alleges he made comments such as, "if you get your breasts out you will get more sales". It is also alleged he made sexual remarks in front of her during Christmas events and repeatedly placed his hand on her leg and up her dress at an evening function. The woman says the manager called her names, made unreasonable work demands, and threatened her. ...
It is understood IBM investigated the claims and was in the process of sacking the manager but he resigned beforehand. In a statement IBM says it takes any matters of this nature very seriously. The company says it is unable to comment on this particular case at this time because it has not seen the claim.
When: 1:30pm, Thursday, April 14, 2011
Where: Cedar Creek Room, Montpelier
Background: "We wanted to come here to set the record straight. IBM insurance is not as affordable to employees as they present it. We do not understand why IBM is trying to tell our elected officials that Vermont shouldn't have universal healthcare. Why have they not even asked what their own employees think first? We are the people who live here. IBM employs people all over the world and they deal with universal healthcare systems all the time. They can do it here," said Earl Mongeon, who works at the IBM facility in Essex and is the Vice-President of the Alliance@IBM, which represents thousands of IBM workers and retirees across in the US.
Mongeon explains: "The employees at IBM have been dealing with the brunt of the rising costs of healthcare. Many of us cannot afford good coverage and even some employees have to put their children on Dr. Dynasaur. These are the issues we should be talking about and are examples of why we need to move forward to universal healthcare. "
The Alliance@IBM have been active members of the Healthcare Is A Human Right Campaign, a grassroots statewide campaign to win universal healthcare coordinated by the Vermont Workers' Center. More at www.workerscenter.org/healthcare
IBM unions, including the Alliance, have worked together over the years as a network of information and cooperation, but the new organization "takes that network to another level and will include many more IBM unions," the Alliance said. In the past year, new IBM unions have formed in Argentina, Chile, and Bulgaria, the group said. ...
Alliance, which has been trying to organize IBM employees since 1999, said: "IBM has negotiated with unions in Europe for decades and IBM has been successful as a company. If the company can do that there, they can do it here." ...
Bronfenbrenner said she thinks IBM's outsourcing of work from the United States to other countries in an effort to cut costs has worked against union efforts here. But unions have emerged more strongly in other nations. "The idea was that you would move it to China and there would be no unions, and they discovered in fact that unions in China were beginning to find themselves," Bronfenbrenner said. If unions work in solidarity globally, Bronfenbrenner said, "I think they can get something."
The disparity is especially stark as companies are swimming in cash. In the fourth quarter, profits at American businesses were up an astounding 29.2 percent, the fastest growth in more than 60 years. Collectively, American corporations logged profits at an annual rate of $1.678 trillion.
So far, this recovery has not trickled down. After two relatively lean years, C.E.O.'s in finance, technology, energy and beyond are pulling down multimillion-dollar paychecks. What many of these executives aren't doing, however, is hiring. Unemployment, although down from its peak, stood at 8.8 percent in March. And few economists predict the jobless rate will drop substantially anytime soon.
|Salary||Bonus||Stock & options||Total||Chg from '09||Stock return|
Executive pay is not only a sign of how a company views its duties to shareholders, Mr. Meyer says, but it is also a crucial tire to kick when making investment decisions.
"When compensation is excessive, that should be a red flag," Mr. Meyer says. "Does the company exist for the benefit of shareholders or insiders?" ...
Of course, pay is just one item that Mr. Meyer takes into account when analyzing companies. In his search for shares he can own "forever," he also hunts for companies with high-quality earnings — that is, those that don't depend on accounting tricks — as well as generous cash flows and management integrity. Companies he avoids include those that award oodles of stock or options to their executives. Such grants vastly dilute the earnings left over for a company's owners: its shareholders.
"Stock-based compensation plans are often nothing more than legalized front-running, insider trading and stock-watering all wrapped up in one package," Mr. Meyer says. ...
The fiction that options should not be counted as a business expense finally changed in 2005, when the Financial Accounting Standards Board required that companies recognize the costs of options in their financial statements. But options had become the drug of choice for those addicted to excessive compensation, whether on the receiving end or delivering it as directors on a corporate board's compensation committee.
"Middle-class America experienced a lost decade in their retirement accounts, whereas executives enjoyed record compensation packages through the subterfuge of stock option programs," Mr. Meyer says.
"There has been a massive wealth transfer from middle-class America's retirement accounts to the bank accounts of the privileged few. The social consequences of this wealth transfer bear scrutiny."
"We all kind of scratch our heads when executives are making millions, and (corporate) directors feel obligated to give them $10,000 for financial planning," says Andrew Goldstein of corporate compensation adviser Towers Watson. "It's not like directors haven't thought about getting rid of perks. They're still a sticking point for a lot of executives. They feel it's part of their compensation package. And it's a stature thing."
There is something profound at work in these types of people, and I don't think it is just about the acquisition of wealth. Look at the Koch brothers and their ilk. They have more than enough money for 25 lifetimes. How much does one need to live a comfortable and pleasant life? They are not satisfied by just making money, but are driven to destroy other people, nature, things that society values etc. Any insights philosophers, psychologists or thinkers would be interesting.
And then the corollary: If we don't spend billions buying back shares, EPS will suffer, since we have no idea how to make money on all this technical crap, after all, we majored in: history, business, marketing etc. They are scared and people like Sam are woefully underqualified to lead a technology company. He knows only one thing - cutting costs.
Then you have people like Bloomberg hiring Cathie Black to be chancellor of NYC schools. There is some belief that boardroom types can really run things. Especially when the goal is to run them into the ground. Glad they bounced her out nice and quickly. Bravo!
That is, until they hit the empty-nest, time-to-start-downsizing phase—and begin wondering what to do with their mountains of accumulated stuff. With some 8,000 Americans turning 65 every day, on average, and the senior population expected to double by 2050, millions are facing a massive, multifaceted purge that's turning out to be much tougher than they thought it would be. And millions more find themselves in similar quandaries as they deal with the truckloads they've inherited from pack rat relatives. Indeed, whether they're leaving an heirloom china set at the local consignment store or packing a stately grandfather clock off to Sotheby's, many are discovering that the resale market is glutted with household goods. And oriental rugs are only the beginning. Got a home full of middle-market, traditional-style furniture to sell? Dealers say that stuff's plunged 50 to 75 percent in value. Elaborate silver tea sets are worth more melted than as decorative objects. And huge heavy items like dining-room breakfronts and banker-style desks are often the toughest to unload. "I once sold a piano for $11," says David Rago, a Lambertville, N.J., auctioneer.
Mr. Bloomberg had argued that Ms. Black was a "superstar manager" whose expertise in cost-cutting and dealing with customers would be a boon to a school system in financial straits. The mayor contended that under the 2002 law that gave him control of the city schools, he should be able to appoint whomever he pleased. ...
Ms. Black has earned at least $4.7 million in cash and stock over two decades from serving on the boards of Coke, I.B.M. and iVillage, according to Equilar, a company that tracks corporate compensation, and her current stock holdings in those companies are valued at about $8 million.
The group asked: Should businesses with strong codes of ethics serve on the board of an organization that is attempting to rewrite anti-corruption laws and is engaged in partisan battles? The Chamber allocated about $50 million in the 2010 elections to unseat candidates who voted for healthcare reform and others. As Just Anti-Corruption first reported, the Chamber recently ramped up its lobbying efforts to tighten the Foreign Corrupt Practices Act.
"The Chamber recently has been an advocate of weakening the [FCPA] that addresses accounting transparency and concerns related to bribery of foreign officials," the group of investors, led by the Boston-based Walden Asset Management, said. "It is difficult to see how these positions are good for IBM or business generally." In an interview last week, Timothy Smith, who heads shareholder engagement at Walden, said that position is at odds with the company's corporate history. "From 25 years ago, IBM had a very strong policy on bribery and people would be fired if they tried," he said. ...
IBM agreed to pay $10 million last month to settle charges that it bribed government officials in China and South Korea with cash and gifts in exchange for computer contracts, in violation of the FCPA. Officials from IBM and Pepsi did not immediately respond to requests for comment.
In the firm's own words, the IDP is "the firm's signature experience for prospective hires interested in a career with PwC." Basically, here's how it works: the program is open to any PwC intern who gets a job offer by the end of their internship. (In that sense it's kind of like new hire training, except you don't get paid.) Those that accept are swept off to Disney in August, where they'll be "immersed in an experiential-based curriculum, which includes professional insights, learning, leadership training skills and personal enrichment sessions." ...
Interns also "have the opportunity to connect one-on-one with PwC partners," an opportunity that will have early career-schemers salivating at the chance to get ahead before the job has even started. 2400 of your fellow interns also make for good networking, and it never hurts to head into an entry-level job flanked by allies and new friends. ...
Best yet, PwC says that it plans to hire a solid 10,000 people in the US alone in 2011 (a 60 percent increase from 2010); 6,000 of these hires will hail from college campuses.
Just like anyplace there were sales reps that finished the year at 101% and others that drove to 180%. There was a "Golden Circle" to reward the best of the best. Sales plans tried to address this "end of year" drop off in sales by offering bonuses that grew with the more you sold. The hope was that the sales rep would be more excited about selling a machine in 4Q if it was worth a few hundred dollars more. Worked for some and didn't work for others.
Sales plans though drove what and when something was sold.
I will say I worked on a commission desk in one of my early jobs and I cut some really, really large checks for reps in January that knew how to work the sales plan and sell what IBM paid them to sell.
The real problem came in the '80s with the conversion from lease to purchase program. This took a stable, constant revenue stream where the sales reps lost commissions when a machine came out and replaced it with a "sell it now" philosophy. It also meant a time when quotas doubled year after year after year and I saw a lot of good sales reps leave the business for real estate because the numbers were simply unattainable.
And in sales if you don't make your number - you suffer.
A great paper was written by D. Quinn Mills, "The Decline and Rise of IBM" in the summer of 1996. It covers the effect of this strategy to be a "100 billion dollar corporation" by the '90s (have we gotten there yet?) It can be purchased through the Sloan Management Review web site.
I personally believe that this created the bag that John Akers got caught holding when he took over the CEO job. Again, not defending him or his actions (or lack thereof) but it is good to understand that a whole set of gears were set in motion before he ever took the job. Pete.
For many years IBM unions, including the Alliance, have worked together as a network of information and cooperation. The new Global Union Alliance, under the umbrella of the International Metalworkers Federation (IMF) and Union Network International (UNI) takes that network to another level and will include many more IBM unions. This past year new IBM unions have formed in Bulgaria, Chile and Argentina. In a statement from the IMF and UNI about the new Global Union to IBM unions:
As IBM has set itself up as a truly global company, trade unions also need to set up a truly global alliance cooperating to the maximum extent for the benefit of their members and IBM employees. This meeting creates an IMF/UNI Global Union Alliance at IBM of trade unions with members working for companies owned by IBM or companies in which IBM has a significant interest.
The purpose is to express the determination/commitment of trade unions at IBM to work together at global level based on shared values and objectives to strengthen communication and cooperation and to implement action coordinated by IMF/UNI global union.
The objectives are:
The partners of the Alliance will work together with the aim of protecting and furthering the interests of IBM employees throughout the world.
The partners will take concrete action to enlarge the network by improving contacts with unions in countries where employees are unionized and make every effort to organize unorganized plants/locations.
The Alliance@IBM looks forward to the forming of this new organization for IBM employees and their unions.
As many of you know, we have lost many members due to job cuts at IBM US.
Please help us build the American section of the new IBM Global Union Alliance. If you are not a dues paying member of the Alliance, please consider joining today at: https://afl.salsalabs.com/o/4004/donate_page/alliance-join
Development teams are being required to parcel out their project requirements as competitions on Liquid Portal. They must create specifications and run competitions rather than do the work themselves. The core development are then left to try to integrate the disjointed deliverables and deal with the continuous training and inefficiency that comes with the lack of continuity.
The ultimate plan will be to RA full time developers and allow them to return to compete for short-term assignments through Liquid Portal, which will eventually be an external application.
IBM does not want full time employees. Who remembers IBM Executive Tim Ringo and how he spilled the beans on this last year, boasting of crowdsourcing and the plan to eventually cut 299K employees? Well, Liquid Portal will be the primary tool used to displace full time IBMers worldwide. -Anonymous-
"Once you have registered in the IBM Liquid Challenge Portal and have successfully designed and/or programmed the specified component, IBM will notify you that your submittal was successful and accepted. Once this is done, ZeroChaos will send payment. Payments are issued with 15-20 days of successful completion, and range anywhere from $60-840 USD, minus applicable taxes and program fees, and depending on the component that was completed.
When accepting components in the Liquid Portal, you will see what the payment for the component will be. If your component is not successful, IBM may ask you to rework it and submit it. A component is payable only when approved and accepted by IBM. During the Enrollment Process, you will receive more instructions on how you will receive payment." -anonymous-
Re: laptop. You should give them the power on password, but you should also scrub the disk so that it's bare.
Re: executives getting laid off? It doesn't happen. It's a club. it takes 3 executives to sign off on you before you can become an executive. VP's listed in your RA sheet are for show. They either have a new position lined up a priori and will claim they found it in the 30 day period or they wanted to retire. -wow-
There is a total and complete disconnect between WALL STREET and MAIN STREET. What is good for Main Street (good wages, benefits and secure long term employment) is bad for Wall Street (higher cost of labor, higher bottom line, less bonus pay for executives and less dividends for stock holders).
The days when tax incentives to US companies would create US jobs is gone. That's why stimulus spending is not working,why tax breaks are not working and why American workers need to have employment contracts for their own protection.
As long as a company sells its goods worldwide and maintains buyers for its goods worldwide it does not care if one country cannot afford its goods because others can. The only companies that care if you are employed are the companies that MUST have your business to stay in business.
Do not fool yourselves that things will get better at IBM if customer service goes to hell. It will not. Nothing will improve if you do not force it to improve. This holds true for all companies playing in the global market . Every global alliance prints pinks slips for American workers.
By the way, the government cannot stop it because it is not illegal. It is in fact encouraged by the government. They foolishly think a strong global economy will create American jobs. It will instead create a vacuum for cheap labor to drive up profits even more.
Our government borrows money from China to give to unemployed Americans so they can continue to buy cheap goods made in China so China can afford to keep lending the US money. Its a death spiral for our economy. We need to organize and get employment contracts across America to insure Americans have jobs then force the Government to stop spending money they do not have. If we do nothing the death spiral will continue and America will go they way of Rome. Unions are good for America. -Exodus2007-
That is correct. Conversely, it is imperative that all labor protect itself on a global basis from the insane greed that has overcome IBM or else they will be come modern day slaves and disposable tools, damaged environmental outcasts for the new global business order. If unions are to succeed, they must cross boundaries and return to their old roots as protective guilds to craftsmanship. I applaud the move of unions to go global, but they should embrace the rising movement of individual craftsmanship and provide modern guild like services for the working class. One example is IBM's slave-like liquid portal. Do you think you have any rights to any residuals of your hard earned, forced lower priced labor? A good guild would provide legal advice to its members to protect them from liquid portal abuses. Let's get unions out of the 19th century mold and into the modern world of micro business and helping entrepreneurship! Now that would really scare IBM. -IBM is Greed Gone Insane-
If there is any doubt that our political system is controlled by an elite who is completely removed from the bulk of the population, this response to the Ryan plan ended it. There is nothing at all serious about the Ryan plan. It is a naked attempt to redistribute yet more money to the country's rich at the expense of everyone else.
In principle, the country's elite should be laying low right now. After all, their greed and ineptitude has given us the worst economic collapse since the Great Depression. But after getting the Wall Street banks back on their feet with trillions of dollars of government subsidized loans, the elite are once again making a full-frontal assault on the living standards of the middle class. Last week it was Medicare, but they promise to be back to attack Social Security in the not too distant future. ...
The ostensible rationale for this attack is the country's huge budget deficit. This is garbage. As all the pundits know, the country has a huge deficit today because the Wall Street boys drove the economy off a cliff. If the government deficit were not propping up the economy, we would be looking at 11 or 12 percent unemployment, rather than 8.9 percent. Spending creates jobs, and at this point, it is not coming from the private sector, so the government must fill the hole.
How much more? Calculations derived from the C.B.O. analysis show that in 2022, when the Ryan plan would kick in, the typical 65-year-old would pay $6,400 to $7,000 more per year than would be paid for comparable coverage under traditional Medicare. ...
But the C.B.O. says a private plan offering comparable benefits would be a lot more expensive than traditional Medicare because the private insurer would have higher administrative costs, would need to make a profit and, in an extrapolation of current trends, would pay hospitals, doctors and other providers substantially more than Medicare does. Beneficiaries would have to pay higher out-of-pocket costs or buy skimpier policies.
Assuming the Tea Partier gets his way and sees Ryan's budget enacted, it would certainly be one of the happiest days of his life, with "liberty" winning out over the hated "guv-mint." Along with Ryan's $4 trillion in domestic spending cuts, the detested "Obamacare," with all its red tape restricting the freedoms of the insurance companies, would be gone, too.
Then, let's dial ahead a decade or so when the activist is reaching retirement age. Let's assume he was lucky enough to have had a job that offered health insurance, which enabled him to handle his diabetes and to get his wife treated for her cancer.
But now he is heading off into the cherished "free market" with what amounts to an $8,000 government voucher to buy health insurance.
The only problem is that $8,000 doesn't get you very far with the private insurance companies, whose principal responsibility – as any Ayn Rand fan knows – is to return a hefty profit to shareholders. For someone over 65 with a checkered health history, the insurance companies won't exactly be lining up to take on his business.
The Tea Partier can expect to pay – on top his $8,000 government "premium support" – perhaps $1,000 a month or more, along with a hefty deductible, perhaps another $5,000, and after that, co-pays. Plus, since thankfully Obamacare was repealed by Congress (or struck down by Republican justices), the insurance companies don't have to cover any of those pesky preexisting conditions.
So, his diabetes drugs are excluded. And if his wife's cancer flares up again, that treatment would have to come out of his pocket as well.
Plus, since the insurance companies were liberated from Obamacare's oppressive regulations requiring that 80 percent or so of premiums go to actual health care, the industry will have every right to short-change its customers, while paying fat salaries to top executives and enjoying lavish corporate perks.
And, as happened to pretty much everyone in America, the Tea Partier's employer would have dumped the old-fashioned pension plan, replacing it with a skimpier 401(k) policy. So, there's only a small pot of money that he managed to squirrel away, along with a modest stipend from Social Security. ...
Our Tea Partier will face another indignity. Despite his personal sacrifices, he won't even have the pleasure of knowing that the federal budget is finally in balance and the national debt is getting whittled down. That's because while Ryan's 2012 budget got rid of Medicare for people who were then 55 or younger, much of the savings went to reducing the tax rates for millionaires and billionaires, to 25 percent from 35 percent, the lowest rate since the early days of the Great Depression. ...
Ryan's 2012 proposal doesn't envision balancing the budget for almost 30 years. So, as the Tea Partier hobbles through his late 60s, suffering through insurance-induced poverty and anticipating an early death, the prospect of the government having its fiscal house in order will still be a hazy future promise, maybe a decade or more still to go. ...
The Tea Partier, however, will be able to take some solace in knowing that he contributed to the luxury of the moneyed interests and multinational corporations. Freed from government rules and enjoying historically low tax rates, the rich will be the nation's new royalty, able to hire servants at sub-minimum wage (since, thank goodness, those oppressive wage laws would be repealed, too).
"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.
Government spending needs to be brought under control. But slashing vital services just to pay for more tax cuts is bad public policy and bad economics. It won't fix the deficit, no matter what the Republicans claim.
We've seen this play before. President Ronald Reagan promised that tax cuts would spur more economic growth and pay for themselves. During his tenure, the deficit hit what was then a peacetime high of 6 percent of gross domestic product, and he eventually decided that he had no other alternative but to raise taxes to try to close the gap.
The Clinton years disproved the notion that higher taxes would inevitably stifle economic growth, or cost politicians their jobs. Taxes were raised in 1993, including higher income tax rates on the wealthiest. The economy was strong, and the stock market surged. Taxes were then cut in 1997 in a deal with the Republican-controlled Congress, but by then the combination of higher tax rates on the wealthy, a strong economy and a rising stock market was boosting revenues significantly.
By the end of President Bill Clinton's term, the federal budget had been in surplus for four straight years.
President George W. Bush and Congress undid that progress with $1.65 trillion in tax cuts, heavily skewed to high earners. The economic recovery of the Bush years was extraordinarily weak by historical standards. By early 2009, shortly before Mr. Obama took office, the Congressional Budget Office projected a budget deficit for that year of more than $1 trillion.
These are the economic facts, which Americans need to hear. The Republicans certainly won't tell anyone. And, so far, the Democrats haven't had the political courage to challenge them head-on. ...
As a matter of fairness, raising income taxes must start with requiring the richest Americans — who have been the biggest beneficiaries of Bush-era tax cuts — to pay more. But even that won't dig the country out of its hole. The middle class is also going to have to pay higher taxes. That is the only way to pay for needed services, tackle the deficit and slow the borrowing and the rise in interest payments. ...
Here are a few more numbers to consider: Stimulus spending since Mr. Obama took office — including tax cuts — accounts for about $600 billion of the current $14.2 trillion in accumulated debt. The Bush-era tax cuts coupled with major new spending for two wars and a Medicare drug benefit, have added $3.2 trillion to the debt. Mr. Obama must make the case for tax increases, based on reality, not ideology. Then, and only then, can a serious debate on the deficit begin.
How rich are we?
Just take a look at the latest reports on what the top hedge fund managers haul in. In 2010 John Paulson led the list with a record $4.9 billion in personal earnings. That's a whopping $2.4 million an HOUR. Here's a factoid to make you wretch: It would take the median US household over 47 years to earn as much as Paulson pocketed in just 60 minutes. And, every hedge fund manager pays a lower tax rate than the average family.
The top 25 hedge fund earners took in $22.07 billion in 2010. Thanks to a generous tax loophole these billionaires will pay a top tax rate of 15 percent instead of 35 percent. Closing that loophole on just those 25 individuals – just 25 guys who wouldn't miss a penny of it -- would raise $4.4 billion, which is enough to rehire 126,000 laid-off teachers.
Extending the Bush tax cuts "would result in a $200 billion to $300 billion cost to the US Treasury compared to what had been expected" in one year — or $100 to $150 billion in six months. So while they very nearly shut down the government to extract painful spending cuts, Republicans had already wiped out those spending cuts many times over with the revenue lost from extending the Bush tax cuts.
Well, consider this: in the 1940s, corporations paid 43 percent of all the federal income taxes collected in this country. In the 1950s, they picked up the tab for 39 percent. But by the time the 1990s rolled around, corporations were paying just 18.9 percent of federal income taxes, and they forked over the same figure in the first decade of this century. We – working people – paid the difference. ...
The shift of all these taxes from corporations to individuals and families has been pushed with the help of a Big Lie – growing from a small kernel of truth – told by corporate America, its lackeys in Congress and the media it dominates just about every day: that American companies face some of the highest taxes in the world.
The kernel of truth is that, at 35 percent, we do have one of the highest statutory corporate rates in the world – that is, the rate that's written down in the tax code. But what's written in the tax code is inconsequential compared to the number written on checks sent to the IRS.
What US companies actually pay in taxes is among the lowest figures in the developed world. The effective tax rate is what companies actually fork over. As the non-partisan Center for Budget and Policy Priorities (CBPP) explained, the 35 percent rate the corporate mouthpieces on CNBC are always whining about "does not take into account the generous depreciation rules, exemptions, deductions, and credits (some of which are sometimes termed 'loopholes') that corporations may be eligible for." ...
Take all of this together, and the U.S. ranked 28th out of 30 countries in the Organization for Economic Cooperation and Development (OECD) (which includes most of the world's leading economies) in terms of the share of the economy corporations pay in income taxes. At 1.8 percent, our government actually collects around half of the OECD average (PDF).
Now ask yourself how many times you've encountered some talking head on a cable news show blathering on about how we need to cut taxes on corporations or they'll move jobs overseas. And then consider this: between 1999 and 2008, while corporations paid about half of the OECD average on their profits, U.S.-based multinationals jettisoned a net total of 1.9 million workers here at home while creating 2.3 million net jobs overseas.
Today, Americans are working harder and earning less while corporate profits soar. As homeowners, consumers and students we see our wealth being stripped away by banks. Our government plunges into debt waging trillion-dollar wars. Meanwhile, our infrastructure erodes and climate change proceeds unchecked. Schools, daycare centers, senior citizen facilities, clinics, parks and firehouses are starved for funds so that corporations and the rich can get billions in tax breaks!
Corporate America's unprovoked assault on working people has been carried out by manufacturing a need for fiscal austerity. We are told that there is no more money for essential human services, for the care of children, or better public schools, or to help lower the cost of a college education. The fact is that big banks and large corporations are hoarding trillions in cash and using tax loopholes to bankrupt our communities.
Spending on social needs is not the reason governments at all levels are facing massive budget short falls. Our debt and deficit problems are a direct result of corporate tax rollbacks, and the extortionist policies of banks and financial institutions that are engaged in a coordinated and massive wealth transfer from the American people to their own coffers.
In particular, the original voodoo proposition — the claim that lower taxes mean higher revenue — is still very much there. The Heritage Foundation projection has large tax cuts actually increasing revenue by almost $600 billion over the next 10 years.
A more sober assessment from the nonpartisan Congressional Budget Office tells a different story. It finds that a large part of the supposed savings from spending cuts would go, not to reduce the deficit, but to pay for tax cuts. In fact, the budget office finds that over the next decade the plan would lead to bigger deficits and more debt than current law. ...
And then there's the much-ballyhooed proposal to abolish Medicare and replace it with vouchers that can be used to buy private health insurance. The point here is that privatizing Medicare does nothing, in itself, to limit health-care costs. In fact, it almost surely raises them by adding a layer of middlemen. Yet the House plan assumes that we can cut health-care spending as a percentage of G.D.P. despite an aging population and rising health care costs.
The only way that can happen is if those vouchers are worth much less than the cost of health insurance. In fact, the Congressional Budget Office estimates that by 2030 the value of a voucher would cover only a third of the cost of a private insurance policy equivalent to Medicare as we know it. So the plan would deprive many and probably most seniors of adequate health care.
Rep. Paul Ryan's budget proposal is a real "roadmap to ruin" for both low-income and middle-class people. It catastrophically weakens the safety nets that seniors and other economically vulnerable people depend on for their basic needs, and it does the same to the stepping stones that millions of people depend upon to aid their climb up the economic ladder. At the same time, it would lock in lower tax rates for the wealthiest individuals and corporations, and would take insufficient steps toward ending billions in tax giveaways to corporations and the super-rich.
Two-thirds of the program cuts in the budget—roughly $3 trillion—come from programs that directly benefit low-income (and some middle-income) Americans. But the financial impact on households would be even broader.
Health care—On health care, Ryan's budget plan would push rising health care costs onto those least able to afford them – the elderly, the disabled and the poor. It would do nothing to curb the rising costs imposed by the powerful complexes – insurance and drug companies, private hospitals – that now force Americans to pay twice as much for health care, while experiencing worse health outcomes, than people of any other industrial nation. And because at the heart of its health care proposals is the repeal of the health care reform passed in 2009, consumers lose the considerable benefits and deficit reduction that resulted from that law. ...
Higher education—For working-class and middle-class families expecting to send children to college, the Ryan plan's cuts to Pell grants would put an affordable college education out of reach of significant numbers of college students. ...
Tax policy—Under the Ryan plan the Bush-era tax cuts for people earning more than $250,000 a year, extended through 2012, would be locked in permanently. That alone costs $700 billion over 10 years, according to the Center for Budget and Policy Priorities. Undoing the estate tax break that was cut last December that meant lower taxes for the wealthiest one-quarter of 1 percent of Americans when they transfer their estates would save tens of billions of dollars. ...
Impact on jobs—Rep. Ryan makes the assertion that his budget "creates nearly 1 million new private-sector jobs next year, brings the unemployment rate down to 4 percent by 2015, and results in 2.5 million additional private-sector jobs in the last year of the decade." This claim, based on a paper from the right-wing Heritage Foundation, should be laughable based on the failure of the George W. Bush administration to create jobs through top-end tax cuts and corporate deregulation, a failure that led the Wall Street Journal to label his presidency as having the "Worst Track Record On Record" on jobs. ...
Middle-class households have been clear that they want Congress to act on the deficit—and they have been explicit in poll after poll about how they want Congress to proceed toward that goal: End the tax giveaways to the wealthy, invest in such job-creating activities as upgrading our transportation network, improve our schools and keep college affordable, and foster the growth of new industries that will produce jobs with solid middle-class wages in America. Rep. Paul Ryan's budget path leads us away from prosperity in all of these areas.
In an era of insecurity, we all want security. We want a decent home to call our own, healthcare to heal us when we are sick or old, education to improve our minds and job prospects, healthy food and clean water to nourish us, income to provide for all our needs and even some affordable luxuries, a career to give us social status and a sense of self-worth, and a pension for our golden years.
These seemingly universal desires define the post-WWII American Dream, and are still the reference point for both left and right. The "Golden Age of American Capitalism" from the mid-1940s to the early 1970s is commonly seen as the triumph of the middle class, a time when the fruits of a robust capitalist economy extended to tens of millions.
But today we are trapped in the fault lines of a violent global economy, and these dreams seem as archaic as waking up at dawn with the grandparents, children and cousins to milk cows, bake pies and plow fields. ...
The contention that the middle class is suddenly under attack – and by implication should be defended – is thoroughly flawed. For one, this trend goes back more than 30 years to the savaging of private-sector unionism and the social welfare state combined with deregulation, reloaded militarism and tax breaks for the rich. The current attack on public-sector unions and the remnants of welfare is just the latest stage.
Paradoxically, nothing makes the need for a tax increase more clear than the Republican budget proposal crafted by Representative Paul Ryan. The Republicans propose slashing spending far more than the public would probably accept — even dismantling Medicare — and rely on economic assumptions that are not merely rosy, but preposterous. Yet even so, the Republican plan shows continuing budget deficits until the 2030s. In short, we can't plausibly slash our way back to solid fiscal ground. We need more revenue. ...
In truth, both parties have been wildly irresponsible, but in cycles. Democrats were more irresponsible in the 1960s, the two parties both seemed care-free in the '70s and '80s, and since then the Republicans have been staggeringly reckless.
After the Clinton administration began paying down America's debt, Republicans passed the Bush tax cuts, waded into a trillion-dollar war in Iraq, and approved an unfunded prescription medicine benefit — all by borrowing from China. Then-Vice President Dick Cheney scoffed that "deficits don't matter."
This borrow-and-spend Republican history makes it galling when Republicans now assert that deficits are the only thing that matter — and call for drastic spending cuts, two-thirds of which would harm low-income and moderate-income Americans, according to the Center on Budget and Policy Priorities. To pay for tax cuts heaped largely on the wealthiest Americans, Republicans in effect would gut Medicare and slash jobs programs, family planning and college scholarships. Instead of spreading opportunity, federal policy would cap it. ...
Ever since Walter Mondale publicly committed hara-kiri in 1984 by telling voters that he would raise their taxes, politicians have run from fiscal reality. As baby boomers age and require Social Security and Medicare, escapism will no longer suffice. We need to have a frank national discussion of painful steps ahead, and since I'm not a politician, let me be perfectly clear: raise my taxes!
"The report pulls back the curtain on shoddy, risky, deceptive practices on the part of a lot of major financial institutions," Mr. Levin said in an interview. "The overwhelming evidence is that those institutions deceived their clients and deceived the public, and they were aided and abetted by deferential regulators and credit ratings agencies who had conflicts of interest." ...
The report adds significant new evidence to previously disclosed material showing that a wide swath of the financial industry chose profits over propriety during the mortgage lending spree. It also casts a harsh light on what the report calls regulatory failures, which helped deepen the crisis.
"There's nothing serious about a plan that claims to reduce the deficit by spending a trillion dollars on tax cuts for millionaires and billionaires," the president continued, as Mr. Ryan sat stone faced. "There's nothing courageous about asking for sacrifice from those who can least afford it and don't have any clout on Capitol Hill." ...
The president agreed to extend the cuts last December, as part of a budget deal with the newly elected Republican majority in the House. Now, with the economy getting back on its feet, Mr. Obama attacked the demand by Republicans to make the lower tax rates permanent as emblematic of their plan to enrich the wealthy on the backs of the elderly and poor. "They want to give people like me a $200,000 tax cut that's paid for by asking 33 seniors to each pay $6,000 more in health costs? That's not right, and it's not going to happen as long as I am president," Mr. Obama said, his only line that drew applause.
Credit rating agencies are supposed to provide independent assessments on the quality of debt being issued by companies or governments. Traditionally, investments rated AAA had a probability of failure of less than 1 percent. But in collusion with Wall Street investment banks, the Senate report concludes, the top two ratings agencies — Moody's Investors Service and Standard & Poor's — effectively cashed in on the housing boom by ignoring mounting evidence of problems in the housing market.
"Instead of using this information to temper their ratings, the firms continued to issue a high volume of investment-grade ratings for mortgage backed securities," the report said. Profits at both companies soared, with revenues at market leader Moody's more than tripling in five years. Then the bottom fell out of the housing market, and Moody's stock lost 70 percent of its value; it has yet to fully recover. More than 90 percent of AAA ratings given in 2006 and 2007 to pools of mortgage-backed securities were downgraded to junk status.
Then people who actually understand budget numbers went to work, and it became clear that the proposal wasn't serious at all. In fact, it was a sick joke. The only real things in it were savage cuts in aid to the needy and the uninsured, huge tax cuts for corporations and the rich, and Medicare privatization. All the alleged cost savings were pure fantasy.
On Wednesday, as I said, the president called Mr. Ryan's bluff: after offering a spirited (and reassuring) defense of social insurance, he declared, "There's nothing serious about a plan that claims to reduce the deficit by spending a trillion dollars on tax cuts for millionaires and billionaires. And I don't think there's anything courageous about asking for sacrifice from those who can least afford it and don't have any clout on Capitol Hill." Actually, the Ryan plan calls for $2.9 trillion in tax cuts, but who's counting?
And then Mr. Obama laid out a budget plan that really is serious. ...
And the hissy fit — I mean, criticism — the Obama plan provoked from Mr. Ryan was deeply revealing, as the man who proposes using budget deficits as an excuse to cut taxes on the rich accused the president of being "partisan." Mr. Ryan also accused the president of being "dramatically inaccurate" — this from someone whose plan included a $200 billion error in its calculation of interest costs and appears to have made an even bigger error on Medicaid costs. He didn't say what the inaccuracies were.
Crediting "tough, responsible decisions," which include allowing the Bush-era tax cuts to expire, and increasing other tax-based revenue, the CBC claims its budget will save $5.7 trillion on the deficit.
Of course, both parties favor the permanent extension of most of those tax cuts — the ones applying to income below $250,000. Both parties also oppose big cuts to the military, Social Security and Medicare, at least in the short term. Unfortunately, the deficit is likely to remain frighteningly large over the next decade without either cuts to those programs or tax increases.
Taxes have decreased dramatically for most American households since Ronald Reagan came to office 30 years ago. But our overall level of taxation, on average, obscures who's paying how much.
So, on this tax day, let's take a look at the way federal tax rates for different income levels have changed since 1981 (using this handy calculator and adjusted for inflation to 2010 dollars). ...
If you make $50,000, your federal income taxes would have declined by 19 percent, from $10,710 to $8,625. ...
Someone making a really good living that brought in $250,000 would pay 47 percent less – that person's federal income tax bill dropped from $126,953 in 1981 to $67,398 today. ...
If you brought in a half-million dollars, your tab would have dropped by 49.5 percent, saving you around $150,000. It's about the same decrease for someone making a cool million. ...
These figures only consider taxable income, and the super-wealthy avoid paying their share of taxes through a variety of loopholes that decrease their adjusted income – the amount subject to taxes. But looking just at the rate-changes, a person making $10 million would have seen his or her tax bill drop by 50.4 percent. ...
It also found that those in the bottom 80 percent of the earnings ladder paid around 9 percent of their incomes in Social Security taxes; the top one percent paid just 1.6 percent of theirs. After the income tax, payroll taxes represent the largest share of the federal take — those dollars represent a much bigger piece of the pie than corporate income taxes or taxes on capital gains. ...
So the dirty secret is that we really have a flat tax. That's the conclusion of a 2007 study by Boston University economists Laurence J. Kotlikoff and David Rapson, who found that when you add it all up — state and local taxes, federal taxes and excise fees – "The average marginal tax rate on incomes between $20,000 and $500,000 is 40.3%, the median tax rate is 41.8%, and the standard deviation of all of those rates is 5.3 percentage points. Basically, most of us pay about 40%, plus or minus 5.3 percentage points."
Ah, how very quaint such sentiments now seem in retrospect. Weren't those just the days, back when even Republicans sorta had a heart with a detectable pulse? Now we live in a very different place. It is a place of destruction and despair. An abattoir where the little people go - all 99 percent of the country, let alone the fully dispensable "human resources" found outside our borders - to be sacrificed on the altar of unparalleled greed.
But that's just the beginning of the story. We'd be in bad enough shape if it were only Republicans out to destroy us. Then there's the "Democrats", including the "socialist" leader of the party, Barack Obama. If we're remotely honest about it, we'd have to acknowledge that today's Obama, the former anti-war community organizer, is to the ideological right of yesterday's Dwight Eisenhower, former five-star general, leader of the Normandy invasion, commander of NATO and head of the Republican Party. As today's worst elements of the Republican Party (that is, almost all of them) seek to do exactly the things that Eisenhower called "stupid", there is Obama, facilitating their efforts. ...
The current budget brouhaha is only the most recent and obvious example of this political pathology par excellence. Think about it. Here's the real version of what has happened: A decade ago, the United States had the greatest budget surplus ever recorded in human history. Then the regressives came to power. They quickly slashed tax revenues, especially from the rich, borrowing like crack addicts in order to pay for their profligacy. They meanwhile spent gigantic sums on wars based on lies, on hugely increased military spending apart from the wars, on a new Medicare benefit which they insisted on setting up in a way that massively benefitted insurance and pharmaceutical corporations rather than the federal treasury, and on general pork barrel spending, thus driving the national debt up dramatically further, and creating the world's greatest ever deficits. Let me repeat, it was the GOP who did this. Now these very same people are falsely claiming an electoral mandate to slash spending, screaming that borrowing is an urgent problem which must be addressed at all costs. At the same time, they continue each year to further slash revenues coming in to the government, massively exacerbating the very problem they claim to desperately want to solve.
He (Paul Ryan) this week released a ten-year plan that is, in fact, astonishing for how cowardly and dishonest it is. It slashes almost every form of domestic spending imaginable, dramatically cuts Medicare for seniors, and turns control of Medicaid over to the fifty states, each of whom can of course then do whatever they want with it. Most amazing of all, while this entire draconian meat-axe of a budget proposal is predicated on the urgent necessity of slashing deficits, Ryan's plan would gut revenues to the government by lopping almost 30 percent off of top individual and corporate tax rates, taking the top rate down from 35 percent to 25 percent. No wonder, then, that the non-partisan Congressional Budget Office has calculated that Ryan's plan would actually increase deficits, the direct opposite of the very rationale that supposedly justifies its existence. ...
None of this is random, however. This has been a three decade long process to produce that which our unparalleled greedy rich have craved the most, namely, a return to the good old days when they had everything and the rest of us had nothing. They have been indignant at the very notion of the slight bit of economic egalitarianism America managed to maintain for a couple of generations. They sat on their hands, gnashing their teeth, from the 1930s through the 1970s, because they had to, but now they've come back with a vengeance.
Exporting jobs, slashing government programs, moving tax burdens, bankrupting the government, breaking unions, coopting Democrats, creating bogus news media, dumbing down education, fabricating scary bogeymen, stealing elections. It's all there, man.
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