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6, 2000 April, 2000

Highlights—May 7, 2011

  • Yahoo! News: IBM Chairman Samuel J. Palmisano Named 'CEO of the Year' by Webster University's Walker Business School. Excerpt: Sam Palmisano, chairman of the board, president and chief executive officer of IBM, has been named the 2011 "CEO of the Year" by Webster University's George Herbert Walker School of Business & Technology. Palmisano was on hand at Webster on April 26 to deliver a lecture, "A Business and Its Ideas: Shaping a Company and a Century," discussing the lessons IBM has learned over the past 100 years. IBM will celebrate its centennial anniversary on June 16. Past recipients of Webster's "CEO of the Year" award include Jack Dorsey, creator and co-founder of Twitter; Ed Whitacre Jr., former CEO of General Motors and AT&T Inc.; and Hugh Grant, CEO of Monsanto Co.
  • Yahoo! IBM Employee News message board: "Improper Denial of Overtime Compensation to IBM Call Center Employee" by "rigrodskylong". Full excerpt: Rigrodsky & Long, P.A. is presently gathering evidence that former IBM Call Center employees were required to work uncompensated overtime by, among other things, arriving before their scheduled start time to boot-up computers, or engage in other preliminary tasks necessary for the performance of their daily duties, for use in the litigation Maloney, et al. v. International Business Machines Corp., 3:10-CV-15599-P, which is presently pending in the United States District Court for Southern District of Texas. In this lawsuit, Plaintiffs seek to recover the unpaid overtime compensation to which they are entitled under the Fair Labor Standards Act on behalf of themselves and all other similarly situated IBM Call Center employees. Plaintiffs are presently seeking to have the Court conditionally certify a class of similarly situated IBM Call Center employees to allow this litigation to proceed as a collective action.

    If you are a former IBM Call Center employee and are willing to provide a statement that you were required to work in excess of 40 hours per week at an IBM Call Center by arriving before your scheduled start time to boot up your computer or, perform other preliminary tasks necessary for the performance of your daily duties, please contact Timothy J. MacFall, Esq. or Scott J. Farrell, Esq. at (516) 683-3516.

    Rigrodsky & Long, P.A., with offices in Wilmington, Delaware and Garden City, New York, regularly litigates securities class, derivative and direct actions, shareholder rights litigation and corporate governance litigation, including claims for breach of fiduciary duty and proxy violations in the Delaware Court of Chancery and in state and federal courts throughout the United States. Attorney Advertising. Prior results do not guarantee a similar outcome.

  • Yahoo! IBM Pension and Retirement Issues message board: "Re: Next years Fed tax" by "Tony". Full excerpt: On 4/30/2011 11:00 AM, mel_zimowski wrote: IBM managers are currently squeezing every ounce of productivity that they can from their employees. From a current employees perspective - what they are getting in a lot of cases is the "Appearance of Productivity" rather than true productivity. A lot of what has been cut in the last 10 - 15 years is the focus on quality, complete testing prior to releasing a product, less serviceability, proper training to enable staff to do their jobs effectively. Having to handle problems and rework is NOT productive but people are working hard at it. Having to learn a product or system on the fly while working on a project is not effective use of people's time.

    Many people are spending 50 - 70 hours a week working a lot of hours to impress their boss to get a high rating when the work that they are actually doing is of little overall value to their team and the company. Many field technical people are spending weeks trying to retrofit solutions that were not sold or designed properly to begin with with products that are not fully integrated or tested.

  • Yahoo! IBM Pension and Retirement Issues message board: "Re: Next years Fed tax" by "Kady". Full excerpt: This is also my impression and experience, but it's not just QA and rework; it's micromanagement. In the case of sales, when individual transactions down to 250K are being scrutinized at the VP level, it requires additional cadence calls and data entry into more than one tracking system to manage at that level of detail. The first line person being thus managed ends up working an additional X hours a week not doing any extra work, but merely keeping up with the additional reporting requirements.
  • Yahoo! IBM Pension and Retirement Issues message board: "Re: Next years Fed tax" by "Tony". Full excerpt: Oh you got that right.... I have never seen micromanagement at this level before. By people that really are convinced they know what the heck they are doing. A negative management style is starting to be pervasive. Rather than reward good behaviors they hope that by making things difficult and punishing people that do not measure up the troops will be more effective.
  • Yahoo! IBM Pension and Retiree Issues message board: "Re: Next years Fed tax" by "thirtyyearibmer". Full excerpt: Kady, good to hear the "sales perspective."

    I would add to this the fact that the current management is financially driven only. They fail to understand the impact of small decisions on 300,000 employees. (one of my sayings is that 300,000 times any number is a large number) For instance, from a sales perspective, they no longer allow Microsoft Office on new laptops. Much of sales and development is now locked into Lotus Symphony even though it works with nothing in the market place today.

    One story I would like to relate is about a sales rep that sent a symphony document (*.odp) in response to a customer proposal and the customer responded "Did you send me a virus? What is an odp file." After explaining that the customer needed to get "free" software to see the IBM proposal, they responded, "I don't have time for such nonsense. My time is not free!"

    The sales rep, being a better rep, went and bought the software with his own money to get the deal on the table. The maxim, "penny wise, pound foolish" comes to mind and shareholders should not be saying, "great results" but rather asking "could results be even better if we had 300,000 employees working as a team with management?"

  • Yahoo! IBM Pension and Retiree Issues message board: "Re: Next years Fed tax" by "teamb562". Full excerpt: I believe you nailed this one Tony. I'm an over 30 year employee. I still work in the "quality" world. I know no other way and is how IBM programmed me. My peers love me, management not so much. I got a 3 this year because of this. I'm told to "play the game". I am non-political and just want to provide quality products for our customers. My manager said don't worry about quality, only worry about problems the customer will find (I got out my crystal ball).

    This overall strategy seems very short-term focused and probably won't end well. I keep thinking there is some corporate strategy behind this new model. I can't help to think it has something to do with making the remainder of IBM US fail to justify more off-shoring, or something along that thinking. To say the least it's very disheartening. Most days have become a struggle. Thanks for surfacing.

  • Yahoo! IBM Pension and Retiree Issues message board: "Calculating number of IBMers affected by initial 1999 Pension Plan change" by "thirtyyearibmer". Full excerpt: I was recently contacted by a group of students working on a MBA project at the Chicago School of Business. (thanks to whoever posted the link to my website off the ibmemployee.com web site - you do make a difference) I have spent a few hours on the phone discussing Lou Gerstner's book "Who Says Elephants Can't Dance?" I would like to start turning around Lou's executive-only perception of history. Little victories like getting in front of our future corporate leaders will help eventually.

    The group is working on a project on Corporate Strategy and Transformation. I would like to offer them hard data on the number of people within IBM affected by the initial announcement in 1999 as Lou says in his book that "some of these benefits changes created a great furor among a small group of IBM employees." I have given them my anecdotal insight into what I saw with not just employees but executives within the business. I have sent them the link to the UK employees burning their Quarter Century Club certificates to get them to understand it was more than a "small group of IBM employees" and the impacts have continued worldwide ever since.

    At one time, I think someone documented from hard data an "estimate" of the number of US employees affected by this announcement by "2nd choicers and no choicers." Does anyone have that data in a format that I can use with them? As a disclaimer, it will also probably show up in my second book as these types of interviews are helping greatly in getting that completed by fall. Cheers, Pete.

  • Yahoo! IBM Pension and Retiree Issues message board: "Re: Calculating number of IBMers affected by initial 1999 Pension Plan change" by "madinpok". Full excerpt: Here is a link to my post from last year where I estimated the number of employees who were affected by the pension plan changes. http://finance.groups.yahoo.com/group/ibmpension/message/69331. (Editor's note: Following is the full text of "madinpok's" original post:
    Go to the files section of this group and look at the Form 5500 Data. Open the file "IBM Pension Statistics 1999-2007-3.xls" and select the 1999 tab. You'll have to do some work to figure out which employees fell into the various groups (First Choicers, Second Choicers and No Choicers).

    My quick look at this data says that there were about 78,000 employees who were forced into the C-B plan (the No Choicers).

    It also looks like there were about 34,000 Second Choicers. Although most of them probably chose to stay with the old (PCF) pension plan, they still got hurt on retiree medical benefits by being forced into the FHA medical plan. In many cases, being forced into the FHA plan will cost them $80,000 or more over their lifetime.

    And don't forget the pension changes that were made in 1995. This reduced the pension of someone who worked for 30 years from 40% of final average salary to around 30% - a 25% reduction in their pension check!

  • Yahoo! IBM Pension and Retiree Issues message board: "Re: Statistics on Number of IBMers affected by 1999 Pension Plan Changes". Full excerpt: Madinpok, thanks for the reply. Just in reply so you know I did something with the numbers, eh?

    So when the 1999 announcement was made it appears the changes affected greater than 85% of the IBM United States population or approximately 121,000 people.

    After "no small furor", an option was given to a group of individuals that were over the age of 40 and had more than 10 years service with IBM. This brought in another 32.2% of the IBM United States population but they received an FHA in place of the medical plans.

    This still left approximately 53% or more than 75,000 people in the IBM United States population with a changed retirement and no medical plan. Some of which were my friends that were 35+ years of age with greater than 15+ years of IBM service. Promises made to a 20 something broken 17 years later with family and kids.

    Just FYI, this is a work in progress, a short section of which responds to Gerstner's statement in "Who Says Elephants Can't Dance" that the announcement was met with a "great furor among a small group of IBM employees…"

    I guess I was one of that "small group" as I got weekly calls from Lloyd Doggett's staff... he has earned my vote just like Jake Pickle before him because of service to their constituents.. I wish more would have been accomplished.

    Thanks to you and for everyone's support on this forum and Kathi's run at getting it taken to the Supreme Court. An amazing accomplishment! Thanks again. Cheers.

  • Yahoo! IBM Pension and Retiree Issues message board: "Re: Statistics on Number of IBMers affected by 1999 Pension Plan Changes" by Art Vandalay. Full excerpt: By the way, I am not sure if we will ever know the true reason for why IBM included the 2nd chancers (or choicers). I still feel the town halls we had in a few cities might have been the final straw to make IBM rethink their overall decision.

    The fact that union representatives showed up (I know they were not invited to the Dallas meeting, but showed up any way), probably also caused concern for IBM. The bad press they were getting and the political pressure from Sanders and Jeffords also likely contributed to come up with a compromise.

    I also believe that the programmer in Austin who sent out the detailed note about how much money he was losing (to Gerstner) and copied the IBM world also had a major impact. IBM might have underestimated our use of technology for communication.

  • Yahoo! IBM Pension and Retiree Issues message board: "Re: Statistics on Number of IBMers affected by 1999 Pension Plan Changes" by Bob Nelson. Full excerpt: I was attending a technical conference in Poughkeepsie when the second choice was announced to us by an IBM VP. He said IBM had reexamined the pension changes and had found that some folks were unfairly effected and IBM, out of the goodness of their heart, was making an adjustment. One of the guys had the guts to ask him why a proper evaluation hadn't been done in the first place.

    I had been spending quite a bit of time on Pok. The place was in revolt. There were planes flying overhead towing banners asking "Who stole your pension." I think the internet played a part. It allowed the far flung IBM workforce to connect. I think that IBM was afraid of unionization and rightly so.

    I was fortunate. When the first pension cut came along, I was within 5 years of retirement and I was grandfathered in to the old plan. Then I was a first choicer and opted for the old old plan. Regards, 73, Bob Nelson, K2QPN, IBM 1967-2005, ITS NE Area Technical Support Staff.

  • Yahoo! IBM Pension and Retiree Issues message board: "Re: Statistics on Number of IBMers affected by 1999 Pension Plan Changes" by Tom Logan. Full excerpt: I think the splitting of the groups had more to do with divide and conquer than anything related to fairness. By carefully splitting the herd, they lowered the outcry and still minimized their expenditure to a point far below what is would have been without doing anything. If you notice, every time they change anything related to retirement - they screw one group at a time. Another piece of the retirement cuts are the continuous, ever increasing payments that are required for heath insurance for retirees. Regards, Tom.
  • Yahoo! IBM Pension and Retiree Issues message board: "Re: Statistics on Number of IBMers affected by 1999 Pension Plan Changes" by "poconos05". Full excerpt: To add to what Rick said, all of the second choicers were also at least 40 at the time of the conversion, thus in a protected group. IBM again wanted to defuse the lawsuits. Why IBM didn't realize this before announcing the original plan conversion we'll never know unless one of the plan architects finally breaks his/her silence, but I'll lay odds that they thought none of the little people could add 2 and 2 together on their own.

    Most of the second choicers had no clue that they should have continued to fight on for better medical coverage than the FHA. Only as they finally think of retiring do they now begin to learn how much they lost.

    I was hired in 1973. Even though I was shafted by the 1995 retirement plan changes (my 5-1/2 year long pension wear away ended only 12 months before I retired -- thank you IBM!), I consider myself lucky that I have the old medical even if not the pre-1995 'old' pension. -Lyn

  • Yahoo! IBM Pension and Retiree Issues message board: "Re: Statistics on Number of IBMers affected by 1999 Pension Plan Changes" by "madinpok". Full excerpt: The S&E (Service and Earnings) plan most certainly did NOT cap your annuity at 30% of average pay (really final average salary). The 1991 changes to the plan capped the years of service at 30 years. But then that gets multiplied by 1.35% of your final average salary. So the real cap under the S&E plan was 40.5%. (And, in fact, people who had more than 30 years of service as of 12/31/1993 were grandfathered and still got to use their years of service as of that date.)

    Under the PCF (Pension Credit Formula) plan, most people would receive about 30% of their final average salary after 30 years of service. Because the PCF plan used a point system which had its own cap, it would max out at about 35% of final average salary after 35+ years of service.

    The end result is that most employees who retire under the PCF plan wind up with about a 25% cut in their pension vs what they would have had if the S&E plan had continued unchanged.

    Depending on your age and years of service at the time the PCF plan was put in place, people were affected differently, just as the C-B conversion affected people differently.

  • Yahoo! IBM Pension and Retiree Issues message board: "Re: Statistics on Number of IBMers affected by 1999 Pension Plan Changes" by "scall0way". Full excerpt: I was hired in 1973. Even though I was shafted by the 1995 retirement plan changes (my 5-1/2 year long pension wear away ended only 12 months before I retired -- thank you IBM!), I consider myself lucky that I have the old medical even if not the pre-1995 'old' pension.

    Yeah, I'm also from the "Class of '73" and had hoped to work for a few more years yet, but got RA'ed in May of 2010 along with my entire department. There were 10 of us in the department, and only 3 of us were eligible for the old pension, old medical. Two were too young for retirement eligibility of any sort (both with 16 years with IBM, but one aged 50 - the group baby, LOL - and the other aged 53. He was a couple months short of getting a retirement bridge.

    The other 5 were all retirement-eligible - over 55 with at least 15 years of service - but not eligible for the old pension, and getting only the FHA. And when I heard what they were having to pay for the medical plans just about made me sick. I think my work partner's medical plan (for himself and his wife, who has various health issues) cost more per month than the pension he is getting from IBM, and that's just for this first year! And like me he still has a good 7 years to go to reach Medicare eligibility.

    So yes, I'm thankful too, though of course bummed about the losses of '95, but at least squeaked through the first choice door in '99.

  • Yahoo! IBM Pension and Retiree Issues message board: "RE: FHA (Future Health Account)" Full excerpt: madinpok posted a spreadsheet in the files section of this board. Look for IBM 2010 Retiree Medical Plan Costs.pdf in the files section. This data was collected for plans available in the Hudson Valley area. The cheapest plan is High Ded PPO - MVP.

    Here are the rates for the old (non-FHA) and new (FHA) plans:

    Coverage Non-FHA (Original Plan) Cost FHA Cost
    2010 Self $0.00 $541.27
    2010 Self+1 $381.00 $1,082.73
    2010 Self+2 $516.00  

    Those are the rates for the CHEAPEST PLAN. Those are just the monthly rates for the high-deductible plan. The rates DO NOT INCLUDE THE DEDUCTIBLE. You pay the deductible IN ADDITION to the monthly rates.

    If you need coverage for more than SELF, you really got nailed. YOU. HAVE. A. HEALTHCARE. PROBLEM.

  • Yahoo! IBM Employee Pension and Retiree Issues message board: "Deja Vu All Over Again" by Kathi Cooper. Full excerpt: ERIC (not our friends, the ERISA Industry Committee) urged the Treasury Department to be more responsive to easing the regulatory burden on sponsors of benefit plans in order to ensure that companies continue to provide health and retirement benefits.

    ERIC also offered the ongoing experience of ERIC members who sponsor cash balance and other hybrid pensions plans as an example of the adverse consequences that misguided regulations can have. ...

    Among their multiple 'issues' are these two:

    • Reduce the level of detail required for notices under Internal Revenue Code section 4980F and ERISA section 204(h), and allow use of interactive modeling tools. ERIC argues that the regulations should be revisited to allow more simple disclosure, with a simplified form for amendments that allow participants to choose between the old benefit formula and the new formula, and allow shorter notices that describe in simple terms the provisions that are changing.
    • Revise the regulations under Internal Revenue Code section 409A to address practical concerns, particularly with respect to benefits payable upon death, disability, or an involuntary separation from service.

    REALLY? This is the same verbiage they pulled in 1999, still singing the same old four bars. They have already dismantled America's only safe and reliable pension plan, the DB plan. What are they after next? Kathi.

  • Yahoo! IBM Employee Pension and Retiree Issues message board: "Re: Deja Vu All Over Again" by Bill Britton. Full excerpt: My opinion is that Defined Benefit plans put the burden on the company to make investment decisions in order to meet obligations. Defined Contribution plans put the investment decision on the individual. We each own our lives and are responsible for our own future. I would rather own the responsibility for my future than rely on any company to make the choices that are best for me.

    Full disclosure, I am receiving a DB pension from IBM, but I know it might get cancelled at any time and will lose value as inflation continues since my DB check will never change. I can only hope IBM doesn't cancel my DB check and inflation stays low or deflation actually becomes a possibility. I took full advantage of IBM's 401K plan in terms of my contributions which meant I got the max IBM match. It was obvious IBM as well as almost all companies wanted to stop DB plans. I can't say I made the best decisions in my 401K plan, but I knew it was up to me and/or my advisor.

    My point is that no company will offer a DB plan unless competition requires it. It's a new world. DB plans are a thing of the past; I feel lucky to have a DB check each month as well as a 401K account that I do my best to manage given my knowledge, risk tolerance, etc.

    Health benefits are no different in my opinion. Instead of companies providing health benefits, I'd rather have a larger salary with the responsibility for securing health care up to me as I see fit. Obviously, if I believe I need to buy health care insurance, it would be cheaper if I'm part of a group seeking health care insurance, but those are the trade-offs I must consider. Maybe my local Credit Union can form a group to buy insurance. Again, if you think IBM or any other company OWES you health care, you need to wake up and smell the stench. Companies are in business to make profits for their shareholders; companies will only offer employee benefits that they consider mandatory to retain the type of employees they need to meet their profit objectives.

    Get the picture?

    You probably won't believe this, but I believe in Capitalism, but only when government gives no financial incentives for companies to do or NOT do this or that particular "planet."

  • Yahoo! IBM Employee Pension and Retiree Issues message board: "Re: Deja Vu All Over Again" by "jonatha1". Excerpt: Full disclosure, I am receiving a DB pension from IBM, but I know it might get cancelled at any time. If you are in the United States, your DB pension cannot legally be cancelled. IBM could of course attempt to get the law changed, and if the pension plan goes bankrupt (not likely, as it's fully funded) you might get less than promised.
  • Yahoo! IBM Employee Pension and Retiree Issues message board: "Re: Deja Vu All Over Again" by Kathi Cooper. Full excerpt: My opinion is that if I accept a job for less than competitive wages because of benefits, then that is what I deserve, nothing less. When two parties come to the table in agreement, then nothing changes, unless we come to the table again.

    But then, we don't have a contract to hold these promises true, do we?

    Instead, we have a company that screws us every time it can get away with it. A company that we can't trust. A company that demonstrates abusive power. A company that rapes its employees for the betterment of the executives.

    I love capitalism too, but I'm no fool.

    And I'm not drinking the Kool Aid that says 'It's a new world, pensions & health care are a thing of the past, just be self reliant.' That 'self reliant' thing only works if you have yours and no one else has theirs. It's not capitalism. Don't get the two confused.

    When was the last time you tried to get health insurance outside of IBM? Your family would suffer. You would change your tune right in the middle of the song.

    Please, go be self reliant. The sooner the better, so you too will grow up to be no ones fool. Kathi.

  • Yahoo! IBM Employee Issues message board: "I had a good laugh the other day" by "nyjints5". Full excerpt: I recently overheard an IBM'er talking to some employees of an IBM contractor. Those employees work for a "bodyshop" that supply's people to IBM, and those people are basically unskilled workers.

    The IBM'er was explaining to the contractors why things were so screwed up. As I listened, I heard things like "The support team is not in The U.S. and they can barely speak English. No IBM employee here in The U.S. can understand a word they say." Then there was this comment: "The overseas resources don't have any skills. They don't have a clue as to what they are doing. They screw up everything"

    One of the contractor employees asked the IBM'er: "Why does IBM hire them if they cant get the job done?"

    The IBM'ers response: "I don't know. To save money, I guess."

    The IBM'er was then asked: "How does IBM save money if everything that has been done overseas has to be fixed by an IBM'er here in The U.S.?"

    I laughed to myself because this sad story can be repeated in nearly every IBM location anywhere in The U.S. It doesn't matter what the work or the product is. It's the same story everywhere you go.

  • Yahoo! IBM Employee Issues message board: "Re Unions" by "maxxcurrey". Full excerpt: Here is my opinion of why IT workers do not unionize.

    I am one of those IT knowledge workers of which you speak. From what I see as a group they are in fact STUPID. Not stupid in their profession, but stupid in buying into the propaganda that unions are bad and capitalism is good. If one talks about regulated capitalism (which has been proven to work) they think you are from Mars. Most of my colleagues have masters' degrees in business, computer science or engineering, but they know about as much of U.S. history as an average fifth grader and therefore are easily manipulated. If you mention the hundreds of unionized Americans killed during strikes by U.S. troops, police and private security forces in the 19th and 20th centuries most have not a clue of such actions.

    As a generalization they have overblown high opinions of themselves and end up supporting policies against their own self-interests as they see themselves as part of an elite. The managers laugh at them and manipulate their overblown high opinions of themselves.

  • Plan Sponsor: Workers Clueless about Retirement Health Care Costs. A Sun Life Financial Unretirement Survey suggests that over nine in ten American workers either have no idea what their health care costs are likely to be in retirement, or underestimate those costs when compared to conservative industry estimates. By Rebecca Moore. Excerpt: Forty percent of those polled claim to have "no idea" what their retirement health care costs would reach, and only 8% estimate that their costs will reach $200,000 or more, according to Flying Blind: How Working Americans View Healthcare Costs in Retirement. Forty-three percent of those polled said they feel "not at all confident" and only 9% feel "very confident" in their ability to meet health care costs in retirement. This sentiment pervades all ages, with half of workers in their fifties "not at all confident" in their ability to meet health care costs in retirement.
  • Glassdoor IBM reviews. Selected reviews follow:
    • IBM Senior Financial Analyst in Somers, NY: (Past Employee - 2009) "High pressure, long hours, but without the pay to match." Pros: Large company with some job security. Recognizable brand and reputation to take elsewhere when you need another job. Cons: Can be a high pressure, long hours environment. Constantly analyzing ways to take out headcount, got depressing. Advice to Senior Management: Don't be afraid to invest in employees. A little recognition and reasonable pay increases go a long way to improve attrition.
    • IBM Anonymous: (Current Employee) "Better than most places to work in, could be better." Pros: Benefits, mostly competent colleagues, management has the right mindset for improvements. Cons: Many legacy products, tendency to resist change, IBM tools are forced down your throat when better alternatives are available, brains are mostly now in other younger companies. Advice to Senior Management: Pay more attention to your engineers, recruit new talented people
    • IBM Anonymous in Toronto, ON (Canada): (Current Employee) "Advisory Technical Service." Pros: Support a lot IBM customer accounts. Cons: a lot overtime without pay, very cheap company
    • IBM Anonymous in Westford, MA: (Past Employee - 2009) "Welcome to the Borg." Pros: Flexible working environment. Can work from home 1-2 days per week. Cons: Management just doesn't care about employees. Treat software developers as interchangeable.
    • IBM Anonymous: (Current Employee) "Managed by people in expensive suits who have never done my job." Pros: Good peers, great products, good benefits, great technical resources, and a great attitude towards customers. IBM has a great product line with reasonable prices and a excellent customer support. Cons: Managers and executives are often put in charge of managing and "leading" people in roles they have never held themselves. Some have no idea what they are doing and resort to simply managing time vs leading. IBM is under the impression that managing by fear will produce results. Advice to Senior Management: Promote people in an job category for which they have demonstrated effectiveness. Stop with the micro-managing and scare tactics. It's not working.
    • IBM Advisory Engineer: (Current Employee) "1st class in technology...way behind in compensation." Pros: Constantly working with experienced, very talented engineers. Constantly working with bleeding edge technology. Ability to work from the office or from home in a very flexible way. Numerous offices throughout the US so transfer/relocation is easily doable.

      Cons: Be careful: when interviewing college level candidates IBM will advertise 'potential' bonus as part of your base salary, making it seem like you are being offered more.

      IBM considers 2 factors when determining your yearly bonus: (A) Was IBM profitable? (B) Did IBM meet it's own projected financial targets? That way, when IBM does poorly, your bonus will be negatively affected by (A). When IBM does well, your bonus will be negatively affected by (B). Historically, IBM will always over-project it's financials so (B) will always be in affect.

      IBM's goal for salary is to be "competitive". So given the industry's salary range for a particular position, their goal is to pay you at the 50% mark of that range. That is their 'goal'... which means you will typically get paid in the 40% (or lower) mark with small yearly increases to slowly move you towards that 50% mark.

      Summary: IBM is definitely a company you would want to invest in, but not necessarily a company you'd want to work for.

      Advice to Senior Management: Fresh younger talent is going elsewhere... the majority of your professional employees are those that have vested 15+ years and once they're gone.... ???

    • IBM Customer Service Representative: (Current Employee) "Used to be a great place..." Pros: - In some territories IBM really offers opportunities to grow, one can become manager in 3-4 years - working from home - some non monetary benefits.

      Cons: - organizational structure (like company made of companies); - processes and bureaucracy; - savings, budget cuts and expense freezing whenever wherever!!!!!!!!!!!!; - horrible workload

      Yes, IBM used to be a great place to work. As our HR calls it an "Employer of your choice". That was however 3-4 years ago. Then someone got a great idea: why not to take advantage of 'global crisis' and start saving on employees. Let's tell them "it's crisis out there, we cannot raise your salaries. Be happy we don't fire you like HP does its employees". Then the crises faded out but hey! salary increases and annual rewards remained on the same level.

      You got more and more work literally on a monthly basis, if someone leaves IBM there is no new hire but the rest of the team 'absorbs' the work. Annual salary reviews has become a joke, annual bonuses (even with PBC 1!!!!!) a very very stupid joke. Whenever an employee who works 12 hours a day (every day!!!!) complaints to management the answer is always the same...."that's the challenge and we are confident you'll manage it. It's within your potential so grab the opportunity and show yourself.". When employee asks back "what do I get for it?" the answer is "well...you'll get the opportunity to grow...both personally and professionally. Remember, money is not that important".

      Advice to Senior Management: You are loosing skilled employees who have dedicated years of excellent contribution to IBM. You are loosing top performers and above average contributors who made a difference. Yes, you save money and make shareholders smile. But for how long?

    • IBM Anonymous: (Current Employee) "A great brand to work for but all the cost cutting is starting to hurt." Pros: Leading edge technologies and processes in most areas. Great brand - well respected employer. Flexible working - from home, hours etc. Availability of online/self paced learning. Opportunities to change jobs internally. Great Talent. Cons: Cost cutting is starting to hurt...constant rounds of travel restrictions, pay freezes, lack of investment in new offerings. One model doesn't always work for all - especially in a company this size. Penny pinching expense rules. Advice to Senior Management: Trust your business unit managers. Give them the power to make decisions and invest in their areas - on offerings and retaining and developing top resources.
    • IBM Sales Representative in Melbourne (Australia): (Current Employee) "Thrown in the deep end." Pros: Flexibility Trusted brand - opens doors. Work/Life balance. Cons: Pay is below market value and it's very difficult to get salary increase. Management doesn't listen - or doesn't want to listen. They're too busy with their heads buried in spreadsheets rather then supporting and coaching their reps who are on the ground, dealing with customer situations every day. Advice to Senior Management: Listen to your employee's and support people managers to do exactly that-coach, develop & mentor their people...
    • IBM Consultant: (Past Employee - 2011) "terrible - not a true consulting business." Pros: the brand of the company. Cons: lack of knowledge and expertise - it sells what it cannot deliver. Advice to Senior Management: they should all quit
New on the Alliance@IBM Site
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  • IBM Global Union being formed! Full excerpt: A network of IBM unions worldwide, including the Alliance@IBM CWA Local 1701, will meet in Switzerland in May to form the IBM Global Union Alliance.

    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:

    • To engage IBM in dialog at global level.
    • To pursue agreements with IBM at global level to improve working conditions of IBM employees worldwide.
    • To raise levels of trade union membership at IBM.

    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

  • 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 5/02/11: -NO_KY- Yes, no one hears of an IBM customer account RE-SIGNING up for IBM anymore either. Anyone hear of a global contract signing for IBM from China, India, Brazil or anywhere else? The AstraZeneca account is toast and so soon will a few others. Most accounts will just disappear after their contract is up since customers are getting utterly disgusted with IBM services. Sam's plan is to pump before the dump takes place. Right now IBM is in the pump period. I think the dump period will start happening in 2013. But he may be retired before then as well as most as his close cohorts will be. They will all take the filthy rich stock options and bonuses and retired off into the sunset by then. And unless IBM USA unionizes by then tens of thousands will be dumped well before 2015. -anonymous-
    • Comment 5/03/11: Beware of the Liquid Portal. When you submit solutions, you lose all ownership to what you submitted. Legally, they can steal your entire design, your code and give it to another cheaper entrant of the portal to finish it up for less money. Developers in Liquid Portal have no protection from theft of their hard earned and developed work. Customer will also not know that the solution they just paid for is"tainted" intellectual property which exposes them legally. Watch it guys, don't let hunger and the promise of some food scraps wipe out all you have of value. -anonymous-
    • Comment 5/04/11: Yes, anonymous, that is exactly IBM's intent with Liquid Portal. The core development team will define all aspects of the project by detailing the design of each component in a specification document. You developers who are becoming spec writers may think your job is secure, but it won't be for long. Soon enough, the Liquid Portal"players" competing for the work will also be given competitions to write the specs themselves. IBM is looking to establish ongoing relationships with cheap freelancers through Liquid Portal.

      The intent is to reduce the full time staff - cut costs. It is expensive to pay benefits and commit to employing people full time when you may just want them for short term projects. With Liquid Portal, there is no commitment. Liquid Portal freelancers will be cut loose when the project is complete. IBM is aggressively moving forward with Liquid Portal, and they don't care about negative impact to project schedules. It's probably because they want to get it well established before employees wake up and realize they are being displaced.

      BTW, it is foolish for IBM US employees to compete on Liquid Portal. You are essentially telling IBM that you don't have enough to do with your full time job, so you you might as well be RA'ed so you can participate as a freelancer, as well. However, if you do attempt to compete as an IBM US employee, keep in mind that your costs are higher than a China/India GR. When selecting Liquid Portal event participants, we are being told to favor the GR players because they are cheaper. Wake up, everyone - it is looking very bad for IBM US employees, particularly in IGS, although I am sure LP will spread to SWG soon enough. -Anony2-

    • Comment 5/04/11: Without a union, you might as well meet your new employer... http://www.rishabhsoft.com/ibm-liquid-player-candidate-faq -nuf_said-
    • Comment 5/04/11: LP is being piloted in SWG. -Anony2-responder-
    • Comment 5/05/11: Confirmed GBS operations firings happening in the next month. If you're in GBS and NOT a consultant /IT specialist/PM look to get a call from your first line by end of May with your exit date and package. I'm just hoping IBM stills gives 6 months severance -Anon-
News and Opinion Concerning Health Savings Accounts, Medical Costs and Health Care Reform
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  • The Center for Media and Democracy's PR Watch: Insurers Getting Rich By Not Paying for Care. By Wendell Potter. Excerpts: If I had stayed in the insurance industry, my net worth would have spiked between 4 p.m. Wednesday and 4 p.m. Thursday last week -- and I wouldn't even have had to show up for work.

    I'm betting that just about every executive of a for-profit health insurance company, whose total compensation ultimately depends on the value of their stock options, woke up on Good Friday considerably wealthier than they were 24 hours earlier. Why? Because of the spectacular profits that one of those companies reported Thursday morning.

    Among those suddenly wealthier executives, by the way, are the corporate medical directors who decide whether or not patients will get coverage for treatments their doctors believe might save their lives.

    UnitedHealth Group, the biggest health insurer in terms of revenue and market value, earned so much more during the first three months of this year than Wall Street expected that investors rushed to buy shares of every one of the seven health insurers that comprise the managed care sector. In my view, it would be more accurate to call it the managed care cartel. ...

    UnitedHealth's shares shot up more than 8 percent during the day. Increases of that magnitude are so rare that I could almost hear the champagne corks popping in the Minnetonka, Minnesota office of UnitedHealth's CEO, Stephen J. Hemsley. ...

    Wall Street analysts had worried that health insurers would have such a hard time complying with the provisions of the year-old health care reform law that their profit margins would decline. Those concerns were put to rest when UnitedHealth reported that its operating margins were "stable" at 8.7 percent in the quarter. The company's stellar performance should also put to rest -- forever -- the myth that "ObamaCare" is "bleeding insurers dry," as industry apologist Sally Pipes contended in a Feb. 24 commentary in Forbes. ...

    As you can imagine, Hemsley and other UnitedHealth executives were peppered with questions during the company's conference call with Wall Street analysts last Thursday. They wanted to know how UnitedHealth had pulled off such a stunning accomplishment.

    As it turned out, they pulled it off by paying far fewer medical claims than anyone had expected. That in and of itself is not new. Last year was one of the industry's most profitable years because, the big insurers insisted, their policyholders had not needed to go the doctor or check into the hospital as much as they had in the past. Consequently the insurers did not have to pay as many claims. The reason they gave was that the flu season last year was much less severe than predicted.

    Well, it turns out that dog won't hunt anymore. UnitedHealth executives admitted during the call with analysts Thursday morning that "the incidence of influenza was substantially higher this quarter than last year." So, even though more people had to be treated for the flu during the first three months of this year than UnitedHealth had expected, the company still managed to spend less on medical claims during the quarter than investors had expected. ...

    Contrary to what insurance company bigwigs try to make us believe, it is not snow, sleet and freezing rain or mild flu seasons that enables these companies to blow Wall Street's estimates out of the water. What they will not admit is that their companies are making record profits by pushing more and more of us into benefit plans that require us to pay a whole lot more out of our own pockets before they will pay anything for our medical care.

    And I'm betting that if the insurers had to disclose their rates of claim denials and the number of procedures their medical directors are refusing to pay for, we would see that those numbers are increasing, and maybe substantially. Medical directors know they play a key role in meeting Wall Street's expectations, and they're rewarded with raises, bonuses and, yes, stock options, if management is pleased with their job performance. The less money these companies pay out for care, the more is left over to reward shareholders and a bunch of corporate executives.

    This is why, folks, that "utilization" is down. Growing numbers of people who have insurance, who are paying hard-earned money every month for coverage that is increasingly inadequate as well as expensive, simply can't scrape up enough cash to go to the doctor or hospital or, in many cases, even pick up their prescriptions. That is a trend that the insurers are determined to continue. And while we are being forced to go without necessary care and empty our pockets to pay our premiums, insurance company billionaire Stephen Hemsley and his cohorts are stuffing their pockets -- with our money.

  • New York Times: Wealth Matters. Putting Your Doctor, or a Whole Team of Them, on Retainer. By Paul Sullivan. Five years ago, Steven L. Glazer, an internal medicine doctor in Norwalk, Conn., told his thousand patients that he would no longer be able to care for them because he was going to focus on only a dozen, wealthy patients who could pay his annual fee.

    With that he entered the world of concierge medicine, a growing subset of medicine where patients pay doctors anywhere from $1,500 to $25,000 a year to receive personalized attention and care. (Dr. Glazer said he was paid toward the top of this range.) In most cases, patients presume that in an emergency their concierge doctor will push them to the front of the line to see a top specialist.

    Even as more people are struggling to pay medical bills and being rushed through office visits with their doctors, an elite group with money has another option: exclusive medical care, around the clock and anywhere in the world, including on a yacht or private plane.

    One of Dr. Glazer's clients, for instance, has had his yacht outfitted with a system from Guardian 24/7, a company in Leesburg, Va., founded by former White House doctors that advertises itself as offering "medical protection previously available only to the president of the United States." The company's "ready room" will allow a doctor trained in the system to perform basic medical care remotely if something should go wrong while the patient is on the high seas. "There is very little that we can't do with the triage room on their yacht," he said.

  • New York Times: Proposal for Medicare Is Unlike Federal Employee Plan. By Robert Pear. Excerpts: House Republicans say their budget proposal would make Medicare work just like the health insurance that covers federal employees, including members of Congress. But a close examination shows the two plans are very different, and the differences help explain why the Republican plan has set off a political uproar.

    Under the federal employees' health plan, which covers eight million people, the government pays a fixed share of premiums. So the federal contribution generally keeps pace with rising premiums, which in turn reflect rising health costs.

    No such guarantee exists under the Republicans' plan to transform Medicare, approved by the House on April 15 as part of a budget blueprint to cut federal spending and deficits. ...

    So, the Congressional Budget Office says, under the Republican plan, Medicare would pay a shrinking share of beneficiaries' total health costs, and seniors would pay a growing share. For a typical 65-year-old, that share would be 68 percent in 2030, more than twice what it would be under current law, the budget office said. ...

    But Representative Chris Van Hollen of Maryland, the senior Democrat on the House Budget Committee, said the similarities ended there. "We keep hearing that Republicans are offering seniors exactly what members of Congress get," Mr. Van Hollen said. "It simply is not true."

  • Washington Post's "The Fact Checker": GOP lawmakers tout Medicare reform by stretching a comparison to the health benefits they receive. By Glenn Kessler. "There's a lot of misinformation about what we are proposing and what we are not proposing. We're saying: Save Medicare by reforming it for people who are 54 and below by working like a system just like members of Congress and federal employees have." — Rep. Paul Ryan, chairman of the House Budget Committee, April 26, 2011. ...

    The implication is that if it's good enough for us, it is good enough for you. During the 2008 election campaign, then-Sen. Barack Obama used a variation of this line to tout the need for universal health coverage, saying during the third presidential debate: "If you don't have health insurance, then we're going to provide you the option of buying into the same kind of federal pool that both Senator [John] McCain and I enjoy as federal employees." Ryan's phrase is alluring — many Americans apparently believe that members of Congress get great benefits — but is it accurate? ...

    How does this system compare with what Congress gets?

    The federal plan provides lots of health-care options, with a range of about five to 15 plans for each enrollee, according to the Congressional Research Service. All of the health plans offer a standard package, but there are variations in what those plans pay for. On top of that, members of Congress get some extra perks, such as care at military hospitals and, for a fee, limited medical services from the attending physician at the Capitol.

    In many ways, the federal plan works a lot like the run-of-the-mill employee-sponsored health insurance plan. The bulk of the costs are picked up by the employer — in this case, the government — with the employee contributing his or her share according to a set or negotiated rate. Under a 1997 law, the government pays a set rate of 75 percent of the costs of the health plans selected by federal employees and members of Congress. The employee (and members of Congress) pick up the other 25 percent.

    Ryan, in his quote, said the new Medicare would be "working like a system just like members of Congress and federal employees have." But the comparison begins to break down once you consider the premium support payments. Ryan would peg the premium support to the consumer price index, a broad gauge that has been rising more slowly than have health care costs.

    The Congressional Budget Office, the nonpartisan arm of Congress, analyzed Ryan's plan and estimated that by 2030, the government would pay just 32 percent of the health care costs, less than half of what the federal plan currently pays. The other 68 percent of the plan would have to be shouldered by the retiree. (The CBO estimated that if traditional Medicare stayed in place, the government would pay 70 to 75 percent of the costs.)

    The CBO analysis also assumed that adding private insurance plans into the mix would raise administrative costs and would not keep medical inflation as low as traditional Medicare has done. Ryan disputes these assumptions. "We believe — based on experience — the competitive elements of patient-centered reform will exert downward pressure on the cost of a private plan, and that therefore the government's share of the tab will be higher," said Conor Sweeney, a spokesman for Ryan.

  • Huffington Post: Are Insurers Writing the Health Reform Regulations? By Wendell Potter. Excerpts: One of the reasons I wanted to return to journalism after a long career as an insurance company PR man was to keep an eye on the implementation of the new health reform law. Many journalists who covered the reform debate have moved on, and some consider the writing of regulations to implement the legislation boring and of little interest to the public.

    But insurance company lobbyists know the media are not paying much attention. And so they are able to influence what the regulations actually look like--and how the law will be enforced--with little awareness, much less scrutiny.

    At a January meeting of several hundred patient and consumer advocates in Washington, a top aide to Health and Human Services Secretary Kathleen Sebelius all but pleaded with those in the audience to bombard the Obama Administration with messages insisting that the law be implemented as Congress intended. Rest assured, he told them, that the insurance industry's lobbyists were relentless in their demands that the regulations be written to give them the maximum slack. ...

    But the consumer groups believe the administration itself has caused some of the problems by taking so long to finalize the regulations. The NAIC got its work done comparatively swiftly. "There is a clear pattern of leaning toward the insurance industry more than consumers," one of the patient advocates told me. The consumer advocates, most of whom not so long ago were applauding the Democrats for getting reform enacted, even if it fell short of their original goals, are becoming increasingly discouraged, partly because there are so many more lobbyists for the insurers than for consumers. It's hard to compete with them. "We're outnumbered 100 to 1," said one of the consumer advocates. It's clear," he added, "that the insurers are willing to make life more difficult for patients" by trying to weaken and delay the consumer protections. It's also clear that, at least for now, the insurers seem to have the upper hand in dealing with the White House.

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: Springtime for Bankers. By Paul Krugman. Excerpts: Last year the G.O.P. pulled off two spectacular examples of bait-and-switch campaigning. Medicare, where the same people who screamed about death panels are now trying to dismantle the whole program, was the most obvious. But the same thing happened with regard to financial reform.

    As you may recall, Republicans ran hard against bank bailouts. Among other things, they managed to convince a plurality of voters that the deeply unpopular bailout legislation proposed and passed by the Bush administration was enacted on President Obama's watch.

    And now they're doing everything they can to ensure that there will be even bigger bailouts in years to come.

    What does it take to limit future bailouts? Declaring that we'll never do it again is no answer: when financial turmoil strikes, standing aside while banks fall like dominoes isn't an option. After all, that's what policy makers did in 1931, and the resulting banking crisis turned a mere recession into the Great Depression. ...

    So what's the solution? The answer is regulation that limits the frequency and size of financial crises, combined with rules that let the government strike a good deal when bailouts become necessary.

    Remember, from the 1930s until the 1980s the United States managed to avoid large bailouts of financial institutions. The modern era of bailouts only began in the Reagan years, when politicians started dismantling 1930s-vintage regulation. ...

    Last year Congressional Democrats enacted a financial reform bill that sought to close these gaps. The bill extended regulation in a number of ways: consumer protection, higher capital standards for major institutions, greater transparency for complex financial instruments. And it created new powers — "resolution authority" — to help officials drive a harder bargain in future crises.

    There are many criticisms one can make of this legislation, which is arguably much too weak. And the Obama administration has frustrated many people with its too-lenient attitude toward Wall Street — exemplified by last week's decision to exempt foreign-exchange swaps, a major source of dislocation in 2008, from regulation.

    But Republicans are trying to undermine the whole thing. ...

    To see what's really going on, follow the money. Wall Street used to favor Democrats, perhaps because financiers tend to be liberal on social issues. But greed trumps gay rights, and financial industry contributions swung sharply toward the Republicans in the 2010 elections. Apparently Wall Street, unlike the voters, had no trouble divining the party's real intentions.

    And one more thing: by standing in the way of regulations that would limit future financial crises, Republicans are giving further evidence that they don't really care about budget deficits.

    For our current deficit is overwhelmingly the result of the 2008 financial crisis, which devastated revenue and increased the cost of programs like unemployment insurance. And while we managed to avoid large direct bailout costs (a fact not appreciated in public debate), we might not be lucky next time. More and bigger crises; more and bigger bailouts; more and bigger deficits. If you like that prospect, you should love what the G.O.P. is doing to financial reform.

  • AlterNet: Reagan Budget Director Slams Paul Ryan Plan, Says 'Absolutely' Raise Taxes Instead. Excerpts: Absolutely. In 1982, we were looking at the jaws of the worst recession since the 1930s. We overdid it in 1981, cut taxes too much. We came back with a big deficit reduction plan in 1982. Unemployment's at 10 percent, the economy is in dire shape, and we raise taxes by 1.2 percent of GDP, which would be $150 billion a year right now — not 10 years down the road — but right now. ...

    Stockman also attacked Rep. Paul Ryan's (R-WI) budget plan, noting it "does not cut one dime from the debt" in the next three years. Indeed, in addition to being draconian and regressive, Ryan's budget fails to accomplish the only thing it sets out to do — solve the deficit — despite claims from Washington journalists that his plan is "serious."

  • New York Times: High Court Ruling May Reduce Consumer Clout. By Ann Carrns. Excerpts: Score another one for big business, it seems. The Supreme Court ruled Wednesday that companies can use contracts that prevent consumers claiming fraud from banding together to file group arbitration claims and, possibly, class-action lawsuits.

    The case has broad implications for consumers because all sorts of companies, like banks, builders and even nursing homes, use contracts that require disputes to be settled through arbitration and forbid class actions. Banks and credit card companies, in particular, have come under scrutiny recently for their use of such binding arbitration clauses in customer contracts.

    "I think it will make it very difficult for consumers to recover for overcharges, mischarges, incorrect billings or identity confusion in disputes with credit card companies or banks," said Michael Donovan, a lawyer in Philadelphia who co-wrote an amicus brief filed on behalf of the plaintiffs in the case. The decision, he said, will "make it difficult for consumers in resolving the typical disputes that they have with companies large and small."

    Here's some background: The decision involved a case brought against AT&T Mobility by a California couple who objected to a $30 charge for what was advertised as a "free" cellphone. They filed a lawsuit seeking class-action treatment. But the couple had signed a standard contract with AT&T that required them to resolve disputes through arbitration — a private legal proceeding — and barred them from banding together with other customers to seek class-action treatment, whether through arbitration or in a lawsuit brought in a traditional court.

    The company, relying on the contract, said the case couldn't proceed in court, or as a class-action case in any venue. Lower federal courts refused to enforce the arbitration agreement. The case ended up at the Supreme Court, which found for AT&T.

  • New York Times: U.S. Business Has High Tax Rates but Pays Less. By David Kocieniewski. Excerpts: The United States may soon wind up with a distinction that makes business leaders cringe — the highest corporate tax rate in the world. Topping out at 35 percent, America's official corporate income tax rate trails that of only Japan, at 39.5 percent, which has said it plans to lower its rate. It is nearly triple Ireland's and 10 percentage points higher than in Denmark, Austria or China. To help companies here stay competitive, many executives say, Congress should lower it.

    But by taking advantage of myriad breaks and loopholes that other countries generally do not offer, United States corporations pay only slightly more on average than their counterparts in other industrial countries. And some American corporations use aggressive strategies to pay less — often far less — than their competitors abroad and at home. A Government Accountability Office study released in 2008 found that 55 percent of United States companies paid no federal income taxes during at least one year in a seven-year period it studied.

    The paradox of the United States tax code — high rates with a bounty of subsidies, shelters and special breaks — has made American multinationals "world leaders in tax avoidance," according to Edward D. Kleinbard, a professor at the University of Southern California who was head of the Congressional joint committee on taxes. This has profound implications for businesses, the economy and the federal budget. ...

    The United States is virtually alone in trying to tax its multinational corporations on their foreign earnings, but it allows companies to avoid those taxes indefinitely by keeping profits overseas. That encourages companies to use accounting maneuvers to shift profits to low-tax countries and to invest profits offshore, says David S. Miller, a partner at Cadwalader, Wickersham & Taft in New York. ...

    In addition to being complex and uneven, the United States corporate tax code is inefficient and has become a diminishing source of revenue. Corporate taxes accounted for about 9 percent of all federal revenue in 2010. At $191 billion, they were equal to 1.3 percent of the nation's gross domestic product. Most industrial countries collect more from companies, about 2.5 percent of output. Only a portion of that disparity can be explained by the many types of businesses in the United States that elect to be taxed at an individual rate. ...

    Furthermore, some business owners complain that the American system unfairly rewards disingenuous bookkeeping rather than innovation. It forces companies to compete "based not on product quality and services, but on accounting gymnastics," said Paul Egerman, former chairman and chief executive of eScription, a medical transcription service in Boston.

  • truthOut: An Appropriate Reaction to a Nonsensical Budget Proposal. By Paul Krugman. Excerpts: The easy, and perfectly fair, shot is to talk about the hypocrisy. Where were all the demands for civility when Republicans were denouncing Obama as a socialist, accusing him of creating death panels, etc.? Why is it O.K. for Republicans to accuse Mr. Obama of stealing from Medicare, but not O.K. for Mr. Obama to declare, with complete truthfulness, that those same Republicans are trying to dismantle the whole program? ...

    But the main point is, what are we supposed to have a civil discussion about? The truth is that the two parties have both utterly different goals and utterly different views about how the world works. It's not nice to say this (but the truth is rarely nice): whatever they may say, Republicans are not concerned, above all, about the deficit. In fact, it's not clear that they care about the deficit at all. They're trying to use deficit concerns to push through their goal of dismantling the Great Society and, if possible, the New Deal; they have stated explicitly that they want to reduce taxes on high incomes to pre-New-Deal levels. And it's an article of faith on their part that low taxes have magical effects on the economy.

    Mr. Obama believes that the major social insurance programs are a good thing, and has extended them with health reform. Some of the best-known research by his chief economist, Austan Goolsbee, debunks claims that tax cuts for the rich pay for themselves.

  • AlterNet: How Wall Street and the Toxic Philosophy of Ayn Rand Are Destroying Our Retirements. Washington is talking about balancing the budget on the backs of the elderly, but the economic security they enjoyed at one time is already imperiled. By Les Leopold. Excerpts: It's tough growing old. And it's even tougher growing old in America -- unless you're rich.

    It used to be that you could count on two pensions – social security and a pension from your employer. But now work-related pensions are an endangered species and Social Security is under assault from a lethal combination of Wall Street's insatiable greed and the pernicious philosophy of Ayn Rand.

    For much of the post-WWII period, private sector workers could count on decent, defined benefit pension funds that paid a fixed monthly amount for as long as you lived. Most also included options that allowed your spouse to receive benefits for the rest of his or her life after you died. You felt like you could survive into your golden years and provide for your loved ones.

    Defined benefit plans are much more secure than 401(k)s, which end when the money runs out. The odds are that you will quickly outlive your 401(k). In fact, the average 401(k) has a balance of only $45,519, and 46 percent of all 401(k)s are worth less than $10,000.

    Twenty-five years ago, 80 percent of large and medium-sized firms offered defined benefit pension plans. Today only 21 percent have them. And half of all full-time workers (and most part-time workers as well) have no workplace retirement plans at all.

    The birth and death of private pension funds are directly connected to the rise and decline of unions. In 1955, more than one in three private sector workers belonged to a union and those unions fought hard for pensions and health care benefits. Currently fewer than 7 percent of all private sector workers are in unions so private employers feel little pressure to provide such benefits. Corporate America has stopped offering pensions because it doesn't have to.

    But corporations do feel enormous pressure to deliver higher profits on a quarterly basis to meet Wall Street expectations. This pressure has led to more movement of facilities overseas, more efforts to keep wages down, more anti-union crusades and more cuts in benefits. ...

    Social Security in the Crosshairs. The financial crash and the ensuing bailouts also set the stage for another assault on Social Security, the most enduring legacy of the New Deal. With unemployment still unconscionably high, federal revenues are down, leading to growing concern about deficits. Of course, the sane solution would be to put America back to work and pay for job creation with taxes on Wall Street's renewed profits. But sanity is not Washington's strong suit. Instead, deficit hawks want the richest country in history to take an axe to "entitlements" that supposedly are unsustainable. ...

    Congressman Paul Ryan, a devout follower of the late Ayn Rand, is resurrecting the failed Bush-era scam to turn Social Security into private investment accounts so that everyone can play in the Wall Street casino. You would think that the recent crash would have killed that idea. But Ryan feels a moral obligation to unshackle the super rich and eliminate government support for the aged.

  • New York Times editorial: Party Like It's 2013. Excerpts: Republicans on the House Financial Services Committee are having a campaign fund-raiser this week. Starting on Wednesday, the committee's majority is expected to pass bills to cripple the Consumer Financial Protection Bureau, one of the most important innovations in the 2010 Dodd-Frank financial reform law.

    The bureau has one purpose: to shield consumers from unfair, misleading and deceptive lending. The purpose of the Republican bills is twofold. One is to deprive the agency of the power to fulfill its mission. Another is to attract campaign money. As long as the Senate and White House are controlled by Democrats, the bills are unlikely to become law. But by advancing them in the House, Republicans can demonstrate how thoroughly they would dismantle reform if they controlled Washington and, in the process, rake in Wall Street donations.

    What do the banks want in exchange? For starters, they want even stricter constraints on the agency than those that were written into the law last year — and that were expressly included to address banks' objections to the agency. ...

    Unless the administration offers a quick, full-throated defense, the agency may never fulfill its promise. And the process by which Congress is bought and sold — and consumers and taxpayers are hung out to dry — will be, once again, on full display.

  • ThinkProgress: GRAPH: Income Inequality In U.S. Worse Than Ivory Coast, Pakistan, Ethiopia. Excerpt: As ThinkProgress has repeatedly noted, crucial services and public investments for Main Street America are being gutted as taxes on the richest Americans are the lowest they've been in a generation. Yet many Americans may not know exactly how unfair this is, as the country has grown increasingly unequal at the same time. Using data from the CIA Factbook based on the Gini coefficient — a measure of income inequality within a society — ThinkProgress has assembled the following graph, which demonstrates that the United States is now about as economically unequal as Uganda and more unequal than countries like Pakistan or the Ivory Coast: ...

    Income inequality in the United States is actually higher than at any other time in modern history since the Great Depression. There is also a tremendous amount of inequality even in life expectancy, with the American Human Development Index reporting in 2010 that there is now a 6 year gap in average life expectancy between Mississippi, in the Deep South, and Connecticut, in prosperous New England." As ThinkProgress previously reported, one of the major factors in this hike in income inequality has been the decline of unionization in America.

  • Jim Hightower: Punishing the Innocent, Enriching the Guilty. Full excerpt: A recent email to me pretty well sums up the big budget hullaballoo being pushed by tea party Republicans. As the writer put it:
    "Remember when teachers, public employees, Planned Parenthood, NPR and PBS crashed the stock market, wiped out half of our 401ks, took trillions in bailout money, spilled oil in the Gulf of Mexico, gave themselves billions in bonuses, and paid no taxes?"

    Then he added,

    "Yeah, me neither."

    Yet, it's teachers, the middle class, the poor, the elderly, the environment, and the idea of public service that GOP Congress critters and governors want to punish for the destructive deeds of Wall Street banksters and corporate elites. For example, the GOP's widely ballyhooed budget plan doesn't just "end Medicare as we know it" – it ends it, period. Instead of extending this efficient and effective health care program, they would toss the elderly under the bus of insurance profiteers. Goodbye and good luck.

    How's this for bitter irony? Last year, tea party Republicans got elected to Congress by falsely claiming that Obama's universal health care program would require "massive Medicare cuts." And now, those same tea partiers are not merely voting to cut Medicare, they're killing it.

    They're also trying to gut Medicaid, taking three-quarters of a trillion dollars out of this essential health care program for poor families. Would this "savings" help reduce the deficit, as they claim? No. It would merely be redistributed to the superrich in the form of a trillion dollars in new tax giveaways.

    The GOP budget plan shows who they are and whom they serve. As one observer says, "it's a measure of just how far off the deep end Republicans have gone." That's former President Ronald Reagan's budget director speaking. And we all remember what a leftie Reagan was.

  • Jim Hightower: The Artful Dodgers. Full excerpt: Here's the hot new phrase in Washington: "shared sacrifice." Sounds nice, but it's really just code for gouging the middle class and the poor.

    Republican budget whackers use the phrase like a war cry as they slash Medicare, education, and every other public program they hate. President Obama, too, has taken to uttering the phrase as he surrenders to the contrived wisdom in Washington that every American must give up even essential government benefits in order to balance the budget. But guess who's not sharing? The corporate powers, which use their lobbyists, lawyers, campaign cash, tax havens, and other tools to avoid giving up anything in the call for national sacrifice.

    For example, while hundreds of thousands of schoolteachers are being dumped and our school children shortchanged in sacrifice to the Deficit Gods – it was recently revealed that General Electric is a sacrifice-free corporation. With more almost 1000 tax lawyers and other specialists in its tax department, this infamous polluter and job-cutter has paid exactly zero in income taxes since 2006, despite raking in $26 billion in profits. Indeed, its army of sacrifice avoiders produced a $4 billion tax refund for GE in those five years. Meanwhile, it continues to be rewarded with billions of dollars a year in government contracts.

    In a concise report titled, "The Artful Dodgers," a watchdog group named Public Campaign uncovers the flagrant tax avoidance scams of a dozen hugely-profitable corporations, including oil giants and bailed out banks, as well as such outfits as FedEx, and Carnival Cruise Lines.

    When your local, state, and national politicos mouth platitudes about sacrificing for the national good, tell 'em to start at the top, then get back to you. To download "The Artful Dodgers" report, go to www.publicampaign.org.

  • New York Times op-ed: You Call That Tough? By Joe Nocera. Excerpts: The only thing missing from Preet Bharara's press conference was the blaring of trumpets. It was Tuesday, and the U.S. attorney in Manhattan was proudly unveiling a lawsuit against Deutsche Bank that his office had filed that morning. As he took reporters through the legal complaint, Bharara spoke sternly about how the bank had defrauded the Federal Housing Administration, which had insured hundreds of millions of dollars' worth of bad loans that the bank then sold to investors, reaping handsome fees.

    Listening to Bharara, one could easily think that prosecutors were finally — finally! — getting tough on the bad behavior that helped bring about the financial crisis. Alas, it was mainly an illusion.

    Upon closer inspection, it turns out that the main target of Bharara's wrath was MortgageIT, a smallish division that Deutsche Bank bought in 2007 — eight years into an alleged fraud that ended in 2009. In the complaint itself, not one MortgageIT executive was singled out as a wrongdoer; it was as if this faceless corporation had somehow defrauded the government without human help.

    Most stunningly, despite concluding that MortgageIT executives had "knowingly, wantonly and recklessly" lied to federal officials, Bharara's office had decided that none of them deserved jail time. It had brought a civil, not a criminal, case, meaning the only punishment prosecutors could seek was money — more than $1 billion in this instance. That sounds like a lot until you realize that Deutsche Bank's 2010 revenues were more than $42 billion. In other words, a tap on the wrist. ...

    As for the big fish, they're all walking away unscathed. The Securities and Exchange Commission got a $67.5 million settlement out of Angelo Mozilo, the former chief executive of Countrywide. (Mozilo paid only $22.5 million; the rest was picked up by Countrywide's owner, Bank of America.) But prosecutors on the West Coast dropped their criminal investigation.

    The Justice Department spent several years trying to build a case against Joe Cassano, the former head of A.I.G.'s Financial Products division. It gave up. Richard Fuld, the former chief executive of Lehman Brothers, approved a bookkeeping scam that hid billions of dollars of Lehman's debt from investors. Recent reports suggest that not only will he not be charged with a crime, he isn't even likely to face civil charges.

    The MortgageIT executives are hardly in the same rank as Fuld or Mozilo, but the facts laid out in Bharara's complaint are truly shocking. Given special status by the F.H.A. to make loans to low-income Americans, which the government would then insure, the company flagrantly lied about the underwriting it had done. Loans would often default in a matter of months. Independent auditors who reported problems saw reports stashed in a closet, unread. To make a criminal case, prosecutors need to show that executives knowingly intended to deceive. If 10 years of this behavior doesn't qualify as intentional deception, it is hard to know what would.

    I know that these are difficult cases to win. The one time prosecutors brought a criminal case involving the financial crisis — against two Bear Stearns hedge fund managers whose fund collapsed in the summer of 2007 — they lost. But so long as prosecutors resist bringing criminal cases against financial executives, they are sending a message.

    Crime pays.

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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