Editor's note: Some of the (now deleted from the Fortune site) comments are available in the March 12, 2011 version of these highlights. Following are some comments that have been posted since Fortune purged the original comments:
Let me summarize what I read here last week. Yes. Sam's done a great job increasing shareholder value, but as the (now deleted) comments in this forum suggested, while Sam has been compensated $40 million over the past two years, IBM employees have been told there is no budget for raises. While shareholders are awarded record dividends, IBM tells their developers there is no budget to replace 4-year-old computers.
IBM used to be a great company to work for and was a good investment for the past few years, but how much longer can Sam squeeze and neglect his employees for the benefit of shareholders?
Understand IBM has to do this to supposedly stay competitive in a tough global marketplace since the EPS is not as high as IBM wants it. It makes more bonus money and better stock option exercise money for the IBM executives the only employees in IBM that are not referred to as resources. And, you as a resource, or FTE work widget, should feel good about this: Sam THANKS YOU you for your hard work and understanding on this. This thank you should be enough compensation for not getting a raise.
What were your surprises on your way out the door? What new things became clear 30 days or so out? I'm looking for information that you've all discovered the hard way. Thanks!
I also spent the first months of "retirement" reducing costs by things like getting new quotes for house/car insurance and getting them from the same insurer - and taking AARP's safe driving course to add to the discounts. The best choice for me was AAA Mid-Atlantic, that throws in a loyalty discount for being an AAA member. They have a great rating with the state. I also dropped my land line phone and now have a "free" phone by signing up for the cable company triple-play discount - this promo was extended thanks to serious competition in my area (NY Metro region).
For FHA the minimum surprise was how much cheaper Cobra (100+ percent of current plan) was than paying for IBM's retiree health coverage through FHA. Final decision was to go on my wife's plan for the time being and probably then Cobra there when she retires and after that move back to FHA funded IBM health benefits. The risk is that IBM could dump FHA and leave me high and dry with worthless FHA dollars - my gamble that I will shake my head over if it happens, but that is our route to make it to Medicare qualification as least expensively as we can.
One thing I did learn is that a Medicare decisions is a critical decision when that comes up between the two plans. I will be sure and get further information when that date arrives. It appears that I could move from my wife's plan back to FHA medicare, but not the reverse. So that decision will be a critical one that I haven't dug into yet but will dig deeper when that date arrives. So that could be a nasty surprise if not considered. As always leave some money in the FHA - don't run it dry as that is a criteria for getting back on (anyone out there that sees any errors in this, let me know.)
Also, have them run an estimate of what your "net check" will be after taxes and everything you are considering. Do not look at the gross - don't be surprised on trying to survive on a 70 to 80% reduction in your income if you are in the category to get a pension check (which I will always say, I was one of the fortunate ones to be a second choicer).
And remember the wise adage if you have a spouse, "You married for better or worse, but not for lunch." My wife is still working until we can see if we are compatible sharing lunch together! :)
PS - figure out if your manager will support a retirement party and how much and throw one. A lot of folks are doing that. I managed to get away with 70+ folks because of good management - others I know of retired and never had a party. If you feel guilty about have a party like I did when so many of your friends will never qualify for retirement, make it about them not you. Get up and talk about those folks that supported you and made it possible for you to get where you are. They will be sad for what they lost, but supportive of a friend thanking them.
PS - PS - I don't know your temperament, but I am a workaholic. I am working more now daily than pre-retirement but enjoying it more. That is not a surprise but an enjoyable realization. If my books don't sell, I will be back in another selling career of some type; only I will sell something I can believe in. What is life without a few gambles. Cheers and good luck. Pete.
I hope things go well for you!
I do not have a mortgage payment, car payments, or a credit card balance. The only way to go, even if you are not retired. I do not collect Social Security (waiting for 66) nor have I tapped my 401K. My spouse works, but it is a relatively low-paying job. Without that, and without SS or 401K usage, things would be uncomfortably tight. Still take nice vacations each year and enjoy life (actually, enjoy it a lot more without any IBM responsibilities).
Personal opinion: there are numerous posts where people worry if they will get their first retirement check promptly on the first of the month after they retire. I filed my paperwork two or three months in advance, and my check was still a month late. No big deal. If your cash flow is managed so closely that you can't do without being paid for a month, are you really ready to retire?
The U.S. District Court for the District of Connecticut ruled that the insurer's description of the plan was incomplete and inaccurate and that it intentionally misled employees. The court changed certain of the new plan's benefits, including how an employee's opening account balance would be calculated among other changes.
Duke converted its traditional final average pay pension plan to a cash balance plan. Unlike many employers that have frozen defined benefit plans, including cash balance plans, and moved exclusively to defined contribution plans, Duke Energy continues to offer its cash balance plan.
The slow job market has brought the perception that job takers are plentiful, but already companies are finding that the most skilled candidates are in short supply, and are difficult to find, recruiters say. This has prompted some companies to launch employer-branding campaigns for the first time in several years.
Potentialpark AB, a market-research firm that specializes in employer branding, has seen the number of analyses it does for companies almost double in the past year, said Chief Executive Torgil Lenning, whose clients include Hewlett Packard Co. and Credit Suisse Group.
India's outsourcing giants — faced with rising wages at home — have looked for growth opportunities in the United States. But with Washington crimping visas for visiting Indian workers, some companies such as Aegis are slowly hiring workers in North America, where their largest corporate customers are based. In this evolution, outsourcing has come home.
Capuana, a manager for Aegis in New York, motivates this U.S. office with dress-down days and the prospect that workers could, one day, earn a stint training call center workers in Goa, India. One of his tasks is to staff 176 cubicles, where workers make or take calls for customers of prescription drug plans or Medicare contracts and enter and verify information. The pay runs $12 to $14 an hour, with bonus checks of up to $730 a month. ...
At its U.S. sites, Aegis says, 90 percent or more of its workers are American. In that way, Aegis is an exception to the rule. Until now, India-based outsourcing companies have largely brought Indian workers into the United States using H-1B visas and L-1 visas and have been the heaviest users of those programs. ...
Some say the visa practice has hurt U.S. jobs and wages. These new visa categories were created by the Immigration Act of 1990, allowing foreigners to work in the country for up to six years. The aim was to lure high-tech talent. Tech America, an industry trade group, says that the visas are crucial to American innovation, future competitiveness and job creation.
But they have been abused, too. In a study released in 2008, the government found fraud and technical violations on 20.7 percent of H-1B applications. Violations ranged "from document fraud to deliberate misstatements regarding job locations, wages paid and duties performed," said Donald Neufeld, of the Department of Homeland Security, at a March hearing. ...
Some lawmakers are looking to curb the practice and to encourage the India-based outsourcing firms to follow Aegis's model of hiring Americans at U.S. sites. Issuance of regular H-1B visas — 10,200 so far this year — is down 43 percent percent from 2010, according to federal data. Last year, the Obama administration added a roughly $2,000 fee per H-1B visa for large companies, which could be curbing applications.
In the past, if, say, BNY Mellon inked an IT contract with Infosys, Infosys would handle 70 percent of the work in India and send 30 percent of its project staff to the United States on temporary work visas. These Indian workers often live in ethnic enclaves on the outskirts of a city, work long hours and earn less than an American would for the same work. ...
Critics of the visa programs, such as Ronil Hira, a public policy professor at the Rochester Institute of Technology, say the work arrangements can amount to indentured servitude. The workers are often paid "home-country wages" in America. "That's as low as $8,000 a year" with housing allowances, he says. The employers own the visas — so the workers can't bargain for wages, and if they lose their job they have to leave the country.
Hira said Indian workers still make up more than 90 percent of most outsourcing companies' U.S. head counts. He and other critics argue that many of these workers are not more highly skilled than their American counterparts but are simply willing to work for less. "It's harming American workers," he said. "It's taking away their job opportunities, bringing down their wages and harming their working conditions." ...
Robert Webb, chief information officer at Hilton Worldwide, said Tata Consultancy Services and Infosys increasingly rival the established consulting companies, such as IBM, Accenture and Bain Consulting, in areas such as integrating massive computer systems, developing applications for companies and even strategy consulting. He predicts that the India-based companies "will evolve to be more like one of the traditional consulting firms in the U.S." by taking on higher-end capabilities such as business planning, industry knowledge and change management. Already, they are "starting to encroach on IBM's territory, where data centers can be run from other parts of the world."
He said IBM and Accenture are rapidly hiring talent in India and other emerging markets as a counterstrategy. "They're all keeping their eyes on wage inflation in low-cost countries" like India, where wages are increasing 10 percent a year.
Hilton hired Tata Consultancy Services in 2009 to take over some back-office operations, such as human resources, financial systems and its intranet portal for the company's 10 brands and 3,700 hotels. Hilton used to handle this work in-house or with hundreds of small consultants.
Management has no clue why employee morale is so bad. Fishkill management has said so at public meetings. Production and development teams tell management what they want to hear while keeping the resumes polished and always ready.
It is amazing that out second and third line were taken by surprise when 4 key people left in an 8 month period. Yes boss, yes boss, everything is just fine here.
The Trade Adjustment Assistance program, which has enjoyed strong bipartisan support, retrains displaced workers and provides extended unemployment insurance. The 2009 stimulus bill added health insurance benefits and expanded the list of those eligible to include the large number of service-sector workers displaced by outsourcing. Those expanded benefits expired in February.
As a morality tale about abuse of power, and the abuses of the powerful, the fall from grace of Dominique Strauss-Kahn, former chief of the International Monetary Fund, is a doozy. Arrested last week for allegedly assaulting and forcing sex on a housekeeper at a luxury hotel in New York, a man who once ranked among the world's most powerful now sits, forlorn, in a jail cell on Rikers Island -- all because an immigrant woman in a lowly position had the temerity to tell a superior that one of her employer's very important clients had done, by her account, terrible things to her.
By any measure, it was a risky thing to do. There's a reason most rapes go unreported. But there was one thing that housekeeper knew could not be done to her for reporting her account, observes a colleague in the labor movement: she could not be fired for having done so, because of the contract between her union, the New York Hotel Trades Council, and the Sofitel Hotel at which she works. ...
It could be that it's just in her make-up to do what she did in making her complaint against Dominique Strauss-Kahn, something the woman whose account brought down the mighty would have done whether her job was protected or not, something she would have done without the fellowship of her brothers and sisters in the union. But, when considering her options, having the bit of protection provided by the union likely played a role in her decision to move forward. Fellowship and solidarity surely have their place in the stories we tell to explain the nature of power.
Alliance reply: You should contact your congressional reps about this and demand action and investigation. Also contact the Vermont and US departments of Labor.
Twelve years later, Dr. Richter will watch Gov. Peter Shumlin, a Democrat, sign a bill on Thursday that sets Vermont on a path toward a single-payer system — the nation's first such experiment — thanks in no small part to her persistence. Though scores of people pushed for the bill, she was the most actively involved doctor — "the backbone," Mr. Shumlin has said, of a grass-roots effort that helped sway the Democratic Legislature to pass it this spring even as other states were suing to block the less ambitious federal health care law. ...
As in all states, the cost of health care has increased sharply in Vermont in recent years. It has doubled here over the last decade to roughly $5 billion a year, taking a particular toll on small businesses and the middle class. All 620,000 of the state's residents would be eligible for coverage under the new system, which proponents say would be cheaper over all than the current patchwork of insurers. A five-member board appointed by the governor is to determine payment rates for doctors, what benefits to cover and other details. ...
Dr. Richter said she embraced the idea of a single-payer system as a young doctor in Buffalo, where many of her patients put off crucial treatments because they were uninsured. As a medical student, she saw a patient with a life-threatening heart infection caused by an infected tooth that had gone untreated because he lacked dental insurance. "He was in the hospital for six weeks, and I was like, 'This makes no sense,' " she said. ...
John McClaughry, a former Republican state senator who is against the new law, said Dr. Richter meant well but did not understand the "long-term damage" it would wreak. In particular, he said the law would drive away businesses that did not want to help pay for it. "She'll tell you that putting in single-payer will attract businesses from all over the place," said Mr. McClaughry, vice president of the Ethan Allen Institute, a conservative research group. "I don't think she has any appreciation of business decisions at all." ...
Some supporters of single-payer health care say Vermont's law does not go far enough, mostly because it would allow at least a handful of private insurers to stay in the market indefinitely. Self-insured businesses like IBM, the state's largest employer, could continue providing health coverage to workers under the law, though they would have to help finance the new system, possibly through a payroll tax.
Physicians for a National Health Program is among the critics, saying the law "falls well short of the single-payer reform needed." Allowing private insurers to remain in the state will prevent meaningful savings, the group says.
Or is this the year they join the ever-growing list of small businesses that have been "purged" by their insurance carrier?
For several years now, insurance companies have been "purging" small business accounts they no longer consider profitable enough or that their underwriters believe pose too much risk. I became familiar with "purging" (yes, that's the actual word insurance executives use internally) toward the end of my career as an industry PR man.
Virtually unknown outside of a few executive suites until I disclosed it in testimony before the Senate Commerce, Science and Transportation Committee in June 2009, the practice is most prevalent at the big for-profit insurance companies -- the ones that are under the gun to meet investors' profit expectations every three months. Along with "rescinding" (cancelling) the policies of individuals who become seriously ill, purging small businesses that employ workers who get sick is a tried-and-true way of meeting Wall Street's expectations.
All it takes is one illness or accident among employees at a small business to prompt an insurance company to hike the next year's premiums so high that the employer has to cut benefits, shop for another carrier or stop offering coverage altogether, leaving all their workers -- and their dependents -- uninsured. ...
Meanwhile, U.S. health insurers are reporting record profits, and their CEOs are topping the list of highest paid corporate executives. So much for celebrating National Small Business Week.
Mr. Gingrich, the former speaker of the House who led a conservative resurgence in the 1990s, said the Republican Medicare plan was "too big a jump" for Americans and compared it to the health care overhaul championed by President Obama. "I'm against Obamacare, which is imposing radical change, and I would be against a conservative imposing radical change," Mr. Gingrich said on the NBC program "Meet the Press."
Milliman's researchers said that employees are paying around $8,000 of the total annual healthcare costs, higher than other areas of consumer spending, as employers offer health plans with higher deductibles, and co-insurance and co-payment limits to control costs and to encourage workers to use medical care more selectively. That includes $4,728 in an employee contribution and $3,280 in employee out-of-pocket costs.
"One of the most enduring myths in American health care is that people without health insurance can get care with little or no problem," said HHS Secretary Kathleen Sebelius. "Nothing could be farther from the truth. The result is families going without care—or facing health care bills they can't hope to pay. When the uninsured cannot afford the care they receive, that cost must be absorbed by other payers. This is why expanding access to affordable health insurance under the Affordable Care Act is so important." ...
Approximately 50 million Americans are uninsured. The report found that most uninsured people have virtually no savings. In fact, the median financial assets for all uninsured families are just $20, compared to a median of more than $14,450 in assets for the privately insured who are younger than age 65. Half of families with income at 400% of the FPL have financial assets below $4,100, compared to $50,000 for the privately insured under age 65, and these families can afford to pay in full for only 37% of their hospitalizations. ...
The high cost of hospitalization means that lacking health insurance poses a greater risk of financial catastrophe than lacking car insurance or homeowner's insurance, the HHS observed. Although people are 50% more likely to have a car accident than to be hospitalized in a given year, the average bill for a hospital visit is over two-and-a-half times higher than the average loss for a car accident. And, while the bill for a single hospitalization is about the same as the average loss from a house fire, a person is ten times more likely to be hospitalized than to experience a house fire.
Since last year's meeting it's estimated that another 50,000 people have died in the United States because they are uninsured. That equals the entire population of Kokomo [Ind.]. ...
After hearing Wendell Potter speak in Bloomington on his book tour (I'm sure you all know Wendell Potter) a friend said to me, "I sometimes thought I was crazy, a conspiracy theorist – now I know they really are evil." I read and talked to Wendell about his book, "Deadly Spin." What stirs my anger the most is the stealth and perversion you've used to shape public opinion. Your PR campaigns have nurtured fear and confusion in the minds of reasonable and caring Americans.
I imagine it must be very difficult hold steady the concept of "I'm a good person and I work for a corporation that by its very nature lacks compassion and is indifferent to suffering." But good and intelligent people can sometimes fall into a trap.
Everyone in this room knows that it's all about money and power. We know WellPoint's sordid history of rescission, rigged software, cherry-picking of healthy patients and denial of care. We know about the barriers you build, making it so difficult that people give up or die fighting with you.
I hope that one or some of you in this room who feel the stirrings of having sold out will find the courage to go public with inside information because your business model is taking down America.
Angela, it takes 285 public school teachers in Indiana who earn an average of $47,000 a year to equal your 2010 compensation package of $13.4 million. Would you kindly tell us why you are entitled to so much more than them?
Like the federal reform law, Massachusetts's plan required people to buy insurance and employers to offer it or pay a fee. It expanded Medicaid for the poor and set up insurance exchanges where people could buy individual policies, with subsidies for those with modest incomes.
Since reform was enacted, the state has achieved its goal of providing near-universal coverage: 98 percent of all residents were insured last year. That has come with minimal fiscal strain. The Massachusetts Taxpayers Foundation, a nonpartisan fiscal monitoring group, estimated that the reforms cost the state $350 million in fiscal year 2010, a little more than 1 percent of the state budget. ...
The average premiums paid by individuals who purchase unsubsidized insurance have dropped substantially, 20 percent to 40 percent by some estimates, mostly because reform has brought in younger and healthier people to offset the cost of covering the older and sicker.
"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.
The rich in 1955 paid far more of their income in taxes than today's rich. In 2008, the new IRS data show, the top 400 paid only 18.1 percent of their total incomes in federal income tax. The top 400 in 1955 paid 51.2 percent of their total incomes in tax. ...
You don't have to go all the way back to 1955 to see how little today's top 400 are paying in taxes. In 1992, the IRS stats detail, only 33 of the top 400 paid less than 20 percent of their incomes in federal income tax. In 2008, 253 did. ...
The main reason: Today's rich are getting more and more of their income from capital gains — the profits from buying and selling stocks, bonds, and other assets — and these capital gains now face a substantially lower tax rate than they did two decades ago.
Some specifics: In 1992, the top 400 grabbed 26 percent of their income from paychecks and 36 percent from capital gains. In 2008, by contrast, only 8 percent of top 400 income came from salary — 88 of the year's top 400 didn't even have jobs — and 57 percent came from capital gains.
These 2008 capital gains faced only a 15 percent tax rate, down from a 1992 rate almost twice that high.
Most of the business community is ecstatically happy. Most of those who care about education and the poor — or those who are part of those communities themselves — are apoplectic.
Eric Schneiderman will probably fail, as did his predecessors in that job; the honest sheriff doesn't last long in a town that houses the Wall Street casino. But decent folks should be cheering him on. Despite a mountain of evidence of robo-signed mortgage contracts, deceitful mortgage-based securities and fraudulent foreclosures, the banks were going to be able to cut their potential losses to what was, for them, a minuscule amount.
In a deal that had the blessing of the White House and many federal regulators and state attorneys general—a settlement probably for not much more than the $5 billion pittance the top financial institutions found acceptable—the banks would be freed of any further claims by federal and state officials over their shady mortgage packaging and servicing practices and deceptive foreclosure proceedings.
At the same time, the SEC and other federal regulatory bodies are making sweetheart deals with the bankers to close off accountability for creating and collecting on more than a trillion dollars' worth of toxic mortgage-based securities at the heart of the nation's economic meltdown—a meltdown that has seen the national debt grow by more than 50 percent, stuck us with an unyielding 9 percent unemployment and left 50 million Americans losing their homes to foreclosure or clinging desperately to underwater mortgages. On top of which an all-time high of 44 million people are living below the official poverty line and fewer new homes were started in April than at any other time in the past half century. With housing values still in free fall, we continue to make the bankers whole. ...
Last week, it was revealed that Schneiderman's office has demanded an accounting from Bank of America, Morgan Stanley and Goldman Sachs as to the details of their past practice of securitizing those mortgage-based packages that proved so toxic. Maybe he will fail against such powerful forces, as did Spitzer and later Andrew Cuomo, but it is a test worth watching, since no one else, from the White House on down, seems to be concerned with holding the bailed-out banks accountable for the massive pain and suffering they inflicted on the public.
On Thursday, Secretary of Health and Human Services Kathleen Sebelius and a group of Senate Democrats contended that's not the case. ...
Sebelius, Whitehouse and the other Senate Democrats argued that the House Republican budget blueprint drafted by Rep. Paul Ryan (R-Wis.) would reopen the "donut hole," the prescription drug coverage gap for seniors on Medicare. ...
The Democrats released a report Thursday showing what they said would be the state-by-state impact of the Ryan budget plan on seniors affected by the donut hole. The total additional cost to seniors annually would be $2.2 billion for prescription drug costs and $110 million for wellness visits, they said.
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