ISM Canada is a subsidiary of IBM Canada, which provides outsourcing information technology solutions to clients. CEP members provide a number of services to ISM, including applications analysts, mid-range operators, mainframe operators and programmer analysts.
The Armonk, N.Y.-based company's workforce has been expanding rapidly in emerging markets while its U.S.-based workforce has shrunk. IBM's lobbying included international issues such as income tax arrangements with China, India, Brazil and Korea; trade issues with China concerning rare-earth minerals; and import/export issues surrounding certain sensitive products such as encryption technologies.
The company lobbied Congress, the Department of Commerce, the Department of State, the Securities and Exchange Commission and the National Security Council, among other agencies.
Even more shocking for the reputation of that most staid of hardware giants - IBM isn't just considering letting its staff muck about with the machines at home. As part of the tax rules regarding the purchase the machines must be used for two years as the recipient's primary business machine.
Editor's note: Selected reader comments concerning this article follow:
Although currently you are doing well as a business, you are much more vulnerable than you think because you no longer treat your employees the way they were treated during the rapid growth years. The most productive and innovative employees always felt that they had a safe job if they always worked hard, maintained and enhanced their skills, and worked effectively with colleagues. This is no longer the case since today your skilled and effective employees may find themselves having to train someone in another country who will be assuming their job or hear of another executive getting a big bonus for improving 'efficiency' while they get a 2 percent raise.
Employees at both companies will have a grace period of several months to decide. Neither offers domestic partner benefits to non-married hetero couples, and now that gay weddings are legal, the exception will no longer be available to same-sex workers. Most companies in states where gay marriage is legal continue to offer the option to gay couples, according to a 2011 study cited by the Journal. Click to read a critic who thinks President Obama is failing to lead on gay marriage.)
Unless the current leadership re-examines and learns the management techniques of earlier IBM executives, the earnings growth and stock appreciation in recent years are only a temporary "bubble".
However, technology and engineering unions do exist. WashTech represents a portion of Microsoft employees. Alliance@IBM, possibly one of the oldest computer technology unions, represents IBM employees. Then there's IEEE for electrical engineers, which has some union-like characteristics, the Programmer's Guild aimed at bettering the programmer profession and the Freelancer's Union for those technical workers who operate on their own. But these groups represent a tiny fraction of the total workforce. Out of the approximate 3,000,000 tech workers in the United States, maybe 5,000 in total are union members. Compare this to coverage of other highly-skilled trade unions, like the Screen Actor's Guild or the American Federation of Teachers, both of which currently represent the majority of employees in those occupations. ...
In a way, it's a very selfless worldview where rational accomplishment is a goal in and of itself, there's no need for power, and all anybody needs in life is access to information. But at a certain point, freedom of information can only go so far. Improving peoples' lives requires access to power, even if the bureaucratic processes involved in achieving that power are completely abhorrent to the independent computer programmer lifestyle.
In the world of labor relations, organized unions have been the best option towards progress for workers. So far, nobody has been able to develop an app that can replace them.
Can anyone on this board certify this information (1.7 million hits/views) that would assist me in this section of my book? Here is the context:
The IBM culture had strayed but it was not broken.
Mr. Gerstner's book and similar articles that examine IBM all culminate in 1999; it is as if with IBM's financial recovery, the story ended. It did not. The story had just begun for most IBM employees. History needs more perspectives before it closes the book on IBM's centennial celebration. History should demand the telling of the employee perspective.
IBMers continue to endure the effects of what many consider the watershed event of Lou Gerstner's tenure. On July 1st, 1999, IBM eliminated its pension and health care plans.
In the 90 days following the announcement, IBM's U.S. employees inundated a Yahoo! website with almost 1.7 million views. Congressional leaders called hearings. In September, the Treasury Department issued a moratorium on conversions from defined benefit plans to cash balance plans. Finally, because of the outcry, IBM modified its original plans—extending its defined benefit pension plans to employees over 40 years of age with more than 10 years of service.
Yet, even after this modification, the changes affected more than fifty percent of the IBM U.S. population. These employees, even twelve years later, shake their heads and remark of this one event, "I awaken each and every day reminded of what I and my family have lost. We will never forget who is to blame."
Lou Gerstner wrote of this change that "it created a great furor among a small group of IBM employees." It was, rather, a great furor among a great number of IBM employees. And IBM continues down this same financial path. Employees and their families continue to fund IBM's on-going record earnings. There is no win-win relationship. The furor continues worldwide.
Thanks for your help. Pete
Cons: Management - be careful of your leadership. That can be your biggest hero or your worst enemy. Due to political nature, if things don't go well on an assignment, management will find someone to blame - it could be you. Beware of undocumented promises from management. At IBM, if it isn't in writing, it was never said. Oh, and by a huge measure, raises suck or are non-existent. Lots of raises go through lengthy 'dry spells'
Advice to Senior Management: Support your people above all else. Give them what they need to be successful, and if they need more tools, training, etc - cough it up. Don't make promises that you are unwilling to backup - it destroys your credibility
Cons: No training other than silly online training of low quality. Too many management changes with no real effect. Partners/AP not performing. Absence of people management skills from Partners and AP. No transparency with performance appraisals. Few promotions. No pay increase. Over the last years many key consultants left GBS and nothing was done about it. The quality overall is decreasing. Older consultants end up staying because they have very good benefits package and no pressure to perform.
Advice to Senior Management: Change and do it fast. Invest in people. People are the asset of the consulting business not processes and products. Lower the age and band levels average
Cons: The extremely negative atmosphere made it a very hard place to work. Everybody was stressed out about coming to work and wondering when, not if, the next layoff would occur and who was next on the chopping block. There is and was little to no upper progression for most. The supposed mentoring program was a joke. IBM Burlington is just about the only game in town with decent wages and they know it. Little to no acknowledgement of a job well done. Lack of communication. The type of business is very cyclical with many ups and downs. When the business is down, the first thing they do is get rid of people and equipment.
Advice to Senior Management: IBM needs to remember that people are its number one asset and to treat them accordingly. Structure the company to weather the ups and downs and to think more long term instead of short term.
Cons: I've seen many really good people not rewarded for their hard work with compensation or career advancement; others have been rather incompetent and still manage to work there way up pretty quickly. Starting salaries are always competitive but raises are pitiful from that point on (this is standard in the industry) with new hires coming in at higher rates than the one year experienced hires make. Similar things happen to experienced hires -- once you're hired don't expect to watch your salary grow! Too much bureaucratic nonsense to complete, and management puts way too much emphasis on "utilization" whereas I know many other firms that give comp time for working more than 40-45 hrs/week.
Advice to Senior Management: Reward your people! Keep your good people happy so they don't leave and don't make us fill out so much paperwork. Invest in team building.
But a new survey of 250 large companies by Towers Watson shows that many of them have pared back on their retiree insurance plans and others are planning to discontinue them permanently. Stuart Alden, Towers Watson's senior health care consultant, said these changes are "significant" ...
When asked what alternatives to early retiree plans employers were considering, 42% said they're considering terminating early retiree plans and will encourage workers to consider buying health insurance through "health exchanges" instead.
The deck is stacked against the average person. This HBO documentary begins with the "hot coffee" lawsuit that awarded $3 million to an 81 year old woman and how "Corporations and Politicians" spun the tale.
The pictures are pretty graphic of what "really happened" along with other stories of how the Judicial System has been gamed by Corporations and front groups of the deep pockets of Corporations like the US Chamber of Commerce to elect "Corporate Friendly Judges".
HBO is presently airing the program: "Hot Coffee".
America’s Health Insurance Plans (AHIP), the insurance lobbying group, warned in a recent report that the rapid growth of HSAs will be hurt unless Congress exempts them from the 80 percent requirement – or abolishes the threshold altogether. ...
Having spent nearly 20 years in the health insurance industry, I knew it was just a matter of time before AHIP would mount a big campaign to ensure a bright future for HSA plans.
One of the reasons I left my job in the insurance industry was because I could not in good faith continue to promote HSA plans as the best thing since sliced bread, as I was expected to do. I knew from my own research that these plans were not good options for most Americans. I came to realize that ever-increasing numbers of people who were enrolling in them were actually joining the ranks of the underinsured because they had to spend far more out of their own pockets for care than they ever had before. ...
What Ignagni did not say was that only the wealthiest Americans can afford to sock any money away in their HSAs and to use more of their own resources to pay for care. She also didn’t acknowledge that the real reason for the rapid growth of HSAs is that her industry is well on its way to eliminating all health plans that don’t feature high deductibles. Insurers don’t want anything to stand in their way.
Insurers spend less on care for people enrolled in HSAs, which is why they are so profitable. The requirement to spend at least 80 percent of premiums on medical care would put a crimp in those profits. Hence, the real reason for the AHIP report. ...
Last year, according to the Employee Benefits Research Institute (EBRI), the average balance in an HSA was just $1,355—almost 5 percent less than in 2009—and very little of that money was contributed by employees. The problem is that the majority of people enrolled in these plans, often against their will, simply do not have the disposable income to contribute any significant amounts of money to their HSAs.
As I noted earlier this week, the median household income in this country is actually 5 percent lower today than it was in 1999, after adjusting for inflation. Most of that decline occurred during the George W. Bush administration, which joined the health insurance industry in persuading Congress to pass legislation making HSAs more attractive by converting them to tax shelters.
That tax exemption has turned out to be a terrific new way for wealthy Americans to avoid sending money to the IRS. The problem, of course, is that the tax shelter is of virtually no value to people who don’t have the money to put into an HSA.
People who are enrolled in these plans are the first to tell you that. Most participants in the GAO survey said they would not recommend HSAs to anyone who might not have the funds to meet the high deductibles. Not only that, they said they would not recommend them to anyone on maintenance medication, to anyone who has a chronic condition, and to anyone with children. ...
HSAs and similar high deductible plans are a central part of the industry’s strategy to shift more and more of the cost of care from them to us. To get the job done, they are encouraging employers to go “full-replacement.” That’s the insurance industry’s euphemistic term for eliminating all benefit plans except those with high deductibles.
"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 Wall Street bailout of 2008 has radically altered the banking business. The bailout was supposed to keep credit flowing to Main Street, but it has wound up having the opposite effect. Small and medium-sized businesses have traditionally been the main engines for increasing employment, and they need bank credit for their working capital; but today credit to local businesses has collapsed nearly everywhere. That’s why so many states—the total is now fourteen—are considering turning to state-owned banks to get local credit flowing again.
The credit collapse of September 2008 was triggered by the speculative activities of giant Wall Street banks. These profligate banks, which would have gone bankrupt without federal support, have emerged from the crisis bigger and more powerful than before. The federal government has supported and subsidized bank consolidation, resulting in the elimination of more than a thousand community banks by takeover or failure.
The five largest banks now hold 40 percent of all deposits and 48 percent of all bank assets. These banks—Bank of America, Wells Fargo, JPMorgan Chase, Citigroup, and PNC—currently control more deposits than the next largest 45 banks combined.
They are big, they are powerful, and they have lost interest in local lending. In the past three years, the four largest banks have cut back on small business lending by a full 53 percent. The two banks that were the largest recipients of TARP funds, Bank of America and Citigroup, have cut back on local lending by 94 percent and 64 percent, respectively.
Why? In 2010, the six largest bank holding companies made a combined $75 billion; and of this, $56 billion was in trading revenues—income from speculating in derivatives, futures, commodities, and currencies. If the too-big-to-fail banks win on these bets, they win big and can pocket the proceeds. If they lose, the federal government can be relied on to bail them out. In those comfortable circumstances, why lend to risky local businesses that might go bankrupt, or to homeowners who might default?
You only need to look at the way they treat 25 people.
The top 25 hedge fund managers in the United States collectively earned $22 billion last year, and yet they have their own cushy set of tax rules. If they operated under the same rules that apply to other people -- police officers, for example, or teachers -- the country could cut its national deficit by as much as $44 billion in the next ten years.
We're not talking about "raising taxes on the rich," either -- although that's an excellent idea. (There's an automated petition here that will encourage your representative to do just that.) This money could be raised simply by removing a tax loophole that protects hedge fund managers. And that's not counting all the other people who run hedge funds. We'd get that $44 billion from just 25 people. They can certainly afford it, and at least one of them (George Soros, #2 on the list) undoubtedly would approve.
But they won't do it. Instead of taking a simple step that could net as much as $4.4 billion per year, House Republicans have passed a budget that cuts $30 million for flood control and emergency funds that would help people avoid being hurt or killed in storms like the ones we've seen in New Orleans, Birmingham, the Midwest, and all across the country. They voted to cut $336 million from the National Oceanographic and Aeronautical Administration to track and predict violent storms. ...
Now the Republicans are going after Social Security and Medicare. Their new budget eliminates Medicare (yes, it does) and replaces it with vouchers that will only cover a fraction of their medical costs. The Congressional Budget Office reports that people who reach Medicare age in 2030 will have to pay twenty thousand dollars more per person as a result. Know how many of those people could get the old Medicare coverage if you taxed those 25 hedge fund managers the same way everybody else is taxed?
All of them. ...
If you took away this tax loophole for hedge fund managers, you could actually increase Social Security benefits by more than $1,000 per year for every baby boomer. In 2010 dollars, that comes to an average benefit increase of nearly 10 percent. And that's just from 25 people. ...
But wait, the Republicans will say. That would kill jobs, they'll say. These people are "job creators" and "wealth creators," they'll say. No, they're not. More often than not, in fact, they're job destroyers. They make their money by betting for or against certain events -- literally "hedging their bets" -- and on more than one occasion they've been accused of creating the negative event they're betting against. Even if they don't do anything unscrupulous, these negative bets make it harder for certain ventures to succeed. ...
So does the closing of this "billionaire's loophole." If the loophole was closed and the Bush tax cuts for the wealthy were finally ended, in fact, we could cut the deficit by another $8.8 billion over the next ten years -- just from these 25 people.
After all, it has been faith in "free-market economics" as a kind of secular religion that has driven U.S. government policies - from the emergence of Ronald Reagan through the neo-liberalism of Bill Clinton into the brave new world of House Republican budget chairman Paul Ryan.
By slashing income tax rates to historically low levels - and only slightly boosting them under President Clinton before dropping them again under George W. Bush - the U.S. government essentially incentivized greed or what Ayn Rand liked to call "the virtue of selfishness."
Further, by encouraging global "free trade" and removing regulations like the New Deal's Glass-Steagall separation of commercial and investment banks, the government also got out of the way of "progress," even if that "progress" has had crushing results for many middle-class Americans. ...
The old notion was that a relatively affluent middle class would contribute to the creation of profitable businesses because average people could afford to buy consumer goods, own their own homes and take an annual vacation with the kids. That "middle-class system," however, required intervention by the government as the representative of the everyman. Beyond building a strong infrastructure for growth - highways, airports, schools, research programs, a safe banking system, a common defense, etc. - the government imposed a progressive tax structure that helped pay for these priorities and also discouraged the accumulation of massive wealth. After all, the threat to a healthy democracy from concentrated wealth had been known to American leaders for generations. ...
In his first inaugural address, Reagan declared that "government is the problem" - and many middle-class whites cheered. However, what Reagan's policies meant in practice was a sustained assault on the middle class: the busting of unions, the export of millions of decent-paying jobs, and the transfer of enormous wealth to the already rich. The tax rates for the wealthiest were slashed about in half. Greed was incentivized. ...
Ironically, the Reagan era came just as technology - much of it created by government-funded research - was on the cusp of creating extraordinary wealth that could have been shared with average Americans. Those benefits instead accrued to the top one or two percent. The rich also benefited from the off-shoring of jobs, exploiting cheap foreign labor and maximizing profits. The only viable way for the super-profits of "free trade" to be shared with the broader U.S. population was through taxes on the rich. However, Reagan and his anti-government true-believers made sure that those taxes were kept at historically low levels. ...
The consequences of several decades of Reaganism and its related ideas are now apparent. Wealth has been concentrated at the top with billionaires living extravagant lives that not even monarchs could have envisioned, while the middle class shrinks and struggles, with one everyman after another being shoved down into the lower classes and into poverty.
Millions of Americans forego needed medical care because they can't afford health insurance; millions of young people, burdened by college loans, crowd back in with their parents; millions of trained workers settle for low-paying jobs; millions of families skip vacations and other simple pleasures of life. ...
With Americans unable to afford the new car or the new refrigerator, American corporations see their domestic profit margins squeezed. So they are compensating for the struggling U.S. economy by expanding their businesses abroad in developing markets, but they also keep their profits there. ...
When a majority of Americans voted for Republicans in Election 2010 - and with early polls pointing toward a likely GOP victory in the presidential race of 2012 - it's obvious that large swaths of the population have no sense of what's in store for them as they position their own necks under the boots of corporate masters. The only answer to this American crisis would seem to be a reenergized and democratized federal government fighting for average citizens and against the greedy elites. But - after several decades of Reaganism, with the "free market" religion the new gospel of the political/media classes - that seems a difficult outcome to achieve.
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