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Highlights—October 1, 2011

Retirement Heist:

Throughout the IBM Pension heist, Ellen E. Schultz, a Pulitzer Prize winning investigative reporter with the Wall Street Journal, exposed IBM's and other companies shenanigans that have cost retirees millions and millions of dollars, while enriching corporate executives.

Ms. Schultz has just published a book that every IBMer should read: Retirement Heist: How Companies Plunder and Profit From the Nest Eggs of American Workers. Many IBMers are aware of the "cash balance heist" of 1999. However, IBM has been stealing money from the pension plan dating back to 1991, well before the Gerstner era.

"Americans have long been burdened by the overwhelming challenge of saving for retirement, as tax deductions for retirement savings favor the highest income earners and pension coverage erodes. But as an economist investigating the retirement crises I was shocked at Ellen Schultz's exposure of outright lies, manipulations, and pure greed of the employers trusted with our retirement funds. Retirement Heist will help ordinary workers pressure Congress's to enact serious pension reform." -Teresa Ghilarducci, Director of the Schwartz Center for Economic Policy Analysis and author of When I'm Sixty-Four: The Plot Against Pensions and the Plan to Save Them

Read more...

  • Poughkeepsie Journal: IBM leads deal for 2,500 N.Y. jobs. By Craig Wolf. Excerpts: IBM Corp. will invest $3.6 billion in a five-year New York-based program that takes microchip production to new levels. Gov. Andrew Cuomo announced the program Tuesday, saying the state has entered into agreement with five companies for their total investment of $4.4 billion over five years and job creation worth 2,500 positions in several sites, including East Fishkill.

    Details of how many jobs go where and when were not precise, an apparent concession to IBM's policy of not disclosing site-specific totals. But no state money is going directly to the companies, Cuomo said, in a switch from some previous deals with IBM. However, New York taxpayers are investing $400 million in the State University of New York's massive Albany NanoTech complex, formally known as the College for Nanoscale Science and Engineering. There, IBM and many other companies do research and development the partners then take to market individually to power everything from high-end computers to cellphones and tablets. ...

    The actual jobs impact is uncertain. Until several years ago, IBM gave out headcount data for specific sites. Growth and shrinkage could be known. But it stopped making such announcements, not only for sites, but for whole states and even the United States.

    IBM has been in a downsizing mode domestically for years as a matter of corporate policy, adding jobs with one hand while reducing them with the other. Its growth has been overseas.

    Dutchess has not been spared the shrinkage. IBM's Dutchess population, which was stated to have been 10,700 in 2008, is down to a payroll of about 7,700, according to documents reviewed by the Poughkeepsie Journal.

  • Poughkeepsie Journal: Reader comments concerning the above article. Selected comments follow:
    • So If IBM won't release detailed numbers concerning just how many employees are (or will be working) at each site, how can the State of New York verify that IBM is holding up their end of this deal??? Honestly folks, does anybody honestly trust IBM to do the right thing here???
    • The key word here is "Retain". Cuomo said IBM will have "additional high-technology positions" including 950 at its East Fishkill and Yorktown Heights, Westchester County, sites. Some years ago Pataki agreed to a plan for the 300mm plant (323 bldg) and most of all of the jobs that filled that plant were from in house or other IBM sites that reduced head count. Which means many mangers took MFG jobs from other sites and transferred from Pok to Fishkill. I saw it with my own eyes. IBM uses this ploy to make money on partnerships and then reduce its operating costs.
    • Some of my former tenants have gone to the Albany area for job offerings. From what I understand this "partnership" is very loosely held, so far at least, and is masterminded by Middle East, Asian and German companies. IBM is participating as a partner. These former tenants have 10 or more years of tech experience and they don't have solid jobs yet. They say hey are in a holding pattern. My former tenants were long time IBM employees who were "let go" shortly before their official retirement time. They are skeptically optimistic at this point. They say it is better than "digging ditches" for me. I don't trust IBM. They have raped our community. But we all need to eat.
    • Anyone else here feel IBM is playing a shell game with US employees? Lay them off and send them to the government unemployment line, then welfare. Get paid to hire them again. Repeat. Who owns who here? Government is bought and paid for. This is just one company in one county. Multiply across nation.
    • All smoke and mirrors going on here. While it would be nice if the hired what they promise, they still are firing 9% per year of dedicated employees. That is a fact! Cheaper ti hire new then retain older employees. IBM is fooling New York State again.
  • Yahoo! IBM Employee Issues message board: "Re: IBM / Intel in Albany" by Paul Sutera. Full excerpt: And who could forget the threat by Lou Gerstner to then governor Mario Cuomo that if NY taxes weren't lowered, he would pull IBM's operations out of NY State. He made good on that promise for IBM Kingston. I can see the building where I used to work and weeds growing up out of the parking lot. It has this post-apocalyptic look about it.

    Now it goes the other way, the state and municipalities falling all over themselves and giving big tax-breaks and even seed money to a capricious and dishonest IBM that often decides to take the money and run, and will employ any sort of evil tricks with phone directories, even hiding IBM India employees in IBM US phone books who are only temporarily here at best.

    Sometimes IBM is planning a layoff even as the last bit of payola arrives that is tied to keeping jobs alive at a particular site. I get so tired of people saying: That's the IBM of today, that's the world we live in. Especially if they collect the checks from "another" world that IBM used to be, while in the ballot box firmly casting votes for our new brave world of corporate thuggery with the glaze of ideology dropping down like a grey film over unseeing eyes.

  • National Public Radio (NPR) Books: 'Retirement Heist': How Firms Trimmed Pensions. Excerpts: Companies have claimed for years that old-style pensions were unsustainable. Author Ellen Schultz tells Morning Edition host Steve Inskeep that there's another explanation.
    "The main narrative is that [companies] are struggling to pay both their pensions and these unexpectedly high health care costs for the retirees," Schultz says. "What isn't known is that companies were well-prepared for this phenomenon. The plans were in fact significantly overfunded. They had more than enough to pay every dime for every person currently employed and already retired." ...

    In the early 1990s, Schultz says, companies were looking for new ways to push out workers, especially older, more expensive ones. She says the expensive way would have been to pay severance, "but the cost-effective way was to instead promise them a bit more pension money in lieu of severance." In the end, "you've just laid off somebody who's expensive and it has cost you nothing." ...

    David Certner, a policy director at the AARP, says that "corporations weren't always so transparent and clear about what they were doing." Schultz says there was a massive transfer of wealth over the past two decades, from a multitude of retirees to a small number of executives. But while she calls her book Retirement Heist, she concedes that nothing that happened was illegal.

    "When you have a properly funded plan, it doesn't matter how many retirees you have or how long they live," Schultz says. "It's not the fact that you have a lot of retirees; it's the fact that you have abused the pension plan."

  • Yahoo! Finance's Daily Ticker: Retirement Heist! U.S. Pensions Plundered By Corporate Greed, Author Says. By Peter Gorenstein. Excerpts: If the average worker didn't have enough to worry about, Ellen Schultz - an award-winning Wall Street Journal reporter and author of Retirement Heist: How Companies Plunder and Profit from the Nest Eggs of American Workers -- says that in some instances the fat paychecks of the top paid executives are coming directly out of the pocket of average workers.

    "As recently as a decade ago there was a trillion dollars, a quarter of a trillion in surplus assets," in corporate funds, Schultz tells The Daily Ticker's Aaron Task in the accompanying clip. "There was plenty of money in pension plans; there was plenty to pay the benefits but corporations went about taking the money away."

    As the title of the book suggests, Schultz believes this was no accident, claiming corporations have been "exaggerating their retiree burdens" and plundering retirement plans in a variety of ways, including:

    • Siphon billions of dollars from their pension plans to finance downsizings and sell the assets in merger deals.
    • Overstate the burden of rank-and-file retiree obligations to justify benefits cuts, while simultaneously using the savings to inflate executive pay and pensions.
    • Hide growing executive pension liabilities, which at some companies now exceed the liabilities for the regular pension plans.
    • Purchase billions of dollars of life insurance on workers and use the policies as informal executive pension funds. When the insured workers and retirees die, the company collects tax-free death benefits.
    • Exclude millions of low-paid workers from 401(k)'s to make the plans more valuable to the top-paid.

    According to Schultz, these and related measures have become commonplace among Fortune 500 companies, including AT&T, Bank of America, JP Morgan, IBM, Cigna, General Motors, GM, Comcast, UPS and the NFL, just to name a few.

  • Yahoo! IBM Pension and Retirement Issues message board: "Re: Another Ellen Schultz interview" by "netmouser". Full excerpt: The article and the video are both really good. It is so clear that companies robbed Peter (workers) to pay Paul (executives), while crying to lawmakers and courts that the burden to pay Peter was so burdensome. It is such fraud. How did we get to "here"? More than sad that oversight agencies and government and courts let it all play out this way without stopping it.
  • Glassdoor IBM reviews. Selected reviews follow:
    • IBM Delivery Project Executive: (Past Employee - 2011) “I had a satisfying career at IBM and a fair run at advancement.” Pros: Big company with tons of resources and opportunities to learn and gain professional experience. One can advance quickly if you know the rules of the games. Cons: Big company with big bureaucracy and unrealistic expectations. As some colleagues put it, we are squeezing blood from our folks. IBM has steered away from its core values and have taken to quarterly focus on the bottom line, at the sacrifice of losing the seasoned people and individuals that gives IBM its prowess. Advice to Senior Management: Take time to get to know individuals and their contributions. Support them with realistic actions, not empty management jargons. Look deeper at the individual's actions and results, instead of depending on hearsay and flattery for performance reviews.
    • IBM Account Manager: (Past Employee - 2010) “Great company in the past, only financial driven future.” Pros: Open culture, international behaviour, in the past good salaries, high variation of activities and jobs, whole range from research to consulting. Cons: Mainly managed by financial targets and forecasts, processes are to rigid and new initiatives are very open blocked out. Management is not entrepreneurial it is mainly operational - masters voice from US.
    • IBM Anonymous: (Past Employee - 2010) “Big company, little growth opportunity.” Pros: If you like working in a big company where you do only one thing, this may be the place for you. Cons: IBM seems to be into everything, but doesn't do anything really well. Advice to Senior Management: It would be ideal if IBM had more concentration in a particular area versus trying to maintain what it has.
    • IBM Applications Developer in New Delhi (India): (Past Employee - 2010) “No growth, less pay, creeping the path to get things done!!” Pros: Better work life balance. Cool environment Onsite opportunities. Process oriented company. Training on various technologies, best part of all. Cons: Very disappointing salary structure. big brand with limited skilled people. Don't bother about employees working for years in monetary term. No job role enhancement. Advice to Senior Management: Please try to identify true professionals, rather than listening to crab people around you.
    • IBM Customer Service Representative in Boulder, CO: (Past Employee - 2011) “Leave your humanity at the turnstile.” Pros: Better than being homeless. Good experience if you can survive there. Cons: I worked in Building 22 in the Best Buy/Fluor call center. You will work there as a "contractor" for Kelly Services or CCI. You will never be hired direct. You will never get a raise. There is no paid time off of any kind, no health insurance, no dental, no benefits for a full time job. The training I received was a joke, little to do with what the actual job was, when I made a mistake I was fired via a phone call at home, no warnings, no conversation, just "your services are no longer needed, surrender your badge". You have been warned. Advice to Senior Management: Train your call center employees properly before putting them on the phones.
    • IBM Anonymous in Armonk, NY: (Current Employee) “Great leaning experience, not the best compensation.” Pros: There are many roles within Finance that you may be able to have. Finance people constantly switch roles within the company. People are nice for the most part. Cons: From what I heard from full time employees salary is not the best, and everything is highly based on very strict deadlines, You may put in many hours a week and see no compensation for it. Since it is such a big company and people switch jobs constantly, you may never find an answer for some of your questions, or it may take for ever. Advice to Senior Management: Provide better compensation to employees and be more conscious about their personal time outside IBM, just because all employees have laptops, that does not mean they should always be working.
    • IBM Account Executive: (Current Employee) “100 year old company and it feels like it.” Pros: Iconic American company. Has acquired great companies/technologies. Provides flexibility to change career path. Cons: Inefficiency. Antiquated systems and process can take up half your day. Processes that take minutes at modern companies literally take hours at IBM. Not only it is chaotic and inefficient to get anything done, it's depressing given your realization of how unproductive you've become. Multiple CRM systems, can spend the entire day reporting on what you did, rather than doing 3x more. Poorly run and organized. They strip the value and ingenuity of the companies they acquire. Unattainable quotas. Sales plans without accelerators. Not a company for a serious sales person. Lastly, terrible customer service. 1-800- India, good luck getting your issues resolved. Advice to Senior Management: Modernize internal operations. Spend more time fixing your broken company. Smarter planet is a great slogan but clearly 100% marketing.
    • IBM Financial Analyst in Bratislava (Slovakia): (Current Employee) “good place to start, but better leave in less than a year.” Pros: It's a nice employer to have on your resume for HR recruiters who don't know IBM. You can learn, but have to do it out of working hours as you have so much administration. Cons: Salaries are extremely low. People are constantly leaving to Dell/HP/Accenture. No life work balance at all. Home office is almost impossible. If you don't work till 7, the management threatens to fire you. HR is still a propaganda machine which promises education/salary improvements/career opportunities. Advice to Senior Management: If IBM is outsourcing everything, the quality keeps on going down. This will make IBM a low cost company, which is not always rewarded in a B2B industry.
    • IBM Sales Representative: (Current Employee) “unsatisfying.” Pros: Good job opportunities to further self advancement. Job for life. Excellent technology and acquisitions. Good name in marketplace. Cons: Exceptionally poor executive and local 'leadership.' Full of rhetoric and platitudes. Not a good sales environment. Management and senior management have a bullying approach. Do as i say not as I do. Advice to Senior Management: Say all the right things, actually do very little. Try backing up what you say with real life examples.
    • IBM IT Consultant in Fairfax, VA: (Past Employee - 2009) “Claims of work/life balance are greatly exaggerated.” Pros: Benefits, benefits, benefits. Good training opportunities which lead to industry respected certifications. Cons: Unreasonable expectation to bill 50+ hours a week.
  • LinkedIn's Greater IBM Connection: What is IBM's culture? Selected comments follow:
    • When I joined IBM UK in Scotland in 1985 it was great place to work and a great employer. When I left in 2007 I had not had a pay rise in 8 years despite good results. What company would treat their employees as bad as that ??? You know how I and people like me in IBM UK feel....like shit!!!!
    • As an employee of over five years now, and as someone who gets to work cross brand internationally, I can safely say that the IBM culture varies greatly between brand, project teams within brands, and between countries. Within Rational the culture on the Rational Team Concert (RTC) team is different than that on the Clearcase team or on the marketing team. There's similarities, but also differences. The culture on the DB2 team in the Toronto Labs is different than some of the Rational teams in the same labs, and different yet again from the DB2ers in California. The Rational team in Bangalore is different culturally from the Rational team in Toronto and different again from the team in Raleigh. The services team culture in Rational is different from that in Websphere and different again from GBS. There are a few common aspects throughout IBM from what I can tell. Respect for others definitely seems to be one and a customer focus is likely another.
    • @Scott Ambler - That is great point - It is so true and you have to adjust , learn , engage to work with different team. I do not know whether the following point will be considered as culture or not - There is definite propensity in the IBM rank to make things unduly complex when there are opportunity to make it simple - whether it is software methodology or other management practices. ( Left IBM 2 years back )
    • I'm only a 4-year IBMer. It may be a bit too early for me to comment on "IBM culture". Yet what I heard the most from those around me is "IBM/IBMer has changed in the past few years". The "elders" would always talk about the "good old days", and complain about how things got so harsh in the last few years. One of the common comment is that the company used to value and respect individual employee, and talent development - IBM was famous for its intensive and innovative training programs, for instance. The old time IBMer on the other hand, were proactive in sharing, collaboration, and offering help to each other. People were very proud to be called an "IBMer" because he or she knew that they were part of a great team, not just because of the brand name. This culture, or norm, is certainly dying, and quickly. I was chatting with a colleague the other day. He was a long-time IBMer. He left the company 4 or 5 years ago and just re-joined. He told me the strongest feeling he had since he's back was that everyone he touch based with so far gave him a sense of “passing the buck". Everyone's saying "this is not my scope" or "I'm not the owner for this". He felt the very spirit of IBMer has gone. The spirit of taking responsibility, exploring the unknown, enabling others to achieve, and collaborating for greater success, has died.

      Obviously I joined IBM a bit late and did not have the luck to experience the "good old time". However I did experience the so called "IBMer spirit" in some cross region projects, where people from different background with different objectives would generously offer their ideas, resources and skills to help each other, even though the final result is not in direct benefit of his/her agenda.

      Culture shall be consistent across the enterprise. But I guess different social cultures, status of economic development and societal changes would have impact on a company's culture in different parts of the world. In emerging markets like China, the dramatic social change and high growth of economy put high pressure on the company, and individual employee. The management and the employees are required to deliver extraordinary results, as well as adapting to the rapidly changing market. The strategy and execution tend to be relatively "short-term". The high pressure is driving everyone to look forward, and leaves little room for people to "Think" and "Collaborate".

      Nevertheless, culture is hard to describe and define. What I described above like "IBMer spirit" can be considered result of the corporate culture. I think IBM culture is the infrastructure that the company strived to establish over the years that enables its employees to innovate, excel, and collaborate for success. It's still there. But in some places it has become merely a set of slogans which is not that effective any more.

    • I believe that you have to view the changes in IBM's culture over the years. A timeline could show in detail each major change. Also, you could discuss each major period. I would suggest 4 periods: (1)1911-1953 when the family culture was practiced; (2)1953 - 1980, the time period when IBM ruled corporate America starting with the introduction of the IBM 701 mainframe computer; (3) 1980 - 1992,, the time period starting with the birth of the Personal Computer, the growth of Microsoft and a host of PC companies, ending with the complete destruction of the past 80 years of IBM's corporate culture, the first IBM layoffs of thousands and the downsizing of IBM; then (4) there is the current time period from 1992 - today where IBM has evolved into a completely different corporation with a brand-new culture.
  • San Francisco Chronicle: Top 5 Underestimated Retirement Expenses. By Michael Sanibel. Excerpts: Retiring has become a bigger challenge over the past few years due to declining asset values, high unemployment and a volatile stock market. 401(k) plans have been hit, and fixed income investments are yielding very little due to historically low interest rates. Many companies are changing or eliminating pension plans, forcing employees to invest and save more for their own retirements.

    In this environment, it's more important than ever to figure out what you'll need in your senior years. Good planning goes a long way to ensuring financial security, but even the best laid plans can be upset by unexpected events. Depending on your personal circumstances, you may incur expenses that exceed those on this list.

  • USA Today: How state lawmakers pump up pensions in ways you can't. By Thomas Frank. Excerpts: At age 55, South Carolina state Sen. David Thomas began collecting a pension for his legislative service without leaving office.

    Most workers must retire from their jobs before getting retirement benefits. But Thomas used a one-sentence law that he and his colleagues passed in 2002 to let legislators receive a taxpayer-funded pension instead of a salary after serving for 30 years.

    Thomas' $32,390 annual retirement benefit — paid for the rest of his life — is more than triple the $10,400 salary he gave up. His pension exceeds the salary because of another perk: Lawmakers voted to count their expenses in the salary used to calculate their pensions. No other South Carolina state workers get those perks.

    Since January 2005, Thomas, a Republican, has made $148,435 more than a legislative salary would have paid, his financial-disclosure records show. At least four other South Carolina lawmakers are getting pensions instead of salaries, netting an extra $292,000 since 2005, records show.

  • New York Times: Outsize Severance Continues for Executives, Even After Failed Tenures. By Eric Dash. Excerpts: The golden goodbye has not gone away. Just last week, Léo Apotheker was shown the door after a tumultuous 11-month run atop Hewlett-Packard. His reward? $13.2 million in cash and stock severance, in addition to a sign-on package worth about $10 million, according to a corporate filing on Thursday.

    At the end of August, Robert P. Kelly was handed severance worth $17.2 million in cash and stock when he was ousted as chief executive of Bank of New York Mellon after clashing with board members and senior managers. A few days later, Carol A. Bartz took home nearly $10 million from Yahoo after being fired from the troubled search giant. ...

    Severance policies typically call for a lump-sum cash payment, the ability to cash out stock awards and options immediately instead of having to potentially wait for years, and sometimes even bonuses. And that’s not counting the retirement benefits and additional company stock that executives accumulate, which can increase the total value of their exit package by millions of dollars.

    “We repeatedly see companies’ assets go out the door to reward failure,” said Scott Zdrazil, the director of corporate governance for Amalgamated Bank’s $11 billion Longview Fund, a labor-affiliated investment fund that sought to tighten the restrictions on severance plans at three oil companies last year. “Investors are frustrated that boards haven’t prevented such windfalls.” ...

    The chief executive at Massey Energy was awarded a large severance contract despite presiding over a company barraged with accusations of reckless conduct and with legal claims stemming from one of the deadliest mining disasters in memory. In June, Baxter F. Phillips Jr. was awarded nearly $14 million in cash and stock severance after the company was sold to a competitor, Alpha Natural Resources. Ted Pile, a spokesman for Alpha Natural Resources, said his company was required to honor an employment contract “put in place before we acquired” Massey.

New on the Alliance@IBM Site
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  • Job Cut Reports
    • Comment 9/24/11: Air Canada has opted to transition their Catalogue services (gts) to Cairo. They get paid $500 USD a month & they speak French. How can anyone compete with that? Sadly my colleague is there now, & is showing a bunch of high school graduates how to perform ID administration. But he first needed to show them how to copy/paste. Can you believe this? Join the union & help put an end to this nonsense. -Shadowschild-
    • Comment 9/29/11: To Alliance Supporter: I am no longer on the fence. I'm all in. Just joined the Alliance. 34 years with IBM and hoping to make a difference. -Nolongeronthefence-
    • Comment 9/30/11: To any current IBMers, I again urge you to do *something," no matter how small, to support our cause. I am fortunate enough to be in a financial position where I can easily afford the $10/month to be full member. If you are also able to comfortably shoulder that load, then that would be the most obvious, helpful action to take.

      If you are not so fortunate, there are still other actions you could take. Talk to your co-workers about Alliance, for example. Or leave some Alliance flyers in the lunch room -- a protected right so long as you don't use IBM resources such as their printers, and you don't do it during your working hours (if you look, you'll probably find a National Labor Relations Act flyer posted somewhere in or near your lunch room that describes your protected rights).

      If you are mad and want to get back at IBM, support this cause -- there is nothing that scares IBM more than the prospect of an American union. Heck, merely seeing that they've pushed us so far that we're seriously thinking about it will probably cause them to treat us better. Egypt and Tunisia emboldened other countries like Libya to fight for their rights. Follow the example of our Chilean and Argentinian co-workers, and demand your rights as well. -Flabbergasted-

      Alliance Reply: Excellent comment! If you decide to hand out flyers, within IBM property or even off IBM property, please read the information in the link: http://www.endicottalliance.org/dosdontsflyer.htm You must make sure to follow all the rules, when handing out flyers.

    • Comment 9/30/11: I want to know what gives managers the right to block transfers. If the manager cannot get me a raise then they should not be able to block me from getting out of this stink pot they call Dubuque. To anyone thinking of moving there for a job with IBM, DO NOT! Any job where you are at now is 10X better, trust me. IBM Dubuque's managers are completely useless and should all be fired first and foremost. Then they can give raises to the SA's actually doing the work. Drop the stupid huddles and Green Team as well. Metrics have no place in Dubuque. -GDF Loser-
    • Comment 9/30/11: "I want to know what gives managers the right to block transfers" You know what? It is called not having a union contract! -IBMUnionYes-
    • Comment 9/30/11: -GDF Loser- There is an old joke about "they can't fire me, Slaves have to be sold". These days it applies to transfers too. Live Better Work Union. -Exodus2007-
    • Comment 9/30/11: >> "I want to know what gives managers the right to block transfers." What gives them the right? The fact that you and the majority of other IBM employees don't have a contract that denies them that right. Only the upper executives have contracts spelling out what IBM can and can't do to them. You? You're an "at will" employee. Meaning, if they want to do it to you, they can and will. Wake up, and join the union, or shut up and keep your head down, or leave the company. Those are your choices. -irRational-

      Alliance Reply: To find out more about what an At Will Employee is, click here: http://www.endicottalliance.org/atwillemployment.htm and here: http://www.endicottalliance.org/allianceibmsimplefactsheet.htm

    • Comment 10/01/11: -Flabbergasted- I totally agree, folks need to do something/anything they can to promote the visibility of the Alliance. I always enjoyed handing out flyers at the cafeteria entrance at lunchtime, or at the exit gates before or after work. The expressions on the faces of some as they try to deny that you're there doing that is priceless. I'd recommend that all your supporters try it in groups, the more the merrier. Visibility counts! -Dave G -
    • Comment 10/01/11: Back in the good old days of IBM, a manager could delay your request for transfer for some time. In 1986 IBM East Fishkill had an open site, meaning if you wanted to transfer elsewhere you could. So many people took advantage of it that my request was delayed from the summer of 1986 all the way until December 1988. But no manager in those days wanted to force you to stay in a position. Today the employee alone has almost no power. Nonetheless, ask nicely for a date of departure and keep doing your job. Today there are no guarantees without a union to advocate for the employee. -Anonymous-
    • Comment 10/01/11: To GDF Loser, The managers have the right to do as they wish since you do not have a contract detailing your rights as an employee. The only way this will change is to join the union and vote for for collective bargaining. -Anonymous-
News and Opinion Concerning Health Savings Accounts, Medical Costs and Health Care Reform
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  • Washington Post: Health insurance costs shifted to workers, even as premiums surge. By N.C. Aizenman. Excerpts: Premiums for employer-sponsored health insurance continued to escalate this year even as the share of workers getting less generous coverage reached a new high, according to survey data released Tuesday. In 2011, for the first time, half of workers at small firms with individual policies faced annual deductibles of $1,000 or more. In 2006, that figure was 16 percent. At large firms, the share has grown from 6 percent to 22 percent over the same five years.

    At the same time, the survey by the Kaiser Family Foundation found that premiums for family plans rose 9 percent in 2011, after several years of slower annual growth. A similar recent survey by the consulting firm Mercer found that yearly premium increases have been hovering around the 6 percent mark and will grow by slightly less in 2012. Both sources point to the same fundamental long-term shift: Faced with continually climbing premiums, a record share of employers have moved to plans that require workers to pay more out of pocket.

    “Without any real national discussion or debate, there’s a quiet revolution going on in what we call health insurance in this country,” said Drew Altman, president of the Kaiser foundation, which conducted the annual survey of employers in conjunction with the Health Research & Educational Trust. “Health insurance is becoming less and less comprehensive. . . . And we expect that trend to continue.”

  • New York Times: Health Insurers Push Premiums Sharply Higher. By Reed Abelson and Nina Bernstein. Excerpts: Major health insurance companies have been charging sharply higher premiums this year, outstripping any growth in workers’ wages and creating more uncertainty for the Obama administration and employers who are struggling to drive down an unrelenting rise in medical costs. ...

    The higher premiums are particularly unwelcome at a time when the economy is sputtering and unemployment is hovering at about 9 percent. Many businesses cite the cost of coverage as a factor in their decision not to hire, and health insurance has become increasingly unaffordable for more Americans. The cost of family coverage has about doubled since 2001, compared with a 34 percent gain in wages. ...

    How much the new federal health care legislation pushed by President Obama is affecting rates remains a point of debate, with some consumer advocates and others suggesting that insurers have raised prices in anticipation of new rules that would, in 2012, require them to justify any increase of more than 10 percent. Kaiser pointed out that the increase this year could be an anomaly, after several years of 3 percent to 5 percent increases during the recession.

    Kaiser estimates that one to two percentage points of the increase this year is related to provisions of the law already in effect, like coverage for children up to 26 years old and for prevention services like mammograms. ...

    Consumer advocates contend that the latest requests exceed any documented rise in costs, with some companies enjoying three years of record profits and paying millions of dollars in dividends and executive compensation.

  • USA Today editorial: Health premiums jump, but don't blame 'ObamaCare'. Excerpts: No sooner had the Kaiser Family Foundation, in its annual survey of health insurance, found that the average premium rose a whopping 9% this year to $15,073 for an employer-sponsored family plan, than the usual partisans began pointing fingers.

    Republicans cited the increase as proof of the failure of the 2010 health care law, aka "ObamaCare." Never mind that very few of its provisions have gone into effect, and that experts attribute only a percentage point or two of the 9% increase to the new law. Those provisions have added nearly 1 million young people to their parents' policies and helped people with pre-existing conditions.

    Democrats, meanwhile, attributed the cost surge to greedy insurance companies trying to ram through rate hikes while they still can. Never mind that hefty increases have been compounding for decades.

    Spare us the simplistic explanations. These latest increases are just further evidence of deep, long-standing flaws in the U.S. health care system that are only modestly impacted by the new law.

  • New York Times op-ed: To Save on Health Care, First Crack Down on Fraud. By Kathleen Sharp. Excerpts: LAST week, the Obama administration announced a plan to cut $320 billion over 10 years from the projected growth of Medicare and Medicaid. The plan would raise premiums and deductibles, lower payments to hospitals and require elderly people who receive care at home to make co-payments.

    But before charging consumers more and eliminating valuable services, we should be much more aggressive in recovering money stolen from these taxpayer-supported programs. According to some estimates, health care fraud is a $250 billion-a-year industry, and about $100 billion of that is stolen from Medicare, the health care program for the elderly, and Medicaid, the insurance program for the poor and disabled.

    There are many ways to defraud taxpayers. For example, a hospital chain can buy drugs at a steep discount and then bill Medicare for high sticker prices. Doctors can bill for procedures that never happened, or for drugs that were supplied to them by pharmaceutical companies free of charge, or pharmaceutical companies can promote a drug for risky, unapproved uses.

  • Plan Sponsor: Employment-Based Health Coverage Continues to Decline. Excerpt: While employment-based health coverage is still the dominant source of health insurance in the U.S., it has been steadily shrinking for 18 years. The report, “Sources of Health Insurance and Characteristics of the Uninsured: Analysis of the March 2011 Current Population Survey,” found that in 2010, 58.7% of the non-elderly population (under age 65) had employment-based health benefits, down from 69.3% in 2000.
  • New York Times: Few Bright Spots in Perry’s Health Care Record. By Emily Ramshaw. Excerpts: At campaign stops and in the three Republican presidential debates he has participated in so far, Gov. Rick Perry has made a sport out of bashing the 2006 state health insurance plan of former Gov. Mitt Romney of Massachusetts. He has not missed a chance to yoke “Romneycare” to “Obamacare,” the federal health care reform that Republicans largely revile.

    But while Mr. Perry condemns both efforts to make carrying health insurance mandatory, Texas faces a staggering crisis in health coverage: the state leads the nation in the number of uninsured residents, has the third-lowest percentage of people covered by their employers and spends less per capita than all but one other state on Medicaid, the joint state-federal insurance program for the disabled and poor children.

    In the 10 years Mr. Perry has been governor, his critics say there have been few effective initiatives out of his office to increase either public or private health coverage significantly in Texas, where today an estimated 6.2 million people — one-quarter of the state’s population — are uninsured, including 1.3 million children. ...

    Texas enters the health insurance game at a disadvantage. Mr. Perry likes to remind voters that the state is responsible for more than 40 percent of new jobs created in America since June 2009. But many of those jobs are in the service industry, in agriculture, construction and the small-business sector, which either do not provide insurance or do not pay their workers enough to buy it. Texas Medicaid is austere — many low-income Texans who might qualify for public insurance in other states do not qualify in Texas.

    Just 50 percent of Texans get insurance through their employers, 10 percentage points below the national average. And though health insurance premiums in Texas are slightly below the national average, they have nearly doubled in the last decade. Despite suggestions that Texas’ illegal immigrants are to blame for the sky-high rate of the uninsured, they make up just one-sixth of the total, according to an analysis by the left-leaning Center for Public Policy Priorities, or C.P.P.P.

  • Christian Science Monitor: Health care law's future: four scenarios. Excerpt: One year ago, President Barack Obama signed a sweeping health-care law to fulfill a long-standing Democratic pledge to ensure health-care coverage for all Americans. Passage of the law was a major legislative victory for Obama and helped change the political landscape, but not always in the way Democrats had hoped. Republicans strongly opposed the law and successfully worked public skepticism about it into sweeping election victories in November. Here's a look at the uncertain future of the health care law.
  • truthOut: Montana Governor Schweitzer Wants to Design His Own Universal Health Care System. By Zaid Jilani. Excerpts: As ThinkProgress previously reported, Vermont Gov. Peter Shumlin (D) made history earlier this year when he signed into law legislation that would make his state the first state to lay the groundwork for a single payer health care system. In order to enact this system, the state needs a waiver from the federal health care law, which it will be able to obtain in 2017. Rep. Peter Welch (D-VT) has introduced legislation to move the waiver date up to 2014, an idea President Obama has endorsed.

    Now, another governor is looking to take advantage of flexibility in Obama’s health care law in order to establish a single payer system. Gov. Brian Schweitzer (D-MT) announced yesterday that he will be seeking a waiver to set up his own universal health care system in his state modeled after the single payer Canadian health care system that began in the province of Saskatchewan.

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.

  • The Guardian (United Kingdom): Occupy Wall Street rediscovers the radical imagination. The young people protesting in Wall Street and beyond reject this vain economic order. They have come to reclaim the future. By David Graeber. Excerpts: Why are people occupying Wall Street? Why has the occupation – despite the latest police crackdown – sent out sparks across America, within days, inspiring hundreds of people to send pizzas, money, equipment and, now, to start their own movements called OccupyChicago, OccupyFlorida, in OccupyDenver or OccupyLA?

    There are obvious reasons. We are watching the beginnings of the defiant self-assertion of a new generation of Americans, a generation who are looking forward to finishing their education with no jobs, no future, but still saddled with enormous and unforgivable debt. Most, I found, were of working-class or otherwise modest backgrounds, kids who did exactly what they were told they should: studied, got into college, and are now not just being punished for it, but humiliated – faced with a life of being treated as deadbeats, moral reprobates. ...

    Everything we'd been told for the last decade turned out to be a lie. Markets did not run themselves; creators of financial instruments were not infallible geniuses; and debts did not really need to be repaid – in fact, money itself was revealed to be a political instrument, trillions of dollars of which could be whisked in or out of existence overnight if governments or central banks required it. Even the Economist was running headlines like "Capitalism: Was it a Good Idea?"

  • New York Times: A Tax Plan That Might Not Be So Painful. By Ron Lieber. Excerpts: If you’re among the households with earnings of $200,000 to $350,000 or so, you can be forgiven at this point for thinking that you have a giant target on your back. This week, President Obama once again took aim at what he calls “tax preferences” for these high-income households, proposing two changes that would affect the low six-figure set starting in 2013. ...

    What gets lost in all of the hand-wringing over the proposed tax increases is that many of the people this is aimed at wouldn’t pay a whole lot more. And families who work at it just a bit, using employer-sponsored flexible spending and other accounts to pay for things like day camp and the commuter train and visits to the therapist, could offset that 2013 tax increase and then some.

  • truthOut: Why Don't the Deficit Hawks Want to Tax Wall Street? By Dean Baker. Excerpts: The intensity with which the country's leading deficit hawks continue to ignore financial speculation taxes (FST) is getting ever more entertaining. While deficit hawks like Wall Street investment banker Peter Peterson, Morgan Stanley Director Erskine Bowles and The Washington Post never tire of preaching the virtues of shared sacrifice, somehow sacrifice for Wall Street never features as a part of this story. ...

    Last week, Bill Gates added himself to the list of FST supporters. In a report that he was asked to prepare for the G-20 on funding development assistance, he cited an FST as one possible mechanism. But the deficit hawks never discuss FST. The deficit hawks manage to ignore FST even when they pop up in front of their faces. Two summers ago, Peter Peterson helped to finance a lavish full day set of town halls in dozens of communities around the country. ...

    In short, FST are a route to reducing long-term deficits that has won support both among the general public and among policy experts and leading political figures around the world. Yet, they are somehow excluded from discussions of the deficit in policy circles in the United States. Could this have to do with the fact that so much of the support for deficit reduction comes from Wall Street? It is difficult not to believe that Wall Street's outsized role in pushing deficit reduction has some impact on the route the debate takes. After all, if the Farm Bureau was sponsoring most of the research on deficit reduction and financing the campaigns of the leading deficit hawks, it is reasonable to believe that lower farm subsidies would not be a prominent item in debates on the deficit. ...

    In short, it is hard to understand why taxing financial speculation never appears on the agenda of the deficit hawks or gets mentioned in budget reporting, if the issue really is deficit reduction. On the other hand, if this is all about using an economic crisis to push a long-standing agenda to cut Social Security and Medicare, then everything suddenly makes sense.

  • New York Times editorial: Killing the Recovery. Excerpt: The world has barely dug out of recession and the global economy is again slowing dangerously. Most leaders seem eager to make things even worse. Instead of looking for ways to reignite growth, Europe’s leaders — and Republicans on Capitol Hill — are determined to slash public spending. Europe’s fixation on austerity is also compounding its debt crisis, bringing the Continent even closer to the brink. Meanwhile, China’s government, which is struggling to contain inflation without letting its currency rise, has been trying to slow domestic demand, allowing its trade surplus to balloon. Each of these policies is wrong. In combination, they are likely to tip the world into a deep recession.
  • Huffington Post: The Men We Trusted to Lead Us. By Robert Scheer. Excerpts: Now he tells us. On Wednesday Federal Reserve Chairman Ben Bernanke referred to the nation's unemployment rate as a "national crisis," an obvious if depressing fact of life to the 25 million Americans who have been unsuccessfully attempting to find full-time employment.

    But to finally hear those words from the man George W. Bush and Barack Obama both appointed to lead us out of the great recession is a bracing reminder of how markedly the policies of both those presidents have failed: "We've had close to 10 percent unemployment now for a number of years, and of the people who are unemployed, about 45 percent have been unemployed for six months or more," Bernanke said. "This is unheard of."

    But why is Bernanke just now discovering this after having overseen the Fed's purchase of trillions in toxic mortgage-backed securities from the too-big-to-fail banks that sacrificed people's homes in a giant Ponzi scheme? Why did he throw all of that money at the banks without getting anything back in the way of relief for the people the bankers swindled?

    The housing meltdown, which has robbed Americans of a considerable portion of their net worth, has led to the continued depressed consumer confidence that is the prime cause of crisis-level unemployment. In another of his too-late-to-matter moments, Bernanke acknowledged that "strong housing policies to help the market recover" would "clearly be very useful," but he failed to suggest any.

    Bernanke, along with then-New York Fed President Timothy Geithner, helped implement the Bush strategy of saving the banks in the hope that their rising tide would lift our little boats. That remained the strategy when President Obama rewarded Geithner for having saved AIG and Citigroup by naming him treasury secretary in the incoming government.

  • Borowitz Report (satire): Banks Raise Fees on Same People Who Bailed Out Their Asses. Introduce New ‘Thank You’ Fee on Debit Cards. Excerpts: The largest banks in the US made history today by hiking fees on the same people who bailed out their asses three years ago.
    “We would not exist today without the generosity of the American taxpayers,” said CEO Brian Moynihan of Bank of America, which received billions of dollars of Federal bailout money. “And we want to thank them by assessing a special monthly ‘thank you’ fee on all of our debit cards.”

    Becoming emotional, Mr. Moynihan added, “We think of the taxpayers every time we vacation on our yachts or visit our third homes, and we want them to think of us every time they try to spend $20 on groceries.” Mr. Moynihan said that even after paying the new $5 monthly fee, “American taxpayers should still have enough money left over to let them eat cake.”

  • AlterNet: Wall Street Employees Watch "Occupy Wall Street" Protest While Sipping Champagne on a Balcony (Seriously). Excerpts: It's hard to believe it's real, but here is video evidence of Wall Streeters drinking champagne from a balcony as they watch the protesters walk by.

    You cannot make this stuff up.

    Wall Street has been like this from the very beginning of the financial crisis, going out of their way to scoff at average people in trouble in this economy. ("We're doing God's work!")I guess they just don't see any need to keep a low profile and ride this out without inflaming the polloi. These "winners" want to rub their noses in it.

  • Washington Post Writer's Group, courtesy of truthOut: Why They Hate Warren Buffett. By E.J. Dionne Jr. Excerpts: Maybe only a really, really rich guy can credibly make the case for why the wealthy should be asked to pay more in taxes. You can't accuse a big capitalist of "class warfare." That's why the right wing despises Warren Buffett and is trying so hard to shut him up. ...

    Buffett has outraged conservatives by saying that he pays taxes at a lower rate than his secretary. He's said this for years, but he's a target now because President Obama is using his comment to make the case for higher taxes on millionaires. ...

    Buffett's sin is that he spoke a truth that conservatives want to keep covered up: Taxing capital gains at 15 percent means that people who make their money from investments pay taxes at a much lower marginal rate than those who earn more than $34,500 a year from their labor. That's when the income tax rate goes up to 25 percent. (For joint filers, the 25 percent rate kicks in at $69,000.) For singles, the 28 percent bracket starts at $83,600, the 33 percent bracket at $174,400.

    So if an investor such as Buffett pockets, say, $100 million of his income in capital gains, he pays only a 15 percent tax on all that money. For everyday working people, the 15 percent rate applies only to earnings between $8,500 and $34,500. After that, they're paying a higher marginal rate than the multimillionaire pays on gains from investments. Oh, yes, and before Obama temporarily cut it by two points, the payroll tax added another 6.2 percent to the burden on middle-class workers. That levy doesn't apply to capital gains, or to income above $106,800, so it hits low- and middle-income workers much harder than the wealthy.

    So if an investor such as Buffett pockets, say, $100 million of his income in capital gains, he pays only a 15 percent tax on all that money. For everyday working people, the 15 percent rate applies only to earnings between $8,500 and $34,500. After that, they're paying a higher marginal rate than the multimillionaire pays on gains from investments. Oh, yes, and before Obama temporarily cut it by two points, the payroll tax added another 6.2 percent to the burden on middle-class workers. That levy doesn't apply to capital gains, or to income above $106,800, so it hits low- and middle-income workers much harder than the wealthy.

    • the bias of the tax system against labor;
    • the fact that in comparison with middle- or upper-middle class people, the really wealthy pay a remarkably low percentage of their income in taxes;
    • and the deeply regressive nature of the payroll tax.
  • New York Times op-ed: Phony Fear Factor. By Paul Krugman. Excerpts: The good news: After spending a year and a half talking about deficits, deficits, deficits when we should have been talking about jobs, job, jobs we’re finally back to discussing the right issue.

    The bad news: Republicans, aided and abetted by many conservative policy intellectuals, are fixated on a view about what’s blocking job creation that fits their prejudices and serves the interests of their wealthy backers, but bears no relationship to reality.

    Listen to just about any speech by a Republican presidential hopeful, and you’ll hear assertions that the Obama administration is responsible for weak job growth. How so? The answer, repeated again and again, is that businesses are afraid to expand and create jobs because they fear costly regulations and higher taxes. Nor are politicians the only people saying this. Conservative economists repeat the claim in op-ed articles, and Federal Reserve officials repeat it to justify their opposition to even modest efforts to aid the economy.

    The first thing you need to know, then, is that there’s no evidence supporting this claim and a lot of evidence showing that it’s false. ...

    Still, isn’t there something odd about the fact that businesses are making large profits and sitting on a lot of cash but aren’t spending that cash to expand capacity and employment? No. After all, why should businesses expand when they’re not using the capacity they already have? The bursting of the housing bubble and the overhang of household debt have left consumer spending depressed and many businesses with more capacity than they need and no reason to add more. Business investment always responds strongly to the state of the economy, and given how weak our economy remains you shouldn’t be surprised if investment remains low. If anything, business spending has been stronger than one might have predicted given slow growth and high unemployment.

  • AlterNet: Meet the Wealthy Men Trying to Buy Our Upcoming Election. These are America's best-funded political factions, their war chests filled by some of the richest men (and almost all are men) in the country. By Justin Elliott. Excerpts: The hidden infrastructure of the 2012 campaign has already been built. A handful of so-called Super PACs, enabled to collect unlimited donations by the continued erosion of campaign finance regulations, are expected to rival the official campaign organizations in importance this election. In many cases, these groups are acting essentially as outside arms of the campaigns. These are America's best-funded political factions, their war chests filled by some of the richest men (and almost all are men) in the country.

    More than 80 percent of giving to Super PACs so far has come from just 58 donors, according to the Center for Responsive Politics analysis of the latest data, which covers the first half of 2011. The Republican groups have raised $17.6 million and the Democratic groups $7.6 million. Those numbers will balloon, with American Crossroads, the main Republican Super PAC, aiming to raise $240 million.)

  • Washington Post opinion: In Senate vote, a win for the middle class and a rebuke to China. By Harold Meyerson. Excerpts: The news that our trade with China has been bad for the American middle class has finally reached the U.S. Senate. On Monday, the Senate will take up legislation that would impose tariffs on Chinese goods so long as China depresses the value of its currency. Despite the partisan polarization that grinds lawmaking to a halt these days, the bill’s support is thoroughly bipartisan, with sponsors ranging from such conservative Republicans as South Carolina’s Lindsey Graham to liberal Ohio Democrat Sherrod Brown. The legislation is expected to clear the Senate’s 60-vote hurdle for a floor vote and move on to the House.

    For students of America’s deranged romance with free trade, the fact that the Senate is willing to take on China is little short of amazing. Since the 1980s, the House has been the legislative body where epic battles have been waged over the free-trade agreements that have decimated American manufacturing. The impact of factory closures on congressional districts is generally too big for representatives to ignore. Local manufacturers and bankers, no less than local union members, complain to their House members; when the town’s biggest employer leaves, grief knows no party. Senators, on the other hand, move in a larger world, one where Wall Street contributors and Washington pundits assure them that free trade is invariably good. So while the House has been home to furious fights over NAFTA, CAFTA and extending permanent normalized trade relations to China, the Senate has long passed such measures with much less fuss and sublime indifference to the consequences.

    But the consequences can no longer be denied. Between 2001 and 2010, the U.S. trade deficit with China cost Americans 2.8 million jobs, according to a report by economist Robert Scott, issued last week by the liberal Economic Policy Institute. Most of those jobs — 1.9 million — were in manufacturing, and of those, almost half were in computers and electronics.

  • Huffington Post: The Moral Question. By Robert Reich. Excerpts: We dodged another shut-down bullet, but only until November 18. That's when the next temporary bill to keep the government going runs out. House Republicans want more budget cuts as their price for another stopgap spending bill.

    Among other items, Republicans are demanding major cuts in a nutrition program for low-income women and children. The appropriation bill the House passed June 16 would deny benefits to more than 700,000 eligible low-income women and young children next year.

    What kind of country are we living in?

    More than one in three families with young children is now living in poverty (37 percent, to be exact) according to a recent analysis of Census data by Northeastern University's Center for Labor Market Studies. That's the highest percent on record. The Agriculture Department says nearly one in four young children (23.6) lives in a family that had difficulty affording sufficient food at some point last year.

    We're in the worst economy since the Great Depression -- with lower-income families and kids are bearing the worst of it -- and what are Republicans doing? Cutting programs Americans desperately need to get through it. ...

    Yet Republicans won't consider increasing taxes on the rich to pay for what's needed -- even though the wealthiest members of our society are richer than ever, taking home a bigger slice of total income and wealth than in seventy-five years, and paying the lowest tax rates in three decades. The president's modest proposals to raise taxes on the rich -- limiting their tax deductions, ending the Bush tax cut for incomes over $250,000, and making sure the rich pay at the same rate as average Americans - don't come close to paying for what American families need.

  • Washington Post opinion: What Wall Street doesn’t want us to know about oil prices. By Senator Bernie Sanders (I-VT). Excerpts: The top six financial institutions in this country own assets equal to more than 60 percent of our gross domestic product and possess enormous economic and political power. One of the great questions of our time is whether the American people, through Congress, will control the greed, recklessness and illegal behavior on Wall Street, or whether Wall Street will continue to wreak havoc on our economy and the lives of working families.

    I represent Vermont, a rural state where many workers drive long distances to jobs that pay $12 an hour or less. Many seniors living on fixed incomes heat their homes with oil during our cold winters. These people have asked me to do all that I can to lower outrageously high gasoline and heating-oil prices. I intend to do just that.

    Why have oil prices spiked wildly? Some argue that the volatility is a result of supply-and-demand fundamentals. More and more observers, however, believe that excessive speculation in the oil futures market by investors is driving oil prices sky high.

    A June 2 article in the Wall Street Journal said it all: “Wall Street is tapping a real gusher in 2011, as heightened volatility and higher prices of oil and other raw materials boost banks’ profits.” ExxonMobil Chairman Rex Tillerson, testifying before a Senate panel this year, said that excessive speculation may have increased oil prices by as much as 40 percent. Delta Air Lines general counsel Richard Hirst wrote to federal regulators in December that “the speculative bubble in oil prices has concrete detrimental consequences for the real economy.” An American Trucking Association vice president, Richard Moskowitz, said, “Excessive speculation has caused dramatic increases in the price of crude oil, which harms end-users like America’s trucking industry.” ...

    First, the American people have a right to know why oil prices are artificially high. The CFTC report proved that when oil prices climbed in 2008 to more than $140 a barrel, Wall Street speculators dominated the oil futures market. Goldman Sachs alone bought and sold more than 860 million barrels of oil in the summer of 2008 with no intention of using a drop for any purpose other than to make a quick buck.

    Wall Street, of course, wants to hide this information. They don’t want the American people to know the extent to which speculators keep oil prices artificially high and the great damage that does to our economy. After the information became public, it was suggested that some on Wall Street may stop trading in the oil futures market. Good!

    Second, Congress recognized last year that excessive oil speculation must end. The Dodd-Frank financial reform legislation required the CFTC to eliminate, prevent or diminish excessive oil speculation by Jan. 17, 2011. Months after that deadline, the commission still has failed to enforce the law, and speculators still are making out like bandits. ...

    I agree with former commissioners James E. Newsome and Fred Hatfield in one respect. Trust in government is at an all-time low. That’s not because Washington is too heavy-handed with Wall Street. Quite the contrary! The American people are angry and disillusioned because they see our government act boldly to protect Wall Street CEOs but not ordinary Americans. When Wall Street needed a $700 billion bailout, the government was there for them. When working families need an end to excessive oil speculation and real relief at the gas pump, the government has failed to act.

  • Harvard University's Nieman Watchdog: Heeding fake concerns about propriety -- instead of real matters of substance. By Dan Froomkin. Excerpts: After firebrand Vermont Senator Bernie Sanders leaked confidential data from the Commodity Futures Trading Commission to the Wall Street Journal last month -- data that dramatically illustrated how speculators were dominating the oil futures market during the 2008 spike in oil prices -- other news outlets jumped on the story.

    In the worst possible way.

    The data, which exposed precisely how much Goldman Sachs, Morgan Stanley, and other Wall Street speculators dominated the crude oil futures market, was a big new lead reporters could have used to further explore the dynamics behind the staggering gas price increase that resulted in a huge transfer of wealth from ordinary Americans to the very rich.

  • Bloomberg: Obama Jobs Plan Prevents 2012 Recession in Survey of Economists. By Timothy R. Homan. Excerpt: President Barack Obama’s $447 billion jobs plan would help avoid a return to recession by maintaining growth and pushing down the unemployment rate next year, according to economists surveyed by Bloomberg News. The legislation, submitted to Congress this month, would increase gross domestic product by 0.6 percent next year and add or keep 275,000 workers on payrolls, the median estimates in the survey of 34 economists showed. The program would also lower the jobless rate by 0.2 percentage point in 2012, economists said.
  • MoveOn: The Elizabeth Warren Quote Every American Needs To See. Excerpt: “I hear all this, you know, ‘Well, this is class warfare, this is whatever. No. There is nobody in this country who got rich on his own — nobody.

    “You built a factory out there? Good for you. But I want to be clear. You moved your goods to market on the roads the rest of us paid for. You hired workers the rest of us paid to educate. You were safe in your factory because of police-forces and fire-forces that the rest of us paid for. You didn’t have to worry that marauding bands would come and seize everything at your factory — and hire someone to protect against this — because of the work the rest of us did.

    “Now look, you built a factory and it turned into something terrific, or a great idea. God bless — keep a big hunk of it. But part of the underlying social contract is, you take a hunk of that and pay forward for the next kid who comes along.”

  • Nation of Change: Big Oil Clings to Tax Breaks While Hoarding Tens of Billions. By Daniel J. Weiss and Vivian Yang. Excerpts: On September 19 President Barack Obama announced his plan to reduce the deficit by $4 trillion over the next 12 years, including raising $1.5 trillion by closing special interest loopholes and other revenue raisers. This includes eliminating $41 billion in tax loopholes for the oil and gas industry (p. 63) over the next decade.

    Big Oil is predictably opposed to losing its unnecessary tax breaks. The American Dream Institute, or API, the oil industry’s lobbying muscle, quickly claimed that “the Administration plan would hurt jobs and investment.”

    But this claim ignores the fact that the big five oil companies—BP, Chevron, ConocoPhilips, ExxonMobil, and Shell—have ample financial resources that dwarf the value of these tax breaks. These companies enjoy billions in cash reserves, made nearly $1 trillion in profits over the past decade, and at least one company (ExxonMobil) pays a lower effective tax rate than the average American family. ...

    The past decade was very prosperous for the big five oil companies due in part to high oil prices, including the record of $147 per barrel in July 2008. A CAP assessment determined that these companies made more than $900 billion in profit from 2001 to 2010. High oil prices this year earned them a whopping $67 billion in six months. These funds come from the pockets of American drivers forced to pay up to $4 per gallon for gasoline.

    At this rate, Big Oil could easily exceed $100 billion in profits for 2011. Why can’t these companies afford to forgo $2 billion annually in taxpayers’ money?

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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