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Highlights—October 22, 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.

"Retirement Heist uncovers one of the most significant threats to the American worker of our time. Ellen Schultz's reporting is expansive, smart, and will have you shouting for someone to be held accountable. Anybody who works and is worried about their future should read this book." -Lewis Maltby, president of the National Workrights Institute and author of Can They Do That? Retaking Our Fundamental Rights in the Workplace. Read more...

  • US News & World Report: Traditional Pensions are Casualties of a Retirement Heist. Excerpts: Companies often say they are freezing their traditional pension plans and eliminating retiree medical benefits to remain competitive with pension-less employers overseas and cope with an aging workforce and stock market losses. But in a shocking new book, Retirement Heist: How Companies Plunder and Profit from the Nest Eggs of American Workers, Wall Street Journal reporter Ellen Schultz explains that pension cuts are actually an accounting maneuver that is being used to boost corporate earnings. The massive retirement liabilities that many companies report are actually caused by unfunded executive pensions and deferred compensation plans, not the pension obligations to ordinary employees, she found. U.S. News asked Schultz to explain why traditional pension plans are really being frozen.

    Why do profitable companies freeze their pension plans or close them to new workers? The retirement crisis was not an accident. The retirement crisis was caused by actions of the companies. They had incredibly overfunded plans and chose to cut benefits and ultimately freeze the plans, even though there was plenty of money in them to pay the benefits. Initially people didn’t understand that the benefits were being cut because companies hid it.

    How is pension plan accounting used to boost shareholder value? Cutting the benefits actually gives companies a boost to profits. It’s an accounting effect. If you promise to pay $100 million to retirees, that’s a debt on the books. If you cancel that debt, then you get to keep the profit. Freezing the plan not only let them keep the money in the plan, but gave them a boost to profits.

    Do companies need to cut retirement benefits to stay competitive? When companies began cutting benefits it wasn’t to remain competitive because the plans had a huge surplus and there was no cost to the company. What they were doing is taking the plan and finding a way to convert some of the assets into a benefit for the company and also to boost their profits. It’s not accurate for them to say they had to do this to remain competitive.

    How are pension plans for ordinary workers and executive compensation related? People have to realize that when companies say their costs are spiraling, maybe it’s the executive’s costs that are spiraling. In many cases the additional pension costs and boost in liability are just because of the executive pensions. The plans for regular workers are tax advantaged and subsidized by taxpayers. If you offer a pension plan, it is supposed to be for everyone more or less. Plans for executives don’t get special tax breaks, but companies have found ways of trying to get the same tax breaks as the plan for regular employees and have found strategies to get money from the regular plan to pay executives. They have been cutting the benefits for the rank and file employees and boosting the pay for the executives.

  • Yahoo! IBM Pension and Retirement Issues message board: "Re: Another interview with Ellen Schultz" by "teamb562". Full excerpt: In my opinion Ellen deserves my buck and the buck of all affected IBM'ers. She helped enormously by publicizing the cash balance story which likely assisted many of us in getting to be 2nd Choicers. In addition, these wounds run deep. Venting here against the blue pig is a release for many, myself included. While I'm at it, thanks to the moderator for starting this group and to all the thousands who donated their experience and knowledge which has helped many of us over these years. I received Ellen's book this weeks and proudly displayed it at work.
  • Yahoo! IBM Pension and Retirement Issues message board: "Re: Another interview with Ellen Schultz" by "willbefree25". Full excerpt: Wholeheartedly agreed, teamb562.

    Remember, it was those at IBM in 1999 who agreed with the poster below who tried to shut down those who found their voice against the theft of their annuity pension and retiree medical benefits.

    Remember Janet and shuff et al against Socks Bouchard and how awesome was the Senate hearing that made IBM 'give back' what they stole.

    Remember, by positioning the theft of the annuity pension against those whom they knew had an age discrimination defense, they manipulated the employees to ignore the REAL thefts -- the annuity pension for those under 40 and the retiree medical for all employees not yet 50.

    Ignore those corporate apologists who say it will do no good to talk about the thefts and the thieves who perpetrated them. We who lived through the thefts and broken promises from one of the richest companies in the world will never forgive and never forget.

    Again, thanks to people like Ellen Shultz who also doesn't believe those who pat themselves on the back for screwing their own employees should EVER be forgiven or forgotten.

    May she get as rich as the corporate thieves who ruined thousands of lives in 1999.

  • Yahoo! IBM Pension and Retirement Issues message board: "Re: Another interview with Ellen Schultz" by Kathi Cooper. Full excerpt: Those 'Corporate Apologists' get paid a lot of money for this.
  • Yahoo! IBM Pension and Retirement Issues message board: "Re: Another interview with Ellen Schultz" by "lastdino1". Full excerpt: Kathi if you assume I'm on the take here I could care less. My goal now is to live as long as possible and suck out as much pension money I can take. I'm having fun and collected over $250K so far. I could care less what happened back in 1999. I still won't buy the book. LOL LG.
  • Yahoo! IBM Pension and Retirement Issues message board: "Re: Another interview with Ellen Schultz" by Kathi Cooper. Full excerpt: So, you have collected over $250K so far on pension? What about other employees of IBM?
    • Those that got screwed in 1991?
    • Those that got screwed in 1995?
    • Those that got screwed in 1999?
    • Those that got screwed in 2006, when the Supreme Court denied cert on Cooper?
    • Those that got screwed in the medical heist of 1999?
    • Those that got screwed when the pension was frozen?
    • Not to mention all of those that have been fired!

    As long as you got yours? And it's more than others? IS THAT IT?????

  • USA Today: 'Retirement Heist' compiles evidence of plundered pensions. By Steve Weinberg. Excerpts: Sometimes the real crime consists of activities considered "legal," despite the damage they cause. That adage has never been more apt than when applied to the termination of pension funds by U.S. employers large, midsize and small. Over and over, loyal, deserving employees with modest incomes have watched their planned retirement savings disappear because of corporate managers and pension industry consultants.

    Journalist Ellen Schultz has been writing about such shameful behavior for a long time, mostly in The Wall Street Journal. Now she has pulled together the copious, irrefutable evidence between the covers of a book. It is shocking, and demoralizing. But will members of Congress and federal agency regulators stop what Schultz calls "retirement heists"? Probably not, unless voters make it clear the incumbents will lose their jobs unless something changes. Unfortunately, voters are rarely if ever that organized, no matter how much they have been cheated by corporate chieftains.

    The book is crammed with heartbreaking anecdotes of retirees suffering (and in some cases probably dying) because of pension-related corporate greed. But the perpetrators have not been charged with any crimes. In most cases documented by Schultz, the perpetrators have escaped widespread blame — except in her investigative pieces and now in this book. ...

    Immelt and other corporate spokespeople have suggested that pension plan shortfalls are caused by out-of-control factors such as the large number of retirees, declining stock market investment returns and competition from foreign competitors that eschew good benefits for laborers.

    Schultz knows better from her extensive research. She is a reporter who has become an expert in a relatively narrow subject matter. As she writes, "What Immelt didn't mention was that, far from being a burden, GE's pension and retiree plans had contributed billions of dollars to the company's bottom line over the past decade and a half, and were responsible for a chunk of the earnings that the executives had taken credit for. Nor were these retirement programs — even with GE's 230,000 retirees — bleeding the company of cash. In fact, GE hadn't contributed a cent to the workers' pension plans since 1987 but still had enough money to cover all the current and future retirees."

    Then Schultz delivers the clincher: GE was indeed burdened by a pension plan — the plan for top executives. The obligations of that plan, for a minuscule number of individuals compared with the 230,000 lower-level retirees, totaled $4.4 billion and had drained about $573 million from the corporate treasury over the past three years.

  • National Public Radio's (NPR's) The Diane Rehm Show: Ellen Schultz: "Retirement Heist" (transcript). Or, listen to audio.
  • Comedy Central's The Daily Show with John Stewart: Ellen Schultz explains how American companies have decimated retiree benefit plans (video).
  • Yahoo! IBM Pension and Retirement Issues message board: "Re: LISTEN UP People" by "willbefree25". Full excerpt: Thank you for the pointer, Kathi. Sadly, after watching her excellent interview (at 14:00 here): http://www.thedailyshow.com/full-episodes/mon-october-17-2011-ellen-schultz or http://tinyurl.com/3ggz6tn my reaction is...so what?

    Other than confirming what we here have known since 1999, what will change after Ellen is no longer the sound bite of the day? Will IBM do anything to amend what they did to retirees? Will IBM do anything to amend what they did to their current employees? Will IBM retirees do anything? Will IBM employees do anything? Will the corporate apologists cease their lies? Will the politicians do anything? So, so what?

  • Yahoo! IBM Pension and Retirement Issues message board: "Re: LISTEN UP People" by Kathi Cooper. Full excerpt: Hey, I sued them last time. You take the ball this time.
  • Yahoo! IBM Pension and Retirement Issues message board: "Re: LISTEN UP People" by Kathi Cooper. Full excerpt: just want to mention one more thing. NEVER EVER blame an IBM employee for what happened to us. It was IBM management. It was IBM directors. It was politicians. It was the courts. Employees are the victims, regardless of what anyone thinks they shoulda, woulda, or coulda done.
  • Yahoo! IBM Pension and Retirement Issues message board: "Re: LISTEN UP People" by "willbefree25". Full excerpt: Of course the consulting firms had a hand in it, no question. Wasn't it Watson Wyatt who was caught on tape laughing about what the employees/retirees would do when they found out what was being done to them?

    As donshuper said: "Find out just what any people will quietly submit to and you have the exact measure of the injustice and wrong which will be imposed on them."

    Sadly, the IBM employees and retirees, with the exception of a few (of course, Kathi, I applaud you for suing and no, there aren't many others who will) went away quietly and thus IBM was able to perpetrate the thefts that they did. Even today, when I talk to those who were screwed, they whisper that all they want now is to keep collecting their pension checks, reduced though they are and further reduced by paying for medical they SHOULD have gotten for life, understandably for a fee. Some are actually surprised when they read about the level of thefts in Ellen's book, can you imagine? Where have they been since 1999? You tell me.

    Kathi, I place the blame on the employee who said to me: "I got mine". I place the blame on the employees who sat in the auditoriums and asked polite little questions while I asked about the inequity of the cash balance plan and the other 'gotchas' that were hidden in the takeaways of 1991 and 1995 and 1999. I place the blame on the employees who were overwhelmed by the corporate apologists on the boards and the subliminal (some not so subliminal) threats at their workplaces, so that many did not even SPEAK of Lee Conrad, much less demand a union.

    Yes, Kathi, I do place the blame on the employees who were cowed and frightened and threatened and fired into silence.

    But of COURSE, I place the majority of the blame on the politicians and the CEOs and the consulting firms and the justice system and the managers and the team leaders who did what they did, and made it possible to silence a work force that, if marshalled and collected, had a voice that would have been heard around the world in 1999.

    Again, so what? It's too late now.

  • Times-Argus (Vermont): IBM’s future in Vermont is cloudy. By Jack McMullen. Excerpts: IBM’s plant in Essex Junction is vital to the economy of Vermont. As the state’s largest private employer, the plant accounts for about 5 percent of Vermont’s 2010 GDP of $26.4 billion. In 1996 IBM was considering where to make the next round of capital investment in its semiconductor manufacturing business. Sen. Leahy, then-Congressman Sanders, and Gov. Dean had an opportunity to make IBM-Burlington the place for such investments.

    According to a former colleague who, until very recently, was one of the most senior IBM corporate executives, Vermont was the company’s first choice for the expansion because of the Vermont plant’s excellent manufacturing performance and its fine record of innovation. IBM didn’t even ask for or expect the kind of outlandish incentives the company got from New York state to entice it to invest in Fishkill, N.Y. ...

    According to Moody’s review of a city of Burlington bond issue, IBM employed 5,400 at the IBM-Burlington site in 2009, down from a peak of 8,500 in the mid-1990s. More ominously, IBM downsized its engineering staff at the site and has been allowing the plant to obsolesce. It now produces mainly lower-cost commodity chips instead of the high-value custom chips it made in its heyday. ...

    Meanwhile, PC World reports that since 2000 IBM has invested more than $10 billion in New York state where IBM chose to make its future. New York state investments, capped by IBM’s recent $3.6 billion commitment to a new nanoscale process facility there, are the largest IBM has made anywhere in the world. With the initial $2.5 billion investment in Fishkill, N.Y., more than a decade ago, knowledgeable observers predicted the fate of IBM-Burlington was sealed. The only question is how rapidly the Essex Junction facility will phase down. ...

    n the 1990s, then-Congressman Sanders launched a very public campaign criticizing IBM for changing its 1960s-era pension plan to remain competitive with nimbler, newer entrants into the semiconductor business. I am told by the same source that IBM’s then-CEO, Louis Gerstner, reacted to Sanders demagoguery with a statement something like: “Don’t the politicians in Vermont realize there are more than a dozen other states vying for our business?”

  • Wall Street Journal: Worries Persist for IBM. Tech Bellwether's Profit Up 7%, but Contracts Disappoint. By Shara Tibken. Excerpts: BM, one of the first big tech companies to post quarter results, is seen as a barometer for investment in technology by governments and corporations. While IBM has benefited from a push toward higher-margin businesses, such as data-analysis services, worries have emerged that the weak global economy is having a negative impact on tech spending, particularly by governments.

    Those worries were exacerbated Monday by a disappointing number of signed service contracts, an indication of future business, and a sequential decline in the company's backlog, which measures the current value of work under contract.

    IBM on Monday reported new service contracts worth $12.3 billion, up 12% from the previous year, but below $14.3 billion in the second quarter. Meanwhile, IBM's services backlog slipped to $137 billion from $144 billion in the second quarter.

    Selected reader comments concerning this article follow:

    • They only have 100k high cost US employees left to get rid of to keep this gravy train going a few more years too...oh forgot some in EU too.
    • I worked in Golbal Services a decade ago for one year before I was RIF'd with 35,000 of my closest friends, some of whom were very close to being vested in the company's defined contribution pension plan. It wasn't a great place to work then, but it's a much worse place to work now. The year I was there, when it was time to pay bonuses, the executives told all the managers to downgrade everyone's performance reviews so the company would have to pay out relatively little in bonuses. IBM's been coasting on its reputation for years and its business ethics are questionable at best. If anyone wants some insight into what the culture's like in Global Services now, go to http://www.glassdoor.com and read for yourselves.
    • They missed on revenue by about $200 million. Although, you wouldn't know that by this article. Now let's see if they revise the article or let it go - it does look GREAT on top of homepage. Unfortunately, earning reports are so gimmicky they've become almost useless. The stock is down in after hours
    • People associate IBM with high-end state-of-the-art technology. But the reality is that they are just a contracting body-shop of IT workers for the most part. I'd rename them as IDM Corp or International Datacenter Maintenance Corp.
  • The Register (United Kingdom): IBM fails to keep Oz harassment case under wraps Squalid tale to play out in public. By Richard Chirgwin. Excerpts: Australia’s Federal Court has ruled against an attempt by IBM to suppress the details of a sexual harassment case against it. As a result, the accusations by Susan Spiteri, a former sales executive at Big Blue, that she was subject to two years of harassment by her supervisor will play out in public.

    According to documents filed in the case, Ms Spiteri was given suggestions like “get those boobies out” to get more sales. She is seeking more than $AU1 million from IBM over the harassment, which she says lasted from 2007 to 2009. Her claim also alleges that the manager put his hand under her dress and would yell abuse at her in the office.

  • Yahoo! IBM Pension and Retirement Issues message board: "IBM Pension and Retirement Issues" by Rich Waksman. Full excerpt: I was very involved with the change to the lump sum pension plan at IBM and I have not seen a single comment or article correctly understand what this was all about. Allow me to explain.

    There is nothing wrong with a lump sum plan if the lump sum IS A FAIR AMOUNT. What IBM did was lump together two actions at the same time to obfuscate the truth from employees and they exceeded beyond their wildest imaginations. IBM was struggling financially then and needed to cut hundreds of millions from their pension costs. At the same time, they hated the traditional pension plan and wanted to end it. So, by combining the lump sum method and only paying about half of what the amount should have been (to be a fair present value), they got the change they wanted and they saved the money they were looking to save.

    For those that remember, it was at least three months later until they told employees how much the lump sum would be. I knew it would be grossly inadequate, but almost every other employee was optimistic this was a good thing, since IBM's presentation "lied" by saying this was a big "win" for all employees. Everything hit the fan when the actual amounts were disclosed since they were about half of what most people would expect as a fair present value.

    If they did not combine the two actions and just converted to the lump sum system, no one would have had a complaint because the amount they would have offered would have allowed you to take the lump sum and buy an annuity exactly equal to the pension you were expecting. So, while everyone blames the lump sum system as this horrible rip-off, it is not the lump sum system that is a problem, but IBM's cost cutting disguised as a pension change.

    Alternatively, if they did not change the system, but simply cut the old pension plan formula in half, people would have been equally outraged. A benefit cut is a benefit cut and a system change that is fair in concept is not to be blamed. In fact a lump sum system is BETTER, if the amount is fair because it would give you the option of taking all the cash or buying an annuity equal to the old pension amount. So, put the blame where it is -- IBM's continued erosion of employee benefits as they converted from a "special" company to just another high tech firm among all the others.

  • Glassdoor IBM reviews. Selected reviews follow:
    • IBM Anonymous: (Current Employee) “It use to be a great place to work.” Pros: Good corporate reputation, intelligent, hard-working employees. Cons: It's not your father's IBM. Poor use of skills. No employee development. Stay here too long and you will rot. Employees are viewed only as liabilities....will be India Business Machines soon. Advice to Senior Management: Invest in your employees...develop their talents.
    • IBM Senior Managing Consultant in New York, NY: (Past Employee - 2009) “Great place to work, lots of air miles.” Pros: IBM Consulting is the largest consulting company in the world and often works on the largest and most complex projects in the world. The work is often very interesting and challenging with the opportunity to work in various industries and in different parts of the world. At IBM you will have the opportunity to advance your career faster than others who work in "normal" 9-5 jobs.

      Cons: The downsides of IBM Consulting is that you are almost never at home. I spent the majority of 8 years on an airplane twice a week. From this, I gained career experience that few others outside of consulting would be able to have. During my career at IBM I was significantly underpaid compared to consultants working at other consulting companies. It took me a while to understand, but IBM is a sales company, not a delivery company. If you excel in delivery, you will not be rewarded financially or with career advancement. If you have technical abilities, translating those skills to be used in a sales capacity would be where you would see the largest financial returns.

      Advice to Senior Management: Executive management at IBM is excellent at creating a winning strategy for the company. The middle management leaders often don't provide a lot of value to your career or direction of the firm.

    • IBM Anonymous in Gaithersburg, MD: (Current Employee) “Worst in my life.” Pros: They are big on working at home. Cons: No communication, practically EVERYTHING is outsourced...very non USA. Advice to Senior Management: Enlist more in your employees and clients
    • IBM Sales Manager in Sydney (Australia): (Current Employee) “It is a hard place to work, to much corporate overhead and irrelevance.” Pros: Good training, encourage working from home, good with work/life balance issues and they try to accommodate peoples unique personal situations within the working environment. Cons: Too many internal meetings that are pointless, to much "you have to do this to comply with requirements" so people just go through the motions, such as on-line updates on products. Too much dead-wood around the place, lack of local authority to approve anything, processes that are far to rigid which make it hard and waste time. Not enough emphasis on doing what is right for the customer, things have to fit within the IBM policies and procedures or they simply do not happen. Advice to Senior Management: Allow greater flexibility and work with your customers to really meet their needs and requirements.
    • IBM Management Consultant in Manchester, England (United Kingdom): (Current Employee) “Not focused on its staff only on revenue.” Pros: Good people, good projects and innovative company. One of the better consulting houses. Cons: If you enter the organisation near the bottom its very difficult to rise up through the ranks. Negotiate a higher band when you join is my advice. Advice to Senior Management: Promote from within instead of always looking to the market
    • IBM Anonymous: (Current Employee) “Used to be a good place to work not anymore.” Pros: The company has variety of clients all over the Americas and Global also the name "Big Blue" is know world wide. Cons: So much offshore work has been transitioned and they are hiring HS diploma candidates, moving towards less pay and less qualified people. Advice to Senior Management: Need to revive the economy in USA not global if this fails then the leadership jobs will be going global as well
    • IBM Unix Systems Administrator in Dubuque, IA: (Current Employee) “Low pay and no clear system for promotion.” Pros: IBM expects performance but is lenient when it comes to taking time off when you need it. The three weeks of vacation is nice. You have the advantage of working for a very large organization so business processes are pretty streamlined. Cons: Lots of bureaucracy to deal with and political infighting between global teams. Pay is not great and turnover where I work is very high. Problems are dealt with reactively rather than proactively. Advice to Senior Management: Pay your talent to retain them. Stop hiring people that have no interest in sticking around. Outsourcing sometimes mean you get what you pay for.
  • LinkedIn's Greater IBM Connection: What is IBM's culture? Can you share with us your experience, knowledge of IBM's culture? Selected comments follow:
    • I completely agree with Brice Wolford, having been in the middle of that. Shortly before I got "selected for resource action" out of IBM a directive went out from the "big boys". That directive was three-fold, and much like the old IBM culture. I repeat it in my own words, as it's been too long to remember the exact wording.
      1. Participate broadly across divisional boundaries, and managers should respect that.
      2. Educate yourself, participate in the differing programs IBM offers.
      3. Be inventive, we all benefit from ideas from different cultures.

      When that came out I wrote a blog entry about it, for two reasons. First, I thought it was a wonderful idea that all employee contributions were valued; second, I could see from within my own division (GBS) these values were not followed by a substantial percentage of directors. My own management structure felt I was not putting full effort into my own job because I participated in cross-IBM programs like HackDay, SocialBlue, and data privacy, and told me as much (please note my manager supported me, it was upper management who held this view). Participation in these programs was the secondary reason for my being laid off (the primary reason being lack of seniority); I got this information second-hand on request of anonymity, which I maintain.

      As to the idea that IBM values "customer service", just before the RA in 1Q2010 (when I was selected) my manager put in for three more people as we were (all of us) falling behind in work despite working 60-hour weeks. Instead of permitting him to hire three new people he was told to lay off three. The consensus among us (and our immediate supervisors) was that IBM had become "just another business" as far as their outsourcing clients were concerned, and the bottom line of GBS was more important than our customer service.

      I am referring only to GBS; other areas of the company (such as the Smarter Planet crew) were much more modeled on the older culture the IBM veterans are used to... but shouldn't a company's culture be reflected across the company, rather than selectively applied? That was the point of my blog entry. It may still be on Blog Central, possibly Lotus Connections; you can perhaps find it by doing an IBM Intranet tag search on "danodea".

    • Years ago in the late 80s or early 90s when we were still on Profs, a communique came across stating that we were to become more like other corporations. I knew it was the beginning of the end for the 'culture'. Extremely sad to me as I grew up in the 'culture' from '77 onwards as an OP CE, SE, and then something I can't even remember now. With that being said, I can go by the Rochester MN plant and see the IBM sign and I still get goose bumps.
    • Bruce your assessment is dead on. Once IBM sole purpose was profit, shareholder value rather than people it "lost" IBM Basic Beliefs. Focus on people, do right by the rank & file, individual contributors in the trenches and revenue flows, profits grow.

      Granted IBM Basic Beliefs were used inappropriately by too many to mean life time employment @ any cost. This was a flaw in IBM Management in 70s, 80s. Employees needed to reinvent themselves, transform themselves to continue to be a valued contributor.

      BM stood for something in 70s, 80s. Today it means "I'm by myself"; which says it all. There is no corporation, no division, no group, no department, no unit. ONLY the individual and individuals care only about himself/herself. IBM created this culture over past 15 years and it will be the death of it.

      People learn from it's leaders. Leaders are into short term goals, achievements, e.g., $15 or $20 EPS by 2015 the translation to individual contributors is do whatever it takes to WIN, move (transfer to another department) when road gets too hard, and agree with 1st line manager no matter what. IBM is no longer people focused. Even IBM HR professes the mantra; employee centric, self-directed, self-service. A shame.

      Also, remember all great "ages"; agriculture, manufacturing, industrial all had 50 year life span. The IT age is technically in its 60th year. It's a mature market, consumer based, commodit ized and hence technology replaces people. Cheers

    • Excellent description of IBM -- I'm By Myself. I worked for the company three separate times. First in the last Sixties and early Seventies and then in the past decade. The one phrase I noticed they stopped using when I rejoined in 1999 was "Respect for the Individual"
  • Moneyville (Canada): Why these IBM pensioners are fuming. By Ellen Roseman. Excerpts: The best pension plan is one that guarantees you a certain amount of money in retirement, no matter what happens to the stock market and interest rates. But it's on the way out. Instead, many employers are switching to a pension plan that has no guarantees. You choose the investments and if they do badly, you'll do badly too. Many large Canadian companies are making the switch from defined benefit plans (the best kind) to defined contribution plans that shift the the risk to employees. It's a fast growing trend. ...

    RBC will move to a defined contribution plan for new hires in January. You wonder how Canada's largest bank (with great money management skills) can't keep its own defined benefit plan alive. IBM Corp. made the switch in 2006. Now it's asking Canadian employees and retirees to approve another proposal to shore up the pension plan.. The company sent out letters in September, asking to extend the time to pay off any new deficits from the usual five-year period to a 10-year period. "If more than one-third of eligible members and former members of the plan object. to the proposed extension, we cannot proceed with this option," it said.

    Several retirees contacted me. They felt the company was botching its communications in an effort to get enough support to approve the change. "I didn't receive a ballot at first," says Gary Rogers. "When I phoned the call centre, I discovered that it had been sent to an old address. Many other pensioners have the same problem. "Since I receive company tax slips, medical/dental benefits, newsletters and charity solicitations, IBM must have my correct current address." When he finally got the letter, he found that there was no postage-paid addressed return envelope for the ballot. ...

    Tony Medici, another retiree, felt the company was not including a post-paid return envelope to discourage people from mailing in their ballots. Also, it was using a form of negative option billing. If the 10-year option is acceptable, "no further action is required on your part, and you will be deemed to have consented to IBM's implementation of the plan," the letter said. ...

    I have a friend who spent 40 years at IBM before recently retiring. She voted against the proposal. "There is nowhere to go for advice," she said. "I haven't called the support number offered, but I understand from others that they were not too helpful." IBM moved its human resources to another company, which outsourced its call centre offshore. "I think the call centre is located in Costa Rica," Rogers said. "People are unable to provide answers when a pensioner calls. Phone calls to IBM are referred back to the call centre number." The deadline is fast approaching. Notices of objection have to be received by Oct. 28.

  • Boulder Daily Camera: Ricoh continues layoffs at Boulder's InfoPrint Solutions. By Alicia Wallace. Excerpts: Japan-based Ricoh Co. on Thursday conducted layoffs at its Boulder InfoPrint Solutions facility, a company official confirmed. It is unclear how many people were affected. InfoPrint spokesman Peter Lazaroff said the company is "doing some reductions (Thursday)," but declined to disclose a number. Earlier this year, Ricoh officials announced plans to realign the firm's production print resources operations, form a new entity called Ricoh Production Print Solutions and move the InfoPrint Solutions headquarters to West Caldwell, N.J., from Boulder. Ricoh anticipated the workforce reduction would affect 9 percent of its 109,000-person global employee base. At the end of July, InfoPrint employed 700 people in Boulder, company officials told the Camera at the time. In 2010, InfoPrint had 725 employees locally. ...

    The relocation and reductions at InfoPrint's former headquarters mark a milestone in the history of IBM's Boulder campus, which has housed printing operations for more than 45 years. Ricoh acquired a majority interest in the IBM printing systems division for $725 million in 2007, fully acquiring the outfit during the subsequent three years. Ricoh leases about 400,000 square feet in four buildings at IBM's Boulder campus. Mike Stratton, a spokesman for IBM-Boulder, said Ricoh's lease remains in place and the square-footage has not changed.

  • LinkedIn's Greater IBM Connection: IBM Canada DB Pension Funding Relief Statement Sept 12, 2011 Did you get your letter? Selected comments follow:
    • Are there other Canadian Retirees or IBMers eligible for a Defined Benefit plan who are concerned about a recent mailing you should have received titled IBM Canada Pension Funding Relief Statement dated Sept 12, 2011. If you are Canadian and either collecting or entitled to collect a defined benefit pension, you should have received a letter about the pension funding shortfall.

      If you didn't' receive a letter, or if you want to see other IBM Canada DB retirees reaction to the letter, go to the Rewind site at http://www.bigblueretirees.com/ for more information. It is the IBM Canada retiree site.

      If you want to object to the company's plan to extend the repayment of the shortfall, you need to mail in the form you received, anonymously...i.e. don't put your name on it and don't put a return address on the envelope, or it won't count. But you MUST send in the form if you want to object to the IBM plan.

      The objection must be received by Towers Watson by October 28, 2011. Towers Watson must receive these forms from at least 1/3 of the Plan members; otherwise IBM Canada will implement a 10 year deficit funding plan.

      If you moved since you retired, IBM may not have your new address, the letter they sent won't reach you and IBM will assume that you have agreed to their plan to prolong making the pension plan whole for 10 years! So it is up to you to be proactive.

      Note this note only applies to IBM Canada pensioners and those current employees who are vested and only to Defined Benefit plans.

    • Adele Berenstein: The IBM Canada Retirees group called Rewind is trying to assess who has and who has not received their letter dated Sept 12, 2011 regarding IBM Canada DB Pension Funding Relief. Here's what they are asking IBM Canada Retirees on the DB plan (or still working for IBM Canada but eligible to do.

      Please send a email prior to Tuesday, October 18th to email address at letter@bigblueretirees.com. In your reply, please include the following:

      • As a DB IBM'er I did or did not receive the above letter
      • If not received then please advise us
      • I didn't receive and contacted Morneau Shepell (416) 445-8899 X3328 (or IBM) and asked for a ballot?
      • I made the request on DATE
      • I haven't receive my ballot or I received my ballot on DATE.

      Note: You are not being asked for your position (agree or object to the IBM Canada proposal) The only issue they are trying to address is whether or not you received your letter. So if you are in the IBM Canada DB pension plan or still working but eligible, please help out by sending in your email. Note this is for IBMers from IBM Canada only!

  • Wall Street Journal: The Young Are Happy at Work. By Melissa Korn. Excerpts: Younger workers tend to be happier with their employers than their older counterparts—but they are also more likely to be looking for an exit. Those attitudes—culled from a recent survey by consulting firm Mercer of nearly 30,000 workers from a variety of industries world-wide—might seem contradictory, but they do make sense, says Bruce Tulgan, founder of Rainmaker Thinking Inc., a workplace consulting company. Twenty-somethings may see a job in a "short-term, transactional way," he says. "They don't necessarily think 'Where do I fit in with this employer?' " ...

    To stem potential losses among younger employees, International Business Machines Corp. has launched rotation-based training programs that expose young staffers to diversity in geography, job responsibilities and co-workers. Those new experiences can keep the employees from getting bored too quickly, experts say. ...

    Selected reader comments concerning this article follow:

    • Perhaps the young are happier because they are still able to delude themselves into thinking there is hope. Older workers know better.
    • The young ones are like new strippers. "It's just temporary." Reality hasn't sunk in.
    • The reason is the younger generation want see themselves tied to an employer who will pay them as little as possible and release them as soon as it's convenient. 'm not anti employer, let them give me what they think I'm worth. But don't try to pin guilt on me for not being loyal to and employer when they have no loyalty to me. If my employer wants to know that I wont quit for the highest bidder, they better be kind and let me know in a contact what my LONG TERM compensation is going to be.

      I like right to work, it makes it easy for the employer to take a chance on somebody new. If the company wants to move beyond that type of relationship where you can walk or be fired instantly, they need to pony up something to let me know that. Otherwise I'm a free agent, (and doing quite well).

      Otherwise it would seem they are expecting a trade that's far to much in their own favor. They go to sleep knowing I won't quit, but I live in fear of when my pay checks stop coming?

      Get real. I spent my 20's acquiring skills. You want them, you pay what I call the market clearing rate. The more you pay over that, the more likely I want to stay in your employ. You want to not worry about me leaving, link my financial success to yours.

    • As long as part of management compensation is based upon paying the minimum for their employees there will be problems. The real jaded part comes when there's a round of layoffs to affect the quarterly earnings so management makes their numbers and gets bonuses. I know - no one holds a gun at their heads to make them work, but you can't make them smile. all the time
  • Plan Sponsor: Reaching Financial Goal Not Main Driver of Decision to Retire. Excerpts: A new Hearts & Wallets study finds the decision to retire in five years is driven by a Pre-Retirement Checklist. At the top of the list is feeling "done" (satisfied or frustrated) with work. Children reaching financial independence, having one's "financial house" in order, knowing relatives died at a young age, and seeing friends retire are all precursors for this transition. Few Americans cite reaching a financial goal or a "go-ahead" from an adviser.

    According to a press release, 16% of those 55 to 64 consider themselves “Pre-Retirees,” primary household breadwinners within five years of retirement. The Pre-Retiree lifestage group is comprised of diverse age groups. Slightly more than half of Pre-Retirees are 55 to 64.

New on the Alliance@IBM Site
  • The Alliance@IBM is considering an organizing campaign at IBM's delivery centers. We are beginning to get support from workers in the GDF's at Dubuque IA, Lansing MI, Fishkill NY, Boulder CO and Columbia MO. Although it is in the initial stages, we are hopeful that we can develop a network of concerned GDF workers and Alliance chapters at those locations. The ultimate goal of course is union recognition and a contract.

    But we need your help. As many of you know, the Alliance struggles to stay afloat. Our dues paying membership at 200 members is not sufficient to have an aggressive organizing campaign. That needs to change. A victory at IBM's delivery centers can have positive effects for all IBMers.

    So while you have heard this pitch before, we are once again asking you to help support the Alliance by becoming a full member at only $10 a month, or an associate member at $5 a month. There has been concern that IBM would know who you are if you join. The Alliance membership is confidential. IBM will not know if you are a member unless you tell them. The link to join is here: https://afl.salsalabs.com/o/4004/donate_page/alliance-join, Or you can go to our web site at: www.allianceibm.org There is also a paypal donate link on this web page.

    To those that are members and associate members your financial support is greatly appreciated. If you work at a GDF and want to be part of the network, contact us at ibmunionalliance@gmail.com The following is an email being sent to IBM GDF employees:

    Join the IBM GDF Worker Network at: http://www.endicottalliance.org/allianceibmglobaldelivery.htm.
    Did you know that Dubuque IBM GDF employees are paid an average of $20,000 LESS per year than GDF workers in Fishkill? Are you concerned about working conditions at your delivery center?
    Working hard and did not get a pay raise July 1st as IBM makes billions in profit? Wages in the new GDF's are much lower than other locations. GDF workers in Boulder got a 15% pay cut. Your concerns are not addressed by management. If you were "selected" to move to a GDF your choice was move or quit. IBM did not pay moving expenses. Transfers are being blocked by management. Band levels are lower. Verbal promises made by IBM become promises broken Don't you think it is time to join with your co-workers at all the GDF's to improve working conditions and wages? Isn't it time you were treated as a professional?
    Well that time is now! Make your voice heard!
    Based on information and concerns from GDF workers, the Alliance@IBM CWA Local 1701 is starting a campaign to organize GDF workers, including contractors. To do this the involvement of IBM GDF workers in the Alliance needs to increase and information gathered.
    If you work at one of IBM's GDF's in the US please contact the Alliance at: ibmunionalliance@gmail.com. Information we need from you: Name and contact info. GDF location. Job title. Employee or contractor Information will be held in confidence.
    Help build a better future for GDF workers!
    Statement of Principles: Alliance@IBM/CWA Local 1701 is an IBM employee organization that is dedicated to preserving and improving our rights and benefits at IBM. We also strive towards restoring management's respect for the individual and the value we bring to the company as employees. Our mission is to make our voice heard with IBM management, shareholders, government and the media. While our ultimate goal is collective bargaining rights with IBM, we will build our union now and challenge IBM on the many issues facing employees from off-shoring and job security to working conditions and company policy. -Alliance-
  • Job Cut Reports
    • Comment 10/21/11: I think the best thing that could happen to IBM is a union. There is so much dirty pool going on at IBM right now. Why? Because management has all the power, calls all the shots, and can do whatever they want. With a Union contract you would have something on your side to protect your job. I worked for a horrible manager for several years at IBM. When I went to my second line manager to complain he sided with my manager. The next thing that happened was my manager systematically and methodically lowered my appraisal, one step at a time. It was agonizing and there was nothing I could do about it. Management finally had the evidence they needed to lay me off as a poor performer. The IBM management culture really sucks. It is all about protecting their managers and covering their tracks to avoid lawsuits. You can thank Sammy Palmisano for that. A Union contract is what I needed to save my job. -Gone From Big Blow-
    • Comment 10/20/11: Answer on question about off-shoring vs RA. In 2008, I had a conversation with a 3nd line in IGS who simply stated they where given a must meet target of 60% of GR labor. It was up to them at the time in how they met the target. They could either grow their business or release US employees. This is normal business and I wouldn't be surprised if the percentage has been pushed higher since then.

      There are other reasons beyond that for the RAs. If the executives are not going to meet their numbers, or they failed to meet their numbers, you can bet that RAs are coming. The days of competing with employees are long gone having been replaced by competing against employees. This is the way it works now and a Union is the only way to combat it. Otherwise you are at their mercy.

      If you get a RA letter, make sure you get a copy of it. It protects you from later claims that your release was your fault. They may put a lotus notes lock on the letter that prevents it from being printed or sent anywhere, but it's easy to defeat. (Do a search.) If you were represented by a Union, you wouldn't have to deal with such nonsense. -RA'd in June 2011-

    • Comment 10/19/11: With all the talk of upcoming RA's, does anyone know how much offshoring of our jobs is involved? -anon-
    • Comment 10/18/11: The 3rd quarter earnings are up ,BUT, SG&A expense last quarter is up 10% and revenue only went up 7.8%. Also for the quarter SG&A as a percent of revenue also went up .So the cost of sales must get back in line..the way to do that is cut travel, head count raises,etc. that will be the plan going forward. -Anon-
    • Comment 10/18/11: Member - you can bet there will be an RA, and soon. Look at IBM stock price today: it's tanking. So much for Sam the Sham's "great" news about the QTR results. Something like $10B has disappeared based on market cap. How do ya think they are going to make this up quickly? Yep, an RA. And if you can believe it more operational cost cuts for employees, supplementals, and contractors to suffer in. You can also bet the Armonk royalty (they are definitely in the 1% group) have already cashed stock options out as a profit take (or should I say steal!?) before today to greedily grab more wealth. The only way to stop RAs is to unionize. Why folks are camping out near Wall St. without a clear agenda and get attention and IBMers can't even make a real try for positive change with a union boggles my mind. -Member2-
    • Comment 10/17/11: Sam just posted 3Q earnings, 13% up, 8% up; basically up everywhere. Now the question is, will workers get raises? NO! "Thank you for the good work you did, this proves that not giving raises and firing people is a good method". Pretty much a lost cause; but as a business analyst, I plan to bleed them from every paycheck I can and do as little as possible. If they gave me raises, I would work harder; but after 5 years of no raises, f' it. I'll milk this cow till they let me go -Anonymous- Alliance Reply: If you want raises, would you fight for a contract that could guarantee raises?
News and Opinion Concerning Health Savings Accounts, Medical Costs and Health Care Reform
  • New York Times: Wal-Mart Cuts Some Health Care Benefits. By Steven Greenhouse and Reed Abelson. Excerpts: After trying to mollify its critics in recent years by offering better health care benefits to its employees, Wal-Mart is substantially rolling back coverage for part-time workers and significantly raising premiums for many full-time staff.

    Citing rising costs, Wal-Mart, the nation’s largest private employer, told its employees this week that all future part-time employees who work less than 24 hours a week on average will no longer qualify for any of the company’s health insurance plans.

    In addition, any new employees who average 24 hours to 33 hours a week will no longer be able to include a spouse as part of their health care plan, although children can still be covered. ...

    In Wal-Mart’s 2012 health offerings, premiums will increase for some plans by more than 40 percent, although many of their workers pay relatively low premiums in comparison to more generous plans offered by other employers. But many Wal-Mart employees complain that their low premiums are accompanied by high deductibles that sometimes exceed 20 percent of their annual pay. ...

    Barbara Collins, a sales associate at the Wal-Mart in Placerville, Calif., said that the premiums for the H.M.O. plan for herself and her 5-year-old son would rise to $18 every two weeks from $10. Her big concern, she said, was that her deductible would jump to $5,000 a year, from $1,000 — a daunting amount considering she earns $19,000 a year. “I don’t know how I’ll be able to afford it if I go to a doctor or to physical therapy,” she said.

  • AlterNet: Corporate Greed Alert: Wal-Mart Cutting Healthcare Benefits for its Workers. By Melissa McEwan. Excerpts: I was just thinking that what this country needed was MORE corporations treating their employees like expendable garbage:
    After trying to mollify its critics in recent years by offering better health care benefits to its employees, Wal-Mart is substantially rolling back coverage for part-time workers and significantly raising premiums for many full-time staff.
    Citing rising costs, Wal-Mart, the nation's largest private employer, told its employees this week that all future part-time employees who work less than 24 hours a week on average will no longer qualify for any of the company's health insurance plans.
    In addition, any new employees who average 24 hours to 33 hours a week will no longer be able to include a spouse as part of their health care plan, although children can still be covered.

    Guess what's another good way of cutting costs? Hire two part-time workers to work 20 hours a week instead of one worker to work 40 hours a week. Then you don't have to pay for any healthcare benefits at all! Wheeeeeeeeeeeeee!

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.

  • Forbes: America's 25 Highest-Paid CEOs. By Christopher Helman. Excerpts: If you happen to be a billionaire or corporate Fat Cat, you may have noticed a mob assembled near your headquarters or home recently. You may not know what they’re protesting exactly; you might even joke that perhaps this has something to do with why they are unemployed. But when it comes to their complaint that the rich have been getting richer while things keep getting worse for the poor, downtrodden and unemployed, you gotta admit, they have a point.

    As you can see from the accompanying slideshow of America’s 25 Highest-Paid CEOs, while the stagnant economy continues to hurt those at the bottom of the American workforce, there’s plenty of money for the .0001% at the top. (The totals, compiled by Forbes’ stats guru Scott DeCarlo, include salary, bonuses, perks and the value of exercised stock options through Sept. 6. Sources are CompuStat ExecuComp and SEC filings).

    Compensation for the chief executives of America’s biggest corporations is way up in 2011, 28% higher than last year on average, according to GovernanceMetrics International. If you were already in the top quartile of high-paid plutocrats, your comp nearly doubled. Cash bonuses are triple what they were before the recession.

  • New York Times editorial: Elizabeth Warren’s Appeal. Excerpts: While most other Democrats are afraid to talk about the need for higher taxes and are running away from the problem, Elizabeth Warren, the leading Democratic candidate for a Senate seat in Massachusetts, has engaged the fight and is beginning to rally supporters

    Ms. Warren talks about the nation’s growing income inequality in a way that channels the force of the Occupy Wall Street movement but makes it palatable and understandable to a far wider swath of voters. She is provocative and assertive in her critique of corporate power and the well-paid lobbyists who protect it in Washington, and eloquent in her defense of an eroding middle class. ...

    Ms. Warren, a law professor at Harvard, helped to design the new Consumer Financial Protection Bureau. Because of her fierce advocacy on behalf of consumers, Senate Republicans and the financial industry made clear they would never allow her to run it.

    She is a remarkably eloquent and appealing Senate candidate. “Washington is well wired for big corporations that can hire armies of lobbyists,” she said last month, soon after joining the race. “But it’s not working very well for middle-class families, and that’s what I care about.”

    She is both knowledgeable and accessible when she explains the destructive credit-swap and subprime mortgage games that created the financial crisis. She draws a detailed map back to the early deregulation of the 1980s that began to rip the nation’s economic fabric — the same deregulatory fervor the Republicans are preaching today.

  • New York Times op-ed: Losing Their Immunity. By Paul Krugman. Excerpts: For the financialization of America wasn’t dictated by the invisible hand of the market. What caused the financial industry to grow much faster than the rest of the economy starting around 1980 was a series of deliberate policy choices, in particular a process of deregulation that continued right up to the eve of the 2008 crisis.

    Not coincidentally, the era of an ever-growing financial industry was also an era of ever-growing inequality of income and wealth. Wall Street made a large direct contribution to economic polarization, because soaring incomes in finance accounted for a significant fraction of the rising share of the top 1 percent (and the top 0.1 percent, which accounts for most of the top 1 percent’s gains) in the nation’s income. More broadly, the same political forces that promoted financial deregulation fostered overall inequality in a variety of ways, undermining organized labor, doing away with the “outrage constraint” that used to limit executive paychecks, and more.

    Oh, and taxes on the wealthy were, of course, sharply reduced.

    All of this was supposed to be justified by results: the paychecks of the wizards of Wall Street were appropriate, we were told, because of the wonderful things they did. Somehow, however, that wonderfulness failed to trickle down to the rest of the nation — and that was true even before the crisis. Median family income, adjusted for inflation, grew only about a fifth as much between 1980 and 2007 as it did in the generation following World War II, even though the postwar economy was marked both by strict financial regulation and by much higher tax rates on the wealthy than anything currently under political discussion.

    Then came the crisis, which proved that all those claims about how modern finance had reduced risk and made the system more stable were utter nonsense. Government bailouts were all that saved us from a financial meltdown as bad as or worse than the one that caused the Great Depression. ...

    Money talks in American politics, and what the financial industry’s money has been saying lately is that it will punish any politician who dares to criticize that industry’s behavior, no matter how gently — as evidenced by the way Wall Street money has now abandoned President Obama in favor of Mitt Romney. And this explains the industry’s shock over recent events.

    You see, until a few weeks ago it seemed as if Wall Street had effectively bribed and bullied our political system into forgetting about that whole drawing lavish paychecks while destroying the world economy thing. Then, all of a sudden, some people insisted on bringing the subject up again. And their outrage has found resonance with millions of Americans. No wonder Wall Street is whining.

  • Washington Post opinion: Why our children’s future no longer looks so bright. By Robert J. Samuelson.
  • truthOut: Madder At Washington Than Wall Street? Wall Street's The Reason. By Isaiah J. Poole. Excerpts: Lessig, a Harvard University professor, recently launched an organization called Rootstrikers, an organization that promises to fight back against the "political bribery" by wealthy special interests that has corrupted both political parties.

    One of the core problems animating the Occupy movement around the country is the fact that when it comes to Washington, to paraphrase what former Sen. Christopher Dodd of Connecticut said last year during the financial reform debate, corporations "own the place." And they continue to pay big money to make Washington bend to their interests.

    Consider what's on the list of the top five lobbyists in Washington. Here's what the Center for Responsive Politics is reporting so far in 2011:

    • U.S. Chamber of Commerce — $31.8 million
    • General Electric — $15.4 million
    • AT&T Inc. — $11.7 million
    • Blue Cross/Blue Shield — $11.1 million
    • Comcast Corporation — $10.7 million

    Just the top two of those corporations have spent more money on lobbying so far this year than organized labor did in all of 2010. No wonder the voice of working people is drowned out in the halls of Capitol Hill by the golden microphones and oversized amplifiers of Wall Street lobbyists.

  • AlterNet: Mortgage CEO Gets 40-Month Sentence for $3 Billion Fraud, Homeless Man Gets 15 Years for Taking $100. By Lauren Kelley. Excerpt: This image has been making the rounds this week, and for good reason. It elegantly illustrates how our nation treats the haves vs. the have-nots -- the 1% vs. the 99%, if you will. We live in a country where white collar criminals convicted of multi-billion-dollar fraud schemes get less than 3.5 years in prison, while homeless men who take a hundred bucks (and feel bad about it) are tossed behind bars for 15 years. The stories aren't new (the first is from June and the second from 2009), but it hardly matters; you could sub in any of the numerous stories of white collar criminals getting away with enormous crimes, and of poor people being targeted because of their class, and you'd get a similar result.

    If anyone you know still doesn't understand what the Occupy Wall Street protesters are angry about, please point him to this.

  • Christian Science Monitor: A long, steep drop for Americans' standard of living. Not since at least 1960 has the US standard of living fallen so fast for so long. The average American has $1,315 less in annual disposable income now than at the onset of the Great Recession. Excerpts: Think life is not as good as it used to be, at least in terms of your wallet? You'd be right about that. The standard of living for Americans has fallen longer and more steeply over the past three years than at any time since the US government began recording it five decades ago.

    Bottom line: The average individual now has $1,315 less in disposable income than he or she did three years ago at the onset of the Great Recession – even though the recession ended, technically speaking, in mid-2009. That means less money to spend at the spa or the movies, less for vacations, new carpeting for the house, or dinner at a restaurant.

    In short, it means a less vibrant economy, with more Americans spending primarily on necessities. The diminished standard of living, moreover, is squeezing the middle class, whose restlessness and discontent are evident in grass-roots movements such as the tea party and "Occupy Wall Street" and who may take out their frustrations on incumbent politicians in next year's election.

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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