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6, 2000 April, 2000

Highlights—April 7, 2012

  • Zacks Equity Research, courtesy of Yahoo! Finance: IBM Expands in Brazil. Consistent with its expansion policy in the growth markets, tech giant International Business Machines Corp. recently announced its entry into a strategic agreement with Brazil-based EBX Group. EBX Group headed by Brazilian billionaire Eika Batista comprises eleven companies with operations in diversified fields such as logistics, energy, marine, entertainment, mining, oil & gas and technology.

    As per the terms of the agreement, IBM will acquire 20% of SIX Automacao, a subsidiary of SIX Solucoes Inteligentes, the technology arm of the EBX Group. Moreover, IBM will set up a research & development (R&D) center in collaboration with SIX Automacao, which will focus on developing technology solutions aimed at boosting EBX’s presence in the natural resources and infrastructure sector in Latin America. ...

    Emerging economies (termed as growth markets by IBM) forms an important pillar of IBM’s long term growth strategy. Over the last decade (2000-2010), the company has focused on expanding its operations in emerging growth economies of the Asia-Pacific, Africa and Latin America. During the period, IBM earned more than $10.0 billion from growth markets which contributed approximately 21% of total geographical revenue. ...

    Our Take: Although we remain optimistic with IBM’s policy of expanding its business in the Latin American region particularly Brazil, we remain concerned about the increasing government regulation for U.S.-based companies going forward. IBM, along with other U.S. based companies face tax related issues in Brazil, which may become an impediment for growth in this region going forward.

  • Yahoo! IBM Employee Issues message board: "Re: Surprise! IBM Expands in Brazil" by "Paul S". Full excerpt: It probably means IBM would like there to be no tax at all. Many multinationals operate in China and officially on paper, they say they pay taxes, but actually they often do not. Then they tell Uncle Sam they are paying national taxes to another country and therefore do not owe US Federal income taxes on said amount. The result is that IBM, for example, pays only 2.1% US Federal Income taxes (2010 number). This is the so-called tax-break for offshoring that you hear so much about.

    Many in the Congress are protecting these tax-breaks for their corporate friends/donors that have operations overseas. The percentage of corporate taxes paid to the US Federal government has declined partly from offshoring and partly from these tax-breaks.

    We first need verifiable numbers for US-based employees before we can give tax-breaks for onshoring of work to the USA. Companies like IBM have decided that they don't have to publish any of these numbers. There is legislation pending to address that and force openness of official employee counts, but thus far it is running up against stiff conservative opposition.

  • Huffington Post: Augusta National Golf Club's Ban On Women Hits A Corporate Sponsorship Snag. By Jason Linkins. Excerpts: Burk's efforts have thus far proven fruitless, but over at ThinkProgress, Travis Waldron reports that as a result of a collision of another Augusta tradition, a change may finally come. Or not! We'll see.

    Everything basically hangs on how much fealty the golf club is willing to show to its historic corporate sponsors. See, one of the Masters' longtime sponsors is IBM. And the golf club has honored that company's CEO -- along with the CEOs of Exxon Mobil and AT&T -- with the symbolic trappings of membership. But here's the tricky part: The new CEO of IBM is Ginni Rometty, currently ranked No. 7 on Fortune magazine's list of the "50 Most Powerful Women in Business."

    It says a lot about how casual one can be about the lack of concern that there is insufficient gender equity at the executive level in corporate America that the Augusta National Golf Club managed to make it all the way to the 21st century with the rest of us without foreseeing this eventuality. Waldron gets to the heart of the matter:

    Rometty’s situation, though, gives her leverage Burk never had. The CEOs of the other two Masters sponsors, Exxon Mobil and AT&T, are both members, and they’ll both be donning the club’s signature green jackets next week. If Rometty isn’t allowed to join them (and given Augusta’s history, she probably won’t be), it will send another message to the 6 million American women who play golf and countless others who watch it that even if they are capable of breaking every last one of corporate America’s glass ceilings, they aren’t capable of playing golf with the boys.
  • Wall Street Journal: Masters Flap Won't Deter IBM Chief. By Spencer E. Ante. Excerpts: Virginia M. Rometty, chief executive of International Business Machines Corp., is expected to attend the Masters Tournament at Augusta National Golf Club, a move that will likely bring more attention to a now-raging controversy over whether the all-male golf club should admit female members. Ms. Rometty's case presents a uniquely delicate problem for IBM and the tournament, considered one of golf's most prestigious. IBM is one of the Masters longtime corporate sponsors. Ms. Rometty, who plays golf but is more partial to scuba diving, is the technology giant's first female CEO.

    Augusta has offered membership to a number of IBM CEOs but because of its all-male policy, it's unclear if an invitation has been extended to Ms. Rometty.

    Ms. Rometty, 54, who took IBM's helm at the beginning of this year, hasn't commented publicly on the matter. She plays golf, though not frequently, IBM says. She plans to entertain clients at the tournament. IBM continues to sponsor the tournament because it is one of the company's major marketing and advertising events of the year, said a person familiar with the matter. ...

    If Ms. Rometty isn't offered a membership it would be a break from Masters tradition. The last four CEOs of IBM have been offered membership, which allows a person to don the club's famous green blazer.

  • Wall Street Journal: All Quiet in Augusta National’s IBM Cabin. By Jason Gay. Excerpts: One of the most closely-monitored stories at the 2012 Masters is not occurring on the course: the whereabouts of International Business Machines Corp. chief executive Virginia M. Rometty. IBM is a major sponsor at the Masters, and in the past, the company’s CEOs have been offered memberships. But Augusta National, of course, is an all-male club, and so the question of whether Ms. Rometty – known to be a golfer – will be offered a membership has provoked considerable speculation and controversy. ...

    On Friday, the Journal reported that Ms. Rometty is expected to attend this year’s tournament, which concludes Sunday. Like other major sponsors, IBM has a hospitality cabin on the Augusta National premises. Friday morning, a pair of Journal reporters walked down the perimeter of the course’s back nine and entered the small but well-appointed IBM cabin, where a number of people were already gathered inside.

    A man who did not introduce himself said that Ms. Rometty was not there, and declined to take a message. It was not clear if Ms. Rometty was elsewhere on the course, or had yet to arrive at Augusta, where her presence, no matter how quiet, is likely to stir golf’s biggest weekend.

  • Christian Science Monitor: All-male Augusta National overlooks Virginia Rometty. Should IBM complain? Augusta National Golf Club, host of the Masters, has offered membership to the CEOs of sponsor IBM in the past. But it hasn't let in new CEO Virginia Rometty, potentially causing problems for IBM. By Daniel B. Wood. Excerpts: It's an awkward moment for IBM and CEO Virginia "Ginni" Rometty as they consider what – if anything – to do about the apparent snub. Fighting the feminist cause might not be IBM's job, say some experts, but the company might have to brace for a potential backlash if it continues its relationship with Augusta.

    While Augusta National undercut protests in 2002 by eliminating commercials on its broadcasts – thereby removing the opportunity for potential boycotts – IBM could face an uprising that is harder to handle.

    “IBM can decide to support the Augusta National as is, but the tradeoffs are huge,” says Mary Ellen Balchunis, a political scientist at LaSalle University in Philadelphia, who will be using the episode for her course on women in politics. "First, it would be a real slap in the face to CEO Ginny Rometty should the Augusta National not admit her as a member," she says in an e-mail. "Second, should IBM continue to be the chief sponsor if IBM does not admit their CEO, IBM should be prepared for a large boycott by women. Women are IBM users and purchasers.”

    For its part, Augusta has long been proud of its exclusivity and conservatism. It didn’t have a black member until 1990, when the club extended an invitation to Gannett television executive Ron Townsend, according Orin Starn, a cultural anthropologist at Duke University in Durham, N.C., and a golf historian.

    “You would think that Augusta would be very sensitive, even embarrassed about its exclusionary past – this was a club that was very much about Jim Crow for the first five decades of its existence,” says Professor Starn, author of “The Passion of Tiger Woods.” “Apparently, they refuse to discard their anachronistic, stick-to-their-guns mentality.”

  • Yahoo! IBM Pension and Retirement Issues message board: "Are one year retirement bridges still being offered if RA'd" by "oldyellowbus". Full excerpt: Hello all, I am a second round choicer who is 54 years old plus some change. I have 28 years of service.

    While I wouldn't say the second round pension is in any way liveable -- and certainly greatly diminished from what it should have been -- the annuity certainly beats where I'd be with cash balance and I'm grateful that I have it.

    IBM being the company it is, I can always see this game of musical chairs coming to an end and being RA'd before I turn 55.

    My question is: Does anyone know if during the latest round of RAs the 1 year bridge was still being offered? I believe the bridge was always offered at "management discretion." And is there a line of thought that says that to make sure the bridge is made available, the IBMer needs to be a bit "difficult" so the bridge is offered as a pacifier?

    On a related note, does anyone know if severance pay up to 26 weeks was still being offered during RAs? Severance is certainly not required by law but I know IBM has always used severance as a way to get IBMer to sign away their ability to sue. So, I'm more than curious about severance too.

    Any thoughts appreciated. My best wishes to all those leaving IBM -- I'm consistently told that post IBM life can be very sweet indeed.

  • Yahoo! IBM Pension and Retirement Issues message board: "Re: Are one year retirement bridges still being offered if RA'd" by "flatsflyer". Full excerpt: The cost of RA's is not a charge against IBM, the Pension Trust Fund is tapped to fund severance, etc so that these cost don't impact the salary, benefits, bonuses, etc. of the 3,499 Greedy Bastards and 1 Greedy Bitch.
  • Yahoo! IBM Pension and Retirement Issues message board: "Re: Are one year retirement bridges still being offered if RA'd" by "Tony". Full excerpt: I had a few friends that got the boot recently. I do not think I have heard of anyone getting a year of bridge in a while. I have seen people get a few months bridge to get them to 30 years. All the folks I talked to this last round got 26 weeks severance. One of them , even though he had 30 years, did not qualify for the FHA though (thankfully his wife has a good medical plan). Good luck trying to get a year bridge.
  • Yahoo! IBM Pension and Retirement Issues message board: "Re: Are one year retirement bridges still being offered if RA'd" by "willbefree25". Full excerpt: What does the latest USHR119 say? The old one I went by said:
    Employees who accept the terms and conditions of the IBM Individual Separation Allowance Plan and who are regular IBM employees (i) within one year of retirement eligibility as of their departure date; or (ii) retirement eligible as of their departure date, who were not within five years of retirement eligibility on March 1, 1996; are eligible for a retirement bridge (Retirement Bridge "A"). The period of this retirement bridge is only until the employee reaches his or her earliest retirement date. (For complete details see Attachment A which is hereby incorporated by reference.)

    Employees who accept the terms and conditions of the IBM Individual Separation Allowance Plan may request participation in a retirement bridge (Retirement Bridge "B"), if they were regular IBM employees within five years of retirement eligibility as of March 1, 1996 or were on a Retirement Bridge Leave of Absence as of March 1, 1996. (See the Summary Plan Description for the IBM Retirement Plan - Prior Plan to determine who is eligible to retire.)

    Employees who meet the above criteria may request a retirement bridge for a period of up to a maximum of five years following their departure date from IBM (including, to bridge between their departure date and the day their pension benefits commence, when their departure date is not the last day of the month.). All employees who meet the above criteria are currently retirement eligible and, should they elect to take a retirement bridge, will not receive retirement income until the end of their bridge. (For complete details see Attachment B which is hereby incorporated by reference.)

  • Yahoo! IBM Pension and Retirement Issues message board: "Re: Are one year retirement bridges still being offered if RA'd" by "madinpok". Full excerpt: The Individual Separation Allowance is NOT what is used under a Resource Action. The ISA applies when a person is fired for performance reasons or other reasons specific to that individual.

    For those who lose their jobs as part of a RA, the details of the retirement bridge are spelled out in the information package that the affected employees are given.

    In all the RAs up to this point, the one year bridge has been part of the package.

  • Yahoo! IBM Pension and Retirement Issues message board: "Re: Are one year retirement bridges still being offered if RA'd" by "teamb562". Full excerpt: The ISAP (USHR119) actually covers two situations.
    • Situation 1: being fired for performance reasons (like two 3's), max of 13 weeks, up to 1 year medical and $2500 retraining.
    • Situation 2: very much like an RA (hey, we just don't need you anymore) for a single person, as opposed to a group (or more then 1 person) which constitutes an RA, max 26 weeks, up to 1 year medical and $2500 retraining.

    USHR119 because I just got taken out for alleged performance reasons. The best I can tell, either one (situation 1 or 2) is the same as an RA in regards to benefits except if it's performance based, max of 13 weeks pay.

    Also, the details of the retirement bridge are spelled out in USHR119.

  • Glassdoor IBM reviews. Selected reviews follow:
    • IBM Advisory Software Engineer in Littleton, MA: (Current Employee) “A workplace where everything depends on how you good you can market yourselves.” Pros: Lot of opportunities inside the organization to grow and look for opportunities that might be of your interest. Diverse work culture and a lot of focus on patenting ideas. Cons: You are a drop in an ocean. To get visibility from senior or middle management, you have to market yourselves. More than the work you do, you may be appreciated for the initiatives you take and how good you can communicate and convince others. Advice to Senior Management: Take a look your workhorses. There might be real innovators who are working head down and not asking anything. Management should put real effort to recognize people who loves to work, rather than talk.
    • IBM Industry Marketing in Costa Mesa, CA: (Past Employee - 2011) “Too many chiefs and not enough Indians!” Pros: Great public perception of the company. World wide operations with local presence everywhere. Fair treatment to newly acquired employees. Good work at home policies and technology that really helps the home worker. Cons: Too big. Business run by financial types stripping managers of choices in how to get work done. Way too much outsourcing to India. Advice to Senior Management: Less focus in building "management tools" and more effort in moving decisions closer to the customer!
    • IBM Anonymous: (Current Employee) “Outdated compared to other technology companies.” Pros: IBM offers excellent training opportunities, and encourages employees to change jobs to gain a broader experience. This in my opinion is excellent, as there are very little companies out there that will be willing to do this. Cons: Globalization is creating a 24x7 environment, and employees tend to work long hours. Evenings are spent on conference calls, and that takes time away from the family.
    • IBM Anonymous: (Past Employee - 2012) “Unsatisfactory” Pros: Diversity / inclusion policies. Ability to work from home. Good benefit package. Good starting salary. IBM cache still sells in the job market. Cons: Annual raises and bonuses are minimal to non-existent. Quantity of hours worked is valued much more than quality of work produced. Overtime expectation increases every year; a minimum of 20% overtime is required to receive anything more than a mediocre annual performance review. Successful performance may lead to repetitive work assignments thereby limiting the chance to develop new skills. 'Resource actions' to permanently lay off US employees occur at least once every year resulting in ever lower US employee morale. Some managers take as gospel any negative comment made by a third party about an employee without ever discussing the negative comment with the employee. Some managers prone to passive aggressive behavior. Advice to Senior Management: Stop employing a bell curve in the annual performance review process and start evaluating employees on their merits as individuals. Rethink the ways in which performance is judged; develop objective measures to evaluate work quality. Recognize the degree to which US employees "fix" the work of offshore resources. Rethink the cost / benefit of shifting work to offshore resources; the cost may be low but the benefits are even lower.
    • IBM Senior Marketing Program Manager in New York, NY: (Current Employee) “Serious workplace for those that want to make an impact to the world.” Pros: Opportunity abound for those who want it. Conservative workplace, highly virtual where teams are global almost every meeting, extremely high matrixed organization provides challenges for those who want to navigate the system. The workplace is reflective of any megacap company except IBM sets the standard for those companies in business process, use of technology for employees, and work/life balance. Don't get me wrong, get ready to work 50 hours normal week and up to 70 a few weeks in the year when busy. But the work is terribly rewarding. It's great to be an IBMer. Cons: Large, really large company. Systems galore. Meetings are on the phone almost all the time except when meeting with clients or being assigned to client sites. When you have 420,000 employees, you need that. But, if you don't like having a serial number and being part of the machinery, you may want to rethink IBM. Advice to Senior Management: Let's truly be the world's most essential company, as a business and as IBMers in society.
    • IBM Backup and Restore Administrative - Blues in Dubuque, IA: (Past Employee - 2011) “Able to learn an incredible amount, but workload burnout.” Pros: Learning opportunities, some very knowledgable coworkers, lower level management is good, decent benefits, nice facilities. Cons: Very low pay in the GDF structure, senior management in Dubuque completely out of touch, due to low wages in Dubuque the level of expertise that can be attracted is insufficient, new hires take too long to contribute since they do not know the job, for the few people that can actually do the job, they are completely overworked, constant fire fighting and can never get ahead to be proactive, priorities are focused on the low bang for the buck..."make sure your yearly training activities and quarterly security reports are done and make sure your signature line in email is correct", it doesn't appear they are really concerned about supporting the customer. Advice to Senior Management: You are overtaxing your best workers and they are leaving to find better jobs as the economy slowly improves. Stop hiring low level employees who are expected to learn technical responsibilities when they were working as a graphics artist in their last position. IBM made money hand over fist in 2011 and can afford to pay a little more for quality workers. Sending work overseas is not always the best answer. I have seen many instances of "you get what you pay for". It is nice to see the jobs being kept in America and not "best shored", but you must increase the salary of your best workers and pay enough to attract competent workers to Dubuque.
    • IBM Anonymous: (Current Employee) “It's never enough for the management chain and corporate, but you can learn a lot here.” Pros: For what I do, the compensation is very good. There is lots of flexibility about hours and working remotely or at home. Colleagues are by and large very professional, smart, and collaborative. Cons: Totally anonymous culture (for some this may be a positive, but for me it's not). Lack of access to some critical hardware and software resources. Performance evaluations are based on doing more (or appearing to do more) without any requisite proof of quality. A lot of people who are promoted and thrive in this organization are people who are good at pushing people around and either don't understand the technology or how to make it palatable to the public. Advice to Senior Management: Stop laying off people when we're making so much money (about 1,500 let go in March 2011). Get rid of the forced bell-curve performance assessment system. Don't be so penny-wise, pound-foolish with expenditures. Upgrade the clunky infrastructure.
    • IBM Technical Sales in New York, NY: (Past Employee - 2012) “Not what it used to be.” Pros: Brand recognition, everyone knows IBM. Wide breadth of technologies and products, and most of it is industry leading (they have a lot of cool products.) IBM does a lot of cool stuff...but not everyone knows about it. Job security, you really need to try hard to get fired for poor performance (though you can be laid off at any time, but this doesn't mean you were a poor performer).

      Cons: You'd think the company was going out of business the way it's run. There's very little training (budget cutbacks), little budget for travel, below average salaries, below average commission payments, mediocre medical benefits, no equity awards given to employees, etc. It's all about the numbers, and the new corporate motto is "everybody sells".

      It's also very easy to get pigeonholed into one area. While it's a big company and you can have a career, switching jobs is more about fighting with management to let you move on.

      Self service company - you're left on you're own to figure out everything. Again, training is nearly non-existent, this includes employee onboarding.

      Advice to Senior Management: Care about your people and increase pay to at least industry average. I saw a lot of very very good people leave voluntarily, many because of compensation. Don't treat everyone as replaceable, because as you attempt to continue to grow revenue, you still need good people. Employees are a companies most valuable asset, and IBM is forgetting this very important fact they way the business is run.

    • IBM Anonymous in Atlanta, GA: (Current Employee) “IBM is not what it used to be, expect little and you will survive.” Pros: Flex - Time - You don't have to kill yourself to get to work before 8AM. Vacation - For the most part you can take vacations without too much hassle from management. Stock Purchase Program. Normally your peers are professional so for the most part a pleasant place to work. Cons: Salaries: Normally based on a national level not regional - all that has changed. So if you move from Atlanta to NY don't expect a pay raise to cover the additional cost of living. Not very competitive anymore unless you get into higher mgmt levels. IBM running on bare bones for the last 2 years trying to keep cost down and appease stockholders - little movement, so if you are looking to get ahead- this is not the place for you. Advice to Senior Management: In order to keep IBM running strong and maintaining the level of work performance we are known for, you have to get back to basics - IBM Basics - respect for the individual - develop your people at home as well as abroad.
    • IBM Staff Engineer in Rochester, MN: (Current Employee) “Good in the past, steady decline in the last decade.” Pros: Chance to work with world class technology. Vacation holiday and personal time flexibility. Health benefits seem to be pretty good. Cons: Erosion of support functions, leads to extra work just to keep your work environment going. Workstation support is one, admin support is another. Recurring layoffs keeps you on edge. Advice to Senior Management: Not sure what advice I could offer. Leadership at IBM is driven by shareholders, and apparently some large shareholders exert a lot of pressure on IBM execs with regard to earnings per share, share buybacks, dividends, acquisitions, "productivity" -- which is tied to human resource costs, etc.
    • IBM Staff Engineer in Austin, TX: (Current Employee) “IBM used to be great place to work, but not anymore.” Pros: big company with many divisions. tend to be relatively more stable than other high tech companies. Cons: company is outsourcing everything, employee morale very low.
    • IBM Anonymous in Nice (France): (Current Employee) “I would probably choose not to join IBM...” Pros: - The company's image, still...at least for the general public, 'I work for IBM' means something. - IBM is really serious about training, and very well organized for that.

      Cons: - Way too much time spent dealing with processes. - No chance to grow a team (at least in Software Development): no organic growth, no new projects. - Every year, only around half of the employees get a salary raise. You may never get a raise if you're not (considered) better than your closest colleagues. Say 'Bye!' to team spirit. - Cost control is way too tight. Some employees even start to buy computers on their own money to be able to do their job correctly! And travel is extremely restricted.

      Advice to Senior Management: - Planning to spend 35k$/year/employee for the next 5 years on 'returning value to the shareholders' (c.f. 2015 plan) is outrageous given what employees get in the meantime - Planning for the whole growth to be driven by acquisitions precludes existing teams to grow. Very bad for employee's morale. - Be careful about imposing constraints on how to do things without any justification except pleasing the team in charge of implementing/checking these constraints. The costs of those constraints never seem to be accounted for. - Stop restricting salary raises to only around 50% of employees! - Let managers decide how they want to spend their budget: do you really think that an accountant (or, rather, a policy) knows better what's good for the business? - For employees the work of whom is not tied to a specific country, don't let their country's results affect their raises and bonuses.

    • IBM Anonymous in Hortolandia (Brazil): (Current Employee) “Once upon a time it was my dream to work here. Now it's becoming a nightmare. Unfortunately.” Pros: I would say the benefits we are granted. Nothing much. Cons: Management. They need to improve much to become something to deserve respect. Advice to Senior Management: Managers has to take care of people management not duty management. For that we have Team Leader, Shift Leader, Technical Leader. They need to worry about employee growth, not on pushing them down.
    • IBM Director: (Current Employee) “Challenging and rewarding experience with lots of opportunity to develop” Pros: Remarkably competent colleagues, who are committed to success. Extensive opportunities to develop and take on new challenges Cons: The ever increasing responsibilities out-pace the compensation. You can increase your responsibilities and scope, and the "Machine" does not maintain competitiveness in compensation, and you quickly are more valuable elsewhere in the marketplace.
  • U.S. News and World Report: Young Employees Seek Jobs with Pensions. Excerpts: The proportion of workers under age 40 who consider the retirement program an important factor in accepting their job more than doubled from 28 percent in 2009 to 63 percent in 2011, the survey of 9,218 employees at private sector businesses with 1,000 or more employees found. “The combination of a slow economic recovery and more older employees delaying retirement is making it increasingly difficult for younger employees to find jobs or advance in their careers,” said David Speier, a senior retirement consultant at Towers Watson. “As a result, young workers are clearly giving much more weight toward both employer retirement and health care benefits when making career and employment decisions.”

    The study found that traditional pensions are becoming an increasingly effective way to attract and keep young workers. Some 72 percent of employees at companies sponsoring traditional pension plans say the retirement program gives them an important reason to stay on the job, up significantly from 37 percent in 2009. The majority of workers with a traditional pension (74 percent) say they hope to work for their current employer until retirement, up from 44 percent in 2009.

    Far fewer young people with 401(k) accounts say the company retirement plan influenced them to join (28 percent) or stay with (36 percent) their firm. And less than half (47 percent) of employees only offered a 401(k) plan would like to stay at their current job until retirement. “Employers with open defined-benefit plans appear to have a leg up on their competitors in keeping employees,” said Laurie Bienstock, a North America practice leader at Towers Watson.

  • Washington Post with Bloomberg: The 401(k): Americans ‘just not prepared’ to manage their own retirement funds. By Jia Lynn Yang. Excerpts: When lawmakers added a subsection to the tax code called the 401(k) more than three decades ago, they could not have imagined that this string of three numbers and a letter would become a fixture in the financial lexicon. Nor could they imagine the stress it would unleash.

    A poll by Gallup last year showed that for two-thirds of Americans, not having enough money for retirement topped seven other financial worries, including medical bills, mortgage payments and their children’s college tuitions.

    Worrying about having enough money for retirement is not a new phenomenon. But the rise of the 401(k), dating to the early 1980s, has steadily shifted more financial responsibility onto the shoulders of many Americans who are — let’s face it — clueless. ...

    Consider the hurdles between every American with a 401(k) and a decent retirement: First, wade through your HR department’s paperwork to enroll in a plan at your company. Second, save enough. (Imagine what you think is enough. Then save more.) Next, manage your investments intelligently through stock market highs and lows, tending to your portfolio every year to make sure you have the right balance of stocks and bonds, and avoid withdrawing any money early. And not least, when you retire, ration your money at just the right rate: not so little that you live uncomfortably but not so much that you run out.

  • MetLife: MetLife Study Finds Contrary to Predictions, Boomers Are Retiring. More Than 60% of 65-Year-Olds Already Collecting Social Security. Excerpts: Despite the popular belief that Baby Boomers will continue to work well past the traditional retirement age of 65, those born in 1946 are retiring in droves, according to Transitioning into Retirement: The MetLife Study of Baby Boomers at 65. This study is a follow–up to the 2008 MetLife Mature Market Institute study, Boomer Bookends: Insights into the Oldest and Youngest Boomers (released in 2009), which looked at the same segment of Boomers at age 62 and includes 450 of the same interview subjects from the original study. ...

    Additional findings:

    • The average retirement age for the 1946 Boomers is 59.7 for men and 57.2 for women.
    • 24% have a living parent.
    • 84% are parents; 83% are grandparents, up from 77% in 2008.
    • Of those not retired, 61% plan to retire at the same age as they planned one year ago.
    • 31% of 65-year-old Boomers think they were at their sharpest mentally in their 40s; only 20% say they’re at their sharpest today.
    • Home ownership increased significantly among the studied cohort since 2008, from 85% to 93%.
    • 71% are married or in a domestic partnership; 12% are divorced or separated; 10% are widowed and 7% are single.
  • EE Times: Things that older electronics engineers can do (humor). By Richard Krajewski. Excerpts: In every profession, there is an acknowledged body of stored wisdom and knowledge firmly packed into the noggins of those geezers and codgers still kicking about with a sufficient level of awareness to identify themselves as members in good standing. Electronics engineering is no different. Though there is a myth that age is a disqualifier for service within the EE ranks, in fact the brother- and sisterhood of those devoted to the movements of electrons and their accompanying fields of charge make full use of the experience and random outbursts of their aged members. ...

    Yes, there is much that an older engineer can do. From inspiring the younger generation with tales of food stamps and foreclosures to watching their retirement accounts disappear and waiting for social security to blow up, older engineers are our anchor, our source of guidance and our pizza deliverymen. Professionals to the core, they illustrate the engineer’s prototypical versatility as they seamlessly transition from designing multilayer analog and digital printed-circuit boards to asking perhaps the most pressing question of our time: “Will you have fries with that?”

  • GlassDoor: Top 25 Highest Rated CEOs 2012. Excerpt: Glassdoor is revealing its latest list of the Top 25 Highest Rated CEOs – the list is based entirely on feedback from employees who were asked one simple survey question: Do you approve of the way your CEO is leading the company? In the last year alone, more than 280,000 employees rated their CEO on Glassdoor. Check out who made the Top 25 Highest Rated CEOs list...
  • The Brad Blog. Palm Beach, FL Elections Settled by Hand-Count After Op-Scan Computer Misreported Results. By Brad Friedman. Excerpts: A public hand-count of paper ballots in Palm Beach County, FL over the weekend has decisively determined the winners and losers of several disputed elections after paper ballot optical-scan computer tallying systems made by Sequoia Voting Systems (now owned by Dominion Voting) declared the incorrect "winners" of several races in a March 13th election.

    But a dispute over who is to blame for the initial failure flared up again over the weekend as Dominion issued a statement that seems to contradict their previous admission that their software was to blame.

    "The hand-count was 100%. We weren't missing a ballot," the Palm Beach County Supervisor of Elections Susan Bucher told The BRAD BLOG this afternoon about what happened over the weekend. "Frankly, without paper ballots and without audits, we would have let the wrong winners serve." ...

    John Greene, who was initially announced as the loser of the Wellington City Council race by the Dominion/Sequoia system was pleased with the results of Saturday's public hand-count which was only allowed in the state of Florida --- where it is now illegal to manually examine paper ballots for a hand-count after they've already been tabulated by a computer --- after a judge gave the okay. ...

    Saturday's public hand-count of paper ballots, which we've long described as "Democracy's Gold Standard" (at least when its done on Election Night, at the precinct, in front of the public) settled all questions about the results. But it hasn't settled all question about what went wrong, and whether voters in the 14 states which currently use the faulty Dominion/Sequoia system --- many of them swing states --- should rely on the results reported by it. ...

    Similar, if not identical paper-based computer tallying systems are set to be used across the country for some 70% of the votes cast in this year's Presidential Election, despite the myriad of failures and vulnerabilities in such systems that we've been reporting here at The BRAD BLOG for nearly a decade.

  • Rochester (NY) Democrat and Chronicle: For now, Kodak backs off on retiree benefit cuts. Company files motion to work with retirees. Excerpts: Medicare-eligible Eastman Kodak Co. retirees facing possible cuts to their company-provided health care coverage have some additional breathing room. The company, in a filing Wednesday, sought U.S. Bankruptcy Court approval for creation of a retirees committee to represent their interests through Kodak’s Chapter 11 process.

    Kodak also said it was yanking a previous motion seeking to end the Medicare Advantage plan it provides to post-1991 retirees who are eligible for the government health insurance program. ...

    Veronda said Kodak “hopes to continue” providing medical and survival benefits while reducing the cost.

    Editor's comment: It appears that Kodak, a company that is entering Chapter 11 bankruptcy, is more committed to its retirees than IBM, a phenomenally profitable company.

  • Alliance for Retired Americans: Friday Alert (PDF). This week's articles include:
    • Parts of Wisconsin’s Controversial Anti-Collective Bargaining Law are Struck Down
    • State Chapter Update: Michigan, New Hampshire
    • Single Retirees Often Face Extra Challenges
    • Something on Your Mind? Write Letter, Win Pen!
    • American Story Bank
  • Times of India: Facebook hires software engineers from India to fill US posts. By Srividya Iyer. Excerpts: Facebook, the world's largest social networking site, is doing something that no domestic or multinational company has done before - hire software engineers from India for positions based in the United States. Typically, global firms such as IBM and GE hire in India for positions here and send some of these recruits abroad for specific projects. However, Facebook's open invitation in a newspaper advertisement last week seeking applicants "to work in the US" is being regarded as a first.

    "It is unusual and I haven't seen anything like this," said Sharad Sharma, the chair of industry body Nasscom's software product forum. The advertisement in The Times of India pointed applicants to an online coding challenge for 86 open positions in software engineering in Chicago, Dublin ( Ireland), New York and Seattle.

  • Baseline Magazine: Millions of Jobs Could Be Sent Overseas. By Dennis McCafferty. While many hope the recovery of the U.S. economy will create domestic job opportunities, a recent report from the Hackett Group finds that the U.S. job market will continue to face challenges. Many jobs will be off-shored in the coming years to nations such as China and India. These “low-cost geography” nations appeal to organizations that strive to keep operating costs low. As a result, the wave of migrating opportunities should have a considerable impact over the next several years. However, the Hackett Group reports that this trend will begin to decline by 2014, and then the outflow of jobs will likely cease because companies will run out of positions that are suitable for moving to these nations. The research was compiled via available data on 4,700 companies with annual revenues over $1 billion headquartered in the United States and Europe. ...
    • 150,000 business service jobs in Europe and North America are moving off-shore per year.
    • 54,000 of these positions off-shored annually are IT jobs. ...
    • 2.1 million jobs in North America and Europe will vanish due to off-shoring by 2016. ...
    • 54% of IT jobs in North America/Europe will be lost to off-shoring by 2016. ...
    • 37% of "knowledge-centric" IT jobs will exist in off-shored to "low-cost geography" nations within two to three years compared to the 26% based there now.
    • 50% of "operational" IT jobs will exist in "low-cost geography" nations in two to three years, compared to the 36% based there now.
New on the Alliance@IBM Site
  • SOS! Stop Off-Shoring our jobs! Informational pickets April 24. Locations:
    • Poughkeepsie: Sidewalk in front of Spackenkill Plaza, Rt 9 4pm-5pm
    • Endicott: Corner of North and McKinley, Endicott. 4pm-5pm
    • Boca Raton: Congress Ave. 4pm to 5pm.
    • Burlington, VT: location and time TBA
    • Boulder: Location and time TBA
    • Rochester, MN: Location and time TBA
    • RTP: IBM Main site front gate (intersection of Davis Drive and E Cornwallis Road) 4pm to 5pm

    If you want to participate or have an information picket line at your site please contact: ibmunionalliance@gmail.com

  • Job Cut Reports
    • Comment 04/02/12: I bet the actual number of RAed is 2% of the USA employees. I use the infamous HR managed out presentation that Randy Mac pitched. So it is highly conceivable there could be another 200 or more that got the ax. -stillgoingup-
    • Comment 04/02/12: At the current pace the 2015 roadmap will only leave about 70K USA employees. -anonymous-
    • Comment 04/03/12: IBM does not shake in its boots if they lose a contract. The reason is two-fold: the Execs and Sales team are compensated at the point in time of the contract and IBM only reduces expenses to cause the stock price to increase. I am an IBM employee and almost hate working there. I cannot leave for another 18 months. My GDP pay could only cover 1 night's rate for Summer vacation while my manager sends a note that she is taking a week vacation right as it came out. My neighbor's sister is married to a Sales Exec at IBM who just used GDP money to purchase another $1.5M home in RTP. Yes, his GDP was over $1.5M take home. Whether it is cash (most likely not) or options given, his bonus after taxes was over 7500x more than mine. Sickening. -Stockholder-
    • Comment 04/03/12: If you do not like your PBC rating, there are only 2 options to take: not sign it or appeal through HR. Not signing will have you out the door quickly. Appealing is a joke. You have a choice at an Exec review or a trial by peers. Either path is not retroactive and simply a bit flip in your file. You do not get any compensation for the change. You GDP does not increase and it has no bearing on pay raises. The Exec review is simple. They assign an Exec to "look" into it. A month later, they raise it. Total time spent is about 30 seconds: 10 seconds to change the rating and 20 seconds to put you at the top of the RA list. The other is a trial with 3 peer employees of your band level and 2 managers. You have to convince them that you deserve a better rating. The 3 peer employees are screwed if they side with you, so it is unlikely you win there now. The verdict is given and your PBC is updated accordingly in HR. Then, you are put at the top of the RA list. -PBC Ratings-
    • Comment 04/03/12: Urgent action needed for Minnesota and New Jersey IBM employees but others feel free to call the Senator and Representatives below. It appears IBM is putting a lot of pressure on them to support S.1747 the bill that takes away overtime pay for computer workers. We need you to call Sen. Franken and Rep Waltz in MN and Rep. Rush Holt in NJ asap to urge them to oppose this bill. They need to hear from IBM workers and ex-employees on this. IBM is taking a PR team with 4 "supportive" employees to congress urging support of this bill. Phone numbers:
      • Senator Franken: 507 931-5813
      • Rep. Waltz: 507 206 0643
      • Rep Holt: 609 750 9365
    • Comment 04/03/12: I too was affected by the 2/27 RA and was told it was to "streamline operations and increase productivity". I received a 3 on PBC because"a delivery executive observed one day that I more readily identified problems than solutions" - I contested it which was a waste of time - and here I am looking for a job. What hurts even more is that I know FOR A FACT there are other employees that weren't affected that have been sub-par employees for YEARS and they are still there. -NoLongerBlue-
    • Comment 04/04/12: I was laid off in the recent resource action. I initially was told I would only receive credit for vacation accrual for Jan & Feb. When I pursued it with the ESC due to the fact that I was on an AWS schedule and 3/28 would have been my last workday regardless I was again told that I would only receive credit for 2 months. I sent an email directly to R. Mac and I eventually received a check for an additional 12 hours of vacation time. I also noticed that my final salary payout was 2 days short. I contacted the ESC again and was told that my manager never followed procedures to correctly identify me as an AWS employee. They are now sending me a check for the additional 2 days... those that got RA'ed..check your final payouts to be sure they don't short change you.. If they can.. they will. -anonymous-
    • Comment 04/04/12: Also got my "exit" 3/28. Same sob story ... 15+ yrs of glowing PBC's ALL with 2 and 2+ ratings. Customer facing position with multiple active project assignments. Last review was 2 weeks before the infamous Monday morning 'thanks for stopping by' call. Reasons given are of course 'staff reduction' while there were multiple open Career Marketplace opportunities for my position posted. I've dodged 4-5 previous bullets but knew law of averages would take over at some point. What a relief; I physically feel better now then I have in years. I'll make out just fine. Now, most of you have heard this many times before, but I'm going to stress it here again.

      A sincere warning to the survivors: PLAN NOW! Look at your bank accounts, debts, and monthly expenses, and short term new expense needs (kids schooling, braces, what cars falling apart, etc). Ask yourself how you'll manage > WHEN < someone comes along and says your employment is ending in 30 days.

      I know first hand from the exiting manager that THERE IS MORE RA planned for this year once they've closed out this last one. And it will not stop. My own opinion is IBM won't make it's 2015 'road map'. Sammy saw the big picture and bailed in time. This was HIS vision, his 'baby' to corp America. Why else would he bail in the home stretch if he actually thought he had chance of victory. It will now be Ginny's failure whether the house of cards collapses before the road map goal, or during 'her' dismantling approach to it. God speed all. -areyoukiddingme-

    • Comment 04/04/12: Wouldn't a contract define what constituted overtime for what band levels? I agree the law needs to be opposed but how much longer are the players who will be most affected going to just sit on the sidelines and hope someone else protects them? Organize people. The sooner the better. Every day you delay IBM think tanks come up with new ways to take away from you, to prop up the companies false bottom line. Can you imagine an SSR who already works 60 hours a week and more and is on call 24x7 not getting paid overtime? That 60 would become 100 or more. IBM would work them till they died. They will beat employees like rented mules if you do nothing to stop them. -Exodus2007-
    • Comment 04/04/12: So IBM has still not discussed the loss of the contract with Disney with employees? All they get are rumors and notices that pass through the wire from their client. How is this a way to treat the people that worked for you for years and brought in profits to the business? A lack of communication is a sign of poor leadership. -MooCow-
    • Comment 04/04/12: In case you are thinking job cuts only happen once per quarter, there were job cuts announced in Canada the other day with end of April as last day. We were clearly told there are more cuts coming due to global resourcing initiative. -Canada GDF-
    • Comment 04/05/12: Had the opportunity to ask a third line manager about Roadmap 2015 and the drive to have as few US employees as possible. He confirmed the RA's will continue, as it was a "fact of life". For any IBMer that thinks they do a bang up job and will be exempted from an RA action, I have a bridge to sell you......... -Jaded-
    • Comment 04/05/12: To anonymous posted on 04/04/12: Who is R. Mac? I worked until 3/28 also but was told by my exit mgr that the rule is that I only got 2 months credit of vacation. I would like to know more about how I can get additional almost 1 month's vacation. Is it too late now? -exit_2012_03_28- Alliance reply: R. Mac is Randy MacDonald, IBM's Corporate HR Director. Yes, It may be too late to get anymore vacation pay. Sorry for your job loss.
    • Comment 04/05/12: Is there a way for us to find out how many FTEs IBM currently has in the US? I have a feeling it is already significantly less than the estimated 96K. -Curious- Alliance reply: Based on some estimates, the number seems to be less than 95,000; however, Alliance believes there are more firings coming. Possibly in June.
    • Comment 04/05/12: There were circa 3000 US IBMers RA'ed on 3/28. Alliance estimates are low. That equates to about 3% of the IBM US workforce. -Anonymous- Alliance reply: The estimate for 2.27.2012 has been suggested as 2560, in a previous comment on this board. Alliance numbers are calculated from the RA Pkgs. we receive from those people that have been RA'ed. We can only post those numbers as accurate. If we had received ALL the RA packages we would probably be closer to the 2560 estimate, as accurate.
    • Comment 04/06/12: Why does everyone think that IBM gave us all 7 shares of stock to be vested in 2015? Because most of us will not be employed. The worst part for survivors is the work doesn't go away, you are left to add it to your already over burdened workload, and blames the worker that things are not getting done (lower PBC ratings). There is not a single manager 1st-3rd line that could make a decision if their life depended on it. They are simply YES men looking out for themselves to avoid the axe. -SlaveLabor-
    • Comment 04/06/12: How many others listened to Dianne Diggleman's All Hands webcast? I don't know how she got through it without exploding and telling us all it was a bunch of hogwash and they made her do it. She spoke about how IBM values their employees and is dedicated to their development and career growth. Meanwhile, all that was on my mind for the hour of HOGWASH was will I dodge the next RA bullet. I signed up to question her about Roadmap 2015...but as you would guess there was little time (about 2 minutes) left for answering questions. They had a moderator of course...if it were an open call I bet she would have been put on-the-spot for sure. She seems like a nice person though, nothing against Diane personally, we all know she probably HAD to deliver their bullcrap to the masses. I am a member of the Alliance already. -AllHandsOnUnemploymentLine-
    • Comment 04/06/12: Response to -AllHandsOnUnemploymentLine-: She is right they will take care of IBMers - But not in US. I don't get to go for training on Advance AIX technologies, but SAs in India recruited as AIX admins get to for Basic AIX training. Go Figure -StillHere for Now-
    • Comment 04/06/12: To -AllHandsOnUnemploymentLine- Yes I heard the speech. I was so annoyed to here her talk about how much money IBM is investing in education. She failed to mention most of that education is for the off-shore workers and little is spent in the US unless you have top director level approval for something! It's all smoke and mirrors and how they can spin something to look better than it really is. -Dun-4-
    • Comment 04/06/12: Shouldn't the real question be how many US workers are actually US citizens and were born and raised here vs how many were brought here via onshoring regardless of whether they now have a green card or even citizenship? An onshored employee may be working on American soil and may officially be counted as a US worker but they were brought here to take away a job from a US citizen. The ~96K US employees is probably significantly less if you take these onshored employees out of the equation. I am already a full dues paying member of the alliance. -Dave-
    • Comment 04/06/12: Re education: I recently interviewed a candidate for certification in one of the IBM technical professions. He met all requirements except one, a 4-day class that is mandatory for this certification. He explained he was unable to take the class because there was no budget for it. Hence he was declined certification, jeopardizing his band promotion (the certification is a pre-req for the band promotion). Dedicated to development and career growth indeed. -EscapedButAcquired-
News and Opinion Concerning Health Savings Accounts, Medical Costs and Health Care Reform
  • The Brookings Institute: Why Health Care Isn’t Broccoli—Some Basic Economics. By Henry J. Aaron. Excerpts: The government defended the mandate that nearly everyone carry insurance by arguing that almost everyone is in the market for health care at one time or another during their lives. People who are not insured may at any time become seriously ill or suffer major injury. The health care they will need is often costly and many people will not be able to pay for it. Under the Emergency Medical Treatment and Active Labor Act of 1986 hospitals must treat everyone who needs emergency care regardless of ability to pay. As a result, hospitals and other providers get stuck with bad debts. To make up their losses on the uninsured, they must charge those who have insurance more than the cost of their care in order to make up those losses. In the jargon of economics, those with insurance are forced to 'cross subsidize' those without it. And that, in turn, boosts the cost of insurance, which is already high enough, reduces its affordability, and thereby increases the ranks of the uninsured. ...

    During the oral arguments on the Affordable Care Act, Justice Scalia challenged the Solicitor General, Donald Verrilli: "everybody has to buy food sooner or later, so you define the market as food, therefore, everybody is in the market; therefore, you can make people buy broccoli." Chief Justice Roberts commented that if the Court approves the insurance mandate: "All bets are off," meaning that there would be no limit to what Congress could do in regulating interstate commerce. Justice Scalia said he wanted a 'limiting principle,' so that the federal government, whose powers are constitutionally limited, would not be given unlimited sway over individual behavior. Justice Alito echoed that request.

    Solicitor General, Donald Verrilli, representing the government, failed to come up with such a principle. But there is a simple answer to Justice Roberts', Scalia's, and Alito's question. When someone consumes broccoli, one is not normally imposing costs on other consumers that make broccoli more costly or unaffordable. Furthermore, broccoli is not vital to preserving life or reducing pain. ...

    Later Justice Scalia also dismissed the notion that young uninsured people are effectively in the health insurance market whether they are currently insured or not, observing: "We're not stupid. They [the young] are going to buy insurance later. They're young and need the money now. When they think they have a substantial risk of incurring high medical bills, they'll buy insurance, like the rest of us."

    This statement is wrong on many levels. The most obvious is that when people have a substantial risk of incurring medical bills, insurers have to charge premiums many cannot afford. Letting people wait to buy insurance until they need it means letting them wait to buy it until many cannot afford it. Unless, that is, everyone is required to carry insurance and price differences are limited by law, which is just what the Affordable Care Act does. In that event, insurance for the old or sick will cost less than the value of services they will use, and insurance for the young and healthy will be priced above the cost of services they will use.

    But there is a more fundamental error of perspective in Justice Scalia's observation. He and other opponents of the mandate seem to be thinking about relatively brief time periods-like, one year. People may or may not be "active" in the markets for health insurance or health care over such a period. Hence, there are those who can freely choose to be outside the market while others freely choose to be in the market. These are seen as distinct groups. Forcing one of those separate groups to do something that they don't normally do or want to do may seem to infringe their freedom. If Congress is going to do that, the mandate opponents argue, there should be some limiting principle that stops Congress from doing a whole lot more that would infringe their freedom.

    But, let's engage in a thought experiment... something lawyers like to do. Let's assume that the earth revolves around the sun very slowly, so that a "year" in that situation corresponds to eighty of our years. Assume further that insurance contracts run for one of those elongated "years." One of those contracts would cover healthy 20-year-olds who use little health care and feeble, disease-ridden 80-year olds who, quite literally, could not live without it. If one thinks in these terms, the healthy 20 year-old and the sick 80 year-old are simply time-lapse images of the same human being. In discrete time, it is the pooling achieved through mandatory insurance that makes the multiple stages of the life-cycle fuse into a single sharply-imaged entity. The issue, then, is not whether there will be cross subsidies between today's young and today's old, but rather whether the lifetime costs of insurance will be averaged over time. That perspective is sufficient to sustain the mandate.

  • Wolters Kluwer: Though Support For Individual Mandate Is Low, It Would Affect Few, Stabilize Insurance Market. As the U.S. Supreme Court considers the fate of the Affordable care Act (ACA) individual mandate that requires all individuals to either have health insurance coverage or pay a fine, public support for the mandate continues to be low, Kaiser Family Foundation research shows. The legal spotlight on the mandate shed by the ACA’s opponents has not only made the mandate the best known of the ACA’s provisions (two-thirds know that it’s part of the ACA) but also shaped public perception. However, public opinion of the requirement remains “malleable and basic factual information and messages can sway Americans’ opinion,” Kaiser asserted in its new Data Note, A Snapshot Of Public Opinion On The Individual Mandate.

    The December 2011 Kaiser tracking poll found support for the mandate varied from 17 percent to 61 percent, depending on which messages or information opponents or supporters of the mandate hear on the issue. By far the most effective information in terms of changing people’s minds is that, “under the reform law, most Americans would still get coverage through their employers and so would automatically satisfy the requirement without having to buy any new insurance.” After hearing that message, favorable views of the mandate rose 28 percentage points to 61 percent. ...

    A recent study by the Urban Institute found that “if the ACA were in effect today, 94 percent of the total population (93 percent of the nonelderly population) or 250.3 million people out of 268.8 million nonelderly people—would not face a requirement to newly purchase insurance or pay a fine.

  • Daily Kos: Health care glossary (satirical cartoon) by Tom Tomorrow.
  • Dr. Jen Gunter: Cancer v. the Constitution. Excerpts: The patient in the emergency department smelled of advanced cancer. It is the smell of rotting flesh, but even more pungent. You only ever have to smell it once. She had been bleeding irregularly, but chalked it up to “the change.” Peri-menopausal hormonal mayhem is the most common cause of irregular vaginal bleeding, but unfortunately not the only cause.

    She hadn’t gone to the doctor because she had no health insurance. The only kind of work she could get in a struggling rural community was without benefits. Her coat and shoes beside the gurney were worn and her purse from another decade. She could never afford to buy it on her own. She didn’t qualify for Medicaid, the local doctor only took insurance, and there was no Planned Parenthood or County Clinic nearby. ...

    “I’m very sorry to tell you this looks like a cancer of the cervix,” I said She looked surprised. “Oh.” She paused in silence as she adjusted to the news. And then quietly she added, “But the doctor back home said you could fix me up. He said you can offer free care because you have the university.”

    But we didn’t have free care at the university hospital. While resident salaries come from Medicare dollars, there is very little, if any, money from the State for the medically indigent. We were in the same situation as her local OB/GYN. The cost of caring for those without insurance was born by the profits from those with insurance. But medical care was becoming more expensive and what insurance companies were willing to reimburse was decreasing. In addition, with more unemployment there were fewer insured patients and more uninsured. Not a sustainable model.

    She needed a biopsy to confirm the type of cancer and a CT scan to see if the tumor had spread beyond the cervix. If she were lucky, she would have a some combination of a hysterectomy, chemotherapy, and radiation with a 50-65% chance of survival. If the cancer had spread, she would have radiation and chemotherapy with about a 25% chance of surviving.

    But the cancer surgeons were not allowed to offer an uninsured woman a hysterectomy. Every now and then they snuck someone in, claiming to the administrators that the patient was more emergent than they really were. But one surgery doesn’t cure stage 2 or 3 cervical cancer, or even stave it off for long. It takes multiple admissions and week after week of expensive chemotherapy and/or radiation.

    The radiation doctors were also not allowed to see uninsured patients. They could not even give a dying women a few weeks of radiation to ease her tumor’s stench while it caused her to bleed to death or killed her another way. They could give her one dose today. A very temporary measure for the bleeding, but only if her blood count was low enough. It wasn’t because she’s had the blood transfusion to get her here. ...

    I had never encountered this clinical scenario during my training in Canada. I had never seen a woman suffer because she couldn’t afford something as simple as a Pap smear, never mind deal with the indignities of shopping around her sorrow and hard luck to try to patch together what would inevitably be inadequate medical therapy. It is this reality of medical care in America for which I was wholly unprepared. Many times I found the residents comforting me. ...

    It’s not health care, not by any stretch. But as long as the Supreme Court finds it constitutional I guess they’ll sleep better than I do.

  • Financial Times: The folly at the heart of the US healthcare debate. By Bruce Bartlett. Excerpts: America is the only developed country that does not offer some form of national health insurance to all its citizens. ...

    Exactly what would replace the Affordable Care Act if it is found unconstitutional is a mystery. The Obama administration appears to have no back-up plan and Republicans have steadfastly refused to offer any proposal for expanding health coverage. One problem is that before Barack Obama became president, Republicans were the primary supporters of an individual mandate, viewing it is as a more market-oriented way of expanding health coverage without a completely government-run health system. Indeed, Mitt Romney, the likely Republican presidential nominee, established a healthcare system in Massachusetts, where he was governor, that is virtually identical to the national system created by Mr Obama. ...

    What neither party has made any effort to grapple with is the extraordinarily high cost of health, public and private. According to the Organisation for Economic Cooperation and Development, the US spends more of its gross domestic product on health than any other country by a large margin. Americans spent 17.4 per cent of gross domestic product on health in 2009 – almost half of it came from government – versus 12 per cent of GDP or less in other major economies. Britain spends 9.8 per cent of GDP on health, almost all of it through the public sector. The total government outlay is almost exactly the same in the US and the UK at 8.2 per cent of GDP. This suggests that for no more than the US government spends on health now, Americans could have universal coverage and a healthcare system no worse than the British.

    However, the option of a completely government-run health system was never seriously considered in the US when the Affordable Care Act was debated in 2009. Americans are too convinced that everything government does is less efficient and costs more than if the private sector does it. The fact that this is obviously wrong in the case of healthcare has never penetrated the public consciousness.

  • truthOut: In World's Richest Country, the Uninsured Wait in Line Overnight for a Chance at Health Care. By Rose Aguilar. Excerpts: Stan Brock never expected to see adults and children shivering in line in the middle of the night, hoping to get free medical, dental and vision care in the wealthiest country on earth. Now that he's seen it for years, he's no longer surprised. "It's quite common," he said. "People line up many, many hours before the event opens, which is normally at 5:30 in the morning."

    Brock is the founder of Remote Area Medical (RAM), an all-volunteer mobile medical clinic that's been traveling to cities across the United States offering free health care since 1992. Brock founded RAM in 1985 to provide care to people living in the most remote areas of the Amazon rainforest. Seven years later, he was asked to bring the clinic to Knoxville, Tennessee. The invitations have since increased.

    "You can close your eyes and stick a pin on the map of the United States and go there, and you're gonna find people by the hundreds, and in many cases by the thousands, that need services," said Brock.

    "It's simply unaffordable, particularly in dental and vision care. A very, very small percentage of people in this country have insurance that covers those two key items. We're still seeing people dying of bad teeth in the United States," he said. "I'd like to see us work ourselves out of a job so we can concentrate our efforts where we began, in places like the Amazon and Haiti, of course, but we're bogged down here in the United States, I think, for years and years to come."

  • Philadelphia Inquirer: Express Scripts completes Medco acquisition. By David Sell. Excerpt: Pharmacy benefit managers are usually unseen companies that handle drug plans for employers and fill millions of prescriptions by mail. The three biggest were reduced to two Monday when Express Scripts Inc., completed its $29.1 billion acquisition of Medco Health Solutions Inc. The deal went through once the Federal Trade Commission said Monday it would not block the move, but that decision was controversial and will not end a legal fight, if independent pharmacists have any say.
  • New York Times op-ed: Broccoli and Bad Faith. By Paul Krugman. Excerpts: Given the stakes, one might have expected all the court’s members to be very careful in speaking about both health care realities and legal precedents. In reality, however, the second day of hearings suggested that the justices most hostile to the law don’t understand, or choose not to understand, how insurance works. And the third day was, in a way, even worse, as antireform justices appeared to embrace any argument, no matter how flimsy, that they could use to kill reform.

    Let’s start with the already famous exchange in which Justice Antonin Scalia compared the purchase of health insurance to the purchase of broccoli, with the implication that if the government can compel you to do the former, it can also compel you to do the latter. That comparison horrified health care experts all across America because health insurance is nothing like broccoli.

    Why? When people choose not to buy broccoli, they don’t make broccoli unavailable to those who want it. But when people don’t buy health insurance until they get sick — which is what happens in the absence of a mandate — the resulting worsening of the risk pool makes insurance more expensive, and often unaffordable, for those who remain. As a result, unregulated health insurance basically doesn’t work, and never has.

    There are at least two ways to address this reality — which is, by the way, very much an issue involving interstate commerce, and hence a valid federal concern. One is to tax everyone — healthy and sick alike — and use the money raised to provide health coverage. That’s what Medicare and Medicaid do. The other is to require that everyone buy insurance, while aiding those for whom this is a financial hardship.

    Are these fundamentally different approaches? Is requiring that people pay a tax that finances health coverage O.K., while requiring that they purchase insurance is unconstitutional? It’s hard to see why — and it’s not just those of us without legal training who find the distinction strange. Here’s what Charles Fried — who was Ronald Reagan’s solicitor general — said in a recent interview with The Washington Post: “I’ve never understood why regulating by making people go buy something is somehow more intrusive than regulating by making them pay taxes and then giving it to them.”

    Indeed, conservatives used to like the idea of required purchases as an alternative to taxes, which is why the idea for the mandate originally came not from liberals but from the ultra-conservative Heritage Foundation. (By the way, another pet conservative project — private accounts to replace Social Security — relies on, yes, mandatory contributions from individuals.)

  • AlterNet: America Needs Healthcare, Not Health Insurance. Ironically, the Roberts Court could actually be the instrument that leads us toward something approaching a rational, affordable healthcare provision. By Marshall Auerback and L. Randall Wray. Excerpts: In Friday's New York Times, Paul Krugman argues that the Supreme Court conservatives grasping for reasons why Congress lacks the power to do anything that they don’t like have forgotten an important distinction: the one between a judge and a politician. We're not sure this is correct. It's always been the case that for all of their lofty protestations of being "above politics," the Supreme Court has been political, whether it be the Warren Court or today's Roberts Court. ...

    Historically, Krugman has been one of the most eloquent critics of the insurance-based model. Yet he makes the mistake common to many progressive defenders of Obama’s healthcare bill: He conflates two distinct issues and thereby masks the fundamental flaw underlying the entire approach. Private health insurance is not synonymous with healthcare. There is a big difference between levying a tax for a public good (i.e. healthcare) versus forcing people to buy a service from a private health insurance company, which is by no means synonymous with healthcare.

    Using insurers to provide funding is a complex, costly and distorting method of financing healthcare. Imagine sending your weekly grocery bill to an insurance clerk for review and having the grocer reimbursed by the insurer to whom you have been paying “food insurance” premiums—with some of your purchases excluded from coverage at the whim of the insurer. Is there any plausible reason for putting an insurance agent between you and your grocer? No. Then why should an insurer stand between you and your healthcare provider? And why should you be forced to contribute to such an arbitrary scheme?

    Furthermore, it is important to note how unusual the United States is—no other comparable nation (in terms of high per capita income) lacks universal healthcare coverage, and many nations that are much poorer provide universal access. And in most of the nations that are similar in other respects to the United States, government plays a much bigger role in healthcare delivery and in financing the system. ...

    The U.S. is the only country in the world where healthcare has become a marginal cost of doing business, thereby putting American corporations at a significant cost disadvantage vis a vis their foreign competition. ...

    Given today’s political constraints, perhaps a full “single-payer” option might not be feasible, but one earlier variant of the proposed healthcare legislation did feature a Medicare buy-in. In effect, if the Supreme Court does strike down the major provisions of the Obama healthcare plan, Congress could easily use Senate reconciliation and expand Medicare via the Senate’s buy-in provisions (the House can approve this on the basis of a simple majority vote). The Congressional Budget Office has already signed off on this as a means of saving money (“budget savings” is in some respects a nonsensical concept, but it provides the necessary political cover to deploy what is essentially a budgetary procedure).

    More important, the expansion of Medicare would provide a genuine “public option” that, by competing against private insurance companies (which would presumably no longer have any genuine cost constraints given that the ban to deny coverage on the basis of pre-existing conditions would likely be struck down with the individual mandate), would help control costs. It would also help solve the problem of preexisting. And because Medicare does not deny coverage on the basis of pre-existing conditions, it is actually far more cost effective than private health insurance. ...

    A Medicare buy-in would also have the added benefit of getting us closer to a single-payer system, which is a far more rational way to control healthcare costs, largely due to the administrative complexity associated with our current patchwork system and the corresponding inability to bargain with suppliers, especially drug companies, for lower prices. Residents of the United States notoriously pay much higher prices for prescription drugs than residents of other advanced countries, including Canada. This proposal would also give American healthcare consumers far more bang for their buck than the current legislation. It would indeed be the height of historic irony if the Roberts Supreme Court was the instrument that led us away from a private health insurance based system toward something approaching a rational, affordable healthcare provision.

  • Huffington Post: Supreme Court Health Care Repeal Would Drive Up Hospital Costs: Study. By Jeffrey Young. Excerpts: Health care reform repeal would slam big for-profit hospital chains like HCA, Community Health Systems and Tenet Healthcare as uninsured people continue to flood emergency rooms and rack up bills they can't pay, according to a report released Wednesday by Moody's Investors Service.

    Hospitals didn't get everything they wanted from President Barack Obama's health care reform law but industry lobbying groups backed it anyway. Hospitals agreed to take a $155 billion, 10-year hit on their Medicare payments in exchange for the law's plans to expand health insurance coverage to more than 30 million people. Since federal law requires hospitals to treat anyone who shows up in an emergency room, hospitals currently have to eat much of the expense from poor people who can't afford their medical care.

    That deal collapses if the Supreme Court decides that all or part of the health care reform law is unconstitutional; the Court is expected to issue a ruling by the end of June. During three days of oral arguments last week, Chief Justice John Roberts and other conservatives harshly questioned the Obama administration's defense of the so-called individual mandate, which will require nearly every U.S. resident to obtain health insurance starting in 2014. ...

    But a partial reform could create chaos in the insurance market for individuals and small business in 2014 and beyond. The individual mandate aims to pressure younger and healthier people into the insurance market to offset the expense of providing medical care to older and sicker people. Were the Court to repeal only the mandate, health insurance companies would have to abide by the law's bans against denying coverage to people with pre-existing conditions and limits on their ability raise rates on more expensive patients. Sick people could flood the market, driving up premiums, which in turn could drive healthy people to to drop their insurance, leading to even higher premiums for those who remain.

  • New York Times op-ed: Down the Insurance Rabbit Hole. By Andrea Louise Campbell. Excerpts: ON the second day of oral arguments over the Affordable Care Act, Solicitor General Donald B. Verrilli Jr., trying to explain what sets health care apart, told the Supreme Court, “This is a market in which you may be healthy one day and you may be a very unhealthy participant in that market the next day.” Justice Antonin Scalia subsequently expressed skepticism about forcing the young to buy insurance: “When they think they have a substantial risk of incurring high medical bills, they’ll buy insurance, like the rest of us.”

    May the justices please meet my sister-in-law. On Feb. 8, she was a healthy 32-year-old, who was seven and a half months pregnant with her first baby. On Feb. 9, she was a quadriplegic, paralyzed from the chest down by a car accident that damaged her spine. Miraculously, the baby, born by emergency C-section, is healthy.

    Were the Obama health care reforms already in place, my brother and sister-in-law’s situation — insurance-wise and financially — would be far less dire. My brother’s small employer — he is the manager of a metal-fabrication shop — does not offer health insurance, which was too expensive for them to buy on their own. Fortunately, my sister-in-law had enrolled in the Access for Infants and Mothers program, California’s insurance plan for middle-income pregnant women. AIM coverage extends 60 days postpartum and paid for her stay in intensive care and early rehabilitation.

    But when the 60 days is up next week, the family will fall through the welfare medicine rabbit hole. As a scholar of social policy at M.I.T., I teach students how the system works. Now I am learning, in real time. ...

    When the AIM coverage expires, my sister-in-law will be covered by Medi-Cal, California’s version of Medicaid, because she is disabled and has limited income. But because my brother works, they are subject to cost-sharing: they pay the first $1,100 of her health costs each month. Paying $1,100 leaves them with a monthly income of just 133 percent of the federal poverty level. If my brother makes more money, their share of the cost increases.

    They must also meet the Medi-Cal asset test: beyond their house and one vehicle, they can hold $3,150 in total assets, a limit last adjusted in 1989. They cannot save for retirement (retirement plans are not exempt from the asset test in California, as they are in some states). They cannot save for college (California is not among the states that have exempted 529 college savings plans from their asset tests). They cannot establish an emergency fund. Family members like me cannot give them financial help, at least not officially. If either of them receives an inheritance, it will go to Medi-Cal. Medi-Cal services that my sister-in-law uses after age 55 will be added to a tab that she will rack up over the rest of her life. When she and my brother die, the state will put a lien on their estate; their child may inherit nothing. Even my brother’s hobby runs afoul of the asset test: he enjoys working on old cars, which he can no longer keep.

  • Huffington Post: Ann Romney Wouldn't Find Free-Market Health Care Without Mitt Romney's Millions. By Jeffrey Young. Excerpts: If Ann Romney weren't wealthy, she might have even more in common with Kelly Gaeckle. Both women suffer from multiple sclerosis, a chronic neurological disorder that impairs motor function, cognitive abilities and vision and can cause uncontrollable muscle spasms, fatigue and dizziness. Patients eventually can lose the ability to walk.

    Romney, whose husband is Mitt Romney -- the leading Republican presidential contender, the ex-governor of Massachusetts and a former corporate honcho worth as much as $250 million -- presumably doesn't struggle to pay for her treatments, even if she doesn't consider herself wealthy.

    Romney, who turns 63 later this month and also has a history of breast cancer, would likely be in dire straits if she had to turn to the open market for health insurance -- without her husband's millions.

    "Ann Romney would literally be unable to get health insurance in most states in America and if she could get it, she'd pay an unbelievable price," said Jonathan Gruber, an economist at the Massachusetts Institute of Technology. And it probably wouldn't cover treatments for M.S. and cancer, he said. Gruber helped develop both the Massachusetts health reform law signed by then-Gov. Mitt Romney in 2006 and the national law enacted by President Barack Obama two years ago.

    Kelly Gaeckle, a 35-year-old stay-at-home mother and a part-time fitness instructor who lives in Santa Cruz, Calif., is lucky enough to have a high-cost insurance plan, but it doesn't cover many of the medications she needs. She and her husband, who runs his own business, struggle to pay the $1,500 monthly premium on their plan, which covers the couple and their four kids. They put just about enough money into a health savings account every year to cover the plan's high $6,500 deductible, but the funds run out quickly. After they meet the deductible and their out-of-pocket expenses hit $6,000, the insurance pays practically the full cost of their medical treatments -- but only those that are actually covered. The couple worries that its insurer will raise rates to something completely out of reach, a perfectly legal move under California law.

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.

  • Statement By Sen. Bernard Sanders On Oil Speculation (PDF). Excerpts: There has been a major debate over the last several years as to whether spikes in oil prices are caused entirely by the fundamentals of supply and demand or whether excessive speculation in the oil futures market is playing a major role.

    That debate should be put to rest. Let’s look at the facts.

    The supply of oil and gasoline is higher today than it was three years ago, when the national average price for a gallon of gasoline was just $1.94. The demand for oil in the U.S. is at its lowest level since April of 1997. Internationally, during the last quarter of 2011, world oil supply exceeded demand by nearly 2-1, while crude oil prices increased by over 12%.

    There is now a growing consensus that excessive speculation on the oil futures market is driving oil prices up. ...

    Interestingly enough, Goldman Sachs, perhaps the largest speculator on Wall Street, recently came out with a report indicating that excessive oil speculation is costing Americans 56 cents a gallon at the pump. I personally think that is low, but that is Goldman Sachs’s view. ...

    Gary Gensler, the Chairman of the CFTC has stated publicly that oil speculators now control over 80 percent of the energy futures market, a figure that has more than doubled over the past decade.

    In other words, the vast majority of oil on the futures market is not controlled by people who actually use the product – airlines, trucking companies, fuel dealers, etc. -- but people whose only function in life in being on the oil futures market is to make as much profit as possible.

    Let me give you a list of just a few of the oil speculators and how much oil they were trading on June 30, 2008, when the price of oil was over $140 a barrel, and gas prices were over $4 a gallon...

    Editor's note: The firms include Goldman Sachs, Morgan Stanley, Bank of America, Lehman Brothers, and Merrill Lynch.

  • Washington Post opinion: Wall St. attacks Obama for tactic it uses. By Harold Meyerson. Excerpts: In 2008, Wall Street backed Barack Obama. Hedge fund operators, private equity investors and mega-bank executives gave his campaign twice the amount they contributed to John McCain. Many of the financial masters of the universe saw in Obama a guy much like themselves — self-made, very bright, assertive and validated by all the right academic credentials.

    Today, Alec MacGillis reports in the New Republic, Wall Street has turned against Obama with a vengeance. Hedge fund operators have given Mitt Romney four times what they’ve given Obama, MacGillis writes — and that doesn’t count their contributions to “super PACs” backing Romney and other Republican candidates. Just as notable are their assessments of Obama, which rival those of Glenn Beck at his most paranoid.

    Chicago hedge fund executive Ken Griffin, who raised funds for Obama in 2008 but is now backing efforts to unseat him, told the Chicago Tribune last month that since Obama took office, the values of capitalism “are under attack. . . . This is the first time class warfare has really been embraced [by an administration] as a political tool.” Asked whether the ultra-wealthy had an inordinate influence on politics and government, Griffin responded, “I think they actually have an insufficient influence.” ...

    Perhaps the bluntest expression of Wall Street’s discontent comes from Leon Cooperman of Omega Advisors, a onetime Obama supporter who complained to MacGillis that the president, by seeking to raise taxes on the rich, is “[expletive] on people who are successful.”

    True, Obama wants them to pay higher taxes. Partners in hedge fund firms have their pay taxed at the 15 percent rate for capital gains, not at the 35 percent rate that applies to the highest salaries. Obama wants to tax their pay as if it were pay.

    But there’s more to this anti-Obama animus than mere hedge-hoggery. What leaps out from the bankers’ indictments of the president, even more than their affronted amour propre, is their insularity, their complete cluelessness about how their fellow Americans see them and their effect on the U.S. economy. Who besides Wall Street’s more benighted denizens is affronted by legal action against what looks to be securities fraud? Who besides the very rich and Republican political candidates thinks the very rich don’t have enough political clout? Who believes that making Warren Buffett pay taxes at rates as high as his secretary’s constitutes defecating on the rich? (Buffett certainly doesn’t.) ...

    These transformations didn’t happen by accident. They’re the result of decades-long campaigns by Wall Street and corporate leaders to lower their tax rates; to craft a pay structure for executives that caused their incomes to soar, often at the expense of shareholders; to weaken domestic manufacturing; and to create ever more ingenious ways to market credit, which ultimately enriched bankers and nobody else. The ascent of the 1 percent was also fueled by its war on unions, which has lowered the living standards of working-class Americans while increasing their employers’ profits.

    Wall Street has decimated the middle class and calls it a meritocracy. Obama won’t acknowledge that charade (at least, not sufficiently). Romney accepts it wholeheartedly. Wall Street leaders’ shift from Obama to Romney isn’t just about preserving their tax breaks and, by repealing the Dodd-Frank financial reform, bringing back high-yield deals that may imperil the broader economy. It’s also about having a president who won’t challenge the lies they tell about — and to — themselves.

  • AlterNet: Capitalism's Dirty Secret: Corporations Don't Create Jobs, They Destroy Them. If we want good jobs and long-term career opportunities, we have to tame the wild horses of big business. By Lynn Parramore. Excerpts: For the last four decades, U.S. corporations have been sinking our economy through the off-shoring of jobs, the squeezing of wages, and a magician’s hat full of bluffs and tricks designed to extort subsidies and sweetheart deals from local and state governments that often result in mass layoffs and empty treasuries.

    We keep hearing that corporations would put Americans back to work if they could just get rid of all those pesky encumbrances – things like taxes, safety regulations, and unions. But what happens when we buy that line? The more we let the corporations run wild, the worse things get for the 99 percent, and the scarcer the solid jobs seem to be.

    Yet the U.S. Chamber of Commerce wants us to think that corporations – preferably unregulated! – are the patriotic job creators in our economy. They want us to think it so much that in 2009, after the financial crash, they launched a $100 million campaign, which, among other things, draped their Washington, DC building with an enormous banner proclaiming “Jobs: Brought to you by the free market system.”

    But the truth is that unfettered corporations are just about the worst thing for creating decent jobs. Here’s a look at why, and where the good jobs really come from. ...

    In the 1990s, these companies added more jobs at home than abroad. What changed? 1) The rise of India and China, with 37 percent of the world’s population, as hotspots for off-shoring; and 2) the availability of tens of millions of workers in these places, many with college degrees, to do the jobs previously done by American workers.

    In India, indigenous companies like TCS, Infosys and Wipro along with transnationals like IBM, HP and Accenture, employ hundreds of thousands of college-educated workers to perform IT services, in large part for American firms. In China, the electronics contract manufacturer Foxconn (headquartered in Taiwan) barely existed a decade ago, but now employs about 1.2 million workers, with Apple its single biggest customer. ...

    After victory in World War II, America was able to emerge as the world’s most powerful nation because it had a large middle-class and a strong industrial and technological base. The horses of Big Business were tamed, and they could be harnessed to do useful things for society. Then came the Reagan Revolution and Big Business freed itself from the regulations, unions and taxes that had curbed its worst instincts and it began to shred the nation’s economic and social safety net. The gap in income inequality grew, and jobs were eliminated and outsourced. Long-term investment in innovation and human capital slowed down, while fraud and financial speculation took off.

  • The Fiscal Times: The Small Government Myth Behind the Reagan Recovery. By Merrill Goozner. Excerpts: Public sector employment has fallen sharply in the wake of The Great Recession, which is markedly different from every other recession of the past 35 years, according to a new analysis from the Economic Policy Institute.

    Government jobs held steady between December 2007, when the downturn began, and September 2009, when it officially ended. That was largely due to beefed up aid to state and local governments contained in the Obama administration’s $787 billion stimulus package. When that disappeared, so did more than 600,000 state and local teacher, police, firefighter and other public sector jobs, which added about a half percentage point to the overall unemployment rate.

    Which president’s economic recovery benefited most from an increasing number of government jobs? Oddly enough, it was President Ronald Reagan, who successfully ran for re-election in 1984 by proclaiming it was “morning in America.” Reagan, running in a year when unemployment fell over a percentage point to 7.5 percent, is generally (and incorrectly) remembered as the first conservative president to dramatically shrink the size and role of government.

  • Boston Globe editorial: Romney is clueless on who is ‘out of touch’. By Scot Lehigh. Excerpts: So my first thought watching you on TV this week was that I was probably mistaken yet again. After all, I thought I heard you calling President Obama “out of touch.’’ Mitt, the man from Planet Money, mocking Obama as clueless? No. Couldn’t be. But there you were on the night of your primary hat-trick, repeating the charge.

    “Years of flying around on Air Force One, surrounded by an adoring staff of true believers telling you that you’re great and you’re doing a great job, it’s enough to make you think that you might become a little out of touch; and that’s what’s happened.’’

    here’s an old caution that applies here, Mitt. People who live in glass houses shouldn’t throw stones. Or, to update the axiom: People who plan to live in 11,000-square-foot beach homes with car elevators should think twice before accusing others of being out of touch. Particularly when aforementioned people shrug off $374,000 in speaking fees as “not very much.’’ Or off-handedly challenge political rivals to $10,000 bets.

    In other words, I don’t think you’d fare that well debating who’s in touch and who’s not with Barack Obama. (Or even, for that matter, with Dr. Livingstone.) In fact, I’d dial back the denim-clad regular guy who identifies with the plight of everyday families schtick, too. As a long-time Ann fan, I hope (with apologies to the Everly Brothers), that she always drives a couple of Cadillacs. But remember the scornful reaction in 1994 when she tried to strike a common chord by saying that, during your student days, the two of you sometimes had to sell stock to get by?

  • Rolling Stone: How the GOP Became the Party of the Rich. The inside story of how the Republicans abandoned the poor and the middle class to pursue their relentless agenda of tax cuts for the wealthiest one percent. By Tim Dickinson. Excerpts: The nation is still recovering from a crushing recession that sent unemployment hovering above nine percent for two straight years. The president, mindful of soaring deficits, is pushing bold action to shore up the nation's balance sheet. Cloaking himself in the language of class warfare, he calls on a hostile Congress to end wasteful tax breaks for the rich. "We're going to close the unproductive tax loopholes that allow some of the truly wealthy to avoid paying their fair share," he thunders to a crowd in Georgia. Such tax loopholes, he adds, "sometimes made it possible for millionaires to pay nothing, while a bus driver was paying 10 percent of his salary – and that's crazy."

    Preacherlike, the president draws the crowd into a call-and-response. "Do you think the millionaire ought to pay more in taxes than the bus driver," he demands, "or less?"

    The crowd, sounding every bit like the protesters from Occupy Wall Street, roars back: "MORE!"

    The year was 1985. The president was Ronald Wilson Reagan.

    Today's Republican Party may revere Reagan as the patron saint of low taxation. But the party of Reagan – which understood that higher taxes on the rich are sometimes required to cure ruinous deficits – is dead and gone. Instead, the modern GOP has undergone a radical transformation, reorganizing itself around a grotesque proposition: that the wealthy should grow wealthier still, whatever the consequences for the rest of us.

    Modern-day Republicans have become, quite simply, the Party of the One Percent – the Party of the Rich. ...

    The staggering economic inequality that has led Americans across the country to take to the streets in protest is no accident. It has been fueled to a large extent by the GOP's all-out war on behalf of the rich. Since Republicans rededicated themselves to slashing taxes for the wealthy in 1997, the average annual income of the 400 richest Americans has more than tripled, to $345 million – while their share of the tax burden has plunged by 40 percent. Today, a billionaire in the top 400 pays less than 17 percent of his income in taxes – five percentage points less than a bus driver earning $26,000 a year. "Most Americans got none of the growth of the preceding dozen years," says Joseph Stiglitz, the Nobel Prize-winning economist. "All the gains went to the top percentage points."

  • The Smirking Chimp: The Best Congress the Banks’ Money Can Buy. By Bill Moyers and Michael Winship. Excerpts: Here we go again. Another round of the game we call Congressional Creep. After months of haggling and debate, Congress finally passes reform legislation to fix a serious rupture in the body politic, and the President signs it into law. But the fight’s just begun, because the special interests immediately set out to win back what they lost when the reform became law.

    They spread money like manure on the campaign trails of key members of Congress. They unleash hordes of lobbyists on Capitol Hill, cozy up to columnists and editorial writers, spend millions on lawyers who relentlessly pick at the law, trying to rewrite or water down the regulations required for enforcement. Before you know it, what once was an attempt at genuine reform creeps back toward business as usual.

    It’s happening right now with the Dodd-Frank Wall Street Reform and Consumer Protection Act -- passed two years ago in the wake of our disastrous financial meltdown. Just last week, for example, both parties in the House overwhelmingly approved two bills that already would change Dodd-Frank’s rules on derivatives -- those convoluted trading deals recently described by the chairman of the Commodity Futures Trading Commission as "the largest dark pool in our financial markets."

    Especially vulnerable is a key provision of Dodd-Frank known as the Volcker Rule, so named by President Obama after the former Federal Reserve Chairman Paul Volcker. It’s an attempt to keep the banks in which you deposit your money from gambling your savings on the bank’s own, sometime risky investments. It will come as no surprise that the financial sector hates the Volcker Rule and is fighting back hard. ...

    Matt Packard, the Super PAC’s chairman, told The American Banker, "If someone says I am going to give your opponent $5,000 or $10,000, you might say, 'Yea, okay.' But if you say the bankers are going to put in $100,000 or $500,000 or $1 million into your opponent's campaign, that starts to draw some attention." Don Childears, president and CEO of the Colorado Bankers Association chimed in, "It would be nice to sit on the sidelines or sit on our hands and say, 'Oh we don't get involved in that stuff,' but that just means you get run over. We need to get more deeply involved as an industry in supporting friends and trying to replace enemies."

    All of which demonstrates, as per Bloomberg News, "that four years after Wall Street helped cause the worst economic downturn since the Great Depression and prompted a $700 billion taxpayer bailout, its lobby is regaining its power to blunt or deflect efforts to rein in the banks."

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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