Why was IBM in trouble during the early 90's? One was because decisions were made in the mid and late 80's to exchange the continuous and repetitive gold rental dollar for a one-time paper two dollar bill purchase transaction. It was because of failure to replace that revenue stream. IBM sold off the lease/rental business of almost 11 billion per year growing at double digits for pennies on the dollar and "forecast and spent" like they were going to be a 100 billion dollar company. (again in the interest of disclosure, I was hired during this "boom.") This was done over the objections of product managers I have talked to that could see the end result coming - they were right. There was no plan to replace this revenue other than IBM Credit Corporation that failed to achieve that level of revenue stream, even to today.
Would IBM have folded? Did Gerstner save IBM? Well, look at the charts... He came in at the end of a major recession, managed IBM during one of the greatest stock market bull runs, IT spending was the largest it ever was in world history and then left before the next recession hit. Good timing if nothing else. He deserves credit for keeping the IBM company together, seeing a strategy for software-hardware-services, focusing back on the mainframe as a profit center; but also should receive an annotation in history as being at the right place at the right time as Chief Executive Officer and recognition of his impact on employee morale. Unfortunately you won't find this acknowledge with any humility in his book "Who Says Elephants Can't Dance" or in any Forbes article on IBM.
So just look at the charts and decide for yourself - revenue did not climb but profits did, especially when he extracted the years of imbedded value in the IBM employees pension plan.
OK, I'm an IBM dinosaur, near extinct, but what are they inhaling, drinking, injecting, or smoking to lead us to believe that 6% is a reasonable default assumption rate? I remember when I was not quire a dinosaur and IBM said that the cash balance plan was COST NEUTRAL to IBM and the pensioners.
Can Fidelity give us a better estimate of the future interest crediting rate since IBM obviously doesn't care? Gee, sometimes I wish I was truly extinct and a fossil. How is LIFE IS GOOD?
Just some ideas... Kathi
On the medical benefits, I would expect they are waiting to see what happens with the Supreme Court challenges before they settle on a strategy. I'm sure, though, that alternatives are already established.
Moving jobs to India and China appears to be getting less and less cost effective. A few companies are re-shoring already.
All the rest -- yeah, they could do that.
Cons: -Endless micromanagement and pointless process. -Matrix style management adds more layers of repetition and reporting. -IBM more often than not, makes it harder to sell with its management of sales people & endless processes. -Mandatory training is scheduled for the worst possible times. It's time consuming, and simply becomes yet another 'tick in the box' on an endless list of non value add activities which distract from your core goals & objectives as a sales person. -Management change so often, than most of the time management poorly understand the intrinsic value of your particular solution. There is little real interest in understanding it either, as your above line manager is so busy reporting that he does not have the time or inclination too do so. Therefore all products, solutions & otherwise are invariably treated the same way, with the same quarterly transactional expectation applied. -Management in general add little to no value to a sales opportunity. They are watch dogs & and spreadsheet focused.
Advice to Senior Management: Do not mistake activity with productivity. Treat sales staff as autonomous & self motivated people who are there to achieve objectives and goals. Help facilitate this, please! Facilitating does not mean, deal clinics, win plans, cadence reports, SCII reports, Siebel entry every 2 minutes, territory plans, learning for growth... the list goes on. Customer facing time = more results. 80% of our time is spent inwardly focused.
IBM’s acquisition approach also is fairly disciplined, usually focusing on smaller deals. This certainly is contrary to the behavior of many other tech companies, including Hewlett-Packard and Microsoft, which have been aggressive with large acquisitions. Generating positive results from such deals, however, can be extremely difficult.
During the past decade, there have been most some huge developments in technology, including the emergence of cloud computing, big data and mobile. Yet these require global infrastructures of datacenters, servers and high-end software. The good news is that IBM is one of the few companies that can provide all of this at scale.
For decades, IBM has been investing in emerging-market economies. No doubt, they need top-notch technologies to continue their growth.
Cons: Many of IBM's employee's are remote workers. This comes with both pro and con qualities. IBM is such a huge organization that sometimes getting through the red tape to accomplish something is horrible. Costs like health care and commuting keep rising, with no pay raises to even keep things even. IBM keeps cutting costs at the employee's expense, reducing or eliminating reimbursement for legitimate business expenses. Employee recognition has been declining year to year for quite a while.
Advice to Senior Management: Pay more attention to employee satisfaction. It feels like IBM has been playing the "cost cutting" card to squeeze employees more and more, without relaxing the pressure when times improve. This has been a trend over the past 7 or 8 years, and it could come back to bite IBM when the job market improves.
But there were children and grandchildren who they would miss once they had moved to Florida. They would want to make sure they were all comfortable when they visited. By the time all was said and done, they ended up buying a home that would cost them just as much as in New York. Then, the couple discovered, they really missed being close to their family. That meant buying another small house back in New York.
"It totally blew up their financial plan," says David Schwartz, chief executive at Great Neck, N.Y., financial advisers FCE Group. "If they had stuck to their plan, they would have had plenty of money to live the lifestyle they wanted."
eWEEK learned from a trusted inside source that a substantial number of those cuts—possibly as many as 15,000—will come at the expense of the company's Texas-based HP Enterprise Services division, formerly known as Electronic Data Systems, or EDS. HP bought EDS, which was founded in 1962 by H. Ross Perot, for $13.9 billion in 2008. Palo Alto, Calif.-based HP said it expects to save as much as $3.5 billion per year from the job cuts and other internal fiscal measures. ...
Why exactly is HP cutting back so severely its service force? Is it giving up in its decades-long turf war with IBM, and allowing newer kids on the block (Oracle, Dell, EMC and Cisco Systems) to move in? HP isn't talking at this time, but you can bet the answer would be a stout "no." The relevant terms here are "streamline" and "more efficient operations." HP is not only trimming a lot of service-related jobs, but it is also becoming a more efficient company internally in order to save costs.
The technology boom has created an acute shortage of engineers and software developers. The industry has responded by taking a page from the playbook of professional sports: identify up and comers early, then roll out the red carpet to lock them up. ...
Starting salaries at leading companies for average computer science grads from top schools range from $75,000 to $100,000, plus signing and relocation bonuses worth $5,000 to $15,000, according to venture capitalists and recruiters. New hires may also get small equity grants, with stars getting additional cash bonuses or larger grants worth as much as 1% of the company. ...
Companies, he said, routinely wine and dine students at posh restaurants to discuss internships and jobs, plying them with free limo rides to bars, $500 cash giveaways and raffles for iPads. So many companies give away free food when they hold technology talks at Brown that sponsors had to move the food inside the computer science auditorium to keep non-engineering students from grazing.
Selected reader comments follow:
I will give you this much: Recruitment is aggressive on the green grass of college campuses where the average age of recruits barely touches 30....they are still cute and or hot to look at typing away at a keyboard. Experienced software/developer engineers (math/science nerds too) in their 40s on up can't compete with the studly look...but they are far more experienced and loyal with a keen quest for emerging technologies. Don't believe me? I have 17 on my LinkedIn list now who are looking for a good fit. And their salary requirements, I just betcha, are less than what the firms will pay these inexperienced newbies.
New economy folks, but not a very patriotic one...
Don't be an idiot. Any company or recruiter that tries to recruit you out of school is ONLY concerned about getting a product out the door or collecting a placement fee. After that, you're on your own ... make sure you're ready for that.
Of course, I've been programming since I was about eight years old and continued to work on little hobby projects while I was in the service (Even today, I always have at least one side project going on, usually using some hot new technology that I don't get a chance to play with at work).
Now, at 32, I'm considered a geezer by most of the 'hot' SV startups (I recently interviewed at a company where I would have been the oldest engineer there had I been hired. I was not). My timing just sucks. I also bought a house in 2007 :D
Anyway, I'm not sure what point I wanted to make when I started this post. Oh yea, don't drop out of school you freaking idiots. No way any one would have offered me my first job as a software engineer without my BSCS. Yea, I run into guys without degrees from time to time. They tend to get paid quite a bit less. I know a great programmer, probably better than me, who makes about 30% less than I do because he doesn't have a degree (but he's working on it). American companies have an irrational love of credentials. You have to play the game.
The remaining 95% contains a lot of talent that is being wasted. What is happening on the means streets of America is that if your GPA isn't 3.9/4.0 or better, then engineers will be installing garage doors for Home Depot and programmers will be doing desktop support for Manpower ... both at $10/hour. The less R&D type engineering and programming jobs that would have otherwise gone to the 3.9/4.0 and lower crowd are instead going to Communist China. There is no shortage of engineers and programmers in America and therefore shipping these types of jobs overseas is economic suicide. Their best is no better than our best. Their average is no better than our average.
The proof that there is no tech sector hiring boom underway is that when a company posts an entry-level engineering or programming position, they get 25000 resumes on average. If there were truly a tech sector boom underway, then it would be more like 10 resumes. In other words, companies would be snapping up *ALL* American engineers and programmers as fast as the universities could crank them out.
If you go down to Silicon Valley, it seems that it is mainly filled with the over 35 crowd. Just because a very small handful of social media firms employ some youngsters, doesn't mean there's enough jobs to go around. Nearly a million H-1B visas have been granted to firms to import foreigners when the resume queues of nearly every business that uses or deals with technology are full of very high quality talent, just waiting for that phone call.
Any business that has difficulty finding people, by all means, feel free to message me on Facebook with this account.
Interesting that another article today in this same paper is about insane picky and incompetent HR practices and states that no-one can get a job - even an exec experimented to apply for a job like his own and was not even called back!
I think this retirement planning math is interesting and argues strongly for the long-term stability of the Social Security program.
Summary of findings. Continuing to work is not an easy option for older workers, many of whom have difficult jobs or retire sooner than planned due to job loss, illness, or the need to care for a sick family member
Beginning in July, the U.S. Department of Labor will begin requiring disclosure of all 401(k) plan fees. But as of right now, many workers don’t understand the hidden fees their plans are charging—and neither do employers, according to a recent GAO report.
In addition, the report notes that the average mutual fund matches the average return of the overall stock market by earning a 7% return before fees are factored in. However, once those fees are subtracted, the report notes that these returns fall to 4.5% or about one-third less.
Unknown to most consumers, many hospitals and physicians offer steep discounts for cash-paying patients regardless of income. But there's a catch: Typically you can get the lowest price only if you don't use your health insurance.
That disparity in pricing is coming under fire from people like Snyder, who say it's unfair for patients who pay hefty insurance premiums and deductibles to be penalized with higher rates for treatment.
The difference in price can be stunning. Los Alamitos Medical Center, for instance, lists a CT scan of the abdomen on a state website for $4,423. Blue Shield says its negotiated rate at the hospital is about $2,400.
When The Times called for a cash price, the hospital said it was $250. ...
In the view of Robert Berenson, a senior fellow at the Urban Institute and vice chairman of the Medicare Payment Advisory Commission, big hospitals are exerting their market power to charge ever-increasing rates and major insurers go along with it because they can pass along the costs to employers and consumers. Insurance industry officials say that health plans negotiate the lowest prices they can, but that they also need to include prominent hospitals favored by customers in the network, and those institutions can command higher prices.
Hospital executives say they don't like to charge insured patients more, but say that's a result of the country's broken healthcare system.
So-called navigators are supposed to act as public advisers to help connect people with appropriate plans, whether offered by Medicaid or private insurers.
Although many in the Republican Party have tried to torpedo the entire law, they are working overtime to manipulate how an exchange will eventually work. The goal of some Iowa lawmakers is to use it to provide a little help to their insurance agent friends. Before it adjourned this month, the Legislature passed a bill requiring navigators to be licensed agents.
Last year, lawmakers tried to require a 5 percent commission for agents selling such coverage. But this is just as wrong. ...
The goal of the health reform law was not to create a jobs program for insurance agents. It was to finally help people buy affordable health insurance. The federal government should clearly tell Iowa it will not tolerate provisions that cater to special interests and hurt average consumers.
Patients don’t want to be denied a test or treatment that they or their doctors believe could improve their health or save their lives — no matter what the cost. But simple faith in a procedure’s effectiveness is not enough.
Each medical decision should be based on the best available evidence, combined with the doctor’s best clinical judgment about what is right for each patient. Only then can we put an end to the current practice of doing whatever is possible, no matter what the odds of success. But too often, patients and their advocates insist on procedures that have little or no chance of success, including some very costly treatments not yet proved — or even disproved — to be beneficial in well-designed clinical trials. A case in point was noted recently by Dr. Howard Brody (no relation) of the University of Texas Medical Branch in Galveston: the treatment of advanced metastatic breast cancer with high-dose chemotherapy, followed by bone marrow transplantation.
Initially, it was thought that the procedure had perhaps a 10 percent chance of significantly extending a patient’s life. But “the actual chance of meaningful benefit from this treatment is zero, and that the only effect of the treatment was to make patients’ remaining months of life miserable,” Dr. Brody wrote recently in an article in The New England Journal of Medicine titled “From an Ethics of Rationing to an Ethics of Waste Avoidance.”
The Veterans Health Administration does provide coverage for most veterans, although not all: Eligibility is determined in part by factors including income, injuries sustained in combat and length of service. The eligibility requirements leave 1.3 million veterans without health care benefits, alongside 0.9 million members of their families. ...
The expansion of coverage under the Affordable Care Act could lower the uninsured rate among veterans — not by targeting them specifically, but by expanding health insurance to lower-income populations. Nearly half the uninsured veterans would become eligible for Medicaid, which will expand to cover all those with incomes under 133 percent of the Federal Poverty Line. Others will qualify for subsidies to purchase private insurance coverage on the individual market.
Today, in most states, there are no caps on how much insurers can charge a 60-something forced to purchase his own insurance. In the individual market, only New York State bans age rating altogether, and just three other states limit how much premiums can vary, based on age, to less than 3:1. When insurers sell policies to small businesses, Vermont also prohibits age rating, but only five other states cap increases.
To check whether your state shields older boomers in either of these markets, take a look at these charts. (A checkmark in the right-hand column means that age rating is now unregulated in that state.)
Under reform, more states could decide to ban age rating, or follow Massachusetts’ example, and limit the ratio to 2:1. But, politically, this would be a third-rail decision. If older boomers pay less, younger adults would be charged more, and most are vehemently opposed to being asked to support the Pepsi Generation. As one of my younger readers once commented, “I’m willing to help my mother, but not someone else’s mother.” ...
Just how much more would a 20-something pay? According to researchers at the Urban Institute, eliminating age rating would lift average premiums for those 18 to 34 years old by $1,400 (from $3,600 to $5,000). Policy holders ages 35 to 44 would see their premiums rise by $800 (from $4,200 to $5,000). Meanwhile, premiums for those between age 45 and 64 would fall by about $2,400, from $7,500 to $5,100.
Robert Galle, Aetna's head of pharmacy benefit management operations, said his company is responding to employers' concerns about escalating costs from these specialty drugs. "As new drugs are brought to the market, we are generally adding them to these tiers," he said. Consumer advocates and some benefit consultants argue this trend could backfire as a cost-saving tool if workers stop taking needed medications and require even more costly medical care down the road. ...
To help lower their costs, health plans are changing their approach to drug coverage, often expanding from a three-tier to a four-tier plan. The first tier would be generic drugs at a $10 co-payment, for instance, the second tier preferred brand-name drugs at a $30 co-pay, the next tier non-preferred brand-name drugs for $50, and the top tier would be dozens of specialty drugs costing patients 10% to 30% co-insurance or $150 co-pays. Nationwide, 14% of workers are in a plan with four or more tiers of cost sharing for prescription drugs, compared with 7% five years ago, according to the Kaiser Family Foundation.
It is a tragic irony that even as Washington debates whom to screw over to cut the Phantom Menace of our federal deficit, it has so far failed to address the single most important factor driving those deficits over the long term (if we paid the same for health care per person as the 30-plus countries with longer average life expectancies, we'd be looking at budget surpluses). It's a problem that also leads to tens of thousands of unnecessary deaths annually, creates some of the worst health outcomes in the developed world, makes American firms less competitive in the global marketplace and contributes a great deal to wage stagnation for the middle class and the working poor.
In 2009, the Democrats passed a series of insurance reforms misleading dubbed “healthcare reform.” Many of those reforms were valuable tweaks to our private insurance system, and while many Americans are wary about the law as a whole, when asked about the specifics, most of the specifics in the law are quite popular. But Congress didn't reform the healthcare system in a way that would significantly "bend the cost curve," and the new study – which uses insurance industry data that was made available to the public for the first time (other studies extrapolated from Medicare payment data) – shows that the costs of medical services continue to climb much faster than the economy – or wages – are growing.
Chapin White, a senior researcher at the Center for Studying Health System Change, told Kaiser Health News that the report shows that working people covered by their employers "are paying more and getting less" because hospitals and other medical providers "just seem to be able to raise prices faster than general inflation." In some areas – like ER visits, outpatient surgery and mental health services – prices have increased at five times the rate of inflation.
1. Introduction. Almost all prices in health care are hidden from both doctors and patients. Any cost that’s hidden or confusing is easy to inflate.
Those payment changes would be in the service of a larger goal: slowing health-care costs to grow at a rate similar to the rest of the economy. If the health sector did not meet that target, there would be a consequence: A state agency watching over the process would have the authority to write a “corrective action plan” for health providers who weren’t moving in the right direction. ...
Massachusetts has previously proved a leader in health policy. Its 2006 health insurance expansion, signed under then-Gov. Mitt Romney, became the model for federal reforms. Becoming the model for cost-control, many say, will probably prove a much bigger lift.
New Hampshire's House passed a bill by Republican Rep. Andrew Manuse that would prohibit lawmakers from creating laws to enact exchanges. He said Cato and ALEC helped him draft his proposal. "Not setting up an exchange is the best way we can work toward making the law be amended or repealed," Manuse said.
Before the health care law was passed, Smith said, she was working with 22 states to create exchanges, which she called a Republican idea. "I'm a conservative and a Republican, but I still would not be willing to bet the farm on" the idea that the law will fail if states don't create exchanges, Smith said. "When you work at a think-tank, it's really easy to come up with these really high-risk plans."
No Republican alternative to the health care law has been announced.
Opinions may not change overnight, but the fact is, more and more seniors are benefiting from the law. Figures released today show that thousands of seniors and disabled Americans are improving their health thanks to expanded preventive care services and saving money on prescription drug prices because of a shrinking "donut hole."
It is especially important that seniors learn about the benefits of the ACA because they have been the victims of some of the most egregious misrepresentations about the law. Remember "death panels"? That was the heated political term applied to the notion of counseling about living wills, advanced directives and end-of-life options.
We prefer factual information to overheated rhetoric. Here's the latest dollars-and-cents news about how the Affordable Care Act is helping senior citizens across the country, according to figures released by the Centers for Medicare & Medicaid Services (CMS)...
In the first part of this two-part series, I will outline two under-reported facets of Obamacare that will have far-reaching impacts. In the second part, I will outline how DaVita has made a smart move with their recent $4.4 billion of acquisitions pushing them ahead of virtually all other healthcare provider organizations in the country.
Two portions of Obamacare have received relatively little attention and are a backdrop to DaVita’s prescient moves. Taken together, these provisions could have a long-term effect that is going to be devastating to the traditional health insurance business while also creating huge new opportunities for them and others. The first is the new “Medical Loss Ratio” (MLR) requirement. The second is allowing flat-fee primary care practices, also referred to as Direct Primary Care Medical Homes (DPC for short), to compete within the state-based insurance exchanges. The DPC models have a membership model that isn’t insurance-based and so they avoid the 40% or more of the costs associated with insurance that doesn’t positively impact patient well-being. ...
Allowing for DPC is the best example in Obamacare of what can actually bend the cost curve, as it removes 40+% of the cost out of the equation. Previously, that 40% has gone to insurance overhead and profits. This relatively little-known provision in the law creates an affordable new choice for individuals and businesses by allowing flat-fee DPC practices to compete within the state-based insurance exchanges. This is where many Americans and small businesses will be able to shop for health coverage beginning in 2014 although there’s no need to wait until then from a consumer perspective. Smart health insurers have begun to recognize that a way they will compete on insurance exchanges is based on price, so they are actively developing their DPC strategy since the combination of DPC and a high-deductible policy can lead to lower overall costs.
The DPC provision enables Americans to elect a more affordable health care option compared to traditional insurance plans — an alternative in which patients and/or employers pay a flat monthly fee directly to a primary care provider for all primary and preventive care, chronic disease management and care coordination throughout the entire health care system. Under the new law, a flat-fee DPC membership can be bundled with a new, lower-cost “wrap-around” insurance plan that covers unpredictable and expensive services outside its scope, such as specialist care, hospital stays or emergency room visits. Not unlike a health club, DPC practices allow unlimited use. Despite that, over-utilization hasn’t proven to be an issue. Further, since primary care providers don’t have to spend so much time and money on Rube Goldbergian insurance billing procedures, they are able to spend far more time with their patients.
So what's changing? Health costs continue to rise, putting pressure on employers to manage insurance expenses. The folks at Oliver Wyman asked about two relatively new approaches that are starting to get some traction.
One is private insurance exchanges, essentially beefed-up menus of coverage options that feature a wider variety of options than you might already be choosing from each year. In some cases, the employer might give you a fixed amount of money to make the decision about which one to pick. About 60 percent of companies would consider this approach if it save them at least 10 percent on health costs, the survey found.
Another option gets a new buzzword: value-based networks. In this approach, providers of health care get paid based on the quality bang for the buck they provide. About half of employers are interested in this option, if it save them at least 10 percent of costs.
As it is, the erosion of employer-based health coverage is well under way, as NPR reported as part of a series on what it's like to be sick in America. "In plain language, it's becoming skimpier and skimpier and less and less comprehensive," Drew Altman, president and CEO of the Kaiser Family Foundation, told us.
Selected reader comments follow:
It saddles businesses with heavy costs that are crushing our private sector and cause more uncertainty than a lot of other factors combined even when healthcare reform isn't being weighed by the Supreme Court.
It distracts businesses from concentrating on what they do best.
It traps workers in places they might normally leave. Without healthcare benefits in the equation they might go to a smaller company where their expertise could be more valuable in growing that company but they stay in a dead end job, strangling their sense of job satisfaction.
It stifles innovation. Without the worry of healthcare people would be more inclined to follow their ideas and dreams and take risks.
We pay for two healthcare systems, yet get one level of care. 1) One "for profit system" that extracts cash from people until they turn 65. 2) An actual healthcare system that provides cost effective care. If we turned everyone over to the system that provides actual care we would more than likely see a drop in the cost of care.
Lets stop paying twice for the same coverage and truly unleash the free markets to do what they do best.
Insurance companies are taking steps to build their relationship with customers as health plans prepare to compete between each other on exchanges where benefit packages will be offered.
Because health plans offering benefits on state-regulated exchanges will all offer similar benefit packages, customer service is one key way to stand out to a potential flood of new customers. Pending next month’s Supreme Court ruling, millions of uninsured Americans are expected to be able to gain federal subsidies to help them pay for coverage they will buy on insurance exchanges in 2014.
But what if insurance companies could not overcharge us in the first place? The 80% rule in the federal law only encourages insurance companies to pay hospitals and doctors inflated prices, because it inflates the 20% that insurance companies get to keep. (It's like the Hollywood agent who gets a 15% cut--his personal incentive is to get the biggest price for his client.) With no real curbs in California on how much insurance companies can charge, they have no incentive to bargain for lower medical costs to begin with.
“Why can’t you or I as a consumer ask what it’s going to cost and be met with something other than a blank stare?” asks Will Fox, a principal with Milliman, a national health actuarial consulting firm. The answer, he says, is that neither providers nor health insurers really want consumers to have that information.
Here’s why: The contracted prices that health plans negotiate with providers in their networks have little or nothing to do with the actual quality of services provided and everything to do with the relative bargaining power of the providers. ...
An obvious way to avoid getting hit with stratospheric out-of-network bills is not to use out-of-network providers.
But that’s not always possible: Sometimes, especially in the hospital, you can be seen by an out-of-network provider without even knowing it. Annmarie Bragdon, 41, from Farmington Hills, Mich., used a network hospital and doctor when her infant needed surgery for a congenital kidney problem. “But we got a bill of about $10,000 for the anesthesiologist, who was out of network,” she says. ...
Why don’t hospitals force doctors to participate in networks? “An individual hospital could have 50 different plans,” says Caroline Steinberg, a vice president of the American Hospital Association. The hospital might not know “which plan a physician has negotiated a contract with.” Or as patient advocate Jennifer Jaff puts it: “Nobody in this drama has an interest in helping you. The provider knows you’re on the hook, no matter what. And the insurance company knows they’re going to pay what they’re going to pay.”
Highlights from the brief:
"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.
Simon's $137 million is almost entirely in stock awards that could eventually be worth $132 million. The company said it wanted to make sure Simon wasn't lured to another company.
Assuming Simon worked a 60-hour week, his pay was $43,963.64 per hour, or $732.73 per minute. To put that in perspective, the minimum-wage worker would have to labor for nearly three years to make what Simon earns in an hour. The average U.S. worker makes slightly less in one year than Simon makes in an hour.
The eye-popping donation was made possible by a quirk in the state law for recall campaigns. And Ms. Hendricks has never been shy about what she wants. A newly released piece of documentary video shows her running into Governor Walker two weeks after he took office in 2011. In what was presumed to have been a private discussion, Ms. Hendricks asked, “Any chance we’ll ever get to be a completely red state and work on these unions and become a right to work” state?
Governor Walker replied, “Oh, yeah,” and he discussed a “divide and conquer” strategy, beginning with collective bargaining for public employees. “That opens the door once we do that,” he said. Mr. Walker, busy as he is with recall, has not taken aim at private-sector unions. But, as an assemblyman, he favored a right-to-work law that would have barred unions from collecting dues from nonmembers. ...
Governor Walker’s office says this access only confirms how sincere the governor was in promising to seek out “job creators” and proclaiming Wisconsin “open for business” from his first day in office. Recall voters should have no doubt about the real business of big-money politics signaled by that $500,000 check.
Every political campaign exaggerates and dissembles. This practice may not be admirable — it’s surely one reason so many Americans are disenchanted with politics — but it’s something we’ve all come to expect. Candidates claim the right to make any boast or accusation as long as there’s a kernel of veracity in there somewhere.
Even by this lax standard, Romney too often fails. Not to put too fine a point on it, he lies. Quite a bit.
“Since President Obama assumed office three years ago, federal spending has accelerated at a pace without precedent in recent history,” Romney claims on his campaign Web site. This is utterly false. The truth is that spending has slowed markedly under Obama.
An analysis published last week by MarketWatch, a financial news Web site owned by Dow Jones & Co., compared the yearly growth of federal spending under presidents going back to Ronald Reagan. Citing figures from the Office of Management and Budget and the Congressional Budget Office, MarketWatch concluded that “there has been no huge increase in spending under the current president, despite what you hear.”
Quite the contrary: Spending has increased at a yearly rate of only 1.4 percent during Obama’s tenure, even if you include some stimulus spending (in the 2009 fiscal year) that technically should be attributed to President George W. Bush. This is by far the smallest — I repeat, smallest — increase in spending of any recent president. (The Washington Post’s Fact Checker concluded the spending increase figure should have been 3.3 percent.)
In Bush’s first term, by contrast, federal spending increased at an annual rate of 7.3 percent; in his second term, the annual rise averaged 8.1 percent. Reagan comes next, in terms of profligacy, followed by George H.W. Bush, Bill Clinton and finally Obama, the thriftiest of them all.
The MarketWatch analysis was re-analyzed by the nonpartisan watchdogs at Politifact who found it “Mostly True” — adding the qualifier because some of the restraint in spending under Obama “was fueled by demands from congressional Republicans.” Duly noted, and if Romney wants to claim credit for the GOP, he’s free to do so. But he’s not free to say that “federal spending has accelerated” under Obama, because any way you look at it, that’s a lie.
Let me recap, for those of you who haven’t yet read Matt Marshall’s detailed story of what went on inside Facebook during its IPO roadshow, or Henry Blodget’s initial expose of these private communications.
As we now know, Facebook revised its earnings estimates downward during the two-week period leading up to its IPO. But while it put general, vague statements about the revenue into its public S-1 filing, it appears to have given much more specific information to its bankers, privately.
The bankers, in turn, communicated the substantially revised revenue figures to select investors. At the same time, key Facebook investors, including Peter Thiel and Jim Breyer, put an extra 83.8 million shares up for sale. The bankers and Facebook also increased the amount of shares they planned to sell to ordinary, “retail” investors to 25 percent, an unusually high number. And when Facebook priced its IPO, it did so at the very top of its range.
At the same time, because the specific revenue downgrades weren’t widely shared, the company continued pumping up demand for its shares. That kept demand high enough on the first day of trading that the IPO clogged up the NASDAQ’s computers, delaying the start of trading by about half an hour (an embarrassment for the NASDAQ). And it ensured that the underwriting banks, led by Morgan Stanley, were able to exercise their “greenshoe” option and sell an additional $2.4 billion worth of stock, bringing Facebook’s total raise to $18.4 billion. ...
But what really irks me is the revelation that Morgan Stanley and Facebook may not have actually broken any SEC rules. It appears that it’s allowable for analysts to communicate different information verbally with select investors than they reveal in the publicly-filed documents. That’s a ridiculous situation that seems to run directly counter to the purpose of a public, and transparent, IPO.
Stevens has been a trenchant critic of Citizens United since the court decided the case in January 2010. On the day the opinion was announced, he spent 20 minutes reading from the bench a summary of his 90-page dissent. Stumbling over some words that day convinced Stevens, now 92, to retire, but he continued to condemn the ruling in speeches, writings and even on the Colbert Report.
Good Jobs First, a non-profit, non-partisan research center, has analyzed state programs meant to create jobs, but instead have created some $700 million a year in corporate welfare. This scam starts with the normal practice of corporations withholding from each employee's monthly check the state income taxes their workers owe. But rather than remitting this money to pay for state services, these 16 states simply allow the corporations to keep the tax payments for themselves! Adding to the funkiness of taxation-by-corporation, the bosses don't even have to tell workers that the company is siphoning off their state taxes for its own fun and profit.
These heists are rationalized in the name of "job creation," but that's a hoax, too. They're really just bribes the states pay to get corporations to move existing jobs from one state to another, or they're hostage payments to corporations that demand the public's money – or else they'll move their jobs out of state.
Last year, Kansas used workers' withholding taxes to bribe AMC Entertainment with a $47 million payment to move its headquarters from downtown Kansas City, Missouri, to a KC suburb on the Kansas side, just 10 miles away. What a ripoff! Among the 2,700 corporations cashing in on such absurd diversions of state taxes from public need to private greed are Goldman Sachs, GE, Motorola, and Proctor & Gamble.
For more information – and for ways you can help stop this despicable giveaway – get the full report, entitled "Paying Taxes to the Boss." It's available at www.GoodJobsFirst.org.
Box 72465, on a desert road near Phoenix, belongs to a little-known group called the Center to Protect Patient Rights. According to reports by the Center for Responsive Politics and the Los Angeles Times, the center funneled more than $55 million to 26 Republican-leaning groups during the 2010 midterm election.
Where is the money from? The Times found links to the conservative Koch brothers, yet because the center is a nonprofit corporation, it is impossible to know. Such groups must disclose how they distribute their money, not who donates to them.
This privacy makes sense in the context of ordinary nonprofits. But in the push-the-envelope world of modern campaigns, in which such groups spend millions of dollars on thinly disguised campaign ads, the result is an end run around the fundamental principle of campaign finance law: that voters are entitled to know who is trying to influence elections.
Even the Supreme Court understands this: Disclosure, it wrote in its otherwise appalling 2010 Citizens United ruling, “permits citizens and shareholders to react to the speech of corporate entities in a proper way. This transparency enables the electorate to make informed decisions and give proper weight to different speakers and messages.”
Except when, as in the case of the Center to Protect Patient Rights, the identities — and motives — of those giving are hidden from public view. The center sent almost $13 million to the American Future Fund, a Des Moines-based group that ran campaigns against two dozen Democrats in 2010. Rep. Bruce Braley (D-Iowa) was targeted with what the Times described as “a $2-million fusillade” of radio ads, robo-calls and mailers. ...
The response from the U.S. Chamber of Commerce was telling: It would switch its way of influencing elections rather than reveal its donors. The chamber, which has made itself a major political player, plans to spend more than $50 million during the 2012 campaign.
... Moreover, CBO data show that the biggest increase in spending between 2008 and 2009 was for mandatory programs such as Medicare and Social Security that are not appropriated by Congress annually, but continue automatically unless the underlying law governing beneficiaries is changed. This portion of the budget rose from 12.4 percent of GDP in 2008 to 16.4 percent in 2009. By contrast, the discretionary portion of the budget, which is appropriated annually and includes national defense, rose from 7.9 percent of GDP to 8.9 percent between 2008 and 2009.
Another thing that is clear from the CBO data is that the budget deficit is as much the result of lower taxes as higher spending. Revenues fell from 17.5 percent of GDP in fiscal year 2008 to 14.9 percent in 2009 and 2010, rising to just 15.4 percent in 2011 and 15.8 percent this year. Had revenues stayed at their 2008 level, combined federal deficits would have been $1.3 trillion smaller since 2008.
And this estimate actually understates the extent to which Bush’s policies devastated the government’s revenue-raising capacity. In the postwar era, federal revenues have averaged 18.5 percent of GDP. They averaged 18.2 percent during Ronald Reagan’s 8 years and 19 percent under Bill Clinton’s 8 years, but 17.6 percent during George W. Bush’s 8 years and just 15.2 percent for Obama’s 4 years thus far.
At a minimum, this puts a lie to the ideas that we are overtaxed, that Obama has raised taxes, or that low taxes stimulate growth. Indeed, based on history, one can easily argue the opposite – that high taxes stimulate growth. The expansions of both the Reagan and Clinton administrations were preceded by big tax increases in 1982 and 1993, and revenues as a share of GDP were considerably higher during their administrations than under either Bush or Obama.
It’s an old political trick to blame the other side for things that your side is actually responsible for. I remember clearly that Democrats often attacked Reagan for economic conditions and policies that really belonged to Jimmy Carter. Today, Republicans are blaming Obama for those that rightfully should be attributed in large part to Bush.
But in the past few weeks, earmarks have re-emerged with a vengeance. And unlike many of the earmarks from an earlier era, which usually involved pork barrel construction projects in member districts like Alaska’s “bridge to nowhere,” the latest round of special interest provisions are designed to benefit specific companies, sometimes in swing districts where vulnerable Congressman are running for re-election. ...
For instance, the House Financial Services committee on Thursday passed legislation that will save the owners of Emigrant Savings Bank of New York $300 million. The one-sentence legislation was sponsored by Rep. Michael Grimm, R-N.Y., a Staten Island freshman who won a narrow victory in the normally Democratic district in 2010 and is considered vulnerable this fall.
Florida has a sordid history with manipulating voter rolls. In 2000 and 2004, it tried to purge felons from the rolls using wildly inaccurate lists, which had the effect of removing black voters who were not felons. As long as there is a chance of tilting the outcome of a close election, Republicans like Mr. Scott won’t stop trying.
Progressive voting rights groups and even county election supervisors from Scott’s own party are saying the businessman-turned-governor’s latest gambit—claiming there are as many as 182,000 non-citizens among the state’s 11.2 million registered voters and having his appointed Secretary of State send out an initial list of 2,600 names to be purged—has crossed a line in the Florida sand, topping previous voter suppression efforts, and may violate two federal voting right laws.
On Thursday evening, in a late-breaking development, the U.S. Justice Department's top voting rights enforcement officer, sent Florida's Secretary of State a letter saying the state should stop the planned purge and explain its intentions within a week. The turn-of-events capped several days of escalating actions that began to reveal that the purge, Florida's latest voter-supression move, appeared to be little more than a right-wing fantasy unsupported by any facts. ...
Scott’s urge to purge voters, particularly likely Democrats and the imagined right-wing obsession—hoards of non-citizens voting illegally—has been a constant throughout his tenure. It is consistent with the conservative hyperventilating in other states where GOP majorities have imposed many statewide ballot security measures complicating voting, even though—as in Colorado recently— claims of non-citizen voters could not be substantiated. ...
As expected many people who were registered voters received the letters. One recipient was 91-year-old Bill Internicola, who fought in World War II’s Battle of the Bulge, received a Bronze Star for bravery, and has been a Florida voter for 14 years. Another was 41-year-old Juan Artabe, a Democrat who emigrated from Cuba and has been a citizen since 2009. “I’m upset,” he told the Tampa Times. “How can they be asking me for this?” Another was Miami’s Maria Ginorio, an infirm 64-year-old Cuban who became a citizen in 2009, who told the Miami Herald, “I guess I won’t vote anymore.” ...
In the meantime, the Miami Herald conducted a computer analysis of the 2,600 names to be purged and concluded that, “Hispanic, Democratic and independent-minded voters are most likely to be targeted.” And this week, the push-back by other election supervisors who also are Republicans, continued. Seminole County Supervisor Mike Ertel posted a picture on Twitter of a voter who was accused of being ineligible—with his passport. ...
How low will Scott’s anti-voting crusade go? It’s hard to predict. And what will stop this partisan madness? It appears Florida is heading into another perfect voting rights storm in 2012. Whether or not the fabricated non-citizen voter purge now whimpers away—as was the case in Colorado—the state still curtailed registration drives for most of the spring, shortened early voting, complicated polling place voting for people moving across county lines, disenfranchised former felons and created an overall atmosphere of fear. And November’s election is more than five months away.
On Tuesday, the same day Trump proved yet again that money and truth, like money and taste, are seldom twined, Romney talked about amending the Constitution to require the president to have business experience. He spoke approvingly of a notion from a store owner who wanted to make anyone who does not have at least three years of business background ineligible to lead the country.
“He said, ‘I’d like to have a provision in the Constitution that in addition to the age of the president and the citizenship of the president and the birth place of the president being set by the Constitution, I’d like it also to say that the president has to spend at least three years working in business before he could become president of the United States,’” said Romney, cheerfully summarizing this rewrite of the founders’ governing blueprint.
Well, there goes Teddy Roosevelt, the writer, rancher and police commissioner, not to mention his distant cousin Franklin Roosevelt, the assistant naval secretary and politician, or Dwight Eisenhower, the career soldier. Ike’s résumé, which includes defeating the world’s most concentrated form of evil in Nazi Germany, would not be not enough to qualify him for the presidency.
Romney has made business experience the main reason to elect him. Without his business past or his projections of business future, there is no there there. But history shows that time in the money trade is more often than not a prelude to a disastrous presidency. The less experience in business, the better the president.
In a scholarly ranking of great presidents, a 2009 survey conducted by C-Span, 6 of the 10 best leaders lacked sufficient business experience to be president by Romney’s rumination. This list includes Ronald Reagan, the actor, union activist and corporate spokesman, and John F. Kennedy, the naval officer, writer and politician. There is one failed businessman on the list of great presidents, the haberdasher Harry S. Truman.
By contrast, two 20th century businessmen — George W. Bush, whose sweetheart deal with the Texas Rangers made him a multimillionaire, and Herbert Hoover, who came by his mining fortune honestly — were ranked among the worst presidents ever by the same historians. Bush left the country in a sea of debt and an economic crisis rivaled only by the one that engulfed Hoover.
"Quit picking on us" is part of Politico's headline. Their article says that the mega-donors' "six- and seven-figure contributions have... bought them nothing but grief."
This is definitely not what they had in mind. In their view, cutting a million-dollar check to try to sway the presidential race should be just another way to do their part for democracy, not a fast-track to the front page.
Uh-huh. The sound you hear is the world's smallest violin, say, a teeny-tiny Stradivarius insured for millions. "Is there a group of people you can think of who have thinner skin than America's multimillionaires and billionaires?' Paul Waldman asks.
Wall Street titans have been whining for a couple of years now about the horror of people in politics criticizing ineffective banking regulations and the favorable tax treatment so many wealthy people receive... America's barons feel assaulted, victimized, wounded in ways that not even a bracing ride to your Hamptons estate in your new Porsche 911 can salve. And now that the presidential campaign is in full swing, their tender feelings are being hurt left and right. ...
"Most of the megadonors backing [Romney's] candidacy are elderly billionaires," Tim Dickinson writes in Rolling Stone. "Their median age is 66, and their median wealth is $1 billion. Each is looking for a payoff that will benefit his business interests, and they will all profit from Romney's pledge to eliminate inheritance taxes, extend the Bush tax cuts for the superwealthy -- and then slash the top tax rate by another 20 percent." As at least one of them has said, they view these cash infusions as an "investment," plain and simple.
The same can be said of Mitt Romney, who claims that he will balance the budget but whose actual proposals consist mainly of huge tax cuts (for corporations and the wealthy, of course) plus a promise not to cut defense spending.
Both Ryan and Romney, then, are fake deficit hawks. And the evidence for their fakery isn’t just their bad arithmetic; it’s the fact that for all their alleged deep concern over budget gaps, that concern isn’t sufficient to induce them to give up anything — anything at all — that they and their financial backers want. They’re willing to snatch food from the mouths of babes (literally, via cuts in crucial nutritional aid programs), but that’s a positive from their point of view — the social safety net, Ryan says, should not become "a hammock that lulls able-bodied people to lives of dependency and complacency." Maintaining low taxes on profits and capital gains, and indeed cutting those taxes further, are, however, sacrosanct. ...
Here’s the story: For some time now (New Jersey Governor) Christie has been touting what he calls the "Jersey comeback." Even before his latest outburst, it was hard to see what he was talking about: Yes, there have been some job gains in the McMansion State since Christie took office, but they have lagged gains both in the nation as a whole and in New York and Connecticut, the obvious points of comparison.
Yet Christie has been adamant that New Jersey is on the way back, and that this makes room for, you guessed it, tax cuts that would disproportionately benefit the wealthy.
Last week reality hit: David Rosen, the state’s independent, nonpartisan budget analyst, told legislators that the state faces a $1.3 billion shortfall. How did the governor respond?
First, by attacking the messenger. According to Christie, Rosen — a veteran public servant whose office usually makes more accurate budget forecasts than the state’s governor — is "the Dr. Kevorkian of the numbers." Civility! ...
Will Christie’s budget temper tantrum end speculation that he might become Romney’s running mate? I have no idea. But it really doesn’t matter: Whoever Romney picks, he or she will cheerfully go along with the budget-busting, reverse Robin Hood policies that you know are coming if the former governor wins.
For the modern American right doesn’t care about deficits, and never did. All that talk about debt was just an excuse for attacking Medicare, Medicaid, Social Security and food stamps. And as for Christie, well, he’s just another fiscal phony, distinguished only by his fondness for invective.
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