Sources have told The India Times that GTS employees in that country will get what the paper describes as "increments."
"The sources said that the performance assessment exercise had been completed and increments were expected across the organization in India next month," the newspaper said.
"For the best performers, the increment may be in double digits ," a source told the newspaper.
The report out of India came just hours after news broke that IBM executives across the company would not receive raises. ...
By the way, India reportedly is home to the biggest number of IBM employees. While U.S. payrolls have fallen to under 95,000 based on estimates by Alliance@IBM, the union seeking to represent IBM workers, the Indian newspaper estimates that IBM now employs more than 130,000 in that country.
From the large corporation side the issues are cutting costs, raising revenues, increasing productivity, earnings-per-share, and ultimately the price of company stock. Nothing else matters. Old corporate slogans and promises implied in employee handbooks from 1990 have no bearing in the present. It would be nice if companies kept their commitments, but they don’t. Corporate needs change over time. And with rare exceptions for truly criminal behavior we probably just have to accept this and move on.
From the perspective of IT professionals there’s a betrayal of trust that stems from the attempted commoditization of their function. What once were people now are resources and like any commodity the underlying idea is that a ton of IT here is exactly comparable to a ton of IT there. ...
There are huge economic forces at work here — far bigger than many people or institutions recognize. Right now, for example, there are hundreds of thousands of experienced IT workers in the USA who are unemployed at the exact moment when big corporate America is screaming for relaxed immigration rules to deal with a critical shortage of IT talent.
How can this be? Do we have an IT glut or an IT shortage?
Like any commodity, the answer to this question generally comes down to delivered cost. If you are willing to pay $100 per barrel of oil there’s plenty of the stuff to be purchased. There’s a glut of $100 oil. But if you will only pay $10 per barrel of oil there’s a critical shortage. In fact at $10 America probably has no oil at all.
In America right now there is a glut of $80,000-and-above IT workers and a shortage of $40,000-and-below IT workers.
Remember that $80,000-and-above population comes with a surcharge for benefits that may not equally apply to the $40,000-and-below crowd, especially if those are overseas or in this country temporarily. A good portion of that surcharge relates to costs that increase with age, so older workers are more expensive than younger workers.
It’s illegal to discriminate based on age but not illegal to discriminate based on cost, yet one is a proxy for the other. So this is not just class warfare, it is generational warfare. Yet government and media are too stupid to understand that. ...
What we see at IBM and most of its competitors is a sales-oriented culture (get the deal — and the commission — at any cost) that sees technical talent as fungible, yet sometimes it isn’t fungible at all. There are many instances where IT resources can’t be replaced ton-for-ton because in the whole world there is less than a ton of what’s needed.
From the big corporate perspective we discard local resources and replace them with remote or imported resources. This might work if there were no cultural, language, or experience differences, but there are. There are differences based on familiarity with the job at hand. All these are ignored by CEOs who are operating at a level of abstraction bordering on delusion. And nobody below these CEOs sees any margin in telling them the truth. ...
Against this we have a cadre of IT workers who have been slowly boiled like frogs put into a cold pot. By the time they realize what’s happened these people are cooked. They are not just resentful but in many cases resentful and useless, having been so damaged by their work experience. They just want things to go back the way there were but this will never happen.
UNDER AGE 65 WHO PURCHASE COVERAGE ON THEIR OWN IN A HEALTH INSURANCE EXCHANGE AND ARE NOT COVERED THROUGH THEIR EMPLOYER.... (Caps for emphasis, not for shouting)
One of the questions I have asked for some time on these boards, is whether you can go to the exchange if you have access to an employer retiree medical plan. I have never gotten an answer and I have searched for months trying to get an answer.
I guess if you have access through the FHA and are not eligible to purchase from the exchange, you could draw your FHA balance down to zero and lose your FHA access?
THIS IS NOT ADVICE. I don't know the answer...but people on the FHA really need to find an answer.
It would be nice if they let you buy through the exchange if your only alternative were to pay the full price of access-only coverage. But I'm not optimistic about that being allowed.
Here is the only thing I have found that indicates FHA retirees can buy from the exchange. It's on Senator Bingaman's website -- Congressional Research document from April, 2010: http://www.bingaman.senate.gov/policy/crs_privhins.pdf
Individuals will only be eligible to enroll in an exchange plan if they are not enrolled in Medicare, Medicaid, or acceptable employer coverage as a full-time employee.
Seems to indicate that since a retiree is not a "full-time employee" then retirees can buy from the exchange?
I retired as part of the March RA and am a second choicer. After leaving, I received both "COBRA Fact Sheet" and "Plan Year 2012 Benefit Options" documents from IBM. As part of the RA, IBM pays the first year of COBRA. After the first year I plan to pay an additional six months out of pocket. (COBRA lasts for 18 months, regardless of who pays for it.)
The "Plan Year 2012 Benefit Options" document shows five different plans (Aetna High Deductible PPO, Aetna Medium Deductible PPO, Aetna Low Deductible PPO with Health Savings Account, IBM EPO-Aetna, and Kaiser Permanente.)
The COBRA fact sheet lists only the plan I was in before retiring, the High Deductible PPO with HSA. (Apparently you cannot switch your health plan upon retirement...I don't know if that's an IBM rule, an insurance company rule, or a government rule.) So, the only comparison I can make between COBRA cost (i.e. employee risk pool) and retiree cost (i.e. retiree risk pool) is the plan I was in before retiring.
Here's the numbers: For my wife and I the monthly cost under COBRA is $749.35. The monthly cost under the retiree pal is $1082.59, a 44% increase.
Dental insurance is similar. "IBM Dental Basic" for my wife and I under COBRA is $42.84 per month. Under the retiree plan, it's $59.24. After doing the math, I determined it was cheaper to pay for our dental care out of pocket rather than buying dental insurance. (This is even with one crown this year.)
In 1994, Bain bought Dade International, a medical-diagnostics company, then added the medical-diagnostics division of DuPont in 1996 and a German medical-testing company called Behring in 1997. Former Dade president Bob Brightfelt says the operation started well: the Bain managers were "pretty smart guys," he recalls, and they did well cutting out overlap, and exploiting synergies.
Then brutal cost cutting began. Bain cut R&D spending to an average of 8 percent of sales, a little more than half what its competitors were doing. Cindy Hewitt, Dade's human-resources manager, remembers how the firm closed a Puerto Rico plant in 1998, a year after harvesting $7.1 million in local tax breaks aimed at job creation, and relocated some staff to Miami, then the company's most profitable plant. Based on reassurances she had received from her superiors, she told those uprooting themselves from Puerto Rico that their jobs in Miami were safe for now—but then Bain closed the Miami plant. "Whether you want to call it misled, or lied, or manipulated, I do not believe they provided full information about what discussions were under way," she says. "I would never want to be part of even unintentionally treating people so poorly."
Bain engaged in startling penny-pinching with the laid-off employees. Their contracts stipulated that if they left early they would have to pay back the costs of relocating to Miami—but in spite of all that Dade had done to them, it refused to release the employees from this clause. "They said they would go after them for that money if they left before Bain was finished with them," Hewitt recalls. Not only that, but the company declined to give workers their severance pay in lump sums to help them fund their return home.
In 1999, generous pensions were converted into less generous benefits, wages were cut, and more staff members were laid off. Some employees contacted Norman Stein, then the director of the pension-counseling clinic at the University of Alabama law school, with a view to challenging the conversions. Stein says the employees were "extraordinarily nervous," so fearful, in fact, that they refused to let lawyers even make copies of pension documents. "I have been dealing with pensions issues for over 25 years and I never saw anything like this," recalls Stein. The spooked employees did not go to court. Stein says that, while breaking pension contracts like this was not unheard of, the practice at that time was "questionable," adding that Dade may have saved $10 to $40 million from converting its pensions.
The beauty—or savagery—of leverage is that it can magnify any and all cash-flow boosts, such as this one. Take $10 to $40 million squeezed from a pension pot, then use that to create new, rosier financial projections to borrow several times that amount, and then pay yourself a big special dividend from the borrowed funds, many times the size of the pension savings. That is just what Bain Capital did: the same month it converted the pensions, it created new financial projections as a basis to borrow an extra $421 million—from which Bain, its co-investor Goldman Sachs, and top Dade management extracted $365 million in dividends. According to Kosman, "Bain and Goldman—after putting down only $85 million … made out like bandits—a $280 million profit." Dade's debt rose to more than $870 million. Romney had left operational management of Bain that year, though his disclosures show that he owned 16.5 percent of the Bain partnership responsible for the Dade investment until at least 2001.
In 1999, generous pensions were converted into less generous benefits, wages were cut, and more staff members were laid off. Some employees contacted Norman Stein, then the director of the pension-counseling clinic at the University of Alabama law school, with a view to challenging the conversions.
For a minute there I thought the article was talking about IBM. Didn't Norm Stein appear at some Congressional hearings?
Eichenwald’s conversations reveal that a management system known as “stack ranking”—a program that forces every unit to declare a certain percentage of employees as top performers, good performers, average, and poor—effectively crippled Microsoft’s ability to innovate. “Every current and former Microsoft employee I interviewed—every one—cited stack ranking as the most destructive process inside of Microsoft, something that drove out untold numbers of employees,” Eichenwald writes. “If you were on a team of 10 people, you walked in the first day knowing that, no matter how good everyone was, 2 people were going to get a great review, 7 were going to get mediocre reviews, and 1 was going to get a terrible review,” says a former software developer. “It leads to employees focusing on competing with each other rather than competing with other companies.”
When Eichenwald asks Brian Cody, a former Microsoft engineer, whether a review of him was ever based on the quality of his work, Cody says, “It was always much less about how I could become a better engineer and much more about my need to improve my visibility among other managers.” Ed McCahill, who worked at Microsoft as a marketing manager for 16 years, says, “You look at the Windows Phone and you can’t help but wonder, How did Microsoft squander the lead they had with the Windows CE devices? They had a great lead, they were years ahead. And they completely blew it. And they completely blew it because of the bureaucracy.”
However, what she didn't know was that she also needed to "opt out" of this continued ongoing Future HC, and that if she didn't opt out it would be deducted from her monthly pension deposits.
Today she learned that the hard way. She was expecting $x amount pension to be deposited as normal and noticed the deposit was over $2000 less than expected. Fidelity has told her she has to wait until November to opt-out for the next year OR she can also try writing an appeal letter and that they are binded by the agreement with IBM.
I understand the legal aspects of this but am just heartbroken to know that this woman who worked for so much of her life is now trying to figure out how to make it until November. Has this happened to anyone else? Is this common? Is there ANYTHING else she can do to try and get this opt-out moved earlier? She was never contacted by anyone at Fidelity regarding the matter or received notification, unless it was some very fine print. She honestly did not know, so now is paying health insurance in two places and only using one of those policies.
I don't know where to start or how to help but found this board and hoping someone has some advice. Thanks.
The folks at Fidelity call center are really off the street hires and are following a "cheat sheet". She should write to to the IBM PROGRAMS MANAGER (Randy McDonald) and copy NETBENEFITS (using registered mail with written return receipt, not the electronic version) requesting IMMEDIATE OPT OUT.
If she does not have access to netbenefits.com/ibm she should sign up immediately and review her status.
The Federal Government has made OPT OUT, ILLEGAL. IF she OPT'ed IN, she should ask to OPT OUT due to life changing activity (a NEW FULL TIME JOB) ! The OPT OUT should be stated as JAN 1, if she got the new job then.
Since it has been longer than 30 days since she began her new coverage under her employer's plan, she is probably out of luck. The rules don't allow changes outside the window. This is one of those things you can't blame IBM for. The federal government sets these rules.
It is worth filing an appeal. She might get lucky and get a break.
I don't think there is anything illegal here. Just a misunderstanding by the retiree that she needed to take explicit action to drop her coverage under the FHA. Unfortunately, it is a very costly misunderstanding.
My point is, not only do you get misinformation from them (such as trying to get me to pay $600 for a Prescription Drug Option while I was defaulted as I waited for Kaiser to verify my Medicare ... because I'd have to pay a penalty for a gap in coverage ... completely untrue, according to the SSA), but you get a DIFFERENT story every time you talk with them. Seriously, you need to get it in writing because you can't trust them at all.
As to the basic problem, I find it odd that it went down exactly that way. In my adventures, the forms I filled out to sign UP for insurance required me to inform them when my PREVIOUS insurance was discontinued. That should certainly raise a big flag that she needed to verify the exact date that the coverage ended. ALSO, with Medicare, I needed to send a letter (an SSA form) to my wife's employer to verify that I was PREVIOUSLY covered and the date that the coverage ENDED. In this case she would have had to send that form to IBM and they would have had to send that form to IBM and they would have responded in some way as to stop the new coverage.
Retirees also shared the best steps they took toward a secure retirement. The top answer was staying in a job that had a traditional defined-benefit pension plan. Though defined-benefit plans, which pay retirees a set amount each month, have been disappearing, some big companies and government workers are still covered by them.
"The lesson there is if you do have a job with a defined-benefit plan, think twice before you leave," Daugherty said. People considering several offers for a new job may want to lean toward any that have a defined pension, he said.
Now we’re about to see the next level of state and municipal pension warfare: changes in benefits for those already retired.
Municipal bankruptcy The city of Stockton, Calif., filed for bankruptcy late last week, creating a new challenge to public employee pensions and health care promises. Dozens of other cities and districts have filed for bankruptcy in the past — notably Orange County, Calif., Bridgeport, Conn. and Vallejo, Calif. But not only is Stockton the largest municipal bankruptcy in terms of debt load and population, it appears to be the first one in which the court will be asked to void retiree health care and pension promises. ...
In Stockton’s Chapter 9 bankruptcy filing (after a 90-day state mandated mediation), the city said it will eliminate its contribution to retiree health care, along with suspending interest payments to bondholders and making cuts in union contracts. It can do that as part of the bankruptcy process. But after the filing, the retirees become general creditors, along with bondholders and others. It appears that Stockton will be the first municipality to ask the court to adjust retirees pension payments.
Most anti-union posts have common threads. Investment creates jobs, unions are not appropriate to tech workers etc, etc, etc. The divide and conquer mentality has been at work for years. So much so that techies who (like myself) narrowly escaped 21 years of downsizing think that unions will not reward their merit or are for blue and pink collar workers only. And that giving employees better retirement medical coverage is creating "uncertainty". However destroying millions of middle-class jobs, pensions and benefits is what really created the uncertainty.
IBM Germany is largely unionized. They were the major players behind porting and supporting Linux on the IBM Mainframe. Unions did not squash their innovation. In fact Linux breathed life into the mainframe and extended the lifespan of the platform.
>And that giving employees better retirement medical coverage is creating "uncertainty". That's sad too, Paul. Of course, they'll find out when they are fired and go to sign up for their FHA if they're Second Choicers just how bad the coverage is, and how bleak their future will be if they get sick, and how devastated they will be if they get seriously sick. But hey, it will be too late, and they will shake their heads at their past stupidity.
You take an extra long lunch with your closest working buddies and have a great time because, for the first time ever, you don't care about walking past the boss's office after running a little late. Then you back up all your personal files and web bookmarks on the company laptop and start making your rounds to personally thank all those at the workplace who have truly helped you over the years.
However, it will only be possible to have this sort of relaxing last day of work if you have made the necessary preparations for retirement. Here are a few activities soon-to-be retirees should do before they call it quits...
Let's say you have $20,000 in a retirement account. If you assume you can earn a net return of 6.5 percent a year — 7 percent from investment gains, minus a relatively modest 0.5 percent in fees and charges to run the plan — the account would grow to $70,500 in 20 years. Boost the fees to 1.5 percent, and the account will grow to just $58,400. That's $12,100 less because of a percentage point difference in fees and charges....
But this summer, 401(k) account holders should keep a close eye on their mailboxes and email. They'll receive new fee disclosures from their employers containing much greater detail about what they're paying to invest in these tax-advantaged plans. ...
Here are 4 key items investors should look for in the documents...
If you are like most people, you probably assume your 401(k) is free. But no 401(k) is free. You pay, and in some workplaces people pay far too much to get too little. The way you will know is by looking at the letter you are about to receive under new Department of Labor 401(k) fee disclosure rules.
Just be aware, you are likely to see small numbers that appear inconsequential, but are not. When it comes to invest ...
Once you get the letter from your benefits office and see the fees you are paying for your 401(k) or 403(b), you can use the expense calculator I used for the above example (sec.gov/investor/tools/mfcc/get-started.htm) to see the impact on the money you will accumulate. You don't need to fill in the line for a "sales charge" unless you happen to have funds that charge you a load. But you should fill in total operating expenses, or what might be called an "expense ratio."
SOOOOO, who is really saving time or money from this offshoring? I can't answer that. IBM is in a state of emergency...they are bleeding customers because of these inefficiencies...everyone that I speak to about these issues have no answers. We are just waiting for the Big Blue machine to crash. The account I work on is a mess and I would NOT be surprised if they loose it, very soon. Problem after problem...and when these problems arise, guess who they call to the rescue? The US based employees. -BigJoe-
No mention is made of the tens of thousands of loyal employees who have been summarily fired, the pensions for which employees worked their entire lives that have now been stolen, or the elderly widows who had lived for years on a meager IBM pension, and who now receive an invoice for their medical insurance instead of a check. Former Reichsminister Joseph Goebbels must surely be looking up from the Ninth Circle of Hell and smiling, knowing that his legacy of propaganda lives on at IBM, as he eagerly awaits the arrival of those who have perpetrated these grave injustices. -No Fate But What We Make-
Of course the big bosses are immune from RAs. Why can't IBM offshore a VP or Sr. VP to India? Also, no bell curve distribution for PBC ratings either if they are even appraised or under the PBC system to begin with. I wish folks would listen to your wisdom! -anonymous-
Both Mr McConnell and John Boehner, the Republican House Speaker, suggested that it was not the federal government’s job to ensure that patients with pre-existing medical conditions were guaranteed insurance coverage, one of the most popular provisions of the Affordable Care Act. Both said that job should be left to individual states, which could set up “high risk” insurance pools for affected patients.
Former Massachusetts Gov. Mitt Romney, the presumptive Republican nominee, has so far remained mum on what major alternatives, if any, he might offer before the election. It goes without saying that pointing with pride to the Bay State’s “Romneycare” is not a viable option, since its exchanges, subsidies, mandates and tax penalties served as the model for the federal bill he wants to repeal.
Many Republican strategists say it would be a huge mistake for Romney to define his replacement strategy before the election. “He’d be distracting attention from the much more pressing goal of repealing the law,” said Michael Cannon, a health care policy analyst at the libertarian Cato Institute. ...
But some Republican pollsters think otherwise. “You can’t say you’re going to repeal something and not say what you’re going to replace it with,” said John McLaughlin, chief executive officer of McLaughlin & Associates. “It allows your opponent to define what he thinks you’re going to replace it with.” ...
The Heritage Foundation, which originated the individual mandate but has since abandoned the idea, now places transformation of government programs at the top of its to do list. “Existing health care spending such as Medicaid and the State Children’s Health Insurance Program should be redirected to help low-income individuals and families purchase private health insurance,” a recent paper by health analyst Nina Owcharenko said. “Medicare should be a defined-contribution system in which the government provides a contribution for benefits and seniors are able to apply their contribution to the health plan that suits them best.” ...
Politically-attuned observers object to radical overhauls that are primarily designed to lower government costs without addressing the problem of the uninsured. They believe Romney should offer small-bore programs that begin to address those problems. “Expand (tax-incentivized) health savings accounts; give tax credits and tax deductions to encourage people to buy health insurance; roll back the cuts in Medicare,” pollster McLaughlin said.
Democrats and liberal-leaning health care analysts argue that many of these approaches have been tried in the past without success. They say the radical overhauls of Medicare, Medicaid and elimination of the tax preference will lead to higher spending out of pocket by beneficiaries, higher taxes on the middle class and self-rationing by people stuck in inadequate plans.
But those arguments can only be joined if Romney moves beyond the sound bites of repealing Obamacare to offering something specific as its replacement. “I don’t see how Romney can be a credible candidate unless he has a more specific plan,” said AEI’s Antos. “The big question is when he is going to start talking about it.”
Q. My parents are screaming about higher taxes from the Affordable Care Act. Any figures for those who have health insurance through our employers already? What does this mean for us? A. The law imposes tax changes that would affect some people who are covered through their employers, especially those in higher tax brackets. Beginning next year, the law increases the Medicare tax by 0.9 percent on earnings over $200,000 for individual taxpayers and $250,000 for married couples filing jointly. It also imposes a 3.8 percent tax on unearned income for high-income households. ...
Q. What does the law mean for retirees on Social Security and facing high drug costs? A. The law shrinks the Medicare drug coverage gap known as the “doughnut hole” by requiring pharmaceutical companies to give a 50 percent discount on brand-name drugs. Federal subsidies will gradually fill in the rest of the gap until it is closed by 2020.
The fundamental problem is that insurers can often identify specific people — like those with serious pre-existing conditions — who are likely to need expensive care. Any company that issued policies to such people at affordable rates would be driven into bankruptcy, its most profitable customers lured away by competitors offering lower rates made possible by selling only to healthy people.
Economists call this the adverse-selection problem. Because of it, unregulated private markets for individual insurance cannot accommodate the least healthy — those who most desperately need health insurance. ...
Employer plans are thus a significant improvement over individual private insurance, but they are still deeply flawed. If you lose your job, you can lose your coverage. This problem has been cast into sharp relief by the persistent high unemployment in the wake of the financial crisis. In no other industrial country do we see communities organizing bake sales to help defray the cost of an uninsured neighbor’s cancer treatments.
The decline in the number of workers covered by employer plans began long before the recent crisis. According to census data, 65 percent of workers had employer-backed plans in 2000, but only 55 percent were covered by 2010. This decline has been driven in part by rapid increases in health care costs. ...
Modeled after proposals advanced by the Heritage Foundation, the American Enterprise Institute and other conservative research organizations in the 1990s, the main provisions of the president’s health care law were intended to eliminate the most salient problems associated with the current system.
One provision establishes insurance exchanges, where participating companies must offer coverage to all customers, irrespective of pre-existing conditions. Another imposes a financial penalty on those who fail to obtain coverage — the individual mandate. And a third prescribes subsidies to make insurance more affordable for low-income families. (The Massachusetts plan engineered by Mitt Romney as governor in 2006 took an almost identical approach.) ...
It isn’t that people should buy health insurance because it would be good for them. Rather, failure to do so would cause significant harm to others. Society will always step in to provide care — though in much more costly and often delayed and ineffective forms — to the uninsured who fall ill. To claim the right not to buy health insurance is thus to assert a right to impose enormous costs on others. Many legal scholars insist that the Constitution guarantees no such right. ...
No one can be sure how the law will play out. But its critics would be unwise to assume that it would have been easy to draft superior legislation had the law been overturned. Any new attempt would have taken the employer-based system as a starting point. ...
The new law will hardly be the final word on these issues. Though it takes tentative first steps on cost control, government budgets will be decimated unless we do much more to reduce inflation in medical services. And in Medicare, many tough decisions remain to be made about end-of-life interventions, and whether Medicare should become an optional form of coverage for those who aren’t elderly. The point worth celebrating is that last week’s ruling will at last enable our distinctly dysfunctional health care system to evolve into something better.
This shift has already begun among some big employers shedding their role in providing retiree health benefits, and experts say the court's decision this week could eventually lead companies to pursue a similar approach with current workers. ...
One of the more popular ideas being discussed is to give workers a lump sum, or defined contribution, and then let them use that money to buy their own individual health plan.
The approach resembles existing 401(k) retirement plans in which employers put a fixed amount of tax-deferred dollars into employees' retirement accounts and leave it to the workers to manage the money. In the case of health benefits, employers gain more control over their spending and avoid the hassle of picking plans for their workforce.
“This falls under the ‘too numerous to count’ section,” a New Jersey internist said. A vascular surgeon in Indianapolis told me about a man in his fifties who’d had a large abdominal aortic aneurysm. Doctors knew for months that it was in danger of rupturing, but since he wasn’t insured, his local private hospital wouldn’t fix it. Finally, it indeed began to rupture. Rupture is an often fatal development, but the man—in pain, with the blood flow to his legs gone— made it to an emergency room. Then the hospital put him in an ambulance to Indiana University, arguing that the patient’s condition was “too complex.” My friend got him through, but he’s very lucky to be alive.
Another friend, an oncologist in Marietta, Ohio, told me about three women in their forties and fifties whom he was treating for advanced cervical cancer. A Pap smear would have caught their cancers far sooner. But since they didn’t have insurance, their cancers were recognized only when they caused profuse bleeding. Now the women required radiation and chemotherapy if they were to have a chance of surviving.
A colleague who practices family medicine in Las Vegas told me about his clinic’s cleaning lady, who came to him in desperation about her uninsured husband. He had a painful rectal fistula—a chronically draining infection. Surgery could cure the condition, but hospitals required him to pay for the procedure in advance, and, as unskilled laborers, the couple didn’t have the money. He’d lived in misery for nine months so far. The couple had nowhere to turn. Neither did the doctor.
The litany of misery was as terrible as it was routine. An internist in my Ohio home town put me on the phone with an uninsured fifty-five-year-old tanning-salon owner who’d had a heart attack. She was now unable to pay the bills for the cardiac stent that saved her and for the medications that she needs in order to prevent a second heart attack. Outside Philadelphia, there was a home-care nurse who’d lost her job when she developed partial paralysis as a result of a rare autoimmune complication from the flu shot that her employers required her to get. Then she lost the insurance that paid for the medications that had been reversing the condition. ...
Two decades ago, the economist Albert O. Hirschman published a historical study of the opposition to basic social advances; “the rhetoric of intransigence,” as he put it. He examined the structure of arguments—in the eighteenth century, against expansions of basic rights, such as freedom of speech, thought, and religion; in the nineteenth century, against widening the range of citizens who could vote and participate in government; and, in the twentieth century, against government-assured minimal levels of education, economic well-being, and security. In each instance, the reforms aimed to address deep, pressing, and complex societal problems—wicked problems, as we might call them. The reforms pursued straightforward goals but required inherently complicated, difficult-to-explain means of implementation. And, in each instance, Hirschman observed, reactionary argument took three basic forms: perversity, futility, and jeopardy.
The perversity thesis is that the change will not just fail but make the problem worse. The futility thesis is that the change can’t make a meaningful difference, and therefore won’t be worth the effort. We hear both of these lines of argument against the health-care-reform law. By providing coverage for everyone, it will drive up the system’s costs and make health care unaffordable for even more people. And, some say, people can get care in emergency rooms and through charity, so the law won’t do any real good. In fact, a slew of evidence indicates otherwise—from the many countries that have both universal coverage (whether through government or private insurers) and lower per-capita costs; from the major improvements in health that uninsured Americans experience when they qualify for Medicare or Medicaid. The reality is unavoidable for anyone who notices what it’s like to be a person who develops illness without insurance. ...
For all that, the Court’s ruling keeps alive the prospect that our society will expand its circle of moral concern to include the millions who now lack insurance. Beneath the intricacies of the Affordable Care Act lies a simple truth. We are all born frail and mortal—and, in the course of our lives, we all need health care. Americans are on our way to recognizing this. If we actually do—now, that would be wicked.
No, Romney’s problem is that there’s simply no possible health care reform plan that he can support that would both appeal to those who have doubts about the Democratic plan and, at the same time, prevent Republicans from revolting against him. All there is are the same slogans — not plans, but slogans — that Republicans have been reciting over the last three years: purchasing insurance over state lines, malpractice reform. And not only does everyone who pays close attention know that it doesn’t add up to a real reform plan, but it doesn’t seem to even fulfill the job of sounding good. ...
For Republicans running for nominations or in lopsided Republican districts, none of this is as much of a problem; the constituents they care about are mostly happy with just plain repeal, and are certainly happy with crude Obama-bashing. But the incentives are all different for a presidential candidate who has to worry about swing voters. That, and not Romneycare, is what's causing the trouble.
For families this is all about finally getting health insurance coverage for a child with a chronic illness or congenital problem who had been denied coverage for years, saddling already strapped families with medical bills that could never be paid.
It's about never again having to worry that whatever coverage they may have had will reach some arbitrary limit, putting sky high medical bills on the horizon for years to come.
It's about a new health center coming to their community where simply finding a clinic or doctor's office has been a major challenge.
It's about programs to encourage and provide incentives for doctors to practice in communities that have been experiencing serious shortages of medical professionals. ...
In the meantime, let's recognize Obama's health care legislation for the landmark accomplishment that it is. After decades of started and stalled attempts to create a more equitable system of care -- under Democratic and Republican administrations -- the impossible was achieved. ACA is a giant step forward.
And if you don't agree with that, try asking a family who doesn't have health insurance and can't afford medical care for a sick child what it feels like to be stuck with crushing bills and the heartache of not being able to provide the best for those who are most precious to you. ...
Underneath the nearly 200 pages of legal rhetoric issued by the Roberts court, and the incessant bantering by politicians and talking heads, lies a simple understanding: America's health care system was failing millions of families and was long overdue for a makeover. The ACA is just what the doctor ordered.
Most Americans have health care. What they worry about is the cost of insuring 20 million to 30 million more people. Unless the meteoric rise of health-care costs is slowed, a big expansion of coverage might well remain unpopular, no matter how it is explained. ...
A new study conducted by the pharmaceutical company Novartis and McKinsey and Co. shows a stunning difference among countries with regard to health-care efficiency.
For example: Smoking rates are higher in France than in the United States, so the French population has higher rates of lung disease. Yet the French system is able to treat the disease far more effectively than happens in the United States, with levels of severity and fatality three times lower than those in this country. And yet France spends eight times less on treatments per person than the U.S. system. Or consider Britain, which handles diabetes far more effectively than the United States, while spending less than half of what we spend per person. The study concludes that the British system is five times more productive in managing diabetes than is the United States. ...
To understand the issue better, I spoke with Daniel Vasella, the chairman (and former chief executive) of Novartis and a physician by training. He is also frankly pro-market and pro-American, both of which have made him a target for some criticism in Europe.
Vasella emphasized that there is no single model that works best, but he explained that France and Britain are better at tackling diabetes and lung disease because they take a systemic approach that gives all health-care providers incentive to focus on early detection and cost-effective treatment and that makes wellness the goal. “In America,” he said, “no one has incentives to make quality and cost-effective outcomes the goal. There are so many stakeholders and they each want to protect themselves. Someone needs to ask, ‘What are the critical elements to increase quality?’ That’s what we’re going to pay for, nothing else.”
Still, one of the biggest challenges for the state lies ahead: reining in spiraling costs.
Six years after Gov. Mitt Romney signed the nation's most ambitious health care law — one that would lay the groundwork for his presidential opponent's national version — supporters say the Massachusetts law holds promise for the long-term success of Barack Obama's plan.
Like the federal law it inspired, the Massachusetts law has multiple goals, among them expanding the number of insured residents, reducing emergency room visits, penalizing those who can afford coverage but opt to remain uninsured, and requiring employers to offer coverage or pay a fine.
Supporters of the Massachusetts experiment are quick to point out its successes.
An additional 400,000 individuals have gained insurance since 2006, meaning about 98 percent of residents have coverage.
A recent study by the Blue Cross Blue Shield of Massachusetts Foundation found that between 2006 and 2010, the use of emergency rooms for non-emergency reasons fell nearly 4 percent. That was a key goal of the law, since using emergency rooms for routine care is far more expensive than visiting a doctor. ...
The charge that the law has been a "budget-buster" in Massachusetts has also been challenged. A recent study by the business-backed Massachusetts Taxpayers Foundation found that during the five full fiscal years since it was implemented, the law has cost the state an additional $91 million a year after federal reimbursements — well within initial projections.
Drum looked at the results of an Affordable Care Act quiz (you should take it!) put out by a health foundation several months ago and found that the questions that were most frequently answered incorrectly were the ones that asked about issues conservatives have worked tirelessly to distort. ...
The questions on the right were most often answered incorrectly because, as Drum wrote, conservatives are always “rabble rousing” about death panels, illegal immigrants, Medicare cuts, a “government takeover” (public option) and supposed small business mandates.
However, they don’t say much about pre-existing conditions, small business tax credits, Medicaid expansion and low-income subsidies — I guess they haven’t found a way to twist these popular features yet.
Drum also shared his thoughts on why the small business mandate question was the one most often answered incorrectly:
The Rush/Fox/Drudge axis has been screaming about the government takeover of healthcare for three years now, and it's sunk in … That's why, faced with a question most of them really have no idea about, their immediate reaction is to believe that, in fact, government is once again planting its jackboot directly on the necks of America's small businesses. It's a small issue, but it's also a bellwether that the broader conservative misinformation campaign has burrowed very deeply into the American psyche.
To make matters clearer, Maddow played a clip from the 2008 Republican primary in which Romney touted his Massachusetts health reform achievement. "I like mandates, the mandates work," Romney said during the 2008 primary. "If you can afford to buy [health] insurance, then buy it."
Speaking of the 2008 clip, Maddow said, "Mitt Romney taking credit for doing as a governor, exactly what Barack Obama did as president, which Mitt Romney now says is the main reason you should vote against Barack Obama for a second term as president."
Maddow wondered why voters who do not want to re-elect Obama because he implemented health reform would then vote to replace him with a politician "that did exactly the same thing, he just did it first." Maddow described Romney's campaign as a "totally, incoherent mess," as it tries to criticize Obama's health reform while simultaneously attempting to tout Romney's own health care achievements. She added that running on his own signature achievement "is the worst possible thing for [Romney] to run on, and he's decided to run on it."
… [since] the actual [Republican] plan is first to get rid of Obamacare, then pretend to work on a replacement before eventually discovering that it’s expensive and unpopular … the only interesting question here on any level is why so many conservatives feel bound to pretend that the Republicans really are going to formulate some other plan to care for the poor and sick.
Josh Barro made a similar point in a back-and-forth with Reihan Salam:
The alternative to PPACA is nothing. Mitch McConnell’s comments last weekend were instructive — Republicans in Congress have no meaningful plan to replace Obamacare and think that 30 million uninsured Americans is “not the issue.”
Conservative health wonks will object to my characterization. They will say they have many plans to use markets to drive down costs so that affordability is less of an issue. They may even advance plans that spend money to subsidize some sort of coverage for some expanded group of Americans. But Republicans have not taken them up on those plans when they have had the chance.
This is all thanks to former Gov. Mitt Romney, who set up the system — the best of its kind in the country — and is now trying to pretend he doesn’t remember how it works. On Monday, his campaign said Mr. Romney believed the identical requirement in President Obama’s health care law was a penalty, paid through the tax system. Two days later, Mr. Romney rushed to the cameras to contradict the campaign and insist the mandate was a tax.
Why the switch? As he has on so many issues, Mr. Romney caved to Republican conservatives who want him to campaign on the falsehood that the mandate is a vast tax increase on the middle class. The Supreme Court’s decision that the law is constitutional was disastrous to their cause, so they distorted its basic reasoning. Chief Justice John Roberts Jr. wrote that the mandate is legal under the Congressional taxing power, which Republicans took a step further, saying the mandate must now be a tax. And not just a tax, but a huge, oppressive tax, one of the largest in history.
It is, of course, no such thing. How many “oppressive taxes” are entirely optional? Anyone who does the smart thing and gets health insurance won’t have to pay it. It is, as Mr. Romney himself described it in 2006, a fee to promote “personal responsibility” and prevent healthy people from freeloading. (Among those who won’t be able to comply with the law are poor people living in states where Republican governors refuse to expand their Medicaid programs using federal dollars — though most of those people don’t make enough to have to pay the penalty.) ...
Against all evidence, Mr. Romney and his party believe the private system will simply fix itself if government gets out of the way. At least, that’s what he says he believes now.
I was one of the early beneficiaries of the law. When I was diagnosed with an aggressive form of breast cancer late last year, I had no health insurance, which meant my options were extremely limited. No insurer would pick up someone in my circumstances. But luckily, the Pre-existing Condition Insurance Plan had already kicked in, and it made it possible for me to purchase insurance under a government program.
I was uninsured not because I'm a lazy, freeloading deadbeat but because my husband and I are self-employed. We had been purchasing health insurance on the individual market along with 6% of the rest of the population. But after exhausting all of our resources trying to keep up with premiums of $1,500 a month, we had no choice but to cancel it.
can tell you that "Obamacare" — at least the part I've participated in — works. A week ago, I had a double mastectomy after five months of chemotherapy. I have been receiving outstanding care in West Hills — no death panels, no rationing, no waiting, no government officials telling my doctors what to do, no denials of tests or treatments, none of the stuff that the plan's critics said would happen.
Six months ago, when I first wrote about my situation in this newspaper, I got hate mail from people who said I deserved to die. But there was also a lot of curiosity and a lot of encouragement and support. Much of the curiosity was from abroad. Canadians, French, Italian, British and Swiss cannot understand why healthcare reform is so politicized here; why most people don't know anything about the Affordable Care Act; how we can be so cruel to one another; and why we criticize their healthcare systems.
Yet since the Supreme Court upheld the Democrats’ 2010 health care law, Republicans, led by Mitt Romney, have reversed tactics and attacked the president and Democrats in Congress by saying that Medicare will be cut too much as part of that law. Republicans plan to hold another vote to repeal the law in the House next week, though any such measure would die in the Democratic-controlled Senate.
“Obamacare cuts Medicare — cuts Medicare — by approximately $500 billion,” Mr. Romney has told audiences that is a reprise of Republicans’ mantra of the 2010 midterm elections, which gave them big gains at both the state and federal levels and a majority in the House. Yet the message conflicts not only with their past complaint that Democrats opposed reining in Medicare spending, but also with the fact that House Republicans have voted twice since 2010 for the same 10-year, $500 billion savings in supporting Mr. Ryan’s annual budgets.
The result is a messaging mess, even by the standards of each party’s usual election-year attacks that the other is being insufficiently supportive of older people’s benefits.
"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.
Romney’s retort takes various forms: that the offshore outsourcing didn’t happen on his watch; that it wasn’t Bain-owned companies that did it, just their customers; that outsourcing some jobs was the only way to preserve and create other jobs. The critique, says Romney, is just another example of Obama’s anti-business bias.
The debate over outsourcing has been morphing, and today there are growing numbers of people who think that what started as a sensible, globalized extension of sending some work outside a firm to specialized companies may in fact be creating long-term structural unemployment in the United States, hollowing out entire industries. ...
Initially, a lot of outsourcing was to other American firms; later it involved moving production to foreign countries. Many companies rushed to spin off all but their most essential “core” activities.
Today, some of the world’s largest companies and biggest employers are the product of this outsourcing trend: Sodexo in food service; IBM in information technology; Wackenhut, now known as G4S, in security services; UPS and FedEx in logistics; Foxconn and Lenovo in computer manufacturing. Instead of the Rouge plant, the new model of industrial organization has become Nike, which outsources the making of all of its shoes, clothing and sporting equipment so it can concentrate on design and marketing, and Apple, which outsources all of its hardware manufacturing. ...
Back when the business world was dominated by family-owned firms, the owners’ personal ties to workers and neighbors made them reluctant to shift work elsewhere, even if meant giving up a bit of profit. That same sensibility persisted even after entrepreneurial owners began to sell their companies to public shareholders and hire a cadre of professional managers, beginning in the 1920s.
All that began to change, however, in the 1980s, with a wave of corporate takeovers, many of them unwanted and uninvited. Corporate executives came to fear that if they did not run their businesses with the aim of maximizing short-term profits and share prices, their companies would become takeover targets and they would be out of a job. Overnight, outsourcing became a manhood test for corporate executives. ...
While private-equity managers like to boast that they are free to manage the companies they buy without worrying about changes in quarterly profits, the reality is that their “long term” time horizon is limited. Generally, they allow two or three years for recouping their original cash investment and seven years for selling the whole company again at a handsome profit. The standard strategy has been to load up company executives with so much stock and stock options that they don’t hesitate to make difficult decisions such as shedding divisions, closing plants or outsourcing work overseas.
Even its competitors agree that Bain was among the most successful at this game, never more so than during the 1990s when Romney was at the helm. ...
One theory is that in the early days of offshoring, moving production work overseas did indeed have that salutary effect of creating more than enough offsetting jobs back home in engineering, design, marketing and final assembly.
But in the past few years, a number of respected tech executives, among them former Intel chairman Andy Grove and IBM’s former chief scientist Ralph Gomory, have warned that a tipping point of sorts has been reached. It turns out that designing and developing products requires rather intimate familiarity and close collaboration with the manufacturing process. That was not a problem when there was still some production left in the United States. But now that many categories of high tech have moved virtually all production offshore, companies are finding that they also need to move more and more of engineering and design work overseas as well.
Arie Lewin, director of the Center of International Business Education and Research at Duke University, says we’ve seen a variation of this same dynamic before, with the consumer electronics business in the 1950s and ’60s.
At first, U.S. companies found it cheaper to begin shipping some of the production of radios and televisions to Japan. But in time, Japanese suppliers reverse-engineered the products and figured out how to design and produce their own brands. They then took over the global industry. As a result, an outsourcing strategy that might have been benign or even beneficial in terms of U.S. employment eventually turned negative.
The battle over campaign finance is as much about self-interest as it is ideology. Having persuaded the courts that political donations are a form of free speech, the Republicans are determined to protect their cash edge. ...
However, operating in parallel with the super-Pacs, and often under the same roof, are a growing number of campaign organisations that have been established under the tax code as non-profit “social welfare” bodies.
For political operatives, the tax exempt non-profits have one big attraction: they can take as much money as they want, without having to disclose their donors. In short, the new rules have made it easier both to give a lot of money to politicians and political causes, and, in part, to keep donations secret. As a result, the 2012 presidential campaign will cost about double that of 2008.
Mr Obama more than matches Mr Romney in formal campaign funds. Steve Schmidt, John McCain’s 2008 campaign manager, reckons the candidates and their parties’ committees will raise about $1bn each for 2012, compared with a collective $1.3bn four years ago. Otherwise, the big winners have been the Republicans, whose outside campaign groups have been banking one-off cheques as large as $10m from wealthy donors, a trend with profound implications if it offers a permanent financial advantage.
The most extravagant contributors, such as Sheldon Adelson, the Las Vegas casino magnate who has so far given more than $30m to Republican candidates and says he is willing to spend up to $100m to get rid of Mr Obama, have got the most headlines.
Mr Adelson is far from alone. Dozens of wealthy Americans have donated hundreds of thousands and in some cases millions of dollars, mostly to Republicans, in a way they never could have done legally before. Pro-conservative groups operating separately from the campaigns will have an estimated $1bn to spend on the presidential and congressional races, compared with less than $100m in 2008. ...
The law says the non-profits must operate “exclusively” for social welfare reasons, but over time, in a remarkable feat of legal finesse, this standard has been gradually lowered, to be their “primary” purpose.
“To go from ‘exclusive’ to ‘primary’ requires a dictionary which is not available in Great Britain or America,” says Fred Wertheimer, of Democracy21, a Washington group advocating campaign finance reform. “Everyone in the world knows that the only purpose of these bodies is to win elections.” ...
On the morning after the Supreme Court’s healthcare decision, Crossroads GPS, the non-profit co-founded by long-time Republican adviser Karl Rove, was already airing an advertisement in North Dakota attacking the Democratic Senate candidate for her support for “Obamacare”. Although patently political, featuring a scowling Mr Obama and various perceived sins of the candidate, the advertisement would not necessarily be classified as political speech under current law, as it did not advocate a specific vote. ...
Tim Phillips, who heads two non-profits under the AFP banner, says he has about $100m to spend on the 2012 elections. AFP has run hard-hitting campaigns against Mr Obama’s stimulus and the administration’s energy and climate-change policies but stays within its non-profit charter either by not mentioning Mr Obama by name or by not advocating votes for particular candidates. “It may seem like a distinction without a difference but I think it is a distinction,” he says.
An NBC News/Wall Street Journal poll last week provided surprisingly dramatic evidence of how much these commercials are wounding Romney.
In the country as a whole, 23 percent said they viewed Romney more positively because of his experience “managing a firm that specializes in buying, restructuring and selling companies,” while 28 percent said this made them view Romney more negatively. But in this year’s 12 battleground states, many of which have gotten a heavy run of the anti-Bain ads, only 18 percent viewed Romney’s business experience positively; 33 percent viewed it negatively. Obama led Romney by three points nationally but by eight in the battlegrounds.
This is disturbing news for Romney, who hoped his business experience would be an unalloyed asset. The numbers also underscore voter resistance to the core conservative claim that job creation is primarily about rewarding wealthy investors and companies through further tax cuts and less regulation. Americans are not anti-business, but they are skeptical that everything that is good for corporations is also good for their employees, and for job creation itself.
Come August, Romney, with an estimated net worth as high as $250 million (he won’t reveal the exact amount), will be one of the richest people ever to be nominated for president. Given his reticence to discuss his wealth, it’s only natural to wonder how he got it, how he invests it, and if he pays all his taxes on it. ...
Ironically, it was Mitt’s father, George Romney, who released 12 years of tax returns, in November 1967, just ahead of his presidential campaign, thereby setting a precedent that nearly every presidential candidate since has either willingly or unwillingly been subject to. George, then the governor of Michigan, explained why he was releasing so many years’ worth, saying, “One year could be a fluke, perhaps done for show.”
But his son declined to release any returns through one unsuccessful race for the U.S. Senate, in 1994, one successful run for Massachusetts governor, in 2002, and an aborted bid for the Republican Party presidential nomination, in 2008. Just before the Iowa caucus last December, Mitt told MSNBC, “I don’t intend to release the tax returns. I don’t,” but finally, on January 24, 2012—after intense goading by fellow Republican candidates Newt Gingrich and Rick Perry—he released his 2010 tax return and an estimate for 2011.
These, plus the mandatory financial disclosures filed with the Office of Government Ethics and released last August, raise many questions. A full 55 pages in his 2010 return are devoted to reporting his transactions with foreign entities. “What Romney does not get,” says Jack Blum, a veteran Washington lawyer and offshore expert, “is that this stuff is weird.”
The media soon noticed Romney’s familiarity with foreign tax havens. A $3 million Swiss bank account appeared in the 2010 returns, then winked out of existence in 2011 after the trustee closed it, as if to remind us of George Romney’s warning that one or two tax returns can provide a misleading picture. Ed Kleinbard, a professor of tax law at the University of Southern California, says the Swiss account “has political but not tax-policy resonance,” since it—like many other Romney investments—constituted a bet against the U.S. dollar, an odd thing for a presidential candidate to do. The Obama campaign provided a helpful world map pointing to the tax havens Bermuda, Luxembourg, and the Cayman Islands, where Romney and his family have assets, each with the tagline “Value: not disclosed in tax returns.” ...
Mysteries also arise when one looks at Romney’s individual retirement account at Bain Capital. When Romney was there, from 1984 to 1999, taxpayers were allowed to put just $2,000 per year into an I.R.A., and $30,000 annually into a different kind of plan he may have used. Given these annual contribution ceilings, how can his I.R.A. possibly contain up to $102 million, as his financial disclosures now suggest?
The Romneys won’t say, but Mark Maremont, writing in The Wall Street Journal, uncovered a likely explanation. When Bain Capital bought companies, it would create two classes of shares, named A and L. The A shares were risky common shares, to which they would assign a very low value. The L shares were preferred shares, paying a high dividend but with the payoff frozen, and most of the value was assigned to them. Bain employees would then put the exciting A shares in their I.R.A. accounts, where they grew tax-free. With all the risk of the deal, the A shares stood to gain a lot or collapse. But if the deal succeeded, the springing value could be stunning: Bain employees saw their A shares from one particularly fruitful deal grow 583-fold, 16 times faster than the underlying stock.
It’s a reminder that Roberts and his conservative colleagues have not shied away from empowering malignant, moneyed interests who undermine our democracy. Thursday’s decision notwithstanding, this is still a court of, by and for the 1 percent.
In fact, last Monday the Supreme Court doubled down on its calamitous Citizens United decision, which unleashed a flood of anonymous, outside, 1 percent spending into our political process.
As Dahlia Lithwick wrote for Slate, rejecting Montana’s attempt to curb the corrupt influence of money in politics in American Tradition Partnership v. Bullock showed that “the court’s conservatives don’t care how much you hate Citizens United.”
It’s a shame, because we really do hate Citizens United — a lot.
Nearly 70 percent of voters think super PACs should be outlawed, and more than half “strongly” do. We can hardly believe that the billionaire brothers David and Charles Koch will spend more this year than John McCain’s entire presidential campaign raised in 2008. We can’t stand the constant flood of negative ads on every channel or the ominous anonymity of the interests behind them.
The Roberts Court sees all this and refuses to acknowledge that it “give[s] rise to corruption or the appearance of corruption.” ...
Ultimately, nothing short of a constitutional amendment can stem the flood of corporate cash and settle once and for all that corporations are not people and money is not speech. Several have already been introduced in Congress. But the big story since the devastating Citizens United ruling has been the citizens’ movement it inspired. As Texas’s legendary populist Jim Hightower has written, “Ironically, Citizens United . . . literally united America’s citizenry in broad, deep, and vehement opposition to the absurd notion that a corporation is entitled to inclusion as one of us in ‘We the People.’ ”
This devastating economic hurricane is not the natural product of market forces, as the financial elite want us to believe. Rather it's a direct hit from the ethos of plutocratic greed that now prevails among a cabal of our country's corporate and governmental decision makers. They keep putting the short-term, selfish interests of the few over the future well-being of America's many - national interest be damned.
Another recent headline offers a galling example of this shortsighted avarice in action: "China Takes Tech Tips from Silicon Valley." The story behind the headline is that Chinese officials have launched a crash program to zoom their country into the lead of the world's "knowledge economy," by surpassing our country as the entrepreneurial innovator and owner of the high-tech future. And, guess who's helping them make this Great Leap Forward over the USA? Our own venture capitalists, corporate executives, and university officials, that's who.
You might recall that only a dozen years ago, America's middle-class workers were told not to worry about the offshoring of their good-paying manufacturing jobs, because their future lay in the new knowledge-based economy. As we now see, that was a lie, for Silicon Valley itself is presently hightailing it to China.
China. Chasing quick profits for themselves, U.S. firms are transferring our technical knowledge, competitive edge, and middle class future nearly 7,000 miles away from us. Why is this crass betrayal of America's workaday families not even being talked about in this year's elections? To help raise hell, go to: www.AmericanManufacturing.org.
That is the sort of anti-democratic behavior we expect from elites who naturally want to protect their own interests. Of course, the rest of us are more concerned about the well-being of the country as a whole rather than preserving the wealth of the richest 1 percent.
For the 99 percent there are much better ways of dealing with whatever deficit problems may arise down the road. Most obviously, insofar as we need more revenue we can look to tax the sort of financial speculation through which the Wall Street gang makes its fortunes. A very small tax on trades of stocks, options, credit default swaps and other derivative instruments could raise a vast amount of money.
The Joint Tax Committee of Congress estimated that a tax of just 0.03 percent on each trade, as proposed by Senator Tom Harkin and Representative Peter DeFazio, would raise more than $350 billion over the first nine years that it is in place. This is real money. It is an order of magnitude larger than the measures that have been suggested to go after the wealthy, such as President Obama's bank tax or most versions of the Buffet Rule.
A somewhat higher rate, such as the 0.5 percent rate charged in the United Kingdom, could raise considerably more revenue. The U.K. raises the equivalent (relative to the size of its economy) of $30-$40 billion a year just by taxing stock trades. Estimates for the U.S. suggest that a broadly based tax that is scaled appropriately for the asset traded could raise more than $1.5 trillion in the United States over the course of a decade. ...
In short, taxing Wall Street speculation is a great way to raise whatever money might be needed to meet deficit targets. However, because the folks in Washington are so dependent on Wall Street money, it is more likely that they will be looking to target the benefits of people struggling to get by on their $1,100 a month Social Security checks.
As you can see from this first one to the right, the beneficiaries aren't exactly hoi polloi. Nearly half the extra income from low rates go not to the top one percent but to the top one-tenth of one percent. That is hoi oligoi in anyone's book, except for the propagandists who try to convince people there was no such thing as class war until society's whiners and lazybones launched it. The top one percent of taxpayers receives 71 percent of all capital gains, according to the Tax Policy Center. ...
As this chart shows, households with incomes between $50,000 and $75,000 who receive most of their income from their paychecks (as middle-class people generally do) paid 14.9 percent of their income in federal income and payroll taxes in 2011, according to [the Tax Policy Center]. Millionaires who received more than two-thirds of their income from capital gains and qualified dividends faced a 12.0 percent rate.
That isn't good enough for some people, like the face-palmers at the Cato Institute, who think the proper capital gains tax rate should be zero. ...
The CBPP site includes seven more charts focusing on the truth and myths of capital gains. The whole post is a nicely condensed collection whose arguments you can pull out during barbecue today when your right-wing uncle gets started jabbering about the damn socialistic scheme to alter the tax code. The way the current arrangement works, as in so much else, is socialism for the rich.
Now, the truth is even under the best of circumstances, the case for electing a businessman as president would be very weak. A country is not a company – does any company sell more than 80 percent of what it makes to its own workers, the way America does? — and competitive success in business bears no particular relationship to the principles of macroeconomic policy. So even if Romney were a true captain of industry, a latter-day Andrew Carnegie, this wouldn’t be a strong qualification.
In any case, however, Romney wasn’t that kind of businessman. He didn’t build businesses, he bought and sold them – sometimes restructuring them in ways that added jobs, often in ways that preserved profits but destroyed jobs, and fairly often in ways that extracted money for Bain but killed the business in the process.
And recently the Washington Post added a further piece of information: Bain invested in companies that specialized in helping other companies get rid of employees, either in the United States or overall, by outsourcing work to outside suppliers and offshoring work to other countries.
The Romney camp went ballistic, accusing the Post of confusing outsourcing and offshoring, but this is a pretty pathetic defense. For one thing, there weren’t any actual errors in the article. For another, it’s simply not true, as the Romney people would have you believe, that domestic outsourcing is entirely innocuous. On the contrary, it’s often a way to replace well-paid employees who receive decent health and retirement benefits with low-wage, low-benefit employees at subcontracting firms. That is, it’s still about redistribution from middle-class Americans to a small minority at the top. ...
Or put it a different way: Romney wasn’t so much a captain of industry as a captain of deindustrialization, making big profits for his firm (and himself) by helping to dismantle the implicit social contract that used to make America a middle-class society.
Many workers at the Sensata Technologies plant—along with community organizers, religious leaders and labor leaders from around the state—have began speaking out, urging the company to reconsider.
“This area is hurting already,” George Benson, president of the Freeport chapter of the NAACP, said. “The unemployment rate is already above the state average. This is just a move by some rich folks to make more money, to become richer. They are sending these experienced workers’ jobs overseas just for money. They just keep lining their pockets. This just isn’t in Freeport, this is all over. We have to stand against it. It’s a big fight. But it’s an important fight worth being in.”
The employees—who manufacture sensors that are sold to auto manufactures—were told in early 2011 that the plant would be closing in December 2012. They are currently training their Chinese replacements, who have been flown in by Bain to the Illinois plant. “This just adds insult to injury,” said Cheryl Randecker, a Sensata employee. “They’re going to be here three months and they’re not going to leave knowing everything they need to know.”
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