The 2009 changes, known within IBM as “Project Waltz,” reduced retirement benefits for about 4,500 workers, lawyers for some of the employees said in court documents setting out their claim. In 2008, the pension plan went from a surplus to a deficit as a result of stock market declines, IBM said in its court papers from the trial. ...
IBM’s pension plans had a deficit of about $10.4 billion at the end of 2011, according to data compiled by Bloomberg. The company altered the plans to make them more affordable and less volatile, it said in the U.K. trial documents. The employees argue in their court filings the pension losses were a result of investing in equities, “the risks of which IBM had knowingly and willingly embraced.” A trial on the group’s claim started today.
According to the workers’ lawsuit, Project Waltz closed to most employees the company’s defined benefit plan, which delivers set payments during retirement; changed early retirement terms; and stopped plan members benefitting from pay increases.
Will it happen again this year? We hope not, but given the drive towards "Roadmap 2015" (Roadkill 2015) we suspect it will.
We urge IBM workers to be prepared and to share job cut information with the Alliance@IBM.
Why do we asks this? Because IBM wants to keep job cuts a secret from employees, their communities, and state and federal government agencies. Those that have been following the Alliance know that IBM manipulates the WARN notification to their own benefit.
If you are terminated from your job during a resource action please send your RA pack to the Alliance at IBMunionalliance@... so we can verify and count the number of workers terminated. Names are confidential.
If you are terminated and an H-1B or L-1 visa worker remains we need to know.
If you lose your job because it is being off-shored, you are eligible for Trade Adjustment Assistance benefits at www.doleta.gov/tradeact/
The Alliance@IBM also has information on what you need to do if you lose your job: www.endicottalliance.org/news/survival.htm
Please go to our job cuts report page to report your job cut at: www.endicottalliance.org/jobcutsreports.php
The Alliance will take all this information and notify the media and government officials if a large resource action takes place. Good luck to all. The Alliance@IBM team.
The case exploded in October 2009, and within a matter of months Moffat lost his IBM job then later pleaded guilty.
Moffat, once consider a successor to then-Chairman and CEO Sam Palmisano, also had numerous connections to the Triangle. He was actively involved in IBM's PC division, which he helped sell to Lenovo in 2005. He also at one time served as an advisor to Lenovo, which operates its executive headquarters in Morrisville.
The analysis comes as supporters of the skilled-worker visa program are trying to hike the H-1B cap to 300,000. Supporters of the raised cap, though, face opposition from critics who contend that H-1B visas undermine American tech workers and shouldn't be expanded.
Based on the U.S. Citizenship and Immigration Services (USCIS) data analyzed, the major beneficiaries of the proposed increase in the cap would be pure offshore outsourcing firms. ...
Not all of the the major H-1B users are India-based.
Microsoft ranked 11th and has largely been the public face of those supporting a U.S. H-1B cap increase. IBM is also a major visa user but its numbers also include the company's India-based operation. Global firms Accenture and Deloitte use the visa for IT services operations. ...
A group of 10 bipartisan U.S. senators last month filed a bill, called the Immigration Innovation or I-Squared Act, that would hike the H-1B visa cap immediately to 115,000 and then allow it to gradually rise further to 300,000. One of the bill's sponsors, Sen. Orrin Hatch, R-Utah, said the bill addresses "the shortage of high-skilled labor we face in this country. This shortage has reached a crisis level." ...
The USCIS initial data includes some 134,000 entries. Some companies are entered multiple times because of variation in their identification due to multiple business units (IBM Corp. vs. IBM India, for example) and multiple versions of the same company name (such as Microsoft Corp. and Microsoft Corporation). ...
The large hike in H-1B visa use marks the first time that new-use approvals broke 100,000. When asked to double-check those surprising results, a USCIS spokesman said they were confident of the data. Some sources who saw the numbers speculate that the higher H-1B count numbers may be result of a shift from the L-1 visa, which are used by companies with offices in the U.S. and abroad to transfer employees. Visa rejection rates have been rising, they noted.
Selected reader comments follow:
In other words, most of these companies would not even exist if it were not for putting you and me out of work by implementing their caste systems that make it impossible for us to even get interviewed.
Anybody want to tell me how that is going to Keep America At Work?
Cognizant, Infosys, Wipro, and Tata are the H-1b standard bearers. Microsoft may abuse the visa less and pay their workers more, but they are the exception to the rule - not the rule. Nothing I have seen or read in regards to the draft legislation changes these core problems.
I have been on the phone, sending emails, and leaving messages for Senator Rubio's staff (I'm from Florida). Someone is suppose to be calling me back, and I've emailed scheduling asking for some time to explain some solutions and some perspective from someone who is a STEM professional with knowledge on the matter. What bothers me is that there are people who have been active on this issue for years and who understand the intricate details and nuances. Yet they aren't talking to us and instead lobbyists and industry groups are talking about the program through rose colored glasses.
I'm glad that Ron Hira is getting cited by your article. Was he at any of the recent hearings? Of all the people known for having worked to educate politicians on the public on the matter, who is being asked to contribute ideas to the legislation or being invited to hearings or even informal discussions?
What in the draft legislation changes anything in regards to offshoring, the outplacement of workers, or give preference to companies paying top dollar as opposed to those paying bottom of the barrel wages? Nothing that I am aware of.
Kim Berry had a great idea - the "Microsoft Minimum Wage" of $100k that adjusts for inflation. Why isn't anyone talking about that?
The fact is that their goal isn't to increase American STEM employment. Their goal is to reduce STEM wages. Either I'm wrong and they have been mislead into a horrible solution thinking it is for the better, or I'm right and our legislators are corrupt and siding with foreign companies over American STEM professionals.
I'll bet industry groups don't have to wait on hold and email junior level staffers battling acne to meet with legislators. I'll give Rubio's staff a chance before I criticize him personally but just look at the hearings and who is in the seats.
For 200 years we had traditional immigration, which meant you came here to stay. The H-1b visa program killed that, now people come here to learn your job and take your whole department back overseas, leaving you and your fellow Americans unemployed.
That's why Foreign Outsourcing companies gobble up more than 50% of the base allotment of (65000) H-1b visas. And we such complete idiots to allow this, and it is entirely under the control of a U.S. Federal Government program.
No other country on this Earth, allows a government program that so easily facilitates the removal of millions ordinary jobs from their home soil.
Why don't we just give our Senators 300 million knives so they can stab us in back and get it over with? We are so politically stupid in this country.
Don't let foreign lobbyist use their money to twist American policy to their advantage. Stop HR633. Send a hand written letter to you Representative in the House explaining that there is nothing "fair" about HR633. http://www.travel.state.gov/pdf/EmploymentDemandUsedForCutOffDates.pdf
Paul Krugman has commented on how in a globalized world many intellectual tasks are much more likely to be outsourced than those that require physical labor or, at least, physical presence.
So what do H-!B visas do? As a letter to the NY Times from Steven L. Vonderfecht argued that there is not real shortage "of scientists, engineers and mathematicians in the United States. Organizations clamoring for more H-1B visas for high-tech workers do not need more access to highly skilled workers. As Mr. Eisenbrey points out, plenty of such workers are already available. What these organizations want is ready access to these workers who will work for lower wages. ...
The precarious situation comes after a long period of change that improved life for the nation’s seniors starting with the enactment of Social Security in 1935. By the 1960s, retirees also benefitted from universal health insurance through Medicare and Medicaid, sharp increases in Social Security benefits and new protections enacted by the federal government for workers who received traditional pensions, which for decades were a standard employee benefit.
The changes rescued millions of retirees from poverty, while lifting millions of others to prosperous retirements symbolized by vacation cruises, recreational vehicles and second homes. But now problems for future retirees seem to be closing in from all sides. Half of American workers have no retirement plans through their jobs, leaving people on their own to save for old age. ...
Meanwhile, four out of five private-sector workers with retirement plans at work have only 401(k)-type defined contribution accounts, rather than traditional pensions that pay retirees a fixed benefit for life.
Liberal and conservative economists worry that the decline in retirement prospects marks a historic shift in a country that previously has fostered generations of improvement in the lives of the elderly. It is likely to have far-reaching implications, as an increasing number of retirees may be forced to double up with younger relatives or turn to social-service programs for support.
I cannot overstate the hell my wife was put through the first time. Although she remained employed, I felt that I allowed my wife to whore for a beastly pimp. Only the decency of our second process allowed me to remember the great people we have known, most now gone, from IBM.
Good luck. It does seem that you have not maintained the kind of support with your manager that might have made a difference. That is not meant as a judgement of you; it simply seems that you are well along in the process and alone. Best wishes.
I was surprised to learn that there are more state-by-state variations in labor and corporate law than I had thought.
One interesting thing in CA: "Software engineer," which is my official IBM title, is usually recognized as exempt status. But the work that I do is usually given another job title at other companies--a title that the state recognizes as non-exempt.
I am nearly certain that I'm accepting the sep. agreement without negotiating for more severance. Am waiting till the absolute, last deadline date.
And what about all the other things that IBM has done to us during those 14 years? Forget them too? IBM (and you) would love that.
Let it go? Take it? Move on? IBM will continue to screw us over if we do that.
We come from a proud culture. We don't roll over. We don't move on. We don't take it. It's the American way. It's the IBM way. We learned from the best.
Move on? Not me. Not never. You can take IBM employment away and promise of retirement benefits from me but you can never take the moral principles that I worked with when I was an IBMer away. I didn't need the BCG to guide me. I knew what was right. I have a conscience.
Would an IBM executive like to have no FHA (no retire medical benefits at all) with over 15 years of service and not be 55 years old? How would they feel being 54.99 years old with about 37 years of service (starting work out of high school at 18 years old) with no FHA when RAed?
Contrary to what you might believe I am not bitter. No fight worth fighting is ever easy: I am still just fighting the good fight. I will fight till IBM USA and other non-unionized IBM gets a union.
IBM management needs to (re)learn the meaning of the word empathy.
Then, and maybe then, IBM can become the honorable company it once was.
IBM *could* have easily terminated the old pension plan by just keeping it for all vested employees, so the new folks, who weren't really IBMers yet, would have gotten nothing. The way it was done was really unethical. But, like I said earlier, that was long ago.
The people leading the charge on this board aren't even current IBMers and the new folks do not know a different life. Don't let the old stuff keep eating you up and destroying you.
I ask them "to what?"
It starts a conversation and I tend to explain that they should be and should only be mercenaries. You are flying? Why are you not flying on corporate time during work hours? You should be in your hotel before end of day, ready for dinner and able to relax before the meeting the next day.
They make comments like there is no one else to do the work. I reply, did you make the decision to reduce your team to 4 people from 9? Or did IBM make that decision? They decided how much work was worth getting done, it isn't your job to take up the slack for those fired.
This isn't just an IBM story, every major corporation and government entity I step into is running the same way. Too few people, too many projects. When my customer doesn't have the resources to get the job done, I don't volunteer my time to do it, their leaders have made the same decisions. They like IBM will have to suffer the consequences of being understaffed.
This is the difference. When I was a loyal IBMer I did certain things, when IBM told me they didn't want loyal IBMers (by their actions) I became a mercenary and they get what they pay for. Which is much less than if I were a loyal IBMer. If they want me to bleed again for them, they must bleed for me as well.
For further verification, read the posts on Glassdoor: http://www.glassdoor.com/Reviews/IBM-Reviews-E354.htm. Or, read selected Glassdoor posts on http://www.ibmemployee.com.
And, I disagree that "it's the same everywhere else in corporate America." Although in general things are much worse now for workers than was the case in decades past, today's IBM (no relation to the company many of the older of you worked for) takes the employee-hostile environment to the extreme.
The COLA change would hurt seniors and veterans who are already living on tight budgets stretched by prescriptions, utility bills, mortgages and health care costs.
Use the calculator below to see exactly how the COLA change would impact you. Then send a message to your Senators – urge them to reject this shortsighted change and instead find responsible ways to address our nation's budget challenges. Tell them to leave your hard-earned Social Security and veterans' benefits out of any shortsighted budget deal.
Liberal and conservative economists worry that the decline in retirement prospects marks a historic shift in a country that previously has fostered generations of improvement in the lives of the elderly. It is likely to have far-reaching implications, as an increasing number of retirees may be forced to double up with younger relatives or turn to social-service programs for support.
“This is the first time that Americans are going to be relatively worse off than their parents or grandparents in old age,” said Teresa Ghilarducci, director of the Schwartz Center for Economic Policy Analysis at the New School for Social Research. ...
The precarious situation comes after a long period of change that improved life for the nation’s seniors starting with the enactment of Social Security in 1935.
By the 1960s, retirees also benefitted from universal health insurance through Medicare and Medicaid, sharp increases in Social Security benefits and new protections enacted by the federal government for workers who received traditional pensions, which for decades were a standard employee benefit. ...
The changes rescued millions of retirees from poverty, while lifting millions of others to prosperous retirements symbolized by vacation cruises, recreational vehicles and second homes. Meanwhile, four out of five private-sector workers with retirement plans at work have only 401(k)-type defined contribution accounts, rather than traditional pensions that pay retirees a fixed benefit for life. Numerous studies have found that workers with defined-contribution accounts often put aside too little money, make too many withdrawals or employ the wrong investment strategies to save enough for old age. Overall, people ages 55 to 64 have a median retirement account balance of $120,000, Boston College researchers have found, which is enough to fund an annuity paying about $575 a month, far short of what they will need. ...
The government grants at least $80 billion a year in tax breaks to encourage retirement savings in 401(k)-type accounts. But the biggest benefits go to upper-income people who can afford to put aside the most for retirement, allowing them to reap the biggest tax breaks.
Someone making $200,000 a year and contributing 15 percent of pay to a retirement account would receive about a $7,000 subsidy from the federal government in the form of a tax break, whereas workers earning $20,000 making the same 15 percent contribution would get nothing because they don’t earn enough to qualify for a deduction. Someone making $50,000 and making the 15 percent contribution would receive only about a $2,100 tax deduction.
"As much as 70 percent of your hard-earned retirement funds can be eaten up by income, estate and state taxes," says individual retirement account guru Ed Slott, author of the retirement-planning books, Fund Your Future: A Tax-Smart Savings Plan in Your 20s and 30s and The Retirement Savings Time Bomb ... and How to Defuse It.
Jason and Francine Winters traveled from Connecticut to attend "Take Your Parents To Work Day." They both described the company as extremely "forward-thinking." "You don't have to pay for any of the food and there are places where you can shut down and relax. It's very progressive," Jason Winters said. "They really support the creative process. They give you the space to have those 'aha' moments. "They know it's better to do what they can to keep their employees happy and in the building," he added. "This company knows what it's doing."
For at least the past 40 years, I’ve heard colleagues say, “We’d better get our fees and charges up now, because next year they’re really going to crack down on us.” It has never happened, yet. The problem is intensifying as outpatient “providers” have morphed from being real people into being corporations.
The Los Angeles Times reported on a case where a teacher’s group health plan was billed $87,500 by an “out of network” provider for a knee procedure that normally costs $3,000. Her health plan was willing to pay it. Outraged, the teacher ratted on the orthopedic surgicenter to California’s attorney general. After the press got involved, the charge was “reduced” to only $15,000. Not a bad pricing strategy, from the surgicenter’s point of view.
The New York Times reported an incident where a student who needed emergency gallbladder surgery ended up with a couple of “out-of-network” surgeons through no fault of his own. He was billed $60,000. His insurance company was willing to pay only $2,000. He was left to deal with the rest of the bill on his own.
There are many more examples. Privately insured patients are not the only ones affected. Governors around the country are continuing to struggle with how to pay for their Medicaid programs. In Oregon, Democratic Gov. John Kitzhaber is trying to find ways to impose a fixed budget on Oregon’s Medicaid program without adversely affecting Medicaid beneficiaries. But, he acknowledges, disciplining Medicaid alone will not do the job. He hopes his approach will be adopted by most other health insurance programs. ...
One of the central features of Obamacare is the creation of “health insurance exchanges,” or online marketplaces. But the law has recognized that many people will need help making the right choices. So it has created an army of “navigators” to help them. A recent Washington Post story points out that a huge number of such experts will be necessary (California alone plans to certify 21,000 of them). Their cost will be reflected in higher health insurance premiums and has sparked opposition from insurance brokers who view them as competition. That will be an expensive fight, without increasing the amount going to actual health care by a single dollar.
Then there is the purchase of politicians by powerful corporate interests. When the Medicare prescription drug benefit was enacted in 2003, it was prohibited from negotiating lower drug prices, even though the veterans health system and many Medicaid programs are permitted to do so. The lead congressman pushing that provision retired from Congress soon after it was passed to take a lucrative job with the pharmaceutical industry. This has become standard practice in Washington.
And don’t forget the for-profit levels of compensation paid to the executives of nonprofit hospitals.
Many doubt whether the Affordable Care Act, aka ObamaCare, can achieve any of these goals adequately. One widely held goal it clearly cannot achieve is to improve the global competitiveness of American companies by removing, from employers, the costly burden of providing health insurance for employees. What shall be argued here is that national health insurance achieves every one of these goals, but only in a form much like that outlined below, incorporating ten features.
The Affordable Care Act does require employers, beginning this year, to note on W-2’s how much both the employee and the employer contributed to health care costs. Maybe that will help diminish the ignorance regarding true health care costs. But even with greater awareness, many Americans still might not understand that the largest effect of the cost of our health care system is to reduce the amount of money they actually take home.
I have estimated that our 23-year-old employee will bear at least $1.8 million in health care costs over her lifetime. That’s assuming that such costs don’t grow by more than current government estimates, that she never has a working spouse, and that she and her dependents don’t ever contract a serious illness. ...
My new employee thinks that she is paying roughly $2,600 for health care in her first year on the job — her $500 deductible plus her $2,100 share of the company’s health insurance premiums. In fact, she’s paying more than $10,000 into the country’s health care system. As her employer, our company will pay $6,190 of her health care costs, money that might otherwise go to her in salary. (From my point of view as a chief executive of a company, health care is just a different form of compensation.) She is also paying more than $1,500 in federal and state taxes to finance Medicare and Medicaid. ...
This year, a standard deductible family policy for our company will carry premiums of roughly $23,000. How has health care gotten so expensive that even a middle-income worker faces such a burden?
Health and Human Services Secretary Kathleen Sebelius said this week no matter what governors decide, residents in every state will have a marketplace on Oct. 1, which will sell coverage to individuals and small employers. Those policies will take effect in January.
Consumers will generally see little difference in how the websites work regardless of who operates them, say experts. Unlike buying insurance online today, the marketplaces will offer standardized policies so consumers can easily compare plans, something administration officials say should lead to more competitive pricing.
The federal government did not get many takers. Some of the most closely watched states, including Florida and New Jersey, decided to leave the entire task to the federal government. All told, the federal government will run 26 of the state health exchanges. It also will partner with seven states, where state and federal officials take joint responsibility for the marketplace. Seventeen states and the District of Columbia will take on the task themselves. Here’s what that looks like in map form, via the Kaiser Family Foundation...
The goal is to let the public know about payments that might lead doctors to prescribe treatments that benefit them financially without necessarily benefiting patients.
This information will allow patients and their families to check whether their own doctors are receiving payments and to see if those financial connections affect a doctor’s recommendation for a particular treatment or device.
Companies can avoid many standards in the new law by insuring their own employees, rather than signing up with commercial insurers, because Congress did not want to disrupt self-insurance arrangements that were seen as working well for many large employers. (Editor's note: IBM self insures nearly all its medical plans.) ...
Self-insurance was already growing before Mr. Obama signed the law in 2010, making it difficult to know whether the law is responsible for any recent changes. A study by the nonpartisan Employee Benefit Research Institute found that about 59 percent of private sector workers with health coverage were in self-insured plans in 2011, up from 41 percent in 1998. ...
Insurance regulators worry that commercial insurers — and the insurance exchanges being set up in every state to offer a range of plan options to consumers — will be left with disproportionate numbers of older, sicker people who are more expensive to insure. That, in turn, could drive up premiums for uninsured people seeking coverage in the exchanges. Since the federal government will subsidize that coverage, it, too, could face higher costs, as would some employees and employers in the traditional insurance market.
It’s a specially tailored pitch intended for a unique audience, as UnitedHealth announced Wednesday a partnership with the Villages, the country’s largest retirement community, located in central Florida, to create a private Medicare plan that will exclusively serve its 93,000 residents.
Essential benefit requirements apply mainly to individual and small group plans. They also apply to plans provided to those newly eligible for Medicaid coverage.
A few provisions also affect self-insured plans and large group plans offered by employers. Limits on the maximum out-of-pocket costs a consumer would face each year, for example, would apply to all policies. That amount would be $6,250 for a single policyholder and $12,500 for a family based on this year’s rate. The 2014 number is expected to be slightly higher.
We also rank near the very bottom in preventing premature death, infant mortality, total health care coverage, number of practicing doctors, and preventing heart disease deaths.
But, here's some good news (at least for those fans of Americanized health care): our world rankings might soon improve.
Not because we're radically changing our privatized system that puts profits ahead of people's lives. But because banksters in Europe are forcing several nations that rank ahead of us to ditch their national public health care systems, and replace them with more privatized (and profitable) American-style health care systems.
And, despite what conservatives say about how the American health care system is the envy of the rest of the world, those Europeans who are watching banksters re-make their public health care systems are outraged.
On Sunday, protests swept across Spain, with thousands of doctors, nurses, and health professionals demonstrating against new conservative austerity measures that will privatize more than 40 public hospitals and care centers.
Spain, like Greece, is indebted to the very foreign banksters who crashed their economy. And rather than telling those foreign banksters to take a hike like Iceland did, Spain's austerity-happy government is paying off the banksters by taking money from working people through cutting socials services like health care.
In addition, guaranteed access to coverage for people with pre-existing conditions may very well increase average premiums as well, as people with higher health costs come into the insurance system. Hopefully this will be balanced by attracting reasonably healthy young, uninsured enrollees also, using the carrot of premium subsidies in exchanges and the stick of the individual mandate.
The ACA also redistributes the premium burden among different enrollees by eliminating premium differences for gender and limiting variation premiums due to age to a maximum of three to one. Compared with existing practice, the new rules will lower premiums for older people and many women, while raising premiums for young people (particularly young men). This has led to concerns that these young people will suffer “rate shock,” though as we discuss below, the potential for premium increases among young people is mitigated by the fact that many of them will be eligible for premium subsidies. People under age 30 also are able to enroll in a special catastrophic plan that will provide coverage roughly similar to bronze plans and with rates that may be much less affected by the age limitation.
Given that premium ‘rate-ups’ prevent accurate price transparency in health insurance, HealthPocket analyzed 10,817 health plans to determine how widespread this practice is. Nationally 80% of health plans increased premium amounts after the consumer applied. Plans on average increased the premiums for 18% of applicants. Insurer ‘rate up’ practice varied widely state by state. In some states increased premiums were experienced by none of applicants but in most states some portion of the applicants were offered increased premiums. In Pennsylvania, applicants received ‘rate-ups’ at nearly twice the national average. Nearly one in three states had applicant rate-ups above the national average.
Under her plan, employers would pay a 6 percent payroll tax for each worker while employees would pay a 3 percent share. Self-employed people and investors would pay a 9 percent tax on income and capital gains.
In exchange for those costs, all Coloradans who have lived in the state for at least one year by the beginning of 2016 would become part of a statewide health care “co-op” and would get “platinum-level” health plans, the most generous package of essential benefits under the Affordable Care Act.
Those plans would include primary and specialty care, hospitalizations, emergency visits, prescription coverage, mental health care, substance abuse treatment and some limited dental, vision and hearing benefits. In most cases, patients would not have co-payments or deductibles. ...
Nonprofit insurance companies like Kaiser Permanente and Rocky Mountain Health Plans would likely continue as service providers under the new system. For-profit insurance companies would either start managing health care networks or would no longer exist, meaning Aguilar faces a massive battle from lobbyists. Groups representing businesses in Colorado have been waiting to see Aguilar’s final bill before deciding whether to support or oppose it. ...
A new economic study from University of Massachusetts Amherst economist Gerald Friedman estimates Colorado would spend about $5 billion less on health care in 2016 than if the state proceeded with changes under the Affordable Care Act. The savings would increase over time with an estimated $10 billion in savings in 2020 and $16.8 billion in 2024. A group supporting Aguilar’s bill, the Colorado Foundation for Universal Care, commissioned Friedman’s study with support from the Caring for Colorado Foundation. ...
Friedman’s study found that health care costs have tripled in Colorado and have grown from under 10 percent of the state’s economy in 1997 to over 13 percent in 2012. The rising cost of health care has prompted more employers to drop coverage as they’ve seen premiums rise, on average by about 8 percent each year over the last decade.
"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.
Despite a growing federal deficit and the widespread economic instability that has swept the U.S since 2008, the companies in question managed to accumulate profits of $164 billion between 2008 and 2010, while receiving combined tax rebates totaling almost $11 billion. Moreover, Public Campaign reports these companies spent about $476 million during the same period to lobby the U.S. Congress, as well as another $22 million on federal campaigns, while in some instances laying off employees and increasing executive compensation.
The gap between aspiration and reality could hardly be wider. Today, the United States has less equality of opportunity than almost any other advanced industrial country. Study after study has exposed the myth that America is a land of opportunity. This is especially tragic: While Americans may differ on the desirability of equality of outcomes, there is near-universal consensus that inequality of opportunity is indefensible. The Pew Research Center has found that some 90 percent of Americans believe that the government should do everything it can to ensure equality of opportunity.
Perhaps a hundred years ago, America might have rightly claimed to have been the land of opportunity, or at least a land where there was more opportunity than elsewhere. But not for at least a quarter of a century. Horatio Alger-style rags-to-riches stories were not a deliberate hoax, but given how they’ve lulled us into a sense of complacency, they might as well have been.
That didn't get much attention.
There's a Great Robbery underway, although most of its perpetrators don't see themselves as robbers. Instead they're sustained by delusions that protect them from facing the consequences of their own actions. ...
An updated report from economist Emmanuel Saez details the loss of income suffered by 99 percent of Americans, and the parallel gains made by the wealthiest among us. Its most startling finding may be this: The top 1 percent has captured 121 percent of the increases in income since the worst of the financial crisis, while the rest of the country has continued to fall behind.
If you thought the rich recovered from the crisis just fine but everybody else got the short end of the stick, relax: You're not crazy. And since the financial crisis was caused by members of the 1 percent - not all of them, of course, just the ones we spent so much to rescue - it's understandable if the injustice still rankles you.
You rescued them. Now they're drinking your milkshake. ...
Saez: "A number of factors may help explain this increase in inequality, not only underlying technological changes but also the retreat of institutions developed during the New Deal and World War II - such as progressive tax policies, powerful unions, corporate provision of health and retirement benefits, and changing social norms regarding pay inequality."
Wealth inequity is created whenever an employer lowers his employees' wages, replaces a full-time worker with several part-timers, busts a union, cuts corners on workplace safety, or pays a lobbyist to change the rules.
It's created whenever a job is shipped overseas, and when investments are shifted from job-producing industries to the non-productive financial sector. It's created when GE outsources its manufacturing operation and gets into the banking (read, "gambling with taxpayers' money") business. Or when AIG stops insuring risk and starts betting on it.
The existence of one such secret deal, struck in July between the Federal Reserve Bank of New York and Bank of America, came to light just last week in court filings.
That the New York Fed would shower favors on a big financial institution may not surprise. It has long shielded large banks from assertive regulation and increased capital requirements.
Still, last week’s details of the undisclosed settlement between the New York Fed and Bank of America are remarkable. Not only do the filings show the New York Fed helping to thwart another institution’s fraud case against the bank, they also reveal that the New York Fed agreed to give away what may be billions of dollars in potential legal claims.
Facebook is getting the refund in large part because of a $1.03-billion tax break, according to the report released by Citizens for Tax Justice, a tax research and advocacy group. That tax break was a result of stock Facebook awarded its employees in 2012, when the company went public.
The new plan calls for a 3:1 ratio of spending cuts to tax increases, whereas previous versions called for a more balanced ratio. That means that Simpson and Bowles are calling for the majority of future deficit reduction to come from spending cuts at a time when a wide swath of economists, including a prominent conservative economist from the American Enterprise Institute, have warned against sudden austerity measures. ...
Simpson-Bowles and like-minded hawks also uphold the belief that solving the deficit is the headline economic problem of 2013. Just check out the new website Debt Deniers, funded by Fix the Debt, a Simpson-Bowles sister organization run by the same web of alarmists.
The very biggest U.S. banks -- which have grown much bigger than they were before the financial crisis -- look even bigger, almost doubling in size when you use international accounting standards instead of slacker U.S. accounting standards to measure their assets, Bloomberg estimates. By that measure, the size of the banks measures quite closely to that of the entire U.S. GDP.
The combined assets of just JPMorgan Chase, Bank of America, Citigroup and Wells Fargo would be 93 percent of U.S. gross domestic product under these tougher standards, or $14.7 trillion, according to Bloomberg's measure. (That's compared to $7.8 trillion worth of assets under U.S. accounting standards, by The Huffington Post's count). Take into account the entire U.S. banking system's assets, and suddenly that number jumps to 170 percent of GDP under international accounting standards.
What accounts for the difference between U.S. and international accounting standards? Maybe most importantly, international standards count more of a bank's derivatives contracts against them, instead of giving banks credit for derivatives contracts that cancel each other out. U.S. standards let banks ignore about $4 trillion in derivatives exposure, Bloomberg notes.
International standards also assume banks will be on the hook for many of the debts they warehouse off their balance sheets in special entities. This trims the size of bank assets by another $3 trillion or so, according to Bloomberg. The crisis revealed that there was really no hiding from these assets when times got tough. And yet banks still get to pretend they don't really exist, at least in the U.S.
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