IBM Europe Workers Strike

csimoes writes "IBM employees in Europe are on strike today. This is in response to the 10,000-13,000 job cuts that IBM is planning, most of them in Europe. Strikers will be wearing black and blue to signify their struggle. Here is their main union web site. Now I can't say I'm big union guy, but they do make some interesting points on their site. Such as: "IBM is a wealthy and successful company. Its first quarter profit for 2005 was $1.4 billion, and $9 billion for the whole of 2004. It increased the dividend to its shareholders, recently bought back $5 billion in IBM stock, and acquired 19 companies in 2004." The union also questions if other cost cutting mechanisms could achieve the same effect without cutting so may jobs."

Comments

Reduce expenses by cutting executive salaries?

[guyfromindia]

They could save a ton by doing so...

Re:Reduce expenses by cutting executive salaries?

[Anonymous Coward]

They can save even more by eliminating unnecessary jobs.

Re:Reduce expenses by cutting executive salaries?

[Dekke]

It's a sad thing these days but cutting executive salaries often hurts the company in the eyes of the economic elite. I suppose it's for two reasons:

1. Top-rank executives wouldn't want to work there because they wouldn't get treated like diamond-encrusted platinum-plated gold.
2. Investors might see it as the company dying, when worker layoffs means "streamlining" or some other mumbo-jumbo.

Even though cutting back executive salaries just a tiny bit would suddenly make up for all the workers laid off...

Re:Reduce expenses by cutting executive salaries?

[BoomerSooner]

I bet there are a couple of executives being laid off. Your opinion might change if you ever work 20 years at a company and actually become an executive.

Laying off 10~13K employee's will no doubt save a lot as well.

The employee's at my company cost roughly 1.3 times their salary. So if I have a support person that makes 36K a year they cost my company around 46K a year with benefits (we pay 100% at my company so there is no matching) and govt program matching, unemployment, workers comp, ...

Lets say these are the averages:
10K people, 30K salary, 36K salary with benefits
How much does IBM save? 360 Million a year.
That is a very low estimate not including any workspace costs, energy consumption, vacation, bonuses, ...

Start your own business then you'll see where most of your expenses are, in your employees. So make damn sure you need someone before you hire them.

Re:Reduce expenses by cutting executive salaries?

[Flounder]

And I'm sure cutting benefits, pensions, research and development, and giving everybody a 25% pay cut could have saved millions too. Just because it makes the numbers look good doesn't make it a good idea.

Re:Reduce expenses by cutting executive salaries?

[lowmagnet]

May Bob have a word?

Re:Reduce expenses by cutting executive salaries?

[BoomerSooner]

Lo'l, my bad's.

Re:Reduce expenses by cutting executive salaries?

[Muhammar]

Comparison to US is misleading.

The average salaries in Europe are lower compared to US but overall cost is higher because of HUGE hidden taxes. It works like this: A company wants to give your employee a bonus, say 1000 euro, but the company will have to pay additional 800 euro to the government also. If the real taxation was included in the paystub, the average salary taxation level would be around 60-70%.

Re:Reduce expenses by cutting executive salaries?

[Anonymous Coward]

The average salary of an IBM employee in the US is probably at least a bit higher than what he used, which is at the very lowest conceivable end of entry level pay for an engineer

Re:Reduce expenses by cutting executive salaries?

[Carewolf]

No, it is the other way. The wages are the same or higher in Europe, but there are fewer hidden taxes.

The US hides it taxes by keeping a very low income tax, but having the worlds highest corporate tax.

Re:Reduce expenses by cutting executive salaries?

[Anonymous Coward]

OK, but how much *value* is the executive having? The coder is producing code. What does the executive produce? CO2?

Re:Reduce expenses by cutting executive salaries?

[nate nice]

The executive produces a better golf handicap which in turn proves to other wealthy golfers that this company can be trusted as a partner on competitive gold tournaments between wealthy executives. Anyone can code. Not many people can keep their average under 80.

Re:Reduce expenses by cutting executive salaries?

[superpulpsicle]

Higher or lower depends on the hrs. Are you wealthier if you worked 20 more hours for extra $$$?

US corporations can push American salaried employees to infinite number of hours.

US corporations cannot do the same for European salaried employees. A European working in a US corporation, depending on the country, can be limited to x-number of hours a day with tea time in the afternoon.

Now, I am not saying Americans are automatically harder working, but you do the math. You can slave-drive 1 and not the other.

Re:Reduce expenses by cutting executive salaries?

[PenchantToLurk]

In the spirit of comparing european salaries to US, one must consider the current strength of the euro in relation to the dollar. European jobs are more advantageous to cut for an american firm simply by virtue of the exchange rate.

Re:Reduce expenses by cutting executive salaries?

[prockcore]

Your opinion might change if you ever work 20 years at a company and actually become an executive.

The percent of money the average worker makes versus an executive has drastically shrunk in the last 20 years.

In 1980, the average CEO made 42 times the average salary of the regular workers at his company. In 2000, the average CEO made 419 times the average salary.

The pay gap between executive and regular workers has drastically gotten out of hand. We're at the point where nearly 40% of an entire company's payroll is going to one person.

Re:Reduce expenses by cutting executive salaries?

[marktoml]

Yes, it basically boils down to expenses (-) and revenue (+).

If you are having troubles with the (+) side of the equation then you work on the (-) side. Of the expenses there are fixed costs and variable costs. Usually the largest *controllable* fixed cost is the cost of your staff. It is more impressive to lay off the big dogs, but more of an immediate profit to lay off a lot of little ones (and investors in public companies seem to react positively to that) as you save various and sundry tax obligations as well (varies by country).

Re:Reduce expenses by cutting executive salaries?

[Lemmy Caution]

The reasons are socio-cultural, as much as economic-rational. The executive class is pretty much the same type of people who are the economic elite. E-staff sit on the boards of other companies. They remind themselves of each other. Even fund managers are just that - fund managers who percieve themselves as largely in the same class as E- and C- level management.

In a word, it's log-rolling. It's the logical consequence of shareholder capitalism, and its leading to winner-take-all screw-the-worker approach.

Re:Reduce expenses by cutting executive salaries?

[mlyle]

I call a typical European payroll tax rate of 25% (compared to 14% in the US) a huge hidden tax.

Re:Reduce expenses by cutting executive salaries?

[Anonymous Coward]

The wages are the same or higher in Europe, but there are fewer hidden taxes.

Whaaaaaaa?

From Businessweek:

Aren't such hassles outweighed by France's relatively modest wage scales? Gaymard cites a study of major industries by accounting and consulting group KPMG that shows an average annual salary of $40,742, compared with $48,019 in the U.S. But when payroll taxes and other benefits are added in, the average cost per employee surges to $64,154 -- above the U.S. total of $63,379. As to higher-paid workers, a government study found that a company employing a $147,000-a-year worker pays $70,000 in payroll taxes, while the employee pays more than $61,000 in social security and income taxes. The combined burden is far higher than in any other European country.

Neat. $220,000 of expenses to give an employee $86,000 of purchasing power.

Re:Reduce expenses by cutting executive salaries?

[mankey wanker]

The parent makes an excellent point and should be modded up. This same point has been made ad nauseam by traditonally conservative sources like The Economist.

You have a real problem when even The Economist thinks those at the top are being too greedy - The Economist is practically the propaganda arm of capitalist elite "free trader" psychopaths.

Re:Reduce expenses by cutting executive salaries?

[NardofDoom]

So lay off 7,500 employees and three executives. With 2,500 people still getting paid, you have 2,500 people to create demand instead of three, which means an economic downturn doesn't last as long.

Economically, it makes more sense to lay off as few people as possible. However, humans rarely make logical economic decisions.

Re:Reduce expenses by cutting executive salaries?

[wft_rtfa]

In 2000, the average CEO made 419 times the average salary.

It's all because of the baseball players. The people on board of directors watch too much sports. They think the CEO is like the Micheal Jordan of the company. They just see jersies with numbers and no names on the rest of the employees.

Re:Reduce expenses by cutting executive salaries?

[Anonymous Coward]

You can't really talk about "taxes in Europe". That doesn't make sense because taxes is out of the EU's jurisdiction, and there's MASSIVE discrepancies between the countries within the EU, never mind outside it.
Having said that taxes ARE huge in France, Germany, Italy... So , yeah, okay "in Europe".
However, what you're talking about is not hidden. It's all there on your payslip - more on that later...

If you're looking for hidden taxes, look at the health system in the US. Before somebody chimes in about welfare state this, communist that, I'm not arguing here that one system is better than the other. The life expectancy is pretty much the same on either side of the Atlantic, and up north in Canada and that's that. However, in Europe, nobody needs to sue to have somebody pay their medical bill, no money is wasted on lawyers, or medical personnel making you sign a contract before treatment... or consultation! That's what I mean by hidden taxes.

Now, the real problem in "Europe" is the monstrous bureaucracy. Here in Ireland my payslip is 8 lines - I got one today. That includes pension, health care, welfare, income tax, everything. In France it would take a fucking A4. Money goes all over the place to various agencies doing god knows what. Of course this means that people have to manage that stuff: write the law, write software to help do it, type the forms, look for fraud, the list goes on. In the end that's a whole lot of money spent for absolutely *no* work being done. That's what's hidden. And that's the real brake.

If you tell somebody who wants to start a business he has to pay even 80% tax on the payroll, that's huge, but if it's just one 80%, always, one check to one agency, and you get value for money, it might hurt the free market in you and me, but that would be okay. If it's 100 laws, statutes, whatever, to digest, 10 checks to write and then you're fined because you forgot an obscure one, even if the average is 30 to 40%, people won't even try. There's an article in The Economist this week (p 30, dead tree), that says it costs $306 to setup a business in France. Not expensive, now, is it? Pocket money! The catch is it also take 8 (eight!) days! For fuck's sake, what untold amount of paperwork do you have to fill in? Who with? And trust me, it gets much worse after you start growing. Companies are actually refusing business because of the unknowns of getting bigger!

That's the real drag on this Europe you're talking about.

Re:Reduce expenses by cutting executive salaries?

[EggyToast]

While I agree that CEOs are drastically overpaid, it also doesn't help that health costs and other non-salary costs have gone up significantly in the past 2 decades, all of which will impact a worker's income negatively.

Of course, if we used a portion of our military budget to completely sponsor health care using tax dollars, all of those companies would suddenly have a lot more money... But we might as well vote against our interests.

Re:Reduce expenses by cutting executive salaries?

[Anonymous Coward]

Scratch that, it's 6 lines, including the net. I included 2 subtotals.

Re:Reduce expenses by cutting executive salaries?

[Kadin2048]

And you're still mystified as to why IBM is cutting 10,000-plus jobs in Europe, while still actively hiring in the U.S....?

I'm not. The writing's on the wall. If you have to fire one employee, given a choice of one who will only work 35 hours a week and 10 or 11 months a year and has a union that demands raises annually regardless of individual performance, versus someone who'll work 45-50+ hours a week without being asked, 50 weeks a year, and only expects a performance based bonus if anything...it's hardly even a choice. An executive wouldn't be doing due diligence to the shareholders to hang on to the former employee at the expense of the latter one.

The Europeans have priced themselves into obsolescence as workers.

Re:Reduce expenses by cutting executive salaries?

[Kadin2048]

This only makes sense if the employees that are being laid off are also potential customers of the company, or at least live in the same area and contribute somehow back into sales.

I have to imagine that part of the reasoning behind these layoffs--the strategy, as opposed to the tactics, if you will--is that IBM is anticipating that their services will be consumed more in the Asia than in Europe. So who cares whether the layoffs put Europe's economy into the toilet: the business is all heading East.

By unloading all these employees in Europe, IBM can rehire new people from within developing markets. Aside from the obvious cost advantage (they probably work for less, pay less in corporate taxes, and pay out in a currency that's advantageous with regards to the USD), they already have a cultural familiarity with the market and help IBM lose the 'alien invader' image. Plus, they get to score points with some Asian government by bringing in tech-sector jobs.

Re:Reduce expenses by cutting executive salaries?

[Kenrod]

A couple of things - you aren't talking about salary, you are talking about total compensation, which includes stock options, which were about 65% of all CEO compensation. You picked the year 2000 because that was when the stock market was at an all time high, thus CEO compensation through stock options were extraordinarily lucrative. The ratio has fallen since then.

Also, 2000 was at the end of a "boom" period, driven by tech, and companies that did well were rewarding their executives throughout the 90's for improved performance...many of those excutives did nothing to earn it, but many did.

I'm not suggesting CEO's aren't overpaid, many are and do nothing to help their companies innovate. BUT one good CEO is worth a thousand employees (who are for the most part replaceable) if that CEO can direct the company to profit instead of bankruptcy. That's a fact.

Here's a good summary of the situation (and it's a left wing source, so all you hippies can feel good clicking):

http://www.commondreams.org/headlines05/0412-10. ht m

Re:Reduce expenses by cutting executive salaries?

[NardofDoom]

Everything in the global economy is interconnected. Sure, maybe Europe may not be a great place for IBM to be doing business now, but what makes them think that Asia's development isn't connected to Europe?

Europeans buy Asian goods. Well, Europeans with jobs. That's what's fueling the industrialization of China et al. If there are 2,500 people in Europe who don't have jobs, that's 2,500 people who can't buy Asian goods, which means fewer economic activity in Asia, which means fewer orders for IBM.

If there's one thing that should be learned from H2G2, it's "never throw the letter Q into a privet bush."

Re:Reduce expenses by cutting executive salaries?

[kberg108]

Wow. You are niave.

Re:Reduce expenses by cutting executive salaries?

[drsmithy]

I bet there are a couple of executives being laid off. Your opinion might change if you ever work 20 years at a company and actually become an executive.

A person who has worked at an executive level for even a relatively short period of time can comfortably live the rest of their life without ever have to work again (or, if they can't, they don't deserve to).

The same cannot be said for the average grunt worker.

I don't mind people being paid what they're worth, per se, but there's no way any "executive" is worth a wage 100s to 1000s times that of the people who actually keep the wheels of the machine turning. The CEO remuneration orgy is no different from politicians who vote themselves pay rises every year, and should be treated as such.

I'm not a huge fan of government intervention, but the state of executive remuneration packages, coupled with treatment of the average employee has passed into "obscene" territory.

On another note...

The employee's at my company cost roughly 1.3 times their salary.

That's actually pretty damn impressive, usually the "cost" of an employee is closer to 2 or 3x their actual wage.

Re:Reduce expenses by cutting executive salaries?

[TeraCo]

The Europeans have priced themselves into obsolescence as workers.

Or maybe the American's have priced themselves into slavery as workers. 40 hours weeks, paid over time, 4 weeks leave a year, these are all things that other countries take for granted. How much leave do you get again?

Re:Reduce expenses by cutting executive salaries?

[f3773t]

Yes, but in large companies the decision makers are of course the executives ... And of course they are NOT going to cut their own salaries ... So then the other alternative is get rid of some workers ... It is unfortunately the way corporations work.

Re:Reduce expenses by cutting executive salaries?

[Anonymous Coward]

Or maybe the American's have priced themselves into slavery as workers. 40 hours weeks, paid over time, 4 weeks leave a year, these are all things that other countries take for granted. How much leave do you get again?

I'd much rather have the freedom to put in the extra hours than to be forced to limit myself to 35 hours a week. I like feeling like I'm accomplishing something meaningful with my life. And the government shouldn't be forcing me to work less hours just because it puts pressure on lazy people to carry their own weight.

Life is short and it shouldn't be wasted on holiday. It should be spent with family first and at work on something meaningful second.

Re:Reduce expenses by cutting executive salaries?

[God! Awful 2]

In 1980, the average CEO made 42 times the average salary of the regular workers at his company. In 2000, the average CEO made 419 times the average salary.

Okay, sure. But that's just the CEO. The other executives may only be making 2-3 times what a senior employee is making.

-a

Re:Reduce expenses by cutting executive salaries?

[slam smith]

Never happen, here is an article I posted on my blog about Carla Fiorina's severance package. Note in particular how HP's board has members from several public corparations. IBM isn't any different. As long as the stock price doesn't drop too much it is pretty much the ultimate game of I'll scratch your back if you scratch my back.

Re:Reduce expenses by cutting executive salaries?

[Anonymous Coward]

Lets say these are the averages:
10K people, 30K salary, 36K salary with benefits
How much does IBM save? 360 Million a year.

Thats a fatal bean counter miscomputation.
These people you lay off are not just costs, they also contribute to your revenue. They usually contribute much more to your revenue than they cost.

Laying off people is correct if you have no work to employ those people. If the people are actually doing a useful job, laying them off will frequently cost you money rather than save you money.

Thomas

Re:Reduce expenses by cutting executive salaries?

[Carewolf]

You always include payroll tax when comparing across countries. Europeans have higher salaries put has to pay a larger portion to the government and end up with less to spend for themselves.

I didn't even include all the other hidden cost for hiring in the US. When hiring anything more than a slave a company in the US needs to pay for all the basic services the US government fails to provide, such as health care, pentions and various insurances.

Re:Reduce expenses by cutting executive salaries?

[Anonymous Coward]

Maybe the capitalist elite free trader psychopaths realize that it's stupid for executives to stifle the ability for company expansion by taking such rediculous high pay? Can't have a capitalist elite if the fake money market goes under... only the smart ones that put some cash in the matress will be afloat.

Re:Reduce expenses by cutting executive salaries?

[Emperor Cezar]

capitalist elite "free trader" psychopaths
Fuck you.
Yes, because I'm a "free trade" person means I must be rich and elite. Tell me that when I make my $650 rent payment you pretensious snob.

Re:Reduce expenses by cutting executive salaries?

[geminidomino]

4 weeks, here... The insurance sucks, but the tuition assistance is nice (75%).

Re:Reduce expenses by cutting executive salaries?

[Anonymous Coward]

One name will show where you are falling down:

Darl Mc Bride.

Re:Reduce expenses by cutting executive salaries?

[Anonymous Coward]

At least we're not as whipped as the americans. You make american workers sound like perfect little consumers. Work, work, work. And when you're not working, you're buying something i guess.

They have raised you well as a corporate slave. Even got you defending them. Probably in your spare time too! :)

Re:Reduce expenses by cutting executive salaries?

[Hast]

First off, Europe is not one country with identical rules. I live and work in Sweden and we have 40 hour weeks. There are weeks when I work more than that, and not many that I work less. OTOH I get paid for the overtime I put in. That seems somewhat optional in the US (re articles about working at EA studios).

In addition to my long vacation each year, when I get childen I have the opportunity to take time off work to spend time with them during their first years.

Besides it would be interesting to see some research regarding if more than 40 hours work week 50 weeks a year actually produces more in the long run. I do kind of doubt it.

Life is short and it shouldn't be wasted on holiday. It should be spent with family first and at work on something meaningful second.
God forbid that you should spend you holiday or extra time off with your family.

Currently economics is limited since it only place value on the bottom line. There is no concept of getting more work out of your employees since they are not over-worked and content with their life. I'm sure the rest of the world will catch up to European life-standards sooner or later.

Re:Reduce expenses by cutting executive salaries?

[deaddrunk]

These people are not just sitting around doing nothing while you pay them. Employees make you a lot more money than they cost you, because they do the work that brings in the money and keeps the business running.

Re:Reduce expenses by cutting executive salaries?

[Mindjiver]

How the hell did this get moderated as insightful with this crap at the bottom?

"The Economist is practically the propaganda arm of capitalist elite "free trader" psychopaths."

Calling the economist conservative is absurd. For example in the feb 26th - march 4th 2005 edition there are TWO articles about gays in the military both positive. That can hardly be described as "conservative" stance on that issue. I could go on and on but I will not waste my time on leftwingers like you.

Re:Reduce expenses by cutting executive salaries?

[Anonymous Coward]

You are confusing social conservativism and fiscal conservatism. The Economist (which I take) is fiscally conservative and socially liberal.

Re:Reduce expenses by cutting executive salaries?

[TeraCo]

Hey, I work a 45 hour week some times, because it saves me stress further down the line.

However, if the boss asks me to come in at 2am to do something, I'm going to want money for it.

Re:Reduce expenses by cutting executive salaries?

[kraut]

Which is the only sensible political standpoint.

Don't fuck with my money, and don't fuck with my life.

Re:Reduce expenses by cutting executive salaries?

[Anonymous Coward]

The parent did not use the word "Conservative". The reference cited referred only to "capitalist elite free trader psychopaths".

It would seem that you yourself consider these two to mean the same thing...

Re:Reduce expenses by cutting executive salaries?

[Anonymous Coward]

Out of curiosity, if you're living paycheck to paycheck, how do you see YOUR interests being served by free trade?

Re:Reduce expenses by cutting executive salaries?

[geminidomino]

Modded down? I guess someone's jealous. ;)

Re:Reduce expenses by cutting executive salaries?

[Aceticon]

I work as a freelancer in Holland and, due to how the dutch tax authorities have set things up, out of my rate i have to pay both the costs of the employer and of the employee (except for things such as workspace and office supplies).

You example is WAY off.

Roughly about 10-15% of my rate is taken away by the employer side costs (such as tax and mandatory sick leave insurance) while about 30-35% go away as employee side costs (mostly taxes)

Putting things another way, in Holland for every 10 EUR an employers pays in salary he will have to pay another 1 EUR (excluding office space rentals, office supplies, software licenses and such)

Re:Reduce expenses by cutting executive salaries?

[Anonymous Coward]

No, but by responding in that way you have proven you're a moron.

Re:Reduce expenses by cutting executive salaries?

[Anonymous Coward]

Median salarys in the US are lower than median in Europe.

The US average is dragged up by a few very highly paid individuals. Most people in the US are actually paid less than most people in EU.

Re:Reduce expenses by cutting executive salaries?

[Rich0]

Sure, then we'd be able to increase salaries by a few tens of percent (maybe), and then CEOs would only be paid 300x as much as a bottom-rung worker, instead of the much loftier 400x...

Re:Reduce expenses by cutting executive salaries?

[Anonymous Coward]

Uh, you might want to back that up with references.

For example, at MRK the head of R&D makes well over $1 million per year (just read the SEC docs yourself). I guess it depends on your definition of "senior employee". The parent post referred to "regular workers" and they certainly don't make $300-500k.

The fact is that the salary ladder goes up rather exponentially in the last 2-3 levels of management. It goes up hardly at all before that level...

Re:Reduce expenses by cutting executive salaries?

[Anonymous Coward]

Perhaps he wants to maximize the amount of goods and services he can buy with his small paycheck by leveraging the efficiency of the wordwide market. Just a guess.

Re:Reduce expenses by cutting executive salaries?

[fbjon]

Exacly. The options are two: either burn out slowly (or quickly) or work sensible hours. I don't think it makes sense to allow any employer to slave-drive their employees, since they evidently, if allowed, will do so.

Re:Reduce expenses by cutting executive salaries?

[Anonymous Coward]

At my old job at a magazine company, I remember two people would be laid off from our production department and about a week later hired some useless executive along the lines of VP of Paper Supplies. This happened for about a year or so where the production staff dwindled from thirty to about 10 while also consolidated other magazines that they acquired into that dept. One day the CEO came in and gave the department head a tongue lashing for always missing deadlines.

The CEO seemed not to understand that by halving the workforce and tripling their workload, that their product isn't going to be on time. Adding insult to injury, they gave themselve raises and hired friends and family as executive deadweight causing even the good workers to hand in their resignation.

Everyone hated working there, but it was a job. They did everything pretty much half-assed since the higher ups really didn't seem to give a damn. The company went from being the best of their niche to producing crap. They ended up relocating their main office and was eventually bought out.

Re:Reduce expenses by cutting executive salaries?

[mankey wanker]

Uh...yeah...

Listen, I only have time to make this simple statement to you: "free trade" is a myth. Please show me one place on earth engaged in 100% unencumbered free trade. The answer is you can't. What that means is your economic ideal doesn't exist and never did.

Welcome to Reality 101.

Re:Reduce expenses by cutting executive salaries?

[mutterc]

A former manager of mine blames the epidemic of short-term "looting" planning amongst executives to this.

Executives are (pretty much) disposable employees just like us, these days. Back when people could work for one company for 20-30 years, reture and draw a pension, executives wanted / needed their companies to be successful in the long term. (Their future salaries and pensions depended on it!)

Nowadays, executives know they've got a few years at best at that company, and pensions are a thing of the past, so why not plunder all you can in the next year or two, even if it kills the company in the long term? It's no skin off their nose.

Re:Reduce expenses by cutting executive salaries?

[TeraCo]

Life is short and it shouldn't be wasted on holiday. It should be spent with family first and at work on something meaningful second.

I don't know how it is over there, but here, you traditionally holiday with your family.

Re:Reduce expenses by cutting executive salaries?

[Anonymous Coward]

Europe is not a single country.

Job cuts will happen in France and similar oversocialized countries.

On the other hand in "the New Europe" like Poland, Czech Republic or Hungary is likely to see hires.

If you look for data the average number of working hours per year in those countries is on average on the same level as in the US and something 30% higher than in France.

Also people there make 1/4th of French/US salary
and are well educated (Warsaw University team regularly
gets top spots in programming contests).

Also coporate taxes in those countries are half of those
in France/Germany.

Taking into account geographic proximity
it is a no-brainer to move those jobs to the "New Europe".

Re:Reduce expenses by cutting executive salaries?

[cicho]

"Laying off 10~13K employee's will no doubt save a lot as well."

IBM saves, everybody else loses. And I mean everybody, not just those laid off.

"Lets say these are the averages:
10K people, 30K salary, 36K salary with benefits
How much does IBM save? 360 Million a year."

Right. And now taxpayers lose because the government has to pay 10K people unemployment benefits. Businesses lose, because 10K people now have little to no purchasing power. Communities lose because where there is a large number of unemployed people, there is more crime, people get mugged, raped and killed more, and property value goes way down. If the governmment in question provides any universal healthcare, like some civilized countries do, costs of healthcare go way up and quality and availability services diminish.

But IBM has saved 360 million, which is what, probably less than three year's pay for the CEO?

Re:Reduce expenses by cutting executive salaries?

[rsynnott]

That's a generalisation. Here in Ireland, unless you've got a low income they will charge you about 30euro admission. Hidden taxes ;)

Re:Reduce expenses by cutting executive salaries?

[rsynnott]

This is a case of confusion between the economic and social right wing. You can give people equal rights and starve them to dead, or have a welfare state and set fire to minorities. The two forms of right-wing-ness don't necessarily go together, they just often do.

So now a major US export is Job Losses.

[BrentRJones]

Can this rescue our economy?

Perhaps if it reaches India and China.

---We don't need no stinking unions.---

Plcs

[Scruffeh]

That's the problem with plcs though, they always seem to need to make more and more profit. Especially in the computer industry share prices can drop so quickly with a few bad moves from the company. It's sad that people's livelihoods have to be jepordised just to constantly applease shareholders...

Re:Plcs

[uf22]

YES. I've been saying this forever. A public company can't be content with constistently doing a great job and providing a good service. They have to always be growing, growing, growing. That's why we end up with all these mega-mergers. The system is the problem if you ask me. Google will clearly be the next major victim of this vicious cycle.

Re:Plcs

[Scruffeh]

Yep, as soon as Google runs out of innovative ideas then I'm sure it will run into trouble. It happens all the time, AOL and TimeWarner have just shown what happens when you stop doing as well as you were. Another example is Manchester Utd Football Club, they made large profits for years, even this year. However, this year they made a few million less profit and got bought out by Malcolm Glazer. Being a plc basically means your company is constantly up for sale + in danger of being taken over...

Re:Plcs

[Anonymous Coward]

Being a plc basically means your company is constantly up for sale + in danger of being taken over...

And being private basically means your company is constantly short of financial capital, not subject to the same transparent accounting rules as public companies and provides less opportunity for advancement (after all, if management owns the company, it's a little tough to break into management).

See? There are bad things to be said for private companies, too. I guess that means that one size doesn't fit all.

Incidentally, private companies get sold all the time.

Re:Plcs

[Kadin2048]

It should be noted that at the moment anyway, Google is privately held. The IPO isn't until mid-August.

Re:Plcs

[virtig01]

Google hasn't had an IPO yet? Are you sure?

Re:Plcs

[Destoo]

At least use the right link.

Leveno?

[Anonymous Coward]

Wonder if the cuts have anything to do with lost revenues after the sale of their PC sector to Leveno? Or were they not making much profit on PC sales anyway?

Re:Leveno?

[Bellyflop]

Their PC business wasn't a big money maker for IBM. IIRC, they lost money in the hardware business except for laptop sales. So it wasn't such a bad thing to unload that division.

Re:Europeans go on strike

[IdleTime]

Corporations don't give you vacation days in Europe, governments do. It's regulated by law. I know the word "law" is a difficult one for Americans to grasp. :-)

Who cares what IBM's profit margin is?

[BoomerSooner]

Isn't their job to be certain they can provide profit in the future for their shareholders (the owners of the company). Why would a company want to keep 10~13K employees that are obviously not necessary in the daily business? Simply because they are making a profit?

I'm not a fan of layoffs either but a company is there to make money, nothing else. If these 10~13K people banded together and started a competing company maybe they could make IBM pay in that direction. In the end employment is voluntary. I don't hear people screaming about someone quitting IBM when they take their experiences there and help another company use that knowledge. What about all the training and investment IBM made in those people, do they think it was free?

Seems like every time I'm in Europe there is a major strike happening.

Re:Who cares what IBM's profit margin is?

[pthor1231]

I don't hear people screaming about someone quitting IBM when they take their experiences there and help another company use that knowledge.

You gotta be careful with how much you take from one company to the other though. You can wind up in some sticky situations.

Re:Who cares what IBM's profit margin is?

[spiffy_dude]

I think this is a funny point of view considering how many Slashdotters have complained about offshoring. This is almost the same situation as a company deciding they would be better off moving their jobs to India. When they offshore YOUR job they're simply being "certain they can provide profit in the future for their shareholders". I think some sympathy is in order for these folks.

Re:Who cares what IBM's profit margin is?

[ElMiguel]

I'm not a fan of layoffs either but a company is there to make money, nothing else.

You might be surprised but many people believe that ethical behaviour should also be a priority for a company. Perhaps this opinion is more common in Europe.

Re:Who cares what IBM's profit margin is?

[kindbud]

Why would a company want to keep 10~13K employees that are obviously not necessary in the daily business? Simply because they are making a profit?

Because their corporate charter is a social contract, issued in the expectation of receiving some societal benefit, like employment for citizens.

I'm not a fan of layoffs either but a company is there to make money, nothing else.

Not in Europe. They actually retained some ideals from the Enlightenment, beyond their immediate usefulness in fomenting rebellion. You know, things like human rights come before other considerations, like profits.

Seems like every time I'm in Europe there is a major strike happening.

Their workers are not as cowed as ours.

Re:Who cares what IBM's profit margin is?

[Anonymous Coward]

Speaking as a European who owns a business, exactly what compels me to employ people I have no use for, and why have I not heard about it until now?

Re:Who cares what IBM's profit margin is?

[Anonymous Coward]

Because their corporate charter is a social contract

Idiot. Chase the company out of your country with that Marxian "social contract," and see what happens to those jobs.

All of those jobs, not just some of them.

Re:Who cares what IBM's profit margin is?

[Medgur]

Employment is NOT voluntary.

Feel free to try and attempt to choose unemployment, or to become unemployed when feeding a family and paying off a mortgage, I'm sure it'll work out well for you.

In a market where jobs are a commodity and prospective employees must compete for positions the notion of voluntary employment or unemployment is pathetically out of touch with the harsh realities of being middle or low class.

Re:Who cares what IBM's profit margin is?

[Anonymous Coward]

There's nothing unethical about laying off employees. Some high level executives should go with them too. If 13000 employees are unneeded then some high level mangagers screwed up long ago.

Re:Who cares what IBM's profit margin is?

[EnronHaliburton2004]

I don't hear people screaming about someone quitting IBM when they take their experiences there and help another company use that knowledge.

Oh bullshit. I hear plenty of people screaming and complaining. That's why many companies require you to sign a non-competition clause before you take many jobs involving the companys intellectual property.

Re:Who cares what IBM's profit margin is?

[Bamafan77]

Isn't their job to be certain they can provide profit in the future for their shareholders (the owners of the company). Why would a company want to keep 10~13K employees that are obviously not necessary in the daily business? Simply because they are making a profit?

I'm not a fan of layoffs either but a company is there to make money, nothing else

The problem is that we still have a nostalgic view of employer loyalty to its employees. The way it's supposed to work is that you "do your time" and in X amount of years, you retire with a golden watch and pension.

Of course, in the 21st century, this is a myth. That's why I'm a proponent of Stephen Pollan's methodology in Die Broke -- be ruthless and mercenary about your approach to employment. He calls this the "Mercantile Ethic". Always be looking for your next job, and always take the job that's in your best financial interests, not because it's a better fit for your interests. While you should work hard, you shouldn't buy into the "holistic" view of work. Your work is not your life, no matter how much you love it or how many hours you put in. Work is work. It's an income generating stream, period. Don't get caught up in company politics because in the end, you'll be standing in the unemployment line right alongside the kissup and the quiet hardworker. You're a bean. He uses professional athletes as examples we should follow when pursuing jobs in this new reality.

Lots of other good advice there too, much of it traditional (e.g. live beneath your means, kill your consumer credit, etc) and some definitely non traditional (e.g. lease your car rather than buy and never retire).

Re:Who cares what IBM's profit margin is?

[BoomerSooner]

I was laid off last year. After working for several companies I came to the conclusion that I'm better off failing by myself than working for companies that could give a shit about their clients or employees. I'm liberal on social issues and conservative on fiscal policy & economic matters (so I really hate this POS fucking administration we have now because they are shitty on both fronts). As such, before my company hires a new employee we make certain that 1) the job cannot be integrated into someone elses position, 2) that the person philisophically (sp?) matches our beliefs and 3) that no matter what the financial situation of the company that person will not need to be laid off. My companies profit sharing works different than most, since I own the company outright I don't distribute shares. We take a percentage of our semi-annual profit and distribute it according to a formula to our employees based on length of service, job position and overall attitude/work relationships. The pool for all the employees doesn't change if we hire someone new. So if the employees say they need someone to assist in a specific position they know it will cost them money (bonuses) if they don't make up the slack as a group and get more customers that generate profit to allow a larger bonus pool of cash. It is great incentive and people are rewarded based on the company's profit and their contributions.

Sometimes getting laid off is the best thing that can happen to a person so sympathy isn't necessary.

Re:Who cares what IBM's profit margin is?

[Anonymous Coward]

I'm not a fan of layoffs either but a company is there to make money, nothing else.

Wow, and usually when Microsoft use that argument, the entirety of /. jump on them like a ton of flying bricks...

Funny since how it's not Microsoft people seem to be on their side.

Oh yes, IBM are pretty much good guys nowadays aren't they...

Re:Who cares what IBM's profit margin is?

[Ralph Yarro]

I think this is a funny point of view considering how many Slashdotters have complained about offshoring.

Not that funny; there are plenty of us who don't whine about offshoring. Certainly beats protectionism.

Re:Who cares what IBM's profit margin is?

[ribblem]

Think about it this way. Companies used to dump their waste into the nearest river because it was cheaper than properly disposing of the waste. Then society figured out that while this is cheaper for the company it costs society as a whole a lot more. I'm not saying that cutting a bunch of jobs is as bad as dumping waste into a river. I'm just saying I do think there are similarities as far as costs to society.

Re:Who cares what IBM's profit margin is?

[Byrneseyeview]

Well... if the company exists entirely and exclusively to make a profit -- as American corporations do -- anything else would breach that contract. And breaching a contract would be an ethical lapse. So, in a sense, it's just as much a priority in America; we just have a different vision of what ethical behavior for a corporation means.

Re:Who cares what IBM's profit margin is?

[wheelbarrow]

ElMiguel, your sentiment is good hearted but naive. IBM, in this context, has several competing ethical interests. For one, IBM has an ethical obligation to the employees that survived the layoff to maintain a viable business. Perhaps if those 10,000 are not laid off, IBM will not have enough reserve cash to fight a brutal price war with their competitors. When that price war is lost then all IBM employees will lose their jobs. It's simple, lay off 10,000 to protect the remaining 100,000.

Re:Who cares what IBM's profit margin is?

[Anonymous Coward]

...their corporate charter is a social contract, issued in the expectation of receiving some societal benefit, like employment for citizens.

...human rights come before other considerations, like profits.

*shudder*

Of course human rights come before profits, but once you start elevating employment to the status of an innate right, you're a hop and a skip away from killing off the motivation to excel in the marketplace.

Quoth http://www.conference-board.org/utilities/pressDet ail.cfm?press_ID=2560:

"While the productivity gap between the EU-15 and the U.S. is 8 percentage points in 2004, the per capita income gap is 28 percentage points. With the exception of Luxembourg, no European country has turned this relatively high productivity into a per capita income higher than the U.S. This is because EU countries have a smaller fraction of the population employed than the U.S., and those that are employed generally work fewer hours."

Who is John Galt?

Re:Who cares what IBM's profit margin is?

[Hoi Polloi]

"What about all the training and investment IBM made in those people, do they think it was free?"

Good point, IBM is doing a disservice to their shareholders by letting go so many valuable employees.

Re:Who cares what IBM's profit margin is?

[Bellyflop]

That really works well when you can evaluate how much a particular division generates in hard numbers. It works great in consulting firms since revenue is tied directly to hours billed. However, in a lot of large firms, entire divisions of people are support people who are not in a position to generate revenue for the company. They may be there to book the revenue or to prevent losses from legal issues or theft, etc.. The value that they add isn't so easy to measure. Now, you could argue that each division could hire their own set of such people, but many companies find that they get an economy of scale from having them all in one divison.

That being said, not every layoff is a terrible thing. I have some friends who were dying to get laid off from Deutsche Bank because of the generous termination packages and the abundance of positions elsewhere.

Re:Who cares what IBM's profit margin is?

[Jeff DeMaagd]

So you don't think it is possible for a company to need an employee, and then some time later, not need that employee any longer? Employment shouldn't be considered a lifetime entitlement.

Re:Who cares what IBM's profit margin is?

[rewt66]

I see your point. Well, not really a point... maybe a half a point... well, there's at least a tenth of a point in there.

Yes, when the citizens create the rules that allow for corporations to exist, they do so in the expectation that they will get a better society to live in. And the point is that if the existence of corporations is no longer a net good for the citizens, the citizens have the right and the power (and maybe even the responsibility) to eliminate corporations.

But saying that the corporations must increase the net welfare of society is not the same as saying that the corporations have to continue to employ deadwood. In fact, the overall welfare of society is increased by no longer wasting those individuals where they currently are, but rather making them find jobs where they can do some work that is genuinely useful.

Re:Who cares what IBM's profit margin is?

[spike hay]

Because their corporate charter is a social contract, issued in the expectation of receiving some societal benefit, like employment for citizens.

No, it isn't. In the US, a publically traded corporation exists solely to produce the most profits possible for its shareholders within the law. Crown corporations 200 years ago may have existed to fulfill some national need. But corporate charters today are granted just to enhance economic growth.

Re:Who cares what IBM's profit margin is?

[smallpaul]

Because their corporate charter is a social contract, issued in the expectation of receiving some societal benefit, like employment for citizens.

Is IBM laying off everybody in Europe?

Not in Europe. They actually retained some ideals from the Enlightenment, beyond their immediate usefulness in fomenting rebellion. You know, things like human rights come before other considerations, like profits.

If a lifelong job with IBM is now a human right then where do I sign up? I'm not much for big companies but you can't beat the job security of an ethically mandated JOB FOR LIFE.

Re:Who cares what IBM's profit margin is?

[Iloinen Lohikrme]

Needs change when times go by. A worker needed today, can be worker unwanted tommorrow. If you say that a company must know will they need a certain person forever to hire him/her then you are asking for impossible. In my opinion European laws that regulate and in many times don't permit firing workers, hurt more employees. If you can't fire a worker easily, why take a risk on hiring one? That works againt firms and workers.

And I really can't understand why companies should have more responsibilities than laws dictate? If law permits you to fire your workers, what is there to complain? You can always vote in next election the guy who wants to bring the good old days of protectionism and state run mixed socialism-marketeconomy back. You just have to look to France and Germany to understand why that just doesn't work.

Re:Who cares what IBM's profit margin is?

[smallpaul]

Employment is NOT voluntary.

Employment at IBM is voluntary. The workers can quit the relationship whenever they want. Why shouldn't the employer be able to do the same? Sometimes very valuable employees take their ideas to other companies and compete directly with their old companies. That's hard-nosed business: more power to them. Why can't the company be hard-nosed too?

Re:Who cares what IBM's profit margin is?

[mpcooke3]

I'm one of those torn citizens of the UK wedged between crazy euro farm subsidies and the US capitalist pigs ;) I like to think a balanced a approach is possible.

I don't think it is a good idea to subsidise a loss making aspect of a country or a company indefinately but obviously the pros and cons should be weighed up and people should be offered alternative roles and retrained where at all feasible.

If for economic reasons IBM is outsourcing jobs to india they should look at what the european work force can offer that india cannot and consider retraining where possible as this will be cheaper than re-recruiting over the next few years. Also in some european countries legal action could be taken if IBM finds themselves trying re-recruit for the same jobs at lower salary levels.

Ultimately if these people don't have suitable skills for the region in which they work then they should retrain. If they stay at IBM and IBM doesn't offer retraining then they get fired in 5 years time they will be in an even worse situation as IBM will have sheltered them from the realities of the job market.

Although it seems incredibly harsh there may be some morale arguments in favour of a large cut if they fear the alternative is gradual cuts over several years. No one works well when they think their job is on the line every month.

I often wonder in these massive union/company disputes - does the company ever approach the unions *first* to discuss these kind of issues?

Re:Who cares what IBM's profit margin is?

[kindbud]

The article is about IBM Europe.

Europe is not part of the US.

Do you want fries with that?

Re:Who cares what IBM's profit margin is?

[Anonymous Coward]

All of those jobs, not just some of them.

Yeah, I'm sure that IBM is going to love the idea of completely leaving the biggest trade zone in the world.

Re:Who cares what IBM's profit margin is?

[gregorlowski]

So you say that the workers' jobs are to provide profits for the owners of the company. Why do you think the "profits" of the company's shareholders are more important than the livelihoods of 13,000 people who work at the company?

If you trace your argument to its roots, it boils down to the idea that people in society should work for the profits of the small percentage of people who "own" companies. I agree with you that companies in our society exist to make money and nothing else, but maybe people who have worked hard to make the company run feel some sort of entitlement afterward and think that their needs are more important than the future profitability of the company.

Maybe you're among the group of owners. But if you're not, then your point of view to me seems pathological. I think anyone who works at a company and then just passively accepts that they can be discarded inconsequentially is crazy. And it strikes me that our society seems pretty screwed up when programmers posting on /. espouse the view that there is something WRONG with their fellow programmers organizing to protect their own interests.

If I were in Europe now, I'd go to the picket line and show my support.

Re:Who cares what IBM's profit margin is?

[Anonymous Coward]

No, but I just resigned from a nicely paying job for the unethical behavior of management (such as stealing GPL code and not publishing the cutsom patches to their clients, especially when they relabeled other people's code as their own proprietary project.

I'm taking a pay cut leaving and going to another job, but I expect the company to fold within six months and avoiding liability for their misuses.

Re:Who cares what IBM's profit margin is?

[hng_rval]

The idea that the only stakeholders in a company are the shareholders is a common slashdot myth.

Actually, a company has many stakeholders, including customers, suppliers, employees, the environment, the government, and shareholders.

While shareholders do own the company, not all decisions are made in the best interests of the shareholders. There are plenty of companies that will install more expensive, but more environmentally friendly devices, because the employees at that company care. And it's not just about marketing or building a brand - sometimes people just care.

In the end, a company is comprised of people - people who make decisions. Sometimes those decisions are at the expense of the shareholders and in favor of other stakeholders. That being said, I'm not advocating keeping employees whose jobs are no longer necessary, and I don't know the situation at IBM well enough to comment on whether or not this is the case.

Re:Who cares what IBM's profit margin is?

[kindbud]

Europe's workers, with their 35 hour work week, are also veiwed as extremely lazy.

View that way by Americans. Europeans think we're work-a-holics.

How likely do you think it will be that when these abused immigrants hold a majority that they will vote to continue transferring their wealth to a bunch of infidels?

Very likely. Look at the last national election in the US. If they can sell that, they can sell anything. All they have to do is find a scapegoat, and they will be able to rally the population to any cause. So the Anti-Infidel Party will come to power mouthing platitudes about sticking it to the infidel elite, all the while looting the gullible population and continuing the wealth transfer to the same corporate oligarchy that funds their political campaigns. It's worked in the US, don't see why it wouldn't work in Europe.

Re:Who cares what IBM's profit margin is?

[LordNimon]

IBM will not have enough reserve cash to fight a brutal price war with their competitors

What brutal price war? IBM has billions of dollars in profit! If they were losing money, I would understand the need for layoffs, but that's not the case here at all.

Re:Who cares what IBM's profit margin is?

[Luthair]

You've been watching too much Fox News

Re:Who cares what IBM's profit margin is?

[kindbud]

I'm not much for big companies but you can't beat the job security of an ethically mandated JOB FOR LIFE.

Correct. It can't be beat.

Re:Who cares what IBM's profit margin is?

[Anonymous Coward]

2) that the person philisophically (sp?) matches our beliefs

So, only people with certain beliefs get hired? Sounds interesting. I think I'll only hire people who believe in white supremacy. Defacto, legal racism.

Re:Who cares what IBM's profit margin is?

[wheelbarrow]

Have you ever heard of the parable of The Ant and The Grasshopper?

Only the paranoid businesses survive.

Re:Who cares what IBM's profit margin is?

[mcg1969]

Speaking as a citizen who votes and pays taxes, exactly what compels me to permit my government to grant you a corporate charter or a business license?

There is a balance of interests here, of course.

Sure, you can prevent IBM from laying people off if you choose. But they will also be less likely to hire in the future, or will hire less than their balance sheet might initially suggest, because the company knows it will have to retain those employees well past their usefulness, thereby increasing their expected cost to the company.

Re:Who cares what IBM's profit margin is?

[jhoger]

You are so bold as to use a professional athlete in your example... are you saying that a professional athlete does not take a "holistic" view of work, that they are not doing what they love?

Hey, you've got a finite number of hours on this planet. To get by, you sell x number of hours of your time in the marketplace per day, and you get 24-x to spend on leisure time, a normal good.

If you had your druthers you would spend all of your time on leisure time, period.

Is it such a bad idea to try to find work where you are doing what you would be doing in part of your leisure time at work?

Listen, I did the whole "work is just work" thing. You will burn out with that kind of attitude. You have to like it to some degree.

The mercenary attitude, being ready to move on and sell your time to the highest bidder is absolutely right though. None of these companies owe you anything, and you don't owe them anything except for the brief period of time every week where they have accrued a Wages Payable liability to you, or they have accrued a Vacation Wages payable to you. That's pretty much it.

The only real exception to that is DO NOT ditch a customer or employer in mid-stream, i.e. in the middle of a contract or project. Otherwise, your reputation will take a real hit and you're going to have trouble finding future work.

Re:Who cares what IBM's profit margin is?

[Anonymous Coward]

The market goes both ways. 8 years ago someone with minimal programming skills could demand a huge salary and lots of office perks, because there was a huge demand for programmers. I'm sure nobody around here feels sorry for the companies who had to pay $80k for a dropout who knew ASP.

Employment in general may not be voluntary (for very long, anyway), but in specifics it is. You can choose where to work, as long as they will have you. I can quit my job tomorrow. It would hurt the company, and cost them a lot of money, but it is well within my rights. They can also lay me off tomorrow, which will put me out on a limb, but is well within their rights.

Re:Who cares what IBM's profit margin is?

[fupeg]

Ethical behavior? Are you kidding me? First off, WHOSE ethics? That's an entirely subjective matter. More importantly, we're talking about a company here. If they don't do what is best for them, from a purely monetary standpoint, then very bad things will happen. There's this thing called compettition. We all enjoy its benefits (better, cheaper things) but it's flipside is that if you can't do what's best for your bottom line, then you will be put out of business by somebody who is. So if you are IBM, you can keep those unneeded 13K employees around today, but them and the rest of your hundreds of thousands of other employees will all be out of business tomorrow. Similarly, if my employer can get the same things done by terminating me or by replacing me with somebody in India or China, or by replacing me with a machine, the my employer should do this. It may suck for me, but so what? I have no "right" to employment. I didn't get into this business looking for a handout.

Re:Who cares what IBM's profit margin is?

[PaulDineen]

It's not necessarily true that laying off 10-13K employees means that some executive screwed-up years ago. It could be that conditions have changed since then, such as being better able to automate more jobs. My job is to create software that automates some of the tasks that our support people have been doing by hand. For now, it's more the slow, tedious work that's being automated. But, over time, the software will move up the food chain, thereby doing more to reduce the need for support people.

Re:Who cares what IBM's profit margin is?

[Anonymous Coward]

Isn't their job to be certain they can provide profit in the future for their shareholders (the owners of the company). Why would a company want to keep 10~13K employees that are obviously not necessary in the daily business? Simply because they are making a profit?

Well, yes, sort of. Actually, this is part of what unions are around to point out. IBM has to have employees in order to turn a profit for their shareholders. They would rather have good employees than bad employees. They want their employees' morale to be high so that they will work productively. While it may not apply to IBM, most companies want employees who have a little bit of loyalty, so that if the company has a bad year and can't do well on raises or bonuses, the employees don't just leave.

So, from the employee perspective, they work hard for the company, so the company should work hard for them. If the company is making significant profits, then it has no excuse for low salaries, or for working the employees overtime (it can afford to staff properly). It doesn't need to lay off people who might be underutilized today, but who could be useful next week. If the company wants loyalty when it isn't doing well, the employees should expect loyalty when the company is doing well.

Which is not to say that this wasn't an appropriate move for IBM. If they really had 10k excess employees, then they have some problems, but better to rectify that now than later. However, rectifying in a way that doesn't strike terror in the hearts of their remaining employees might do a lot to help the long-term stability of the company. Some of the good people in their remaining staff might be looking for a more stable job right now.

Re:Who cares what IBM's profit margin is?

[sydb]

I often wonder in these massive union/company disputes - does the company ever approach the unions *first* to discuss these kind of issues?

This is your best point. So often these decisions are presented as a "done deal". Why is there no flexibility and room for negotiation? Perhaps the IBM staff would be willing to take a 10% pay cut. I've heard of it happening in other companies (Agilent).

Re:Who cares what IBM's profit margin is?

[Anonymous Coward]

when you are making $9 billion in profit a year it is bloody unethical to lay off the people who help make that profit

Re:Who cares what IBM's profit margin is?

[Anonymous Coward]

Do you think a belief is limited to that kind of stuff? How about belief in technology as an enabler for more free time? Or a belief that Linux is better than Windows? God damn, get a brain.

Re:Who cares what IBM's profit margin is?

[Shihar]

Non-competiting contracts are paper thin. They hold close to no legal weight. What they really boil down to is that if you are working on a project, change companies, and suddenly that project gets finished there with your name smeared all over it, you might be in some trouble.

Really, if you have a clause like that in your contract and lose your job, talk to a laywer. They really are not as ironclad as they sound. Don't let a few words slapped into your contract keep you from a job you want. Talk to a lawyer before deciding what it means.

Re:Who cares what IBM's profit margin is?

[bladesjester]

However, corporations are treated as people in American law. This means that they should also be socially concious in the same ways that actual people are supposed to be.

Re:Who cares what IBM's profit margin is?

[Anonymous Coward]

I would like to know what is the rationale for that belief?

Re:Who cares what IBM's profit margin is?

[Anonymous Coward]

the ethics of giving a fucking damn about people you fucking stupid american arsehole. a company has a duty of care to its employees. when a company makes $9 billion in profit they have 0 reason to fire anyone who is doing their job correctly. I hope you get layed off by an unethical company, can't afford health insurrance, rent, food, clothing then see who gives a fucking damn about you and what your attitude to out of control greed is.

Re:Who cares what IBM's profit margin is?

[Anonymous Coward]

I have some friends who were dying to get laid off from Deutsche Bank because of the generous termination packages and the abundance of positions elsewhere.

I can confirm this. My one coworker talks *NON STOP* about how he wants to get laid off. You'd think they would get rid of him just to stop his whining by now.

Re:Who cares what IBM's profit margin is?

[chris_mahan]

Except of course that it is.

Europe more than any other area in the world has tried to follow the American Way. (I know, I am French)

The Euro: Compete against the dollar.

Europe: Try to do with 30-odd countries what the US has achieved with 50 states.

Follow the rule of democracy until the bitter end (rise of fundamentalism).

Trust me, Europe is like America's lost big brother. China, on the other hand, is like the smart little brother that's gonna beat them both at their own game.

Mod me down if you like, you know I'm right.

Re:Who cares what IBM's profit margin is?

[Duhavid]

How did they get to the point where 10 to 13k people were "suddenly" unneeded?

My arguement is that that did not just happen, management had it's eye off the bubble for a considerable period of time.

So, if management had been paying attention, perhaps they could have delayed some hiring or layied off few over a period of time, sometime a bit kinder to those being layed off.

Which brings up another point. The company wants to make money. To make money, you need productive workers. Workers that feel that management will treat them as people, with some modicum of kindness and respect will be busy working rather than looking for other work or worrying about being laid off, etc, etc.

Re:Who cares what IBM's profit margin is?

[Bamafan77]

You are so bold as to use a professional athlete in your example...

are you saying that a professional athlete does not take a "holistic" view of work, that they are not doing what they love?

Not my example. As I said, it's Stephen's Pollan's example from his book "Die Broke". However, I do agree with the example.

And let me refine what Pollan referred to with "holistic". You have a life at work where you perform actions to generate income. You have a life away from work. For most people, the two are different. There is/was a view out there that somehow you could do things like raise your kids while simultaneously working in a holistic fairyland where you live and work in the same place. At best, you may be lucky enough to have an employer with daycare on company grounds or maybe you even have a company that pays for lunch/dinner. So you liking your work is somewhat outside the scope of the division between work and the rest of your life.

And by all means, you should be doing something at least in the ballpark of stuff you'd be doing on your own. This lessens the "work" effect somewhat and allows you to be more effective. But just realize that this is an income generating stream (which can be yanked from under you at anytime) and you should seek to maximize it. It's just another point of view in addition to the viewpoint that allows you to derive inherent satisfaction from what you do.

Re:Who cares what IBM's profit margin is?

[Anonymous Coward]

Doesn't that cut both ways though? Isn't it just as bad for IBM to lay me off mid-stream on my mortage/rent/car payment/etc as it is bad of me to quit mid-stream on their project?

Re:Who cares what IBM's profit margin is?

[ross.w]

Agreed,

I spent my last 6 months at Sydney Water, DREAMING of being offered redundancy.

They only turned me right way up last week.

Re:Who cares what IBM's profit margin is?

[SlamMan]

And this dear friend, is why companies love contractors.

Re:Who cares what IBM's profit margin is?

[birge]

I'm just saying I do think there are similarities as far as costs to society.

I think it's quite the opposite. Society benefits when inefficiencies are trimmed from an organization. Those 10,000 people may have a tough few months finding jobs, and maybe they'll end up taking a pay cut. But in theory they will end up in places where they are more beneficial to society, and the millions and millions of people who use IBM products will benefit. It sounds nice to say nobody should be fired, but society is in no way helped by having to pay people for work that isn't needed.

Re:Who cares what IBM's profit margin is?

[Anonymous Coward]

The people who feel entitlement are wrong. Simple as that. They traded their time for a paycheck.

It's the owner who took the risks. Unless you're lucky enough to grow up rich and have your daddy give you a ton of money to play with, it is not easy to start a business. There is plenty of risk these owners are taking on. That is why they deserve to make so much more than their workers.

Employment does not equal ownership because if the company tanks, the workers aren't effected nearly as much as the owner.

Re:Who cares what IBM's profit margin is?

[Anonymous Coward]

Live like this if making money is the most important thing in your life.

If other things are more important (e.g. more time with your children while they are growing up, travel, etc.) then do that instead.

Who looks back on their deathbead and says, "You know, I really wish I'd spent more time at work"?

Re:Who cares what IBM's profit margin is?

[Anonymous Coward]

Well... if the company exists entirely and exclusively to make a profit -- as American corporations do

False. Corporations exist to provide the shareholders with limited liabilty for its actions. A corporation represents the shareholders and should represent the goals of the shareholders. Profit is not the only goal for most normal people and for most normal corporations. Don't be confused the greedy me first 80s.

Re:Who cares what IBM's profit margin is?

[Anonymous Coward]

Ethical behavior? Are you kidding me? First off, WHOSE ethics?

The SHAREHOLDERS! Duh. Do you really believe that everyone owning a share of IBM is a greedy unethical pig?

Re:Who cares what IBM's profit margin is?

[Anonymous Coward]

In the US, a publically traded corporation exists solely to produce the most profits possible for its shareholders within the law.

And the shareholders have no say in how the corporation produces those profits as long as the corporation is trying to maximise them. That sounds crazy to me. Can you back up your statement that a publically traded corporation much do everything legally possible to make money?

Re:Who cares what IBM's profit margin is?

[jafac]

You're a bean. He uses professional athletes as examples we should follow when pursuing jobs in this new reality.

We should do Steroids and rape young white girls in hotels on road-games?

Re:Who cares what IBM's profit margin is?

[Anonymous Coward]

Those NDAs are un-enforceable, they're just there to intimidate you. In America, nobody can stop you from doing business and making money.

Re:Who cares what IBM's profit margin is?

[Anonymous Coward]

But why shouldn't they be more profitable? Without these people, maybe IBM could have made $10 billion.

And I don't hear anyone crying for the consumers either. That $9 billion came out of their customers pockets. Maybe the government should regulate corporate profits. After all, isn't it unethical for a company to charge more money than they really need to? How about profits be restricted to $500 million max. Anything over that has to be refunded. Europeans, you love regulation. Get started on that.

Re:Who cares what IBM's profit margin is?

[Billly Gates]

"Sometimes getting laid off is the best thing that can happen to a person so sympathy isn't necessary."

Well I think the creditors and those who have mortages for things like their homes, cars, child's college bills, etc, might have a different oppinion.

Actually take it back. Creditors love people getting laid off. That way they can take away everything they own if they do not pay the bills.

Also many people who develop bad credit as a result of being laid off have trouble finding work and buying or purchasing another home when they find a new job. Most companies today do credit checks and use it agaisnt you because you are more likely to steal from the company or are irresponsible.

Its really not fair to expect someone today to have to pay 30 year mortages on their homes, and other necessities just to exist but end up with unstable at will employment? IBM afterall is making a ton of money.

The greedy executives and shareholders are not the ones losing their jobs here. Its the people who work for IBM.

Its big here in most states that are "right to work". They can fire you for no reason at all without being sued.

Re:Who cares what IBM's profit margin is?

[susano_otter]

You know, things like human rights come before other considerations, like profits.

Please tell me where you got the idea that people have a right to employment. Bonus points if you can explain the specific right to employment at IBM, in Europe, right now.

Also, if my right to employment trumps my employer's need for profit, wouldn't that result in a country full of failing companies who aren't allowed to generate positive cash flow by reducing their labor force? Oh, right... Europe. I almost forgot.

Re:Who cares what IBM's profit margin is?

[bnenning]

I'm not saying that cutting a bunch of jobs is as bad as dumping waste into a river. I'm just saying I do think there are similarities as far as costs to society.

And I'm saying that's silly. Look, IBM has (rightly or wrongly) determined that certain employees are not producing sufficient revenues to justify their salaries. If IBM continues to pay these people (at their current salaries), they are engaging in charity. And if it's your view that they are ethically required to be charitable, why should the recipients of this charity be upper-middle class IT workers? Why not starving peasants in Africa?

Severing a voluntary relationship that is no longer mutually beneficial is hugely different from actively damaging public property. I find it baffling that anybody can make that comparison.

Re:Who cares what IBM's profit margin is?

[Anonymous Coward]

I'm sorry, you mean to say there is a law in the US that says I have to be socially conscious?

Re:Who cares what IBM's profit margin is?

[Anonymous Coward]

You make a lot of noise, and then propose random bullshit.

How about profits be restricted

Hundreds of thousands of corporations world-wide already do this. It's called "Non-Profit". If every corporation was required to be non-profit, you'd be amazed at what would happen to our economy. Microsoft's hundreds of millions of dollars in cash reserves on hand? It'd be spent, generating more technology, more business, more jobs... you can see several other multi-billion dollar companies that just seem to exist to hoard cash, who are doing no-one a favor.

Re:Who cares what IBM's profit margin is?

[David_W]

Sometimes very valuable employees take their ideas to other companies and compete directly with their old companies. That's hard-nosed business: more power to them. Why can't the company be hard-nosed too?

(Note from a strictly logical standpoint the following argument isn't very strong, however, it explains the emotions I think.) I would imagine the reason people don't take well to companies being hard-nosed is they are so much bigger than the people they employ. While losing a person isn't going to generally make a large impact on your typical company (really tiny companies notwithstanding), losing a job is often going to make a HUGE impact on your average person.

Re:Who cares what IBM's profit margin is?

[Qzukk]

I often wonder in these massive union/company disputes - does the company ever approach the unions *first* to discuss these kind of issues?

In fairness to both sides, the answer is usually yes. After all, these disputes don't materialize out of thin air, and we don't hear about the vast majority of "less massive" disputes because they get solved without involving the public.

Re:Who cares what IBM's profit margin is?

[KarmaMB84]

They will give them a case to get you and/or your company into court to until you and your new employer wither and die and nobody ever grows the balls to challenge the mighty non-compete again.

Re:Who cares what IBM's profit margin is?

[Anonymous Coward]

In my opinion European laws that regulate and in many times don't permit firing workers

If law permits you to fire your workers

Huh?

Weird contradictions aside, if you don't like the law, most modern counties grant their citizens the right to complain. In the US, its called "The first amendment". Voice of the minority, jazz like that.

Re:Who cares what IBM's profit margin is?

[bnenning]

So you say that the workers' jobs are to provide profits for the owners of the company.

Um, yes. If a worker doesn't provide a profit to the company, why on earth should they hire him? As an act of charity? Aren't there more deserving recipients of altruism than temporarily unemployed programmers?

maybe people who have worked hard to make the company run feel some sort of entitlement afterward and think that their needs are more important than the future profitability of the company

Lots of people feel entitled to lots of things; it doesn't mean they actually are. Why do you think you should be able to force a company to continue to pay you if you can't produce anything of equal or greater value for them?

I think anyone who works at a company and then just passively accepts that they can be discarded inconsequentially is crazy.

There would be large consequences if my company were to discard me. That's because I'm fairly good at what I do and have acquired lots of specialized knowledge, and as a result it would be very expensive to replace me. If your employer really can get rid of you and not suffer any consequences, then you should be immensely thankful that they haven't figured that out yet, and should look into ways of making yourself useful.

Re:Who cares what IBM's profit margin is?

[KarmaMB84]

I would make a modest bet that they'll either slowly hire people until they get as big or bigger than they were before or hire tons more people in a foreign country for a wage of a bowl of rice a week.

Re:Who cares what IBM's profit margin is?

[Runagate Rampant]

And the best thing is that when a company lays off workers it no longer needs, those workers can in turn just get rid of the children/dependants they can no longer afford.

Re:Who cares what IBM's profit margin is?

[LinuxHam]

How did they get to the point where 10 to 13k people were "suddenly" unneeded?

My arguement is that that did not just happen, management had it's eye off the bubble for a considerable period of time.

It wasn't sudden. There has been a slowdown in tech buying, and an increase in process change consulting. IBM has been pushing very hard to get people retrained with valuable skills for over two years. I see reminders daily. After two years, the company finally decided to get rid of manufacturing people who couldn't or wouldn't be retrained with valuable skills.

Management hasn't had their eyes off anything for quite sometime. These were non-retrainable people with skills of rapidly decreasing value.

Re:Who cares what IBM's profit margin is?

[Etyenne]

2) that the person philisophically (sp?) matches our beliefs

I am not entirely sure what you mean by that, but it give me the creeps. Are your employees supposed to agree with you on all front (ie religion, politic, etc) ?

Sometimes getting laid off is the best thing that can happen to a person so sympathy isn't necessary.

Keyword here : sometime.

Re:Who cares what IBM's profit margin is?

[RobertLTux]

Try this Imagine you have a neighbor that 1 Pays the local folks in Ca$H 2 Seems to know everything that is going on 3 but switches services in a heartbeat (and maybe now has decided to start using some services "across town" instead of local folks) Major Corps are that neighbor btw whats up with the turning test thing all of a sudden??

Re:Who cares what IBM's profit margin is?

[Qzukk]

There is/was a view out there that somehow you could do things like raise your kids while simultaneously working in a holistic fairyland where you live and work in the same place.

The view that people are desparately clinging to isn't some weird crap like this, though there was certainly a period of time where telecommuting was in vogue.

The view they want is "I Matter". They want to be in positions where they are irreplacable. They want to be recognized for that special thing they bring into the company. They want that special thing to bring them fame and fortune.

Unfortunately, in reality people don't matter. Labor is replacable. Skills are replacable. Everyone from the lowest position even to the CEO is merely a cog, spinning in place until they wear out and another cog comes along close enough in shape that a few turns wears it down to a correct match. CxOs are certainly larger cogs, but even executives turn in their own dance to their own tune, and even though their steps aren't familiar to the smaller cogs, one misstep can still lead to replacement.

Wouldn't you rather believe the first? That someone out there other than your direct family cares about you, not merely how well the machine turns this quarter?

Re:Who cares what IBM's profit margin is?

[Qzukk]

Isn't it just as bad for IBM to lay me off mid-stream on my mortage/rent/car payment/etc as it is bad of me to quit mid-stream on their project?

Judging from the response on /. I'd say IBM is taking a reputation hit too.

Re:Who cares what IBM's profit margin is?

[Dravik]

Now if the company can't get rid of you when they want to, should you be able to walk away from the company whenever you want to? I costs a lot to search for, hire, train, and integrate a new person into a company. Should the company be able to demand compensation from you if you quit?

Re:Who cares what IBM's profit margin is?

[StikyPad]

Who looks back on their deathbead and says, "You know, I really wish I'd spent more time at work"?

Workaholics.

Re:Who cares what IBM's profit margin is?

[Dravik]

One issue could be the unemployment benifits in Europe. How long does the company have to keep paying the people after they are laid off? A move that doesn't save very much operational money could eaisly be justified by increased flexibility in the future.

Re:Who cares what IBM's profit margin is?

[zippthorne]

To paraphrase a great european leader:
Capitalism is the worst philosophy of wealth distribution..except for all the others.

The reason we want to encourage shareholder growth is to encourage people with wealth to invest capital in ventures in the hope of generating more wealth for themsleves. If they held on to their wealth instead of risking it and potentially generating hundreds of jobs and improving society in some way, how would that benefit anyone?

The economic philosophy of capitalism does not say, "greed is bad" or "greed is good." It avoids that issue altogether. Instead it says, "People are greedy. This is how to make it work for us." This is a lesson that the russians and the eastern europeans have already learned, at the cost of millions of lives and much treasure.

Re:Who cares what IBM's profit margin is?

[magarity]

If they were losing money, I would understand the need for layoffs, but that's not the case here at all

Just because the company as a whole makes a profit does not make sense to keep divisions/facilities open that do NOT make a profit. Look at it this way: Let's say a company makes a 10% profit. Division A returns 15%, Division B returns 5%. You have to look at the big picture and say that the average player in B's market is getting 15% but we're only getting 5%. It just isn't worthwhile for us to bother with it. B is dragging us down. That's the case in the facilities in question; there's no company that will close facilities and lay off workers who are making a return at a good level. Sure, it's none of those line level employees' fault but the rest of the company is not in business to provide them with a welfare job, which is what it becomes.

Re:Who cares what IBM's profit margin is?

[curious.corn]

Employment in general may not be voluntary (for very long, anyway), but in specifics it is. You can choose where to work, as long as they will have you. I can quit my job tomorrow. It would hurt the company, and cost them a lot of money, but it is well within my rights. They can also lay me off tomorrow, which will put me out on a limb, but is well within their rights.
True, but it's also the best way to build up perfect paranoia. Rules can be tough, bloody tough... some night want to play the game and get a big reward but many don't really care don't they? Imposing grand cynical "it's the game man!" on people that just want to get along doesn't sound very fair. Shure, tiny men don't fit in a Grand Vision but most of the grunt is done by people that put their values somewhere else. You can't expect them to play by your CxO rules, they're not CxO, never will be, don't really care (except for the paycheck). Even little Napoleons have to pay the soldier's due, and can't get rid of them adlib; unless you don't want unions striking or rabid gunners running around your office... not everyone can or wants to handle stress...

Re:Who cares what IBM's profit margin is?

[Anonymous Coward]

"I don't think it is a good idea to subsidise a loss making aspect of a country or a company indefinately but obviously the pros and cons should be weighed up and people should be offered alternative roles and retrained where at all feasible."

Well there goes the content industry. Anyone want to hire a bunch of unemployed game developers, musicians, writers, or actors? Maybe they can be retrained to be the plumber elite?

Re:Who cares what IBM's profit margin is?

[dustmite]

There are two main possible reasons a company lays off this many people in one go:

1. The company is run by sensible people at the top who realise that for long-term survival, they need to increase efficiency in the short term
2. Those at the top are a few greedy pigs who don't care if the company dies, but just want to massively cut R&D costs (i.e. short-term investment costs necessary to maintain growth in the longer term) in order to quickly push up profit margins artificially, pay themselves out incredibly huge bonuses, and then get out quickly before the company inevitably crashes and burns (because you need R&D to survive).

It's never possible to tell which is the case though if you only look at the information "there are layoffs". It's silly to assume though that a company is laying off people "because they are not necessary in the daily business" - that's only the case for number 1 above.

Re:Who cares what IBM's profit margin is?

[Anonymous Coward]

(e.g. lease your car rather than buy and never retire).

Never retire... Easy for him to say..

Anyway, anybody that tells you to lease your car and kill your consumer credit in the same breath isn't worth my time.

Re:Who cares what IBM's profit margin is?

[Anonymous Coward]

"Always be looking for your next job, and always take the job that's in your best financial interests, not because it's a better fit for your interests."

You do realize that this runs counter to all the "Do it for the Love, not the money" talk that goes on around here. Then someone brings up the .com era, makes "HTML for dummies", and MSCE jokes.

Re:Who cares what IBM's profit margin is?

[Anonymous Coward]

Perhaps if those 10,000 are not laid off, IBM will not have enough reserve cash to fight a brutal price war with their competitors.

I suppose that could be true if they didn't profit billions of dollars a quarter.

That's the main reason I would never work for a large company: everyone is just a line item on a budget.

Re:Who cares what IBM's profit margin is?

[Comatose51]

While I agree with most of what you say, a company is more than just an organization that's there to make money. Yes, that's its goal. It is also MY goal to make money as well. However, both IBM and I exist as members of a community and have certain obligations to that community because of our membership. I have an obligation to obey the law and do my civic duty. I don't get paid to vote in the elections or know what's going on with my government. It would be a sad day when none of voted or paid attention. Likewise, IBM have certain obligations to its community and its employees. I agree that shifting or eliminating those jobs are within its rights. I hope, however, that IBM will aid those workers in finding new jobs else where or soften the blow of unemployment. Good will is hard to measure on your SEC filings but bad will can certainly hurt you in the long run.

Re:Who cares what IBM's profit margin is?

[Random Q. Hacker]

A company, on paper, may exist solely for the purpose of enriching it's shareholders. A company, in reality, is a bunch of people who can do whatever the fsck they want when they feel they are getting screwed over.

IBM may have the right to fire those employees, but that does not mean they have the right to do it without consequences.

My congrats to the Europeans for having balls.

Re:Who cares what IBM's profit margin is?

[LordNimon]

Percentages are irrelevant - total revenue is much more important. Division B is still bringing in money, so getting rid of it will result in less profit. That's a bad business decision.

Re:Who cares what IBM's profit margin is?

[spearway]

I think I agree with you but I want to add one thing.

Laying off employees while making money and returning cash to shareholder just mean one thing: That the executives of the company are short of imagination and vision. They cannot find any good business idea to use those assets (human and money). I am an engineer and a company owner I can understand this attitude this is honesty when you cannot solve a problem stop spending your customer money. If you run out of idea free the assets so that someone more clever that you can use them.

It may be the right thing to do but this is certainly not a victory for the board. This is what in MBA school they call milking the cow. Short term strategy...

Re:Who cares what IBM's profit margin is?

[Anonymous Coward]

It's the owner who took the risks.

Take enron, worldcom, tyco, and a few hundred other companies and plug your asshole with them, its gaping wide and all this smelly hot gas is pouring out.

Risks indeed.

Re:Who cares what IBM's profit margin is?

[cduffy]

Wow. I'd be a little curious about what you went through to end up with this viewpoint. Perhaps you've been working with companies which are a bit too large or well-funded?

I'm three years into employment with a startup, and (after watching how hard it is to find more people with my skillset willing to work at the pay levels we can provide) am rather convinced that I do matter. That may because I'm the only sucker with my particular skillset to be stupid enough to work this far below market rate -- but whatever the case may be, if I walked out the door, the company's chances of success would go down somewhat. Not all that much, necessarily -- the guy we hired who knows the line of business and the people involved in it whose personal relationships have brought in our resellers, investors and customers makes more of a difference. The lead architect we hired whose individual efforts in getting the dev team shipshape and rewriting the core of our app are responsible for us having a shippable, usable product makes more of a difference. The chief medical officer who produced more of the content for our app than anyone else, despite having over four MDs under him makes more of a difference... but see, there are individuals here in this organization who are recognized by their fellows and peers as individually making a difference -- and I get some of that recognition as well. It's a fulfilling thing, to be sure -- but it's not necessarily fiction.

Given enough funding, a large enough team of MDs to make up for losing the productivity of our individual CMO could be found. Given enough funding and time, we could find another lead architect of comparable skill, and we could find a replacement for me and my team. But given the limited funding we have, and given the limited time we have, our staff aren't replacable -- so we do make a difference. We miss the IT lead we lost, because the IT department isn't as effective without him.

And quite possibly, this is why I'm still here after three years working well under market value -- because I get the recognition that I really do add something to the company, without the separation from reality you imply always comes with it.

Re:Who cares what IBM's profit margin is?

[Brandybuck]

You're absolutely right. Why, I'm a COBOL programmer, and I'm so glad I work for an enlightened liberal social democrat employer who didn't lay me off when I became totally irrelevant to the industry.

</sarcasm>

Re:Who cares what IBM's profit margin is?

[Anonymous Coward]

There would be large consequences if my company were to discard me.

Dream on. Unless your company only employs one person in your field, you've got someone nipping at your heels right this very instant. And thus office politics were born, and the better brownnoser wins.

If corporate life wasn't full of such bullshit, people would be happier there. If creating your own company was really a solution (when only 1 in 5 survive more than a few years, its merely staving off inevitability) then people would be happier with that course of action. Instead, the people with money try their hardest to make everyone else's lives miserable.

Re:Who cares what IBM's profit margin is?

[Anonymous Coward]

This is how to make it work for us.

Except that it doesn't work for "us". It works for the few multi-millionaires calling the shots. Take wal-mart... how many millions does its CEO make while their employees survive on food stamps and government medical care? Is giving people just enough money that they don't give up entirely and go on the dole really "working for us" when I'm the one who has to pay for these people to live since WalMart is too cheap to? And don't threaten me with walmart "pulling out" or something, since its not like these people aren't already halfway on the dole anyway, its not going to be that big of a difference, except someone will probably buy the old building, hire a few people and run a skating rink, while some other people will open a couple of small stores, and hire more of their fellow co-workers.

Re:Who cares what IBM's profit margin is?

[Anonymous Coward]

encourage shareholder growth is to encourage people with wealth to invest capital in ventures

HAHAHA

When was the last time you got in on the ground floor of an IPO and invested capital in a company?

Earth to Zipthorne: Your stock purchases aren't doing anything but inflating some other crony's portfolio value. But keep trolling, maybe you can find another sucker to buy in on your pyramid scheme and maybe you'll make your money back.

Meanwhile, the real economy would love it if you bought another car, maybe hired some people to build you a summer home.

Re:Who cares what IBM's profit margin is?

[mdfst13]

"If for economic reasons IBM is outsourcing jobs to india"

That raises a side issue that a lot of people here are missing. Europe's currency is way high against the dollar. It's quite possible that they are moving the jobs to the cheaper *US*. I.e. instead of cutting jobs in the US so as to make room for cheaper workers in India, they have chosen to cut workers in the expensive EU.

If enough companies did that, the Euro would stop rising versus the Dollar. I.e. the exchange rate may finally be beginning to have an effect.

Re:Who cares what IBM's profit margin is?

[Kadin2048]

Not true. You have to consider how much profit it's bringing in, versus the value of its assets if you were just to liquidate the unit and invest the cash it would produce.

If some business unit only produces $500k a year in clean profit, it might still get canned if it was sitting on $5M of assets: salaries, real estate, salable equipment, etc. If the company thinks they can do better than 10% ROI somewhere else, the logical decision is to liquidate the unit and invest the cash elsewhere. It's called opportunity cost.

Caveat: Back when the stock market was really good and you could easily earn more than that just by putting your money into other companies' stocks, there was a lot of this going on: unfortunately many companies found out that selling off core businesses to pump money into short-term high-yield endeavors wasn't a good strategy when the bubble burst. I know personally at least one very old (100+ years) company that met its end this way due to mismanagement and short-sightedness.

Re:Who cares what IBM's profit margin is?

[Kadin2048]

*yawn*

And you wonder why IBM is dumping employees there as fast as they can and probably taking the jobs elsewhere.

If the Europeans want to become the 'boutique store' of human resources on the world market, they're going to realize that they're not going to hang on to market share. There are lots of countries out there willing to work for less and become the mass market version of same.

What the employees think they're going to get by striking is beyond me. One day they'll strike and nobody will notice: then they'll just have proved how redundant they really are.

Furthermore, the only contracts companies recognize are the ones that are printed on paper and signed. If you think IBM entered into some sort of social contract to employ huge numbers of Europeans, that's fine, but don't expect IBM to agree with you.

Re:Who cares what IBM's profit margin is?

[Grishnakh]

Exactly. Also, this bit about reputation is obsolete I think. Here in the US, no one calls previous employers for references any more. Even if you royally screw up a project and then walk out, your new employer isn't going to know. Most companies have a policy that they won't say anything about you other than your dates of employment, because trashing you to your new employer is grounds for a lawsuit (one of the very few things I like about today's litigation-happy society).

Re:Who cares what IBM's profit margin is?

[derEikopf]

What's more unethical than giving money away to individuals who did not earn it?

What's more unethical than allowing people to steal money from a corporation that the entire world depends on? I don't see anything ethical about cannibalizing a company on which you depend.

Re:Who cares what IBM's profit margin is?

[Grishnakh]

It still makes sense if you decide you want to spend the least time possible making the most money possible. All I read in the previous post is that you should be mostly concerned with how a job will help you financially, so the job that pays the most for the least amount (time) of work is certainly in your best interest.

I don't think the idea was to make as much money as possible, regardless of all other factors. Only to completely discount obsolete notions such as loyalty, pride in one's work, etc. Try to take as much money as possible from your employers, and don't expend any effort doing them any favors (but do this within the amount of time you're willing to put in). It seems perfectly reasonable to me, given the attitude employers have toward employees these days. Why bother doing a quality job for the company if they don't value it?

Re:Who cares what IBM's profit margin is?

[derEikopf]

then see who gives a fucking damn about you

the ethics of giving a fucking damn about people

It seems that you will be the one giving a fucking damn. Unless you didn't really mean that.

Re:Who cares what IBM's profit margin is?

[Runagate Rampant]

I really don't see the point of your argument. Surely you are also then a COBOL Programmer with years of business knowledge and experience. And you are perfectly capable of learning whatever language is fashionable this month.

People are not like machines, people have valuable experience and can learn new skills. The obsolete argument is flawed.

Surely it is obvious that IBM has decided that cheap labor is currently of more value than their current staff's experience.

And I would add that this does not help anyone really except the employers. It is a race to the bottom where today's cheap workers will in turn be replaced by even cheaper workers. This process can be seen in the growing disparity between the incomes of executives compared to average wages.

Unless workers do resist with unions and strikes they will have no input at all into decisions which could ruin their lives. In that context workers have a right to do whatever it takes to ensure their livelihoods.

Re:Who cares what IBM's profit margin is?

[stevesliva]

China is not little, it is huge. However, I don't think being the overall largest means winning. The winning countries in 2050 are going to be those not bogged down in national welfare state malaise with the few young workers each paying for 5 retirees. (Like myself, I'll be 70 by then-- sweeeeet, oh wait, the social security retirement age will be 80 by then. Damn.)

I really don't know what to do. I, for one, won't be volunteering to kill myself.

Re:Who cares what IBM's profit margin is?

[Grishnakh]

The steroids are just a job requirement. Raping young white girls is a perk. Both are perfectly fine, according to society which actively rewards this behavior.

Re:Who cares what IBM's profit margin is?

[Grishnakh]

Anyway, anybody that tells you to lease your car and kill your consumer credit in the same breath isn't worth my time.

Yeah, this idea doesn't make any sense at all. Unless you're some fool that believes they need to always drive a new car, or you're a fool that keeps buying poor-quality cars that don't last longer than 5 years, the most financially sensible way of approaching transportation is to buy a very reliable vehicle, pay for it with cash, and keep it as long as possible. Buying a newer used vehicle may make a lot of sense too since you won't take the initial depreciation hit, though with very high-resale vehicles like Hondas, the difference between new and 1-2 years old doesn't seem to be very much.

Re:Who cares what IBM's profit margin is?

[shanen]

No, sorry to inform you, but profit is not the highest god above all others. Not even stock prices. That malarky is just the current politically correct BS, which is especially hilarious given that most of the politicians have never earned real profits.

First I better include the disclaimer that I'm in the IBM food chain--and maybe I shouldn't comment at all, but I definitely have a different take on this... I think IBM is a pretty good company, and it is quite difficult to get a job there. If the hiring system is working properly, then anyone who IBM has hired is a better than average person, and losing that person is a loss to the company. If the hiring system is *NOT* working properly, then that's a different and much more serious problem.

I think it's really unfortunate when any company fires people for no fault of their own. What that really means is that the employees will start diverting some of their energies away from the company's business and to trying to "insure" their own job security. It doesn't really matter what "strategy" they use, trying to be indispensible, pushing other employees down so they have better survival chances, or whatever, the company is the big loser.

Re:Who cares what IBM's profit margin is?

[syousef]

I'm not a fan of layoffs either but a company is there to make money, nothing else ...and that is the problem. Companies aren't held accountable for their rape and pillege of resources natural and man-made UNLESS it breaks a law. If the world's legal systems were horses they'd have all been shot and sold for dog food years ago.

Re:Who cares what IBM's profit margin is?

[Anonymous Coward]

"However, in a lot of large firms, entire divisions of people are support people who are not in a position to generate revenue for the company."

You are wrong. Support people do generate revenue. Customers normally buy support contracts and if you have a good support team it keeps the customers maintaining that contract. The results they get back from support can also effect later buying habits.

Sure you have generic phone support but most corporations (certainly IBM) have varying levels using a money scale.

Btw, I know people who work in IBM. None of those are striking today.

Re:Who cares what IBM's profit margin is?

[Qzukk]

I'm three years into employment with a startup

The interesting thing is that I'll be starting my third year with this 3 year old startup in the fall. While I had intended what I had said before to apply to larger corporations, now that I think about it the fact that its a startup changes very little, only that when you only have 4 cogs, if one goes missing even for a minute, they all stop turning, so yes, you do in fact matter more. Without a large machine to provide the torque, replacing you with an inexact match won't prove as easy as in the giant corporation where your replacement would be bent into shape quickly.

As for where this viewpoint came from, I've seen family and friends who were chewed up and spit out by these machines (is it any wonder why drinking seems to be such a problem these days?). I've even had a brush or two with them myself before settling into a pattern of sticking to small companies where "I Matter". Of those, I've been to a few where I didn't matter as much as I thought I did, and others where it didn't really matter anyway, since those ventures failed to be the 1 in 5 companies that "make it", but despite that, I can come home every day without feeling like I need a stiff drink (though sometimes I take a look at some sub-contractor's code and wonder whether if I were drunk too, I'd understand it ;).

Re:Who cares what IBM's profit margin is?

[EccentricAnomaly]

f every corporation was required to be non-profit, you'd be amazed at what would happen to our economy. Microsoft's hundreds of millions of dollars in cash reserves on hand? It'd be spent, generating more technology, more business, more jobs

yeah, it'd be spent and at the first hiccup that interrupts Micosoft's revenue stream the whole company would collapse and a ton of people at microsoft and other companies that depend on microsoft would be out of work. So many people would be out of work, so suddenly that the economy of Washington state and maybe even the whole US would also collapse.

Microsoft keeps its cash reserves so that it can weather economic downturns. And since a big employer like Microsoft is more resiliant to such downturns, it benefits us all by making a large scale economic collapse less likely.

Re:Who cares what IBM's profit margin is?

[roman_mir]

I have worked for 5 years at a permanent position at a startup where I was the first employee hired by the company.

For the last 4 years I've been doing contracts only.

--

I'm three years into employment with a startup, and (after watching how hard it is to find more people with my skillset willing to work at the pay levels we can provide) am rather convinced that I do matter - nonsense. There is always someone who will do your job for the same or even less money. Skill sets are acquired.

if I walked out the door, the company's chances of success would go down somewhat - if that is the case your management is not doing their jobs properly. Otherwise it is also nonsense. Success is about correct management. In some cases correct management means the manager must leave the engineers to do their jobs by themselves. Good managers will make sure that there is no single irreplaceable person in the company in a position to seriously reduce success of the company by leaving. You can matter when the management is not doing their job at all but it does not mean that you get the appreciating you deserve anyway. Don't expect other people to believe you are irreplaceable no matter what you believe yourself.

Sure you have good people but none of them are in fact irreplaceable. Some people are better than others at certain things but on average the project will either ship of fail due to correct/bad management decisions.

You in fact are correct - you do add something to the company but you are sacrificing your own interests for the good of the firm. Unless you get some form of profit sharing you are getting the short end of the stick. Unless you get something extra for the extra work you are putting in you are not making a wise decision by sticking around. You are just a cog, don't be naive to believe otherwise.

Some people can become indispensible for short periods of time here and there but it does not mean that these people will be in such positions all of the time. Some people become irreplaceable for the company during periods of change - growth or shrinkage or something like that. People are not irreplaceable in companies where growth and change are minimal. As your company growth you will become less and less irreplaceable, less important to the overal success. Prepare for that otherwise it may come as a shock.

Re:Who cares what IBM's profit margin is?

[spike hay]

Europe's corporate regulations and owner's rights are much the same as the U.S. Management of European corporations are also charged with maximizing profit for their owners.

Re:Who cares what IBM's profit margin is?

[Anonymous Coward]

we have crazy farm subsidies too.

--an american

Re:Who cares what IBM's profit margin is?

[spike hay]

Uh, take a business class. Shareholders want profit. Anything else is contract infringement and can (and very often does) result in a shareholder's class action lawsuit.

We are talking about for-profit, publically traded companies. If shareholders want charity for its own sake, they can donate their gains to a nonprofit cause.

Re:Who cares what IBM's profit margin is?

[jdigriz]

The company can be hard-nosed all it wants, and so can its workers. The purpose of striking is to inflict more economic pain on the company than it supposedly gains short-term through mass layoffs. In other words, the strikers *want* IBM to do what is in its economic best interests, once they discover that all of their workers aren't as disposable as IBM thinks they are.

Re:Who cares what IBM's profit margin is?

[omega9]

The needs of the many outweigh the needs of the few. I will, and forever shall be, your friend.

Live long and prosper.

Re:Who cares what IBM's profit margin is?

[welshmnt]

I thought more predictability was a GOOD THING in business. And in this case society too. Maybee?

Re:Who cares what IBM's profit margin is?

[God! Awful 2]

It's time to dispell the myth that just because IBM funds some Linux development they must be altruists.

IBM funds Linux development because at some point the executives got in a room, crunched some numbers, and concluded that either a) backing Linux will benefit IBM, or more likely b) backing Linux will hurt IBM but it will hurt IBM's competitors more.

Like any serious company, IBM is not just out to make a profit. They are out to make a profit that will beat the ROI of your average index fund. Otherwise there is no incentive for shareholders to invest their money in IBM instead of some other company. Missing their expectations by a scant $100M doesn't seem like much relative to their total revenue, but it's a lot in absolute terms. If my employer missed their target by that much, they would have to fire the whole company.

-a

Re:Who cares what IBM's profit margin is?

[Reservoir Penguin]

I dont have a problem with laying off "dead wood". But 13K people???? Did they just wake up one morning and found out that 13K people that they have spent lots of $$ training are no longer needed? If so than IBM is really in deep shit. I think not. I think that they have found out that a few divisions are not makaing profits and took the easiest route of just axing *everyone*. The smart thing woul;d havebeen to view thsese trained people as an asset and look for ways to restructure the poor performoing departments. Myabe naive, I've necer worked fopr a firm the size of IBM, but I know how hard it is and how long it takes to bring even one new empoyee up to speed. To me getting rid of so m,any skilled people is insane.

Re:Who cares what IBM's profit margin is?

[mcg1969]

I thought more predictability was a GOOD THING in business. And in this case society too. Maybee?

That's the wrong kind of predictability. What a business needs is to be able to predict its market and act accordingly. I see no benefit for the company to have additional costs forced upon it in the name of predictability.

There might be genuine social benefits---though the unemployment rates in France and Germany suggest otherwise---but let's not fool ourselves into thinking it's good for the company to force them to keep resources they don't need.

Re:Who cares what IBM's profit margin is?

[Brandybuck]

In that context workers have a right to do whatever it takes to ensure their livelihoods.

That "whatefver it takes" had better not include violence, or you'll have to count me as an enemy. The only legitimate use of physical violence is in response to physical violence or its threatened use. If you can't get your way with peaceful non-violent cooperation, then your way isn't worth having.

Re:Who cares what IBM's profit margin is?

[Runagate Rampant]

If you are defending the ability of your family to eat, you are being threatened with physical violence. But yes, tactically, this can often be best fought against with non-violent opposition, like using collective strike action. :-)

Cheers,
Ben

Re:Who cares what IBM's profit margin is?

[Anonymous Coward]

Having worked in a big company for a long time, I can tell all the hard line capitalists, that a lay off in a corporation is NOT (NEVER) made with basis on efficiency or the best interest of the company.

It is just a blind calculation, so you can present good numbers to the shareholders (so stock options for executives can go up).

When some 10.000 people has to be laid, the total figure is split in departments, and each boss tries to get people who wants to be laid first (do you think that it's the brightest bunch?).

After that round, the pointy haired boss use whatever reason they chose (they fire people that they don't get along with, keep their friends, I have even seen a boss who fired the brightest guys because they could find a new better job!!!)

And do you think the company will work better after that? I have never seen it once!!!

The problem is to tie the executive's salaries to the stock value. The shareholders give you a loan to get money for your business, you shouldn't run the company to please them. It is your clients and workers who make a company: I have never seen anybody decorating his home to please the bank that owns the mortgage!!!!

Re:Who cares what IBM's profit margin is?

[_Logic_]

What the hell is a social contract?

Contract:
n.

1) An agreement between two or more parties, especially one that is written and enforceable by law.
2) The writing or document containing such an agreement.

social contract
n.
An agreement among the members of an organized society or between the governed and the government defining and limiting the rights and duties of each.

Now, how can "corporate character" be interpreted as a "social contract" or any sort of contract?

The only "social" contract that I know of is the Constitution of the United States (an "agreement between the governed and the government"). It happens to be a contract (written agreement) and it is also among an organized society (U.S. citizens).

Re:Who cares what IBM's profit margin is?

[Anonymous Coward]

I have never seen anybody decorating his home to please the bank that owns the mortgage!!!!

actually you do that when you refinance to get a higher appraisal and therefore a better rate on the re-fi :)

(However, I do share your outrage on PHB's and short-sightedness)

Re:Who cares what IBM's profit margin is?

[Mac Degger]

The mayor problem is that this is something which is looked upon in a very unsymmetrical way: companies demand and expect employee loyalty...but they conveniently forget that loyalty is a two-way street; a company has to display loyalty towards it's employees if they can reasonably expect an employees loyalty in return.

Furthermore, how much do you want to bet that IMB will be on a hiring streak in a couple of months time when they realise that they have a myor employee shortage? That pattern shows up everywhere when a large company lays off so many people in one go (look at the oil companies in the nineties, the airline companies etc etc etc).

Re:Who cares what IBM's profit margin is?

[Anonymous Coward]

If you really were a COBOL programmer you would know just how much the industry still needs you and will do for a long time to come.

Re:Who cares what IBM's profit margin is?

[Mac Degger]

"who were dying to get laid off from Deutsche Bank because of the generous termination packages and the abundance of positions elsewhere."

That must have been at least 5 years ago...unless you haven't been up on your news, Germany has had mayor unemployment problems for the past couple of years.

Re:Who cares what IBM's profit margin is?

[Anonymous Coward]

Yeah but Europe is also the place where we have helthcare for everyone. Where, oh where did we go wrong? :-)

Re:Who cares what IBM's profit margin is?

[Anonymous Coward]

Seems like every time I'm in Europe there is a major strike happening.

You think this is "major"? You don't know Europe very well then.

Re:Who cares what IBM's profit margin is?

[Anonymous Coward]

People like you are the reason well educated immigrants, making six figures salaries, are leaving your country. Hell, I should know, as I am one of them.

Your language and your culture are not superior to anything else and certainly not worth bending over backwards to please you. We do not come to your little country to bow to your superiority; we come here to get a job done. A job, mind you, that the Dutch were obviously not competent at and had to be covered with a bloody allochtoon. Your despise and sense of superiority towards immigrants is mind shattering. It's because of this attitude that I find myself defending, empathizing and feeling part of the oppressed Muslim communities and having no pity for the locals. The sense of entitlement of the Dutch is like nothing I've ever seen. Your whole lives can be summarized in a phrase: "Ik eerst!". Yes, you first, you first and damn everyone and everything else. Natuurlijk, when jobs and well paid immigrants go somewhere else, you have to wonder.

You think you have a right to abuse "the inferiors"? Think again... every time you use the word "allochtoon" to refer to your dark skin neighbours, we, the Caucasian ones, also take note of your contempt. We feel refered to and associated with. And believe me, we look down on you, take our taxes somewhere else and let you dive an inch further in your little swamp.

Re:Who cares what IBM's profit margin is?

[fsmunoz]

Maybe you're among the group of owners. But if you're not, then your point of view to me seems pathological.

And they are. Most people around here like to speak very loud about the fact that they are still employed speaks volumes about their skills. You see, unemployment is for the non-skilled, lazy workers that just whine a lot. This mindset is part of the reason that I couldn't avoid laughing a bit when the layoffs in the US began a few years ago. It was quite a sight seing the people that were butt buddies with upper management that, to put it bluntly, spat upon their fellow workers all of a sudden shouting "OMG OMG, offshoring, what about our rights!??!?!". Programmers and IT staff are funny in that regard, they like to position themselves as "labour aristocracy" in times of abundance and then they bitch and moan a lot when what happens to them is after all the same that happens to blue collar workers. They are a great source of yellows, too, as the reaction to the strike around here shows.

Re:Who cares what IBM's profit margin is?

[Anonymous Coward]

The winning countries in 2050 are going to be those not bogged down in national welfare state malaise with the few young workers each paying for 5 retirees.

Which is a good argument for more federalization of EU, and the expansion (why do you think EU is so keen to expand towards east if not cheap labour?)

Re:Who cares what IBM's profit margin is?

[deaddrunk]

I am also a COBOL programmer whose 15 years experience is considered irrelevant because I don't have 2+ years experience in newer tech, despite my best efforts to get some.

Re:Who cares what IBM's profit margin is?

[Anonymous Coward]

My thoughts exactly! Thirty years ago, the Dutch felt too good to perform those menial jobs and they imported thousands of Moroccans and Turks. Now, the Dutch consider that the jobs are done and they expect the "servants" to crawl back to whichever hole they came from. Right, cuz we all know that's how social contracts work. Bring them in, use them as long as they are useful to the Dutch and then dump them back... nevermind that they had children, own property and shock, horror, they pay taxes! During the past thirty years, these people were addressed and treated like servants, and now The Netherlands reacts with awe when the children of these people do not conform to "Dutch values".

Re:Who cares what IBM's profit margin is?

[yogix]

When people decide to work for a company, they do it to earn *money*...

When people put in capital into a company, they do it for *money*...

In both cases, there is a risk involved -- and the rewards should ideally be commensurate with it. Working for someone generally has a lesser risk attached to it (basically, you do 'x' units of work and make 'y' units of money, there!). Now, if the former set of people (employees) feel a sense of entitlement or have expectations from a company then so should the latter (owners) who infact own the company!

So while I do not know whether these particular job cuts are justified or not -- I don't think we should just bad-mouth the investors or the execs because they want to make money too...

Re:Who cares what IBM's profit margin is?

[Anonymous Coward]

Who says these people aren't needed? When those ~10.000 people are laid off, IBM will hire new people in India and other people in Europe have to work overtime. That's how it goes, it's not like that these people are not needed.

Re:Who cares what IBM's profit margin is?

[Anonymous Coward]

The typical software engineer in the UK will get about £30k. In the USA this would equate to about $60k. Payroll taxes, plus healthcare in the USA etc means roughly the same bloat on the wage on both sides of the Atlantic. About the only difference is that workers in the USA tend to produce more GDP per hour worked than those in the UK. But then the most efficient workers of all in this regard are the French.

So for the US workers to be significantly cheaper than UK ones, assuming current productivity, the average wage per worker could not exceed around $60k. I am not sure what the break even point with France would be.

Re:Who cares what IBM's profit margin is?

[Anonymous Coward]

If a lifelong job with IBM is now a human right then where do I sign up? I'm not much for big companies but you can't beat the job security of an ethically mandated JOB FOR LIFE.

If you are an USian, there's always the army...

Re:Who cares what IBM's profit margin is?

[Aceticon]

Actually, in the vast majority of companies the IT department falls within your definition of support people (ie the IT department is a cost center, not a profit center).

This is true for all non-IT companies and even for Software products companies the software development group is often seen as a cost center, since higher revenue correlates much more visibly with bigger/beter sales than with beter software development.

IT Services companies are the exception, not the rule.

Re:Who cares what IBM's profit margin is?

[arose]

Um, yes. If a worker doesn't provide a profit to the company, why on earth should they hire him?

No one is complaining about IBM not hiring 10 000 workers...

Re:Who cares what IBM's profit margin is?

[Alioth]

It's not so much the euro rising against the dollar as it is the dollar falling against everything else.

Re:Who cares what IBM's profit margin is?

[MartinB]

If 13000 employees are unneeded then some high level mangagers screwed up long ago.

That's only the case if you assume a fairly static environment, which is a gross simplification. You're perhaps thinking of 50 years ago..?

Here's a simpler example: You run a network of fast food outlets. In early summer, you open a bunch of ice-cream stands at the beach with 2 FTEs each, to take advantage of the enlarged market. Come September/March (delete for applicable hemisphere), and it's cold and raining. Your ice-cream stands are each taking under 10currencyUnits/day, but are costing you several hundred Units/day in rent and wages.

Now here's your choice: Do you close the ice-cream stands and lay off the people, now there's not enough business to sustain them?

Now stretch your brain to a variable environment where peaks/troughs aren't so predicable... You take people on when business is growing beyond your present capacity to supply it (or you miss the opportunity) and you think it's going stay at that size for long enough to make it worthwhile for you to make the hires. When the market drops significantly below your capacity (or is predicted to do so to a sensible level of confidence), you shrink again. You work it so that as many as possible go through the normal processes of retirement, finding other jobs, redeployment to areas of your business that are over-capacity. But if that's not enough, you have to lay people off.

Not doing so is screwing up, my friend.

Re:Who cares what IBM's profit margin is?

[Anonymous Coward]

What kind of business do you own? In most places, a *corporation* is a special kind of business where the people grant it special status and rights. In return, it has certain responsiblities.

Re:Who cares what IBM's profit margin is?

[mpcooke3]

Heh. By aspect I suppose I meant end-to-end business not a particular "department". Obviously you don't sack people if profit making business processes rely on them...

Re:Who cares what IBM's profit margin is?

[Anonymous Coward]

The primary ethical obligation of a company is to return money to the people who invested in it (i.e. shareholders). These are the people who, by buying shares, enabled the company to finance its expansion and create jobs.

While it has an ethical obligation to its employees, it is to treat them fairly, promote where deserved, and demote and / or punish where deserved (so noone profits by dirty tricks).

It has no obligation to society to keep people employed, nor does it have an obligation to its employees to keep them employed (though a principal of fairness should prevent them being dangled along through a succession of short-term contracts).

As a slightly grander example, consider the UK and France. France implemented a series of laws to ensure workers rights. This meant that companies found it a lot harder to lay off people. As such they are reluctant to hire new people, and when they do, only hire them for short-term contracts, and then lay them off before they gain any legal advantage.

Frances unemployment rate is over 10%

The UK didn't enforce such strict workers rights laws. They protected basic fundamentals (discrimination, abuse, etc.), but gave companies freedom in hiring and firing people. The hope was that by making hiring and firing easier, they would encourage more companies to hire people, and thus ensure more people were employeed (which is the ultimate goal).

The UK's unemployment rate is under 5%

The French sneer at this, consider them poorly paid "McJobs" and point at Britains inferior health scheme. There is a grain of truth in this, but by and large, the British are earning more, living better, and have more prospects than the French. Ultimately, it's better to given someone the chance to work and improve themselves, then to coddle them in useless redundancy.

This is why attempts to protect worker's rights, and limit layoffs like those above, should be carefully thought through before implementation. Often it is ultimately counter-productive

Re:Who cares what IBM's profit margin is?

[Khelder]

...people in society should work for the profits of the small percentage of people who "own" companies.

At least in the United States, we're increasingly working for each other. That is, more people in the US own stock either directly or indirectly (e.g., through money market funds or retirement accounts) than ever before.

I'm not saying that IBM is right or wrong here, I just wanted to refute the misconception that there's a tiny group of owners and a huge class of non-owners. The group of part-owners is really big these days.

Re:Who cares what IBM's profit margin is?

[magarity]

Percentages are irrelevant

Sorry, percentages are everything. Note in my hypothetical example that the average player in division B's market gets 15%. It would be better to sell off / close B and simply buy stock in those other companies.

Re:Who cares what IBM's profit margin is?

[MartinB]

If some business unit only produces $500k a year in clean profit, it might still get canned if it was sitting on $5M of assets: salaries, real estate, salable equipment, etc. If the company thinks they can do better than 10% ROI somewhere else, the logical decision is to liquidate the unit and invest the cash elsewhere. It's called opportunity cost.

Yep, which is why anyone making investment decisions always always calculates RoI at Net Present Value (NPV) which includes a discount factor (Discount Cash Flow) for the opportunity cost at N years out. So 100k return in 5 years is nothing like as valuable as 100k next year.

Re:Who cares what IBM's profit margin is?

[Anonymous Coward]

Professional athletes traditionally have short careers, sometimes leaving their bodies crippled, and then if they are lucky manage to make a career out of commentating or endorsing products, or very often end up doing something menial. Is this something to aspire to?

Re:Who cares what IBM's profit margin is?

[gryf]

You might be surprised but many people believe that ethical behaviour should also be a priority for a company. Perhaps this opinion is more common in Europe.

This might explain Europe's much higher unemployment rates.

For decades Germany had an average of 10% unemployment. Now it's up to 20%. But when a liberal Chancellor tries to make it less expensive to hire new staff, the people protest.

Instead of blaming IBM for laying off unproductive workers, try blaming a system that discourages enterprise. Without enterprise, no growth. Without growth, no jobs.

Re:Who cares what IBM's profit margin is?

[zippthorne]

I'm sorry, by "work for us" I meant, "Create the greatest total quantity of wealth and elevate the general quality of living as much as possible." In the capitalist system, a few people will get very wealthy. often their children will piss it away, so there is some turnover of who these people are. The total amount of wealth available to a society, and hence to even its lowest member is the goal.

The whole point is to encourage people WITH wealth to invest and create jobs for people without and more wealth for everyone in general (especially themselves.. that's the point). Why is it that people don't seem to understand the basic tenets of free market economies or the object lessons provided by USSR, Cuba, China, and N. Korea? (If electric lights are a proxy for quality of life, Korea is a startling example: on the "Night map of the world" you can see the DMZ quite clearly..north of it, there is almost no light at all)

Aag now i've responded to your troll calling my post a troll with a troll of my own. My head hurts.

Re:Who cares what IBM's profit margin is?

[Bellyflop]

Actually it was a couple of months ago - DB has offices around the world and this was in New York as part of a larger reorganization effort that started in Germany.

Re:Who cares what IBM's profit margin is?

[Bellyflop]

I think you're wrong. By support staff, I didn't mean people who do tech support or the like, but people like the HR reps and the legal advisement team. Even the analyst who don't book revenue themselves but help others book revenue are valuable but their contribution can't be directly measured.

Re:Who cares what IBM's profit margin is?

[cduffy]

There is always someone who will do your job for the same or even less money. Skill sets are acquired.

Then why haven't we been able to find and hire such a person for the last two years? We've been looking for another me, and it simply hasn't happened. It's easy to say "there's always someone else" -- but if, in practice, we're unable to locate or recruite such a person, those words fall flat. It's likewise easy to say that skillsets can be acquired -- but at a startup, there's simply not time for the level of training required to acquire that diverse of a skillset. (I'm part OS developer, part app developer, part DBA, part revision control specialist, part sysadmin. In the latter two I'm better than the average specialist -- though that boast is partly based on the lack of respect I have for the revision control specialists I've met in real life so far).

Don't expect other people to believe you are irreplaceable no matter what you believe yourself.

I think it's a reasonable belief. Every fellow employee I've spoken with on the topic agrees there's a short list of irreplaceable individuals here. Given that everyone has a short list, it is indeed feasible that I may be on a few of them.

Unless you get something extra for the extra work you are putting in you are not making a wise decision by sticking around.

It's a startup -- you should already know what I get: Stock options. Lots of them. Enough that if the company does well, I'll be able to retire before 30. And if they don't do well -- heck, I'm still young, I've still got most of my health, I can go do something else. Yes, with a wife and a house, I won't be able to afford much of a transition period -- but I doubt I'll stay unemployed long.

As your company growth you will become less and less irreplaceable, less important to the overal success.

I'm not only prepared for that, I'm trying to help it along. I've got a trainee -- a fellow just out of school with minimal experience but who's exceedingly bright, a very fast learner, and almost completely unjaded. I hope that in another 6 months I'll be able to transfer to a different department and narrow my focus substantially without having the previously discussed negative impact on the anticipated value of my shares.

Re:Who cares what IBM's profit margin is?

[Anonymous Coward]

That being said, not every layoff is a terrible thing. I have some friends who were dying to get laid off from Deutsche Bank because of the generous termination packages and the abundance of positions elsewhere

Not so today (at least in IBM).

Re:Who cares what IBM's profit margin is?

[jschrod]

Speaking as a European who owns a business -- and not hiding as AC: My employees are a capital I have invested a lot into. That I don't have use for them currently doesn't mean that there won't be the case again. In addition, they made me lots of money in good times, so I won't drop them at the slightest downturn -- because I try to be fair to them.

But this might be a concept you haven't heard of until now. Too bad for you, I'm of the strong opinion that my business will last longer in the long run than yours. (And my company already exists for more than 15 years, and is profitably each year. My first business ran successfully for 10 years, with the same approach. And my parent's business ran successfully for 40 years with that approach. It's tried and tested.)

That said, there might be the time where one needs to lay off employees because one hasn't enough resources to wait until they are productive again, or where they betrayed you (e.g., I had employees stealing company money), etc. But the bland expression `fire all people that are of no use' is not optimal in the long run.

Re:Who cares what IBM's profit margin is?

[Maggott]

I'm not a fan of layoffs either but a company is there to make money, nothing else.

This is probably among the stupidest and most horrible justifications for an activity I have ever seen, which is why it's especially depressing that it's dogma.

Allow me to counter with the following statement:

"Cat-o-nine-tails exist to cause pain, nothing else."

Ergo, that justifies lashing a child with it to ensure his obedience, right? I mean, that's what the cat-o-nine-tails is for, right?

Re:Who cares what IBM's profit margin is?

[Wesley Everest]

Of course, that's why it's important for IBM employees to push back to make the layoff expensive. If IBM knows that massive layoffs will have repurcussions that hit the bottom line, they will think twice in the future.

Does an amoral multinational tool for enriching shareholders have a moral obligation to care about human beings? In the end it doesn't matter -- whether or not there is such an obligation, multinational corporations will only honor it if forced to. The mechanisms of force are consumers, the workers, and the government. Most of the consumers are corporations themselves and don't give a shit. Governments are bought and sold by corporations nowadays. That leaves one mechanism -- the one IBM workers are exercising. Good for them.

Re:Who cares what IBM's profit margin is?

[Destoo]

Corporations are "social persons".
They have all the privileges of a person but none of the responsabilities.

This also means they cannot be assassinated or kidnapped.

Re:Who cares what IBM's profit margin is?

[Anonymous Coward]

"What about all the training and investment IBM made in those people, do they think it was free?"

Sorry, what training and investment what that be again?

Re:Who cares what IBM's profit margin is?

[roman_mir]

It's a startup -- you should already know what I get: Stock option - good luck with that. All I can say is that I was supposed to be retired by now since I had over 170 thousand stock options of the startup company I worked for from 96 till 2001 (I was the first person hired.) All I can say is again: good luck.

Re:Who cares what IBM's profit margin is?

[jjr1]

This is simply a game of PR. What's worse for relations, one layoff of 10-13k or the recurring layoffs of 2k 6 times making the news each time?

Re:Who cares what IBM's profit margin is?

[luisdom]

Isn't their job to be certain they can provide profit in the future for their shareholders (the owners of the company). Why would a company want to keep 10~13K employees that are obviously not necessary in the daily business? Simply because they are making a profit?

Isn't their job to be sure that every employee is needed? IMHO, when they suddenly discover that 13K people is "obviously" not necessary, management is not doing its job right... but you don't make that big splash on specialized media.
Why the strike? Because they advertise the layoffs to the shareholders, to improve their image as a lean company, at the cost of the people: when you fire 13K at a time, you fire necessary and unnecessary people. When you say "500 a month", you have time to decide who is necessary and who is not... but you don't make that big splash on specialized media.

Re:Who cares what IBM's profit margin is?

[Anonymous Coward]

I was disagreeing that there's some special legislation or social contract that Europeans are subject to that prevents businesses from firing people. But hey, if you want to act all condescending and snotty by assuming I don't know the first thing about human resources, be my guest. You are arguing against a straw-man though.

Re:Who cares what IBM's profit margin is?

[cduffy]

All I can say is again: good luck.

Thanks. I was working in the Bay Area when the boom turned bust, so I'm under no illusions with regard to the risks I'm taking.

Re:Who cares what IBM's profit margin is?

[cicho]

Beautiful. Now show me how it "works for us" in the specific aspect of generating more jobs. How about making corporate tax breaks contingent on keeping or creating jobs? But no, that would be **communism**.

Re:Who cares what IBM's profit margin is?

[Brandybuck]

Your world must be very limited if the only way you can feed your family is by sitting in one particular chair in one particular cubicle owned by one particular company somewhere in the middle of Germany.

What? Did all the Germans starve to death before IBM decided to open up an office over there? People managed to feed their families millenia before IBM ever came into being, so what makes a job at IBM an unalienable natural right that the jackboot of the state has to protect?

Hey, what if you've never had a job before, just out of school? Do you strike against IBM or Siemens? Braun or Hewlett Packard?

Re:Who cares what IBM's profit margin is?

[Runagate Rampant]

I can see the point you are making, and of course you can choose to go and find another job. (Though this will be more difficult once you start approching or exceeding ~65 years old)

The problem with this "head down, keep going" approach is that when generally applied, ordinary workers can make no reply to the general "race to the bottom" that Corporate Globalisation argues is "inevitable". Where will it all end up?

Re:Who cares what IBM's profit margin is?

[Brandybuck]

It's not a "head down keep going" approach, it's a "everyone take charge of their own life" approach. Yes, people are going to make mistakes and stumble, but the operating philosophy should be that most people can take care of themselves quite well.

Re:Who cares what IBM's profit margin is?

[Runagate Rampant]

Yeah, and sometimes that means taking collective action, like the workers at IBM in Germany.

Re:Who cares what IBM's profit margin is?

[Billly Gates]

Does the company have 30 year mortages and credit they need to maintain?

By all means fire a bad employee but what about treating employees as more then just capital? People would not quit if they felt that loyality to them was valued.

People rarely quit one job for the next at another company in the 1950's and in return most companies held people throughout their lifetime. Only the bad ones left or were canned.

ALso most companies want a 2 week notice. Meanwhile you can fire me in a moments notice. Does that sound fair?

A trim and a hair cut.

[Anonymous Coward]

"The union also questions if other cost cutting mechanisms could achieve the same effect without cutting so may jobs.""

Give upper-managment a pay cut.

Oh yeah!

[Pig Hogger]

Wanna make money with IBM?

Buy stock.

IBM isn't there to pamper it's employees. It's there to pamper it's board of directors, and, eventually, the shareholders.

The workers? Fuck'em. They've been paid for all the work they've done for IBM so they're in the least position to squeal about it.

Don't like it? Well, make a revolution. Until then, that's how it works.

Re:Oh yeah!

[IdleTime]

That is how it works in USA, but IBM is a registered company of UK too and they have to follow the laws of the country. UK, as all the rest of the European cuntries have laws that regulatre what a corporation can do when it comes to layoffs. You can't simply dump employees for no reason and this is a no reason.

Re:Oh yeah!

[winkydink]

Trust me, IBM is no dummy. They knew they had an almost 100% chance of success before ever taking this before any works council. The local entity's profitability is what gets looked at, not the global parent.

Even if the global parent is making gazillions of dollars, if the European subs are losig money (or can be made to appear to be losing money... trivial to do for a company the size of IBM) then IBM can lay off the employees at the non-profitable subs and there isn't a darn thing the work councils can do. In fact, if the unions had a snowball's chance of winning through the legal system, the strike would be unnecessary.

Re:Oh yeah!

[zoloto]

That's not true. Employers can release you from your employment as you can walk off the job if they or you are so inclined. There doesn't have to be a reason. Unless you're under contract, then it's legally binding but the general worker can be let go at any time and you can quit at any time.

Nuff said.

Re:Oh yeah!

[IdleTime]

Uhhh no... they will have to relocate excess workers from the offices closed down.

Re:Oh yeah!

[Anonymous Coward]

Wow, you really are complete dick. You seem to think that it's OK to cut the income of a large amount of employees who have families to support. I see you're going for the "It's just business" argument.

Nobody apart from people like you thinks it's OK for them to behave like this. Anyone who isn't completely self-centred can see that paying upper management a disgusting amount of money while 'streamlining' is quite a sickening way for a company to behave. You are either very stupid, a greedy bastard who owns stock, or in upper management.

Don't like it? Well, make a revolution. Until then, that's how it works.

I honestly think that it will eventually come to that the way things are going.

Re:Oh yeah!

[winkydink]

Yes, you are right. IBM will have to offer those Europeans being laid off the opportunity to do their job in India or China, at Indian/Chinese rates. IBM will have to pay for relocation. How many do you think will want to go?

Re:Oh yeah!

[Bellyflop]

That depends entirely on the laws of the government under which you and the company operate. At-will employment isn't always present.

Re:Oh yeah!

[Anonymous Coward]

the general worker can be let go at any time and you can quit at any time.

That isn't even true in the UK - there's a statutory minimum notice period based on length of employment. I'm sure it can't be true in the more 'workers rights' continental countries.

Re:Oh yeah!

[zoloto]

:D

This is a USA centric userbase of readership. I failed to realize certian laws in countries of which are being dealt with. Knee-Jerk reaction on my part, I suppose, because I thought "at-will" was a universal thing.

Re:Oh yeah!

[Anonymous Coward]

In Portugal the employer must give a 30 day warning before firing you (with a proper reason).Also, almost everybody is under contract as a employee can only work for 3 years in that company without being automaticaly contracted (and if he isn't he must be fired receiving some "not so small" benefits)

Re:Oh yeah!

[Anonymous Coward]

Oh, christ. I have absolutely nothing against the American system, but please! Read the fucking law. Small strikes generally come before full strikes. IBM *can* lose millions in a proper strike. Laying off people without a good reasons will cost them a *lot*. Unions in Europe are pretty damn smart. They may still ditch the workers, but it'll cost.

Re:Oh yeah!

[tha_mink]

"Nobody apart from people like you thinks it's OK for them to behave like this. Anyone who isn't completely self-centred can see that paying upper management a disgusting amount of money while 'streamlining' is quite a sickening way for a company to behave. You are either very stupid, a greedy bastard who owns stock, or in upper management.

Calm down. High level execs get their money because of the responsibility their position carries. Some guy screwing in case mounts goes home and his job ends there. The execs are responsible for the entire company. Their salary is commiserate with thier responsibility. Do you want some guy responsible for your $200 billion company getting $90,000 / year? That's stupid. You want to make sure their happy at the wheel. (really happy)

Re:Oh yeah!

[winkydink]

Oh it'll cost alright. It all gets factored in before any announcement is made.

Who's P&L do you think a general strikewill affect? US's? India's? I'm thinking Europe's. Said losses create the justification for future offshoring of more jobs. It seems to me like that would be plying right into IBM's hands.

The union's position is only strong when the employer has no other alternative. I think they are missing that point.

Re:Oh yeah!

[IdleTime]

I'm not sure if you are just ignorant of how the world works or if you really are that dumb. They will have to relocate the workers INSIDE the country they are residing in, i.e inside UK.

Re:Oh yeah!

[Anonymous Coward]

I agree with the reasoning, but not the with the magnitude of that compensation. Color me idealistic but I don't think execs deserve 419 times the average salary - extra responsibilities or not.

Re:Oh yeah!

[Anonymous Coward]

Bullshit!
If said high level exec gets fired he gets a huuuge compensation and goes away to ruin the next company...
may not always be that way but at least more backed up by reality than your "responsability"-argument
I mean really what happens to a manager who drives a whole company into the ground, being responsible for all the ensueing lay-offs, etc.?
Does he get to experience anal gangrape or any mildy inconvenient consequences?
ahah didn't think so...

Re:Oh yeah!

[Anonymous Coward]

Calm down. High level execs get their money because of the responsibility their position carries.

Bwahahaha! *snort* My but you are gullible moron.

Re:Oh yeah!

[tha_mink]

Bwahahaha! *snort* My but you are gullible moron.
BR And you sir are an anonymous coward.

Re:Oh yeah!

[tha_mink]

I mean really what happens to a manager who drives a whole company into the ground, being responsible for all the ensueing lay-offs, etc.?

It ruins his whole career and then he's got to go back in the trenches with the suckers.

Thought for the day

[kawika]

The limbs on a tree can always come up with a reason why they shouldn't be pruned.

If IBM thinks they don't need these workers, they should be able to eliminate them. If IBM is wrong then the company will suffer and the worker will find a better job. If IBM is right they will benefit and the worker will need to get their sorry ass in gear or work at a crappier job.

After being through a half-dozen jobs in my life I realized that a capable person losing a job is an opportunity, not a tragedy.

Re:Thought for the day

[boogybren]

Businesses aren't in business to give people a job. They are in business to make money. As crappy as it is for people to lose their jobs (sometimes), their prosperity is in their own hands. And if this was a bad decision on IBM's part, it's their responsibility to learn from it and accept the consequences.

There are always employment opportunities available, even if you have to scrub toilets or flip burgers until you find a better one. Instead of marching up and down the block complaining, why not start that job search? I think monster and flipdog have EU sites too :-)

Re:Thought for the day

[Alejo]

Your personal experience is not enough to make a rule. Many have problems getting a proper job.

And remember, your taxes/tribute cover unemployment checks.

Re:Thought for the day

[owlstead]

Bet you aint 50 yet.

Re:Thought for the day

[Anonymous Coward]

Problem is these people are slugs and for them this is a tragedy. Unionized IT workers are usually the bottom of the barrel. Oh well back to welfare for them :) Must suck to be a uro-peon.

Re:Thought for the day

[Anonymous Coward]

Many have problems getting a proper job.

He said, "a capable person losing a job is an opportunity."

Useless people don't count.

Re:Thought for the day

[jafac]

If IBM is wrong then the company will suffer and the worker will find a better job. If IBM is right they will benefit and the worker will need to get their sorry ass in gear or work at a crappier job.

. . . either way, 13000 less ably-employed consumers is bad for ALL business.

Re:Thought for the day

[Skuld-Chan]

Thats not the way collective bargaining works though.

Ever wonder what it would be like to have a say in affairs that affect you in your company?

Re:Thought for the day

[Rich0]

After being through a half-dozen jobs in my life I realized that a capable person losing a job is an opportunity, not a tragedy.

Sure, if one person gets fired they'll bounce back - especially if their former employer gives them half-decent severance and all that.

On the other hand, if IBM closes down an office or otherwise terminates 2000 IT folks in the same town, there is no way that most will bounce back without relocating. No job market can absorb that many people when they have specialized jobs.

Cuts of that scale really are tragic. I'm not saying the solution is government regulation, but that doesn't mean that everything is swell either...

Re:Thought for the day

[Anonymous Coward]

Yeah, once you're 50, you have to beg for jobs. I'm watching my dad go through this now, he even went back and completed his P.E. so he can call himself a Chemical Engineer instead of just a chemist, and I make more money than he does.

My parents will probably end up living with me. Kinda puts a damper on the party plans.

Re:Thought for the day

[peachpuff]

"The limbs on a tree can always come up with a reason why they shouldn't be pruned."

The tree can also come up with a few reasons not to cut off its limbs. Usually, it's the gardener who wants to cut--so things look nice and neat.

Re:Thought for the day

[evilviper]

I realized that a capable person losing a job is an opportunity, not a tragedy.

You really need to take a trip to Michigan, and be sure and tell them how lucky they all are. (or at least watch "Roger and Me")

Re:Thought for the day

[Anonymous Coward]

If IBM is wrong then the company will suffer and the worker will find a better job

There is no logical connection between the two parts of the sentence. IBM may suffer and the worker may not find a job at all. This is an entirely possible outcome.

Re:Thought for the day

[crawling_chaos]

Ah, but you missed the genius of his statement! Any person who cannot find a job after being laid off is "incapable" and therefore worthy of contempt. If he didn't put that qualifier in, perhaps he'd have trouble sleeping at night.

Myself, I've seen plenty of capable people flounder, even though I've been able to land on my feet after my layoffs. I just don't justify my good fortune with pseudo-Randian bullshit to let me feel superior.

Re:Thought for the day

[doinky]

Yes, cyberlibertarians, the message here is that macroeconomics DOES matter. Talk to somebody who tried to get a job in Silicon Valley or Austin during the depth of the Bust.

And no, previous responder, the 2000 people laid off in one town can't all just become entrepreneurs. Many, as shocking as this is to believe, don't have enough savings to start their own business! (I know! They must have been profligate wastrels, perhaps overspending on their butlers and whatnot).

looks like IBM found....

[pthor1231]

..the people to lose their jobs already :-) It seriously does suck though, that that many people are being let go and opposed to looking at other cost reducing mechanisms.

Re:looks like IBM found....

[Rosyna]

Yeah. Prove how useful you are to the company and how much you deserve to keep your job by not working!

Pay your people enough...

[davidwr]

If you provide your people a good enough pay and working environment, and they know they can be replaced with a finite costs, they won't strike.

If you don't, or if they know the cost of replacing you is too high, they may.

For better or for worse, a global economy means everything else being equal, the higher-cost employees are the first to get laid off.

Re:Pay your people enough...

[Klivian]

>the higher-cost employees are the first to get laid off.
No they are not, the higher-cost employees are always in the upper-management category and are never laid off in cost saving scenarios like this.

Re:Pay your people enough...

[Locke2005]

For better or for worse, a global economy means everything else being equal, the higher-cost employees are the first to get laid off. The key phrase here is "everything else being equal". IBM if offshoring these jobs to people that don't have the language skills and cultural familiarity needed to best serve IBM's customers, therefore IBM's customers will inevitably suffer. Yes, the European workers should be trying to make themselves more competitive instead of bitching about their "right" to a job, but the globalization race to the bottom means both employees and customers (at least those in high cost of living areas) suffer.

Here's an idea: don't allow any product or service to be sold in your country that isn't certified to have been manufactured in accordance withi your country's occupational safety and environmental regulations -- regardless of where it was made. With globalization, some leveling out of wages and living standards is inevitable. But we really shouldn't reward the places with the most abusive work practices, most disregard for the environment, and most corruption by giving them more business even if by using these practices they can produce products cheaper

Some sympathy

[Realistic_Dragon]

Corporations should have some social responsibility attached to their privilages - after all they are granted permission to exist by the people.

No 'make work' jobs should be encouraged, it's just a waste of economic resource, but strongly suggesting to such companies that they should look into retraining and redeploying their workers rather than just firing them en mass would be a good idea as the shock of such large events can permanently damage communities and economies.

That and I seriously hope the board of IBM is taking a huge pay cut. Lead by example and all that.

Re:Some sympathy

[Anonymous Coward]

...they should look into retraining and redeploying their workers rather than just firing them en mass...

You're making an assumption here, I think.

Re:Some sympathy

[Anonymous Coward]

I seriously hope the board of IBM is taking a huge pay cut. Lead by example and all that.

Welcome to the real world and all that. You stupid cunt!

Re:Some sympathy

[Byrneseyeview]

Is their existence really based on the will of 'the people'? I know it is in a legal sense, but that's just to provide a framework for what would exist with or without corporate law: Pooling of capital and pooling of risk.

No 'make work' jobs should be encouraged, it's just a waste of economic resource, but strongly suggesting to such companies that they should look into retraining and redeploying their workers rather than just firing them en mass would be a good idea as the shock of such large events can permanently damage communities and economies.

Viewing the economy as a whole, rather than just the IBM component thereof, that's exactly what's happening; 10-13K workers are being redeployed to non-IBM jobs. I know this sounds a bit sophistic, but it's also quite accurate.

Re:Some sympathy

[16K Ram Pack]

Yeah, and if they don't, then what? What happens then is that government intervene.

Governments know NOTHING about running business and should keep their noses out. If an employer makes a bad decision letting a good guy go, his competitors will benefit.

Re:Some sympathy

[jafac]

Governments know NOTHING about running business and should keep their noses out.

Judging by the crappy corporate performance and layoffs (along with massive runup in exec compensation) over the past 5 years, I'd say private business knows NOTHING about running businesses either.

If an employer makes a bad decision letting a good guy go, his competitors will benefit.

. . . and the exec who oversaw the layoff will also benefit with a fat bonus. . .

Re:Some sympathy

[jafac]

How is running a corporation a privilege?

Roosevelt said so over a century ago:

It is no limitation upon property rights or freedom of contract to require that when men receive from government the privilege of doing business under corporate form, which frees them from individual responsibility, and enables them to call into their enterprises the capital of the public, they shall do so upon absolutely truthful representations as to the value of the property in which the capital is to be invested. Corporations engaged in interstate commerce should be regulated if they are found to exercise a license working to the public injury. It should be as much the aim of those who seek for social betterment to rid the business world of crimes of cunning as to rid the entire body politic of crimes of violence. Great corporations exist only because they are created and safeguarded by our institutions; and it is therefore our right and our duty to see that they work in harmony with these institutions.

People can freely do business all they want. But a Corporate Charter exempts one from certain rules and taxes, and more importantly, liabilities (ie. RESPONSIBILITIES) - and it is, indeed a PRIVILEGE granted (and FAR too infrequently, revoked) by the government.

Re:Some sympathy

[Anonymous Coward]

You do not have to get permission to do commerce, whether to the extent IBM does or the mom-and-pop video store down the street.

Ok, as an employee of a small business that helps to start other small business, and on behalf of all companies of any size everywhere, You Are A Fuckwit.

You have no clue what the fuck you are talking about. You have never in your life seen a corporate charter, much less know what it says. You have never filed a dba with any governmental agency. You have never done any kind of environmental impact study for a building larger than the shed in your daddy's backyard that you live in, nor have you ever done any kind of OSHA audit.

So shut up about things you know jack shit about. You aren't doing anyone a favor, especially yourself.

Re:Some sympathy

[rfallon33]

Viewing the economy as a whole, rather than just the IBM component thereof, that's exactly what's happening; 10-13K workers are being redeployed to non-IBM jobs. I know this sounds a bit sophistic, but it's also quite accurate.

Not entirely accurate. There is a considerable distinction between being "redeployed to non-IBM jobs" and simply not having a job at all. Things would be different in the laughably implausible event that IBM actually lined up new jobs at other companies for each of the people being laid off.

Re:Some sympathy

[Byrneseyeview]

If we want to get super-hairsplitty: It's not entirely laughable. In the sense that it's happened. Once. When Warren Buffett took over Dempster Mill in the 1960's, he fired lots of employees, but kept track of them to make sure they were better off. So yes, some people do that. It's a lot rarer at larger companies, of course. The point I was making was that IBM doesn't have a responsibility to keep them hired -- the economy as a whole is a mechanism for ensuring that. And given that over the last hundred years, despite oodles of layoffs and redeployments, the number of jobs has stayed at about 95% of the number of people seeking them... I'd say the economy does a pretty good job.

Re:Some sympathy

[Anonymous Coward]

Have you actually seen a summary of business profitability and employment over the past five years?

Gee, I didn't think so.

Re:Some sympathy

[Anonymous Coward]

How is running a corporation a privilege?

We're not talking about governance here but the right of corporations to have some of the rights normally accorded to individuals(see US legal history as an example of how this developed in the USA at least). The concern some people have (e.g. Jefferson) is that incorporation carries too few reponsibilities that individuals would normally have. From your quote it seems that Theodore Roosevelt understood this well.

Shepard has one hundred sheep because...

[Toby The Economist]

...if even one goes missing, he spends ages searching for it.

IBM make so much money because they keep themselves efficient. If you stop doing that, you eventually stop making money. It's not reasonable to argue "we're doing well now, so we don't need to fire people". Anyways, since these are the people who are going to lose their jobs, you can know a priori their perception of the state of the company is biased; they'd be inhuman for it not to be.

Personally, my take in this is very simple; you enter into a contract with another person (a company, as it happens, in this case, which makes no difference) and either of you are free to behave as you like as long as you honour your contract.

It is improper for one individual to use extraordinary means (going on strike in this case) because they don't like what the other person is doing, when they've agreed to the contract between them.

--
Toby

Re:Shepard has one hundred sheep because...

[Anonymous Coward]

Wow, you spell like a Brit, but you have no concept of how a union works? If you're in a union, the contract isn't between you and the company, it's between the union and the company.

Unions are just another obsolete layer of buraucracy that exists to suck up money from their members. You think that you pay taxes and the money goes nowhere? Unions are the champions in that regard!

Re:Shepard has one hundred sheep because...

[Anonymous Coward]

It is improper for one individual to use extraordinary means (going on strike in this case) because they don't like what the other person is doing, when they've agreed to the contract between them.


Why do you say that? As long as there is no "no strike" clause in the contract, the workers are honoring the contract as written. IBM is free to go find new workers so long as they obey the laws of the contries where they are doing business.

No one is out of line here. Why are you singing out the workers as acting improperly?

Re:Shepard has one hundred sheep because...

[neil.pearce]

It is improper for one individual to use extraordinary means (going on strike in this case)

Where exactly are the extraordinary means here?
Their right to strike is enshrined by law, provided due ballots have taken place (which I believe is the case)

Re:Shepard has one hundred sheep because...

[Toby The Economist]

> Their right to strike is enshrined by law,
> provided due ballots have taken place (which I
> believe is the case)

I think the right to strike is an anacronism. It was appropriate when workers lacked rights and were exploited; these days, with for example the highly skilled IBM employees, it's *actually* a State enforced injustice whereby one party in a well-understood and mutually-accepted contract can violate the agreement in the contract.

This issue is in fact what's destroying Ford and General Motors, for example. The CEO of Ford a few years ago summed it up very nicely: "I can't fire any of these workers". Ford desperately needs to cut it's workforce, but it cannot, because of the strength of the unions there and their ability to strike. Ford is probably now on an inexorable decline and will eventually fail; the unions really are not operating in their own best interest, but they lack the insight and foresight to see this.

--
Toby

Re:Shepard has one hundred sheep because...

[v3rgEz]

I won't debate on whether or not people have a right to strike ... I feel they do, but I also feel that IBM should have the right to fire the lot of them if they choose. Capitalism: love it or change it.

True, IBM has a corporate responsibility. But a few years back, in the 70's, they worked a little too close to that corporate responsiblity, and MS took advantage of the larger giant and IBM almost died. I know, my grandfather worked for them. They refused to fire anyone (almost literally), they spent millions on corporate country clubs, golf courses, etc. for use by any employee, they had gazillions of social "perks." It was a huge drain on the company though, and they had to cut perks to survive. They did, and have bounced back reinvention after reinvention. My grandfather kept his job long after it should have been obsolete. His biggest pride was on a patent on a punch card machine. The punch card machine never saw the light of day, it was replaced by computers. I'm glad my grandfather kept his job as long as he did, but if IBM kept on making punchcard machines because it was the nice thing to do, even more would have lost their jobs longterm.

Re:Shepard has one hundred sheep because...

[Toby The Economist]

> Wow, you spell like a Brit, but you have no
> concept of how a union works? If you're in a
> union, the contract isn't between you and the
> company, it's between the union and the company.

That's merely a device.

You're right about the Brit bit.

--
Toby

Re:Shepard has one hundred sheep because...

[16K Ram Pack]

Unions work where people have little choice - public sector employers.

In a time of mobility, what use are trade unions? If I don't like an employer, I find another. I can drive 20, 30 or 40 miles to another. You couldn't do that 80 years ago.

Re:Shepard has one hundred sheep because...

[owlstead]

That contract will be a contract to be employed for as long as the employee sees fit. It's pretty hard to fire people when the company is running fine in the Netherlands, as in many European countries, and it should be. Currently if you have been one year employed, you'll get a full contract.

It can be pretty hard for employees to find a new job, especially when they are older. Companies are required to be looking for the best of their employees, not just profits. Fortunately in Europe companies still exist as benefits to the people instead of the other way around. We should be on guard to keep it that way.

If IBM is willing to fire so many people when they still maintain profits, they should pay, and pay dearly. Especially if they haven't looked at alternatives, though I imagine that would be cumbersome for such a number.

And as said, going on strike is actually a right that has been secured ages and ages ago. It's frequently used in Italy, France, Germany and the Netherlands. You might discover this if you travel to Europe - public transport is known to exercise the right slightly too many times (since it has a big impact, and unions are strong in those quarters).

Re:Shepard has one hundred sheep because...

[Toby The Economist]

> In a time of mobility, what use are trade unions? > If I don't like an employer, I find another.

Your ability to do so is limited by unions. A union essentially exists to obtain for its members pay and priviledges in excess of those warrented by the work they do. In doing so, in particular by making it hard to fire people, companies are discourage from hiring, because once hired, it is hard to dismiss.

Unions are essentially parasitic. You have to remember that by increasing wages beyond the point where they would naturally be, the products and services offered by the company are more expensive; and so EVERYONE ELSE who uses these products and services pays more.

A union brings benefits to its members at the cost of the general public and the economy as a whole.

--
Toby

Re:Shepard has one hundred sheep because...

[neil.pearce]

My business would vault in profits if I could just pick and choose
which labour laws to obey or not, at a moments whim.

There is nothing stopping Ford reducing their workforce, it's just
that they will have to (and this is the stickler) cough up funds, rightfully
due to that said workforce, enshrined by their contracts or law - the very
same contracts and law that the CEO would be bitching like a baby about
if the violation concerned him losing cash.

Damm workers "rights"...

Re:Shepard has one hundred sheep because...

[Chris Y Taylor]

I think an easy fix for this would be to just treat unions as what they are: corporations. Their "product" is negotiated labor. If anti-trust laws were applied to them, then unions would have to fight for who provides the best benifit to the worker at the low end and for which union gets factory contracts at the high end. It would force them to be efficient or lose market share to competing unions.

Re:Shepard has one hundred sheep because...

[ChrisMaple]

Slavery was once "enshrined" by law. Law and right are not the same thing.

Re:Shepard has one hundred sheep because...

[chriso11]

A union essentially exists to obtain for its members pay and priviledges in excess of those warrented by the work they do.

Surprisingly, CEOs and other high-level execs don't seem to need a union to do that - they can get on average 419x as much as the average worker. And when they leave, they get a great deal (Carly F. got $21million to leave, after doing a crappy job at HP).

So don't lecture about how unions are unfair without acknowleging the whole system is unfair, and so a union is an approach by labor to gain leverage. Remember, the lowest guys on the rung are the easiest to push around.

Re:Shepard has one hundred sheep because...

[idlemachine]

So, in other words, corporations have a right to do whatever it takes to make money for themselves & their shareholders, while workers don't?

Been suckling the teat of your inheritance long?

Re:Shepard has one hundred sheep because...

[Anonymous Coward]

It is improper for one individual to use extraordinary means (going on strike in this case) because they don't like what the other person is doing, when they've agreed to the contract between them.

So wait. It's totally improper and unthinkable for everyone at a company to threaten to quit at once, but the company can feel free to threaten or outright fire any number of its employees at any time?

Talk about hypocritical.

Re:Shepard has one hundred sheep because...

[Anonymous Coward]

The punch card machine never saw the light of day, it was replaced by computers.

So in other words, they found something else for your father to do. Rather nice of them to go out of their way to keep their workforce profitable instead of just letting the whole lot of them go.

Re:Shepard has one hundred sheep because...

[Anonymous Coward]

And then you find that everyone else is doing the same and it takes you 90 minutes to get to work and 90 minutes to get back, but you can't afford houses any nearer. So what happens next? Do you expect the government to build a big new road to ease traffic congestion? Or why not get the government to subsidise your wages for a closer job by the amount you would cost it by all that travelling? Or do you telecommute? But if you are telecommuting you could as well be in India.

Re:Shepard has one hundred sheep because...

[Anonymous Coward]

you dumb shit.. since when is one person not going to work considered a strike? A strike is collective action by a group of people.

A union is not a person. Nor is IBM.

You extol the right of an employer to act as pleases him in his position of power, but in a specialised industry like IBM's, the workforce as a whole has power.

In most of the towns where IBM has significant facilites, they are a practical monopsonist (sole buyer) for those types of skills, and this places them in a great position of power.

It is not unethical for the workers to realise that they collectively control supply of those skills, and can thus counter this monopsony power with a collective monopoly, i.e. a union.

Only morons would set out to strike with the intention of driving the company into the ground. A company whose employees do not benefit from the success of the company has no reason to expect employees to be dedicated.

Re:Shepard has one hundred sheep because...

[Anonymous Coward]

IBM, and other multinationals, do keep themselves fairly efficient... but not by 'streamlining'. I'd day about 30% of that efficiency you claim comes from kicking people and the rest (some 70-ish%) comes from moving MONEY around on a global scale and making profit (or a pseudo-profit) on the transfer. What IBM and firms like GM are doing in Europe is continually move their 'investments' around using tax incentives, tax law loopholes and utter bribing from the still-national european governments. This is why you can have a factory in germany five years, then 'move production' to Hungary for five, then on to Spain for a couple and finally back to Germany who manufactured a swell taxbreak-and-free-infrastructure package. Taxpayers by and large indirectly-but-straightlined throw money at multinationals just so that a couple of thousand people in some town or another can keep their jobs for a few years on. A billion USD taxbreaks here, a billion USD free beer there... soon your talking real money. Those bribe packages drain the national budgets quite a lot.. but they also add up to profit margin for the company, and the company sees only its own numbers.
AFAIK it works the same in the US, production moving between states (and/or mexico) in search of lower base costs and larger tax incentives. Combine these types of company perk packages with the regular porkbarrel politics and you get a fine little game of whos who and whomadewhat.

Re:Shepard has one hundred sheep because...

[jschrod]

IBM make so much money because they keep themselves efficient.

I stopped reading here. As an IBM supplier and contractor, I can tell you: There are lots of reasons why IBM is making loads of money. That they are efficient is none of it. IBM and efficiency are two anathemes.

Re:Wealth and success

[Anonymous Coward]

Ah...easy to say when its not your job other wise blame those damn Indians and Chinese

/.ed

[jzeejunk]

looks like IBM paid the poster to slashdot union website.

Re:/.ed

[ehiris]

You'd think the union of IBM would have more potent systems.

Re:/.ed

[jzeejunk]

No because Microsoft "sponsors" the union's servers.

Re:/.ed

[winkydink]

The potency of the union and the potency of the web site are similar.

Re:/.ed

[birge]

If their server couldn't handle it, then perhaps we can see why IBM can afford to fire these guys. Perhaps they did as good an IT job for IBM as they did for the union.

US company / Euopean strike

[winkydink]

When will the Europeans figure out that their polite, silent walkouts, singing songs, sitting down in the corridors, etc... are viewed with a certain amount of amusement by US companies who are used to associating the word strike with picket lines?

IBM is going to do what's right for IBM. (western) European workers are very highly paid, work on average about 35 hours per week, get 5-7 weeks of paid vacation, and phenomenal benefits (most state supplied, but paid for through employer subsidies).

IBM can get the same work done cheaper China/India/etc. What's their incentive for paying more for the same result?

Re:US company / Euopean strike

[Anonymous Coward]

What most Americans don't realise is that French workers are virtually equally as productive as American workers. It just so happens that the French workers don't work so many hours, so more people are required to do the same amount of work. There are other reasons why European economies aren't doing as well, including less flexible labour laws, but productivity isn't one of them. Personally I think the Europeans are happier as people because they're not slaves to their jobs so much as us here in N. America. Another thing when evaluating the cost of business ties in to last night's 60 Minutes: companies don't have the cost of providing health benefits. You might might sit there with your superior attitude laughing at the Europeans and their quaint militantness, but I think the last laugh is on you, the corporate slave monkey.

Re:US company / Euopean strike

[winkydink]

You realize, that outside of France, France is not considered a player in the global economy, don't you?

More people to do the same amount of work = less profitable and less competitive.

Re:US company / Euopean strike

[Salinger]

I work in Europe although originally from NYC. Europeans get 2 weeks paid leave a year. THAT IS ALL! You are spouting typically ignorant US Anti-European sterotypes.

My guess is that you come from a part of the US that doesn't really get out much.

If life is so good over here then why not make the right career move and get a job here?

I'll bet you starve to death within the year.

Re:US company / Euopean strike

[neil.pearce]

The incentive may lie in that many European nations are increasingly reluctant
to furnish contracts with employers who pull out of their territories.

"the cost" of a job is not just what gets paid to the contractee

And there's be nothing wrong with that, as you indeed said, "IBM is going to
do what's right for IBM"

BTW - nobody in the EU gets 5-7 weeks paid leave. "Phenomenal benefits
paid through employer subsidies" is just nonsense. Please
give a concrete example.

Re:US company / Euopean strike

[winkydink]

Excuse me. All Europeans get 2 weeks? I beg your pardon, but you simply don't knwo what you are talking about. I spent 18 weeks outside the US last year on business.

I work for the international arm of a multinational.
I have employees on my staff who are European and work in Europe. Our French employees receive 5 weeks of vacation each year. Plus up to two more that get applied using some Byzantine formula. Our German operation is similar.

I have been offered employment in both Asia and Europe in the past year. I'll stick with the US, thank you very much.

Predictable, resaonable and capped tax rates. Something you won't find in most of western europe.

Nobody starves to deat in western europe. It's all socialized. Surely if you work there, you know this.

Re:US company / Euopean strike

[slavemowgli]

Having a market where people can actually afford their products?

Re:US company / Euopean strike

[Anonymous Coward]

BTW - nobody in the EU gets 5-7 weeks paid leave. "Phenomenal benefits paid through employer subsidies" is just nonsense. Please give a concrete example.

Everything he said applies for France. We usually get 7 weeks of paid vacations (with no real upper limit on how much you work each week), (5 weeks if working 35h a week).
We get full social security, full retirement from the state, both paid through employer subsidies.

Re:US company / Euopean strike

[Salinger]

France is NOT Europe, it is merely its armpit. Just as Americans like to tell the world that Texas is NOT the US.

Get your facts right.

If you talk about Europe then mention Europe. When talking about France, mention France.

Focus, you'll make fewer mistakes.

And BTW nobody is buying your international business man routine.

Re:US company / Euopean strike

[grahamsz]

Hmmm i moved from the UK to the US (with the same company) and didn't notice much difference in my paid vacation.

In the UK i got 30 days + xmas and new year

In the US i get 16 days + MLK Day + Memorial Day + Presidents Day + Independence Day + Day after Independence day + Labor day + Thankgiving + Day after thanksgiving + 5 days for xmas and new year.

UK Total 32 days
US Total 29 days

Plus once i hit 8 years of service i'll get another week, bringing the us total to 34.

Now i rather the european model of not giving you pointless days here and there, and actually giving you enough to take a 1 month break every year... but that's just me.

May not be the same everywhere but i'm looking at another US company that's going to offer me 30 total.

Re:US company / Euopean strike

[winkydink]

You did see the bit about Germany in there too, didn't you?

Dimwit.

Re:US company / Euopean strike

[Anonymous Coward]

BTW - nobody in the EU gets 5-7 weeks paid leave.

I get 6 weeks paid leave per annum. I'd say 4 to 5 weeks is normal.

Re:US company / Euopean strike

[Salinger]

I certainly did. However you didn't quote a figure for Germany, therefore I chose not to comment on it.

Haven't I told you already, Focus!

Re:US company / Euopean strike

[Anonymous Coward]

Is Germany not Europe either? You're running out of countries that are European...

Germany: 4 weeks
Belgium: 20 business days
Spain: 30 calendar days
Netherlands: 4 weeks
UK: 4 weeks upon implementation of EC directive
France: 5 weeks

Funny thing about that EC directive - it mandates a minimum of 4 weeks paid vacation after one year of employment. Of course, that's just the minimum. Check out EC 93/104 Art.7(1). So I guess you're full of crap.

Re:US company / Euopean strike

[Anonymous Coward]

Just as Americans like to tell the world that Texas is NOT the US.

Can you quote figures on the number of Americans who say that? If we're talking about armpits, then I think that you mean New Jersey.

Re:US company / Euopean strike

[Bellyflop]

I worked for a company that was half US and half Swedish. The Swedish half had 4 weeks of vacation in the summer on top of their normal 3 weeks.

Re:US company / Euopean strike

[neil.pearce]

Well, I have learnt something new tonight if the norm is to get such large paid leave in France.

But I'm not sure what you mean by "paid through employer subsidies". Surely if it (benefits) come from the state, it comes through general taxation (both employer and employee)?

Re:US company / Euopean strike

[Anonymous Coward]

HAHAHAHAHAHA!!

IDIOT

Lets compare GDP you freaking sock puppet of all sock puppets.... France is shit stuck to the ass of a babboon.

Lets compare unemployment rates! What the fuck are you thinking??!?!

Lets compare household incomes. .... My god...

France..... FRANCE.... Oh lord... this guy has got to be some kind of right winger making a really cruel joke about europeans... no one is that stupid.. my god

Re:US company / Euopean strike

[Anonymous Coward]

But I'm not sure what you mean by "paid through employer subsidies". Surely if it (benefits) come from the state, it comes through general taxation (both employer and employee)?

Well not really. Employees, citizens do pay taxes, but not for either social security or pensions.
This is paid directly by the employer, as a percentage of the salary given to the employee (of course, this could be paid directly by the employee...). This percentage depends on the salary, as does the pension benefit (but not the social security benefit which is the same for everybody, even unemployed -- it is actually better in this case since everything is 100% covered).
But in both cases, the state is the one distributing this money back.

Re:US company / Euopean strike

[Anonymous Coward]

They're only the country with the 5th biggest economy.

Re:US company / Euopean strike

[TerminaMorte]

This isn't marked as '0, Troll', why?

You might might sit there with your superior attitude laughing at the Europeans

Yes, we're all arrogant and evil people... and you're all frog eating bastards who can't win a battle. Got to love those blanket statments.

Re:US company / Euopean strike

[Anonymous Coward]

Yes you do considering that I live on the western side of the pond.

Anyway, what's up with the frog comment? Is it supposed to be an insult or something? I'm not sure how I'm supposed to feel your statement. I went to France to years ago and tried frogs legs... they were delicious!

Re:US company / Euopean strike

[Anonymous Coward]

you realize that you have no idea what the hell you are talking about. can you even spell france? or us for that matter?

Re:US company / Euopean strike

[winkydink]

From The Standard Report, compiled by graduate students in jouralism at Regent University:

Average annual vacation days:
Italy 42
France 37
Germany 35
Britain 28

For comparison's sake, the number in the US is 13.

Would that qualify as broad enough to say "Europe"?

My guess is that you work in that part of Europe known as Brooklyn.

Re:US company / Euopean strike

[ozric99]

I just moved out to the US from the UK. I had 34 days paid holiday in the UK which seemed to be the norm among my peers. I'll be lucky if I can take a week off in my US job.

Re:US company / Euopean strike

[Anonymous Coward]

Man, I don't even get 4th of July off, much less the day after independence day.

I have so many unused vacation days saved up, too bad it hurts the company's bottom line if I take any of them, so management is instructed to make it as hard as possible. Apply for days off a month in advance, and MAYBE you'll get one of your days off requests accepted. Don't even think of a 4 day weekend though.

But hey, I've ground my face away so the CEO can afford to buy a rolex instead of paying out a Christmas bonus last year.

Re:US company / Euopean strike

[Anonymous Coward]

Heh, I'm from Texas, and this place sucks shit through a straw.

I like the latest stuff going on here. Rather than do any real work, the legislature spun its wheels all session dicking around trying to legislate cheerleaders so that it could look like it was doing something important to all the Christian voters, who continue to think that the Republicans have anything to do with their God, and allow themselves to be drawn in by such lies as "Compassionate Conservative" while Bush (also from Texas, though not natively, thank God) pushes a broken social security agenda that would cripple the safety net that was once set out to make sure the victims of companies like enron and worldcom could survive even when their savings or pensions were wiped out.

And of course there's Delay, who has inspired such wonderful flip-flopping on Republican ethics and word definitions (so tell me, Mr. Delay, if an "admonishment" isn't a punishment, what exactly is it, and why did you not correct the behaviour causing it after the first two or three times?) that John Kerry and Bill Clinton's envy combined runs the green dye bin at the mint.

So, Texas part of the US of A? We might as well be annexed to Mexico since the Border Patrol quit arresting wetbacks so that they wouldn't be "embarassed" by the civilians who are doing their jobs better.

Re:US company / Euopean strike

[Anonymous Coward]

Ummm...there's more to your state than politics... I've visited Texas quite a few times and it's a pretty nice place - lots of variety. Politics? Who cares?

Re:US company / Euopean strike

[Anonymous Coward]

That's unusually generous for a US employer. Few give that number of public holidays, and 5 days for Christmas and New Year is also unusual.

Re:US company / Euopean strike

[Mithrandir86]

You're forgetting May Day, Easter, Europe Day, It's Raining Day, and Friday. (The last 3 are not real). And also the fact that it is illegal on the continent to work more than 48 hours in a week (which the UK has opted out of).

If you're interested in how Americans tend to view their holidays, I suggest you read the following from a 1999 article of The Economist. You can really tell how dated it is (especially with declaration of good oil prices).

Holidays

A great time to work
Jul 22nd 1999 | CHARLOTTESVILLE, VIRGINIA
From The Economist print edition

AMERICA'S holiday season is off to a strong start. With petrol prices blissfully low, airline companies fighting over fares and a general sense of economic well-being, everything looks rosy. So why do Americans still seem to have such difficulty enjoying their vacations?

According to Cindy Aron, a history professor at the University of Virginia, the answer lies in the past. Despite a dramatic increase in leisure time since the mid-19th century, Americans are simply hooked on their jobs. After all, neither they, nor their country, got ahead by being idle.

"Americans engaged in a love-hate battle with their vacations--both wanting to take them and fearing the consequences," writes Ms Aron in "Working at Play: A History of Vacations in the United States" (Oxford University Press). "Relaxing did not come easily to American men and women who continued to use their leisure in the performance of various sorts of work--religious work, intellectual work, therapeutic work. Leisure and labour remained complicated and troubling categories, in some ways polar opposites, in other ways closely connected."

On the eve of the 21st century this friction continues, regardless of station or income. Media moguls hunt for deals at Herbert Allen's invitation-only investment conference in the Rocky Mountain resort of Sun Valley, Idaho. Companies of firemen from the Washington suburbs crowd into rented accommodation on the Atlantic beaches of Delaware, where the talk is of the station house rather than the surf. Not even Ms Aron is immune. While working on her book, she took along her portable computer to her family's annual retreat, a waterfront house in New London, Connecticut. As she herself laments, "Technology has made it too easy to carry our work with us."

Except to the very wealthy, who visited fashionable mountain spas to escape the heat and disease of the cities, rest and relaxation were mysteries to most Americans in the 1800s. A pause from one's labours seemed to betray the Protestant ethic on which the United States was founded. But by the 1850s, as the word "vacation" first wormed its way into the American lexicon, even spiritual leaders began to suggest that leisure and relaxation could lead to God.

From this, in short order, sprang the camp meetings: inexpensive family getaways with a religious flavour, popular with blacks and whites alike, in tiny communities that would become resorts in their own right. Just over a century ago, Rehoboth Beach, Delaware, was best known as the site of an annual Methodist meeting. Now it is nicknamed "the Nation's Summer Capitol" because of its popularity with Washington power-brokers.

One other vacation spot with roots in the 19th century clings to its origins as a place of intellectual refreshment. At Chautauqua, in upstate New York, members of the burgeoning middle class used to attend concerts and talks on the social ills of the day; sometimes they would study Greek, Latin and Hebrew. More than 120 years later, Chautauqua still blends the educational and recreational.

It was at vacation spots that society's norms were tested and changed. In the 19th century's posh resorts of the South and New England, mixed-sex amusements included more than nightly fancy-dress balls. Spotting a "Venus Libitina" emerging from the brine at Virginia's Old Point Comfort, J.R.V. Daniels, a lawyer from Richmond, huffed that "society must throw her out." But before long newspaper

Re:US company / Euopean strike

[JeremyGL]

Did your 30 UK days include : New Years day, Good Friday, Easter Monday, May Day Bank(*) holiday(x2) and the August Bank Holiday ?

My impression is that IT workers in the UK get approx 25-30 days paid leave plus the eight "Bank" holidays (or whatever they're called).

Cheers,

Jeremy

* Why are they still called bank holidays when the one industry which will ALWAYS have (at least some) staff working on those days is the banking industry ?

Re:US company / Euopean strike

[cicho]

And your wellbeing and general level of personal happiness is contingent on your country being a "player" in "global economy"? You realize of course that there is little to no relationship between a country's GDP and the population's average perception of "being satisfied with one's life"?

Re:US company / Euopean strike

[grahamsz]

The 30 UK days didn't include any of them. But the total of 32 days included xmas and new year - but not any bank holidays which we didn't observe (in general comapnies in scotland do not).

Re:US company / Euopean strike

[grahamsz]

Yeah it's fairly good. I do get 16 flex days instead of 11 because of 5 years of service.

But i feel i'm comparing apples to apples since it's the same "generous" company in both cases, and a very similar position.

Re:Europeans go on strike

[Anonymous Coward]

Yes, so IBM is trimming the most expensive european divisions. Welcome to outsourcing. Of course those workers will go on a pretty generous european dole.

Not that I see much problem with that dole. I used to, but then I looked around in my country and I'm seeing all my tax dollars fall out of bomb bays and literally going up in smoke, all to support some stupid politician's lies. I just can't honestly say a welfare state is any more inefficient or evil than that.

More power to them!

[PenguinBoyDave]

Perhaps something like this, if it causes enough problems for IBM, will cause other companies to wake up and smell the friggin coffee. People are tired of the corporate bull shit.

Re:More power to them!

[bladesjester]

I would hope so as well, but I doubt that it's very likely in the United States.

They have to pay for funding some how

[Anonymous Coward]

$1 billion dollars invested in linux, money needs to come from somewhere.

Let's bring these jobs back to America.

[demonic-halo]

If the Europeans don't want to do the work, let's move those offices back to America. I'm sure tons of Americans could sure use the work. =)

There's also a large list of other countries /w unemployed workers that could use the job without the need to hide behind sissy unions.

Strike?

[jrumney]

I go past an IBM campus on my way to work every day. This morning the carpark looked as full as it ever does. Someone needs to tell these people that a strike means you don't turn up at work. Wearing black and blue is what people normally do, it does not constitute a strike.

Re:Strike?

[John Harrison]

Strikes in Europe are weak. I tried to go to the Lourve last time I was in Paris. A rude man at the door told me he wouldn't let me in because he was on strike. I asked him why he was there if he was on strike. He replied that he had to show up if he wanted to get paid. In fact everybody showed up, they just didn't let anyone in. That is a pretty flimsy way of going on strike if you ask me.

Re:Strike?

[Anonymous Coward]

I work at one, and reading this story was the first I've heard of a strike.

And yes, I had just as much trouble finding a parking space today as ever.

Outsourcing

[dutt]

The plain truth of this is that the jobs being cut in Europe are not gone, but transfered to India and other low wage countries.

IBM just wants to make it's profit even bigger. By employing Indian's and sacking European's, they are doing just that.

Sad but true.

Re:Outsourcing

[Chris Y Taylor]

I'm not sure this would be considered "sad" by either IBM stockholders or Indians.

Do you expect them to pay more for the same work just to get people with the "right" nationality or ethnicity?

Re:Outsourcing

[Toby The Economist]

And by doing so, everything IBM produces is cheaper.

Everyone who uses IBM products and services can do that much more business because with the capital they have...which creates more jobs.

--
Toby

Re:Outsourcing

[sydb]

Do you expect them to pay more for the same work just to get people with the "right" nationality or ethnicity?

This has nothing to do with ethnicity. It has lots to do with nationality. The fact that I belong to a nation implies that I and my co-nationals work to improve the entire nation's lot within the world, at the expense of other nations. Sorry, but it's true. Wealth is a limited resource and those who benefit from a nation's existence should be paying back into it. How else can America be described as the worlds most powerful nation? If it doesn't operate as a whole, then it's not a powerful nation at all, it's just a host to powerful individuals and groups, a.k.a. parasites.

There is no getting away from the fact that this is a class issue. The shareholders just want higher profits. The workers, meanwhile, have given the best of themselves to a company, expecting, naively but righteously, some loyalty in return.

If this is a clear out of dead wood then I salute it because no-one has a right to get by without pulling their weight; but if this is just plain old cost cutting then IBM deserves to suffer as a result, and I expect they will.

Re:Outsourcing

[Edward Faulkner]

IBM just wants to make it's profit even bigger. By employing Indian's and sacking European's, they are doing just that. Sad but true.

Sad if you're a European. Excellent if you're an Indian.

How should a poor country try to get richer? By building up skills and capital to attract industry, which is exactly what India has done. More power to them. TANSTAAFL.

I find it amusing that many self-avowed liberals decry economic inequality, but then they complain when the market starts to shift wealth away from their own rich countries.

Re:Outsourcing

[Anonymous Coward]

except only indians have jobs to pay for the goods.

Unfortunately, they don't get paid enough money to afford a computer.

Re:Outsourcing

[KrackHouse]

Yeah, totally, fewer impoverished foreigners and cheaper Ipods are ruining my life.

Re:Outsourcing

[winkydink]

The plain truth of this is that the jobs being cut in Europe are not gone, but transfered to India and other low wage countries.

Welcome to the 21st Century and The Global Economy.

Re:Outsourcing

[16K Ram Pack]

what loyalty do IBM get, then?

People always say this stuff, but when do IBM get the right to tell employers that they can't leave?

You enter a contract, and follow it. You don't like it, go elsewhere. It's that simple.

Re:Outsourcing

[Anonymous Coward]

The plain truth of this is that the jobs being cut in Europe are not gone, but transfered to India and other low wage countries.

IBM's version I've heard some time ago on the radio was that they consolidate miscellaneous European branches. If that's indeed what they are doing it's no outsourcing. Can you point to your source of information that IBM is shipping jobs to India?

Re:Outsourcing

[Chris Y Taylor]

"workers, meanwhile, have given the best of themselves to a company"
I suspect that if that were true, IBM wouldn't be able to afford to lay them off. Maybe you've never seen a large group of real human workers. Show me where I can get 10,000 workers that give the best of themselves to a company instead of stealing office supplies and using the photocopier for personal copies and I'll relocate.

"Wealth is a limited resource"
Uh... what? That's like saying 'happiness is a limited resource', or 'ideas are a limited resource'.

"individuals and groups, a.k.a. parasites"
So now individuals are parasites on nations?

"if this is just plain old cost cutting then IBM deserves to suffer as a result"
Pursuit of an efficient workplace deserves punishment? Inefficiency will make society better?

None of this makes sense. Who believes such things?

"this is a class issue"

Oh, yes. Those people.
Sell your poison somewhere else, comrade.

Re:Outsourcing

[sydb]

when do IBM get the right to tell employers that they can't leave?

When employees breach their contract. It's that simple.

NOT when they can be got cheaper in another country.

Companies are incorporated at the sponsorship of host nations, by the provision of special rights. They thrive off the conditions within host nations, such as an educated workforce, plentiful supply of customers and favourable tax regimens.

To the host nation's benefit, they are expected to provide employment to nationals and pay taxes. If business needs dictate they no longer need to employ workers, they can make them redundant.

In my opinion, getting workers cheaper in another nation is NOT a good enough reason to make people redundant. The negative impact on the host nation is too great.

In such cases, there should perhaps be scope for employees to take limited pay cuts. But fundamentally, shareholder value has to be weighed against the cost to the nation of supporting unemployed people, and the stress this causes to the individuals involved.

Re:Outsourcing

[jumbledInTheHead]

Actually for quite some time now IBM has been shifting from a hardware company to a service and support provider. This shift changes the needs of the company and makes some jobs obsolete. Why you assume they are outsourcing jobs to India, I do not know, as IBM has never suggested they would do this.

Re:Outsourcing

[sydb]

Show me where I can get 10,000 workers that give the best of themselves to a company instead of stealing office supplies and using the photocopier for personal copies and I'll relocate.

My current employer. I won't name them in a public forum but they are of the size you propose and I have been overwhelmed by the quality of the people who work there. I wouldn't like to work where you are, or maybe you just can't see the good in people.

That's like saying 'happiness is a limited resource', or 'ideas are a limited resource'.

No it's not. You can be happy, and I can be happy, and everyone can be happy, and we can all have ideas, without reducing the ability of others to be happy, or have ideas. Wealth is limited by virtue of us living on a planet of limited resource that's hard to leave. Happiness and ideas do not suffer from such limitations.

So now individuals are parasites on nations?

Some are, yes, what's your point? That none are?

Pursuit of an efficient workplace deserves punishment? Inefficiency will make society better?

At the cost of the host nation, yes. Efficiency at the expense of your friends is wrong. Or perhaps you have no friends.

Sell your poison somewhere else, comrade.

Let's have argument, not invective. Thanks.

Re:Outsourcing

[16K Ram Pack]

OK, welcome to the global free market and the 21st century. It doesn't matter whether you think that "getting workers cheaper in another nation is NOT a good enough reason to make people redundant". You start making corporations lives too difficult where you are, they will simply base their operations far away from you.

In effect, governments are now in a market for corporations if they want them to be based there. The boot is on the other foot from the 20th century. If you don't like that, it's just too bad. The only way it will change will be with a global communist revolution.

You know a big reason that the UK gets so much inward investment of Europe? Because trade union power and government bureaucracy over business are much lighter than the rest of Europe. Why is China booming? because right now, it's labour costs are cheaper.

Re:Outsourcing

[Bellyflop]

There is no getting away from the fact that this is a class issue. The shareholders just want higher profits. The workers, meanwhile, have given the best of themselves to a company, expecting, naively but righteously, some loyalty in return.

Well it just goes to show - you should either be a shareholder or don't give the best of yourself to a corporate entity that, by law in many countries, must look out for the best interests of its owners.

Re:Outsourcing

[MasterOfUniverse]

The problem is that its not the case that rich people in wealthy nations are losing thier jobs. Its the middle class people. So basically total sum of poor people still remains the same. They are just getting transfered from india to europe. So who does it benefit? ofcourse the very few rich folks who owns these corporations. Face it, middle class folks does not own millions of dollars of stocks. Its the very few rich people. Globalization is suppose to help everybody. It is suppose to create jobs. But globalization is only helping very rich to move jobs of the middle class very easily. But whats happening is that the middle class people are sacrifising. And just wait few years, when they find more cheaper countries than india/china, they will just move thier.

ps: I'm an indian.

Re:Outsourcing

[sydb]

But what's your point? You state what is, I state what should be.

Re:Outsourcing

[djp928]

Last time I checked, IBM was incorporated in New York. So, the jobs in Europe were already outsourced jobs and were against the strange rules you made up about "benefit to the host country" (In this case, the USA.)

-- Dave

Re:Outsourcing

[sydb]

We can't all live off dividends. Somebody has to work!

Better to regulate things so that neither worker nor employer is abused by the other. Otherwise, by human nature, abuse will happen.

Re:Outsourcing

[sydb]

Well, that might have been a point, except IBM is incorporated in Europe too, because it does business here too and employs people here too.

I'm not arguing, for instance, that IBM should not be hiring people in India, or that they should treat their Indian staff any worse. I am arguing that there has to be an alternative to dumping their European staff in favour of Indian employees to acheive cost savings; if indeed that is what this is about.

Re:Outsourcing

[Acid-Duck]

You think that's bad? How about this.. Refering specifically to call centers: I'm from New-Brunswick (Canada eh!). In NB, real-estate is cheaper (which makes it cheaper for companies to establish themselves) and they get better workers IMO. Why better workers? New-Brunswick is the only province that is truely bilingual (which is something most call centers need), and being a small shitty province like it is, most ppl who graduate from university start off in a call center, unless they're the top of their class or close. This gives them a guaranteed bunch of desperate university graduates who are bilingual, and they pay them a lower salary just because our cost of life is lower. If you work for the same company in a diff. province you'll get payed more for the same job. Now let's see, bilingual people, they pay lower property taxes and such, which means more moeny in their pockets but they still pay us less! Can anyone confirm if working in a smaller province (or state for most of you ppl) means they pay lower corp taxes?? I'd like to add that even from the city I'm from to the city with a university in it, that job still had a 3$/hr difference.

Erik

Erik

Re:Outsourcing

[ChrisMaple]

"Wealth is a limited resource"

Wealth is not a resource, it is the result of productive human activity. It is limited only by how much is created and not destroyed.

Re:Outsourcing

[sydb]

No, it is the result of productive human activity directed upon the limited physical resources available to us.

Your attitude makes me angry. You think the world is infinite. I bet you think climate change has nothing to do with mankind's actions. You know, the oil reserves will run out one day, because they are not infinite.

Why do you think people are starving if wealth is unlimited? Because the Africans are lazy?

Fucking idiot.

Re:Outsourcing

[TerminaMorte]

Do you expect them to pay more for the same work just to get people with the "right" nationality or ethnicity?

Ah, playing the race card. Always a good way to do when you don't have a valid point to make.

The problem is not with indians getting jobs, but people who were already employed getting laid off in order to find cheaper labor outside of the country.

Where are the "rights" of loyal employees?

Re:Outsourcing

[Anonymous Coward]

Wealth is a limited resource. Currencies are not necassarily a limited resource, but the value of those currencies is limited. If everyone in the world had at least U.S. $1 billion, a loaf of bread would cost a lot more than U.S. $1,000.

It's tragic, but wealth is a limited resource and the value of currency is tied to its rarity. The value of currencies are tied to the same economic forces that drive the prices of other resources.

It's also tragic that in a market economy, not everyone can be employed. The more unemployment drops below the NIARU (Non-Inflation Accelerating Rate of Unemployment), the more rapidly prices skyrocket until the economy can no longer afford to keep everyone employed.

Re:Outsourcing

[mickyflynn]

Welth should be a limited resource. But now we have no gold or silver standard. we have no standard for hard money at all. Paper currency is worthless, and electronic currency even more so. Just because we can now make unlimited "money" doesn't mean that real welth -- stacks of the shiney stuff -- is unlimited. precious metals, gems, and real estate -- that's welth. Money is just money and it's not even that.

Re:Outsourcing

[Edward Faulkner]

So who does it benefit?

It benefits every consumer of the product in question. Fat profit margins don't last very long in a competitive market. That's why some companies are basically forced to outsource - their competitors are already passing lower costs on to customers.

When prices fall, every person is effectively a little bit richer, because the wealth they have will go farther. That is why free trade is a net win in the long run. One less dollar spent on software is one more dollar that can now be put to other use.

Re:Outsourcing

[lastninja]

They are already running out of cheap countries to relocate to. In 50 years the standard of living will be pretty much the same in the whole world, and it can only go up from there. However the ride into the future for the western world, will be bumpy and painful for sure.

Re:Outsourcing

[Anonymous Coward]

Globalization is suppose to help everybody. And you believed in it...

Re:Outsourcing

[ghettoimp]

"I find it amusing that many self-avowed liberals decry economic inequality, but then they complain when the market starts to shift wealth away from their own rich countries."

I think the basic premise of these "self-avowed liberals" is that prosperity shouldn't have to leave their country to go to another.

If you want to take a global perspective instead of a european one, it makes little sense to only look at the Indian viewpoint. Viewed from a worldwide perspective, one worker somewhere has lost a $100,000 job so that another worker somewhere else can gain a $30,000 job (or whatever numbers you prefer). That's not progress.

Re:Outsourcing

[Chris Y Taylor]

"I have been overwhelmed by the quality of the people who work there" Isn't that sweet.

"Let's have argument, not invective."
Frankly, I'm tired of arguing these things over and over. At some point you just have to say, "keep your delusions if you want them but don't tell me what I can and can't do, if you know what's good for you." Since you seem like a nice guy, though, I'll counter offer. Forget your argument. Let's both look for the truth.

Let's start with this: "Wealth is limited by virtue of us living on a planet of limited resource that's hard to leave. Happiness and ideas do not suffer from such limitations." First things first. Define terms and state assumptions. What do you think 'wealth' is. Seriously. Is it gold? Bits of paper with numbers? Something people will trade for or make an effort to get? Do writers produce wealth? Singers? Painters? Yoga Instructors? If I am paying a prostitute for sex every week, is the total wealth of the world the same or greater after each exchange? What if we get married and she stops charging me. Does global wealth decrease? Even if we're both happier? If wealth is not tied to human happiness, what use is it? I suspect you have bought into a zero-sum game, philosophy that I'd suggest you carefully re-examine. I suspect you'll be less enamored with wealth redistribution and more focused on wealth creation if you defined wealth in a more modern way. Maybe not. But we obviously aren't meaning the same thing when we use the word "wealth."

""Pursuit of an efficient workplace deserves punishment? Inefficiency will make society better?" At the cost of the host nation, yes. Efficiency at the expense of your friends is wrong. Or perhaps you have no friends"
Aw, I thought you didn't want invective. Well, I'll let it slide. Isn't India a "host nation" too. Isn't failing to give jobs to Indians that offer a better deal in order to give preferential treatment to Europeans doing a disservice to India as a host nation? How do you pick which host nations you should screw your customers and/or business partners to give benifits too? I'm serious. Should you ask your customers to pay higher prices to avoid paying tax money and building the infrastructure of a totalitarian state? What if the choice is between two democracies, but you like the culture of one better? Personally I think India is just as good a host nation as those in Europe or N. America. What makes you prefer European ones? Is that objective?

BTW, I have friends. But business is business. Whenever my friends do business, we are very careful to spell out specifically what the terms are. We don't want a disagreement over to either hurt the friendship, or force one of us to suffer economic losses out of a sense of loyalty. I wouldn't want my friends to buy a product from me at a higher price; I would want my friends to get a good deal. IBM doesn't have friends; it is a company. But the investors and the customers of IBM do. Do you expect one of both of them to suffer economic losses out of a sense of friendship to the people who work in the European IBM facilities? If so, are the European IBM workers really friends, or are they just manipulative jerks playing the "friends" card for their own benifit? Isn't that cronyism? What if IBM's customers and/or investors have friends all over the world? Why shouldn't they. Do you think EUians are the only ones who deserve friends? Personally, I think that it is dangerous to confuse business with friendship or relations. I'm not saying don't do business with friends, btw. I'm saying don't expect cronyism or nepotism, and spell out everyone's obligations and payments very carefully. Do you still think this is a matter of IBM investors and/or customers taking unfair advantage of their friends?

While we're on definitions and assumptions:
What do you mean by "nation." Do you mean society? Or do you mean government?
Do you think something that the words "ethical" and "legal" are equivalent? Do

Re:Outsourcing

[Chris Y Taylor]

"I state what should be."
How noble. But consider that maybe, just perhaps, you state what you FEEL should be.

"I had it first so it should be mine" feels right to a child, too.

Maybe businessmen should get to decide for themselves who they do business with. Maybe the person who will do the most work per unit of measure getting the job really is "what should be." Just consider it.

Re:Outsourcing

[GoofyBoy]

> The fact that I belong to a nation implies that I and my co-nationals work to improve the entire nation's lot within the world, at the expense of other nations.

IBM Europe is owned and run by Europeans. Your co-nationals are improving themselves at the expense of your nation.

Maybe you need to rethink your "rule".

Re:Outsourcing

[Chris Y Taylor]

Now, now. I thought YOU were the one that didn't want any invective. What happened to that?

I think that what Gus is tryin' to say here is that wealth is not limited by limited physical resources. If I tell a story to some children that makes them happy, haven't I created wealth without using up any limited resources (except in the broadest sense of time and entropy that would be only interesting to a physicist). Or did I only create wealth if their parents pay me to do it?

Actually I think that Hernando De Soto (no, the new one) has some good theories on poverty in Africa. Let's turn that around.

Why do you think people are starving in poor countries? What is the solution? Or perhaps the appropriate question is... Why isn't everyone starving? What do you think the non-starving people do differently? Are they just stealing food from the starving? If so, then why is there less starving people now than in centuries and millenia past?

Re:Outsourcing

[Anonymous Coward]

every person is effectively a little bit richer, because the wealth they have will go farther.

When I'm making $0, am I wealthier because the $20k car I can't afford is now $10k?

Face it, unemployment will never be 0%. Starting your own company is only the answer for the 1 in 5 that don't fail after a few years.

Re:Outsourcing

[Bellyflop]

I guess I was suggesting that maybe it's not in people's best interest to give the best of themselves to a company that isn't going to keep them :)

Re:Outsourcing

[doug141]

Doesn't it become progress when the $70k saved becomes capital for job creation? Is paying $100k for a $30k job progress, or waste?

Re:Outsourcing

[Chris Y Taylor]

"Somebody has to work!"

I'm not clear. Are you stating that as "what is" or are you stating it as "what should be?"

Re:Outsourcing

[Dravik]

I think the point is: products compete for consumers, people compete for jobs, and countries compete for corporations. If you country has odious incorporation rules why would a company choose to move to, or stay in, your country? When I buy a product, I don't go to stores that give me bad service and make it a pain to purchase from them. If someone wants to make it hard for me to give them my money I go somewhere else. If a country makes it hard, or a pain to employ people there the corporations will go somewhere else.

Re:Outsourcing

[Anonymous Coward]

Wealth is NOT a limited resource, it is created. Consider the tens of millions of internet related jobs. Where did these jobs come from? They didn't exist 50 years ago. They were CREATED by entrepreneurs who INVESTED in R&D, innovated. Putting up any sort of trade barriers slows down growth and productivity. Adapt or get left behind. Big companies are filled with 9 to 5 lazy people who just expect to keep getting their high salaries for doing the same work year after year. I used to work for a big company, couldn't take it anymore, for every productive, innovative employee, you have 9 worthless ones.

Re:Outsourcing

[dryeo]

I wish. The products I get from IBM are now produced in India. The quality has nosedived and the price has shot up. In my experience when a company saves money it goes to the executives and shareholders, not the customers or the workers. If large profits created cheaper software Windows would cost $20 instead of $200.

Re:Outsourcing

[the eric conspiracy]

Why do you think people are starving if wealth is unlimited? Because the Africans are lazy?

No, because the Africans have devastated themselves with incessant wars of genocide and unmitigated political corruption that have robbed their nations of the capital needed to improve worker productivity.

You think the world is infinite.

Maybe not, but a rock is worth infinitely less than the silicon microchips that can be made from it. What drives modern economies is ever increasing improvements in the way those resources are used. Look at the US economy - in the 70's we went through a big oil price crunch that ruined the economy for a decade. In the first decade of the 21st century we are seeing a similar price spike - and what is the influence on the overall economy this time? Very little - because the value of the energy content is a much smaller percentage of the value of what is produced by industry today than 30 years ago. The numbers are quite plain - energy is a much smaller percentage of the total US economy now that it was 30 years ago.

Economics is NOT a zero sum game. Resources may be limited, but the value of what you can make from the resource is not limited, rather it is constantly increasing.

If a resource becomes scarce and expensive what happens? Low value uses go away and there are waves of innovation that result in big improvements in the efficiency of the use of the resource - and the value of what is produced from the same amount of resource.

Here we sit on the cusp of technological revolutions in biophysics and nanotech - what do you think the price of raw materials inputs into processes based on these new techs will mean? Bupkis. Zero. Lost in the noise. For these are technologies where the kilogram is 18 orders of magnitiude greater than the mass needed to effect a change in economic value in these technical domains.

The world may not be infinite - but our ability to extract wealth from that world is currently so near to zero relative to the potential that it might as well be infinite.

Re:Outsourcing

[dryeo]

Don't worry, here in BC the government and business keeps telling us that since wages are so low in the maritimes they should be the same here even though the cost of living is much higher.
Oh and corp taxes have dropped lots along with wages.

Re:Outsourcing

[Anonymous Coward]

IBM is incorporated in India too. Being a global corporation, incorporated has no meaning. Only headquarters means anything. And by your policy, they should not have ventured outside their headquarters (the US)

Re:Outsourcing

[Vandall]

Exactly. Everyone is out to protect themselves. It is only natural. The Europeans want to keep their jobs. The Indians want their(Europeans') jobs. The shareholders want to keep making money. They need to realise that if the Indians(or any offshoring workers) can get the same amount of work done, with the same amount of quality, for less, the businesses will move there. If the company decides to just stay in the long run the company will face dropping profits. Then it may be too late for everyone. IMO people need to sit back, and think of how to be more productive or provide new services if they want to be the worker of choice. Striking is a short term solution. It may let the current generation keep their jobs but what about the next one?

Re:Outsourcing

[evilviper]

How should a poor country try to get richer?

By leeching off of wealthier countries, as you suggest?

No.

Re:Outsourcing

[Anonymous Coward]

So just assume for the sake of the argument that Indians earn 10% (don't know the exact numbers) of what Europeans or Americans get for the same job. What do you suggest the European or American employees should do to increase their productivity by the factor of 10? Work 80 hours per day?

Re:Outsourcing

[sydb]

Clearly, what is.

Re:Outsourcing

[sydb]

I appreciate the time you have take to reply to my post. I don't have the time to do your post justice right now but I will find it later.

Thanks.

Re:Outsourcing

[mutterc]

The folks at the top sure like enjoying that American standard of living.

Somehow I doubt that any company's going to go to the Third World for their executives, though it would save an awful lot of money.

Fortunately (in a karmic sense), their actions are going to destroy the American standard of living; then they get to share the mud huts with the rest of us.

Re:Outsourcing

[mutterc]

Just because economics is not zero-sum does not mean it's infinite-sum, either.

None of this matters, though - it's obvious that frictionless offshoring will lead to the entire world having the same standard of living, and no country / region / whatever will be able to rise above it (because all jobs will leave if they do). The few at the top will be living in fortified BurbClaves somewhere, and the rest of us will be starving in mud huts.

Re:Outsourcing

[mutterc]

In 50 years the standard of living will be pretty much the same in the whole world, and it can only go up from there.

I agree we'll have one standard of living, but what makes you think it can go up?

If one region tries to increase its standard of living, won't all the jobs go to other places (who are still sitting at the bottom)?

Re:Outsourcing

[the eric conspiracy]

Just because economics is not zero-sum does not mean it's infinite-sum, either.

Right - but my theory is that the current sum is so small that what we will have in the future is likely to be indistinguisable from infinity by comparison.

and the rest of us will be starving in mud huts.

That is zero-sum thinking.

Re:Outsourcing

[cicho]

"Wealth is limited by virtue of us living on a planet of limited resource that's hard to leave. Happiness and ideas do not suffer from such limitations." First things first. Define terms and state assumptions. What do you think 'wealth' is?"

This is BS, and you know it. Sure you can define wealth in five hundred ways before breakfast. But when IBM and its shareholders talk about wealth, you know there's only one definition they care about.

Eiher you have this dollar, or I do. We cannot both have it. That's the only kind of wealth corporations and shareholders deal in.

Re:Outsourcing

[cicho]

"Maybe not, but a rock is worth infinitely less than the silicon microchips that can be made from it."

Only until you factor in all the other resources that went into making that chip. Yeah, we have an abundance of sand. Pity we don't have an equal abundance of potable water, clean air and renewable sources of energy.

Re:Outsourcing

[Chris Y Taylor]

You are an idiot.

Re:Outsourcing

[cicho]

So in other words you're saying IBM shareholders calculate their wealth by how good the paid sex was? Or are you just out of arguments?

Re:Outsourcing

[mutterc]

Interesting. A society of plenty would indeed avoid these problems. We could have a "gift economy", similar to what we have today in open-source software. With enough wealth to go around, concentration of it ceases to be a problem.

Marshall Brain's "Robotic Nation" site has a story called "Manna", which lays out a (utopian?) vision of such a society. Basically, abundant energy + really good recycling + robots = material goods are essentially free. Stuff is produced according to an open-source-style model (individuals design things like clothes, and anyone can construct them - some designers are famous and widely used, most are not; like-minded people get together to design and build projects like space elevators).

Socialists

[Anonymous Coward]

Behold! The power of comm... errr socialism!

So?

[robertgeller]

Good for IBM. Screw the unions. They don't care about what IBM is doing, and the "statistics" they provide on their site are meaningless and irrelevant. Stop bitching and deal with it; at least here in America, corporations intend to make money, not keep employees just to be benevolent. 3 capitalism. ;)

Flawed Logic and More

[Anonymous Coward]

"IBM is a wealthy and successful company. Its first quarter profit for 2005 was $1.4 billion, and $9 billion for the whole of 2004. It increased the dividend to its shareholders, recently bought back $5 billion in IBM stock, and acquired 19 companies in 2004."

But if the jobs aren't necessary, is it IBM's responsibility to keep people working in unnecessary jobs?

The fact that they're making a lot of money doesn't have any relation to their employment requirements. That's the sort of typical red herring that unions like to toss out - "Hey, they're making a lot of money, so it's irresponsible to lay people off."

The questions that they should be asking is "Why are they laying people off and is there something that we need to do differently?" Or maybe "Are we making our members anachronistic by insisting that companies keep doing things the same old way?"

Unions are dinosaurs. They served their purpose a hundred years ago, but now they're nothing more than a wedge between management and workers.

Re:Flawed Logic and More

[MemoryDragon]

Actually unions are important, otherwise we will run again into manchester capitalism at its worst, but the main problem is that unions used to be effective, but are not anymore because they only act on a local scale, they need to act globally nowadays, companies do, unions do not. A local strike only causes a laughter, a global strike really could hurt.

Re:Flawed Logic and More

[Anonymous Coward]

Business doesn't get successful by listening to it's unions!

Look at FORD and GM, they are in big trouble now because of the UNIONS.

I can't believe you said "Unions are important". Where do you live in CUBA! I'm from Michigan the most UNIONized area in the world and I can tell you first hand UNIONS were great back in the 20's. You must like that you can graduate from High School and go to work for an Auto Company and make 70k putting cars together!

Re:Flawed Logic and More

[MemoryDragon]

Well... to my knowlegde... the US car companies were threatened by the japanese ones in the 80s, the japanese ones basically started as outsourcing companies for GM and Ford. Now what happened, the revenues went down, because the japanese cars simply were better for the same price, but instead of increasing the quality, the US companies opted for laying off people in Michigan and shift the work to Mexico, the US cars got cheaper but the quality became even worse. The unions could not help there, because, it did not matter for GM if the unions in the US went on strike, the work was shifted anyway to mexico.

Re:And you were expecting what...

[Anonymous Coward]

and as an american company, it should follow the american ideals of shitting all over everyone outside its borders.

Re:Europeans go on strike

[boomgopher]

I'm interested in this because it's the first major tech-strike I've personally heard of. The US slashbots always talk about how we should unionize, etc. to improve our lot, so I'm rather interested in the outcome of this. I have my doubts this will help - but, hey, you never know.

Re:Europeans go on strike

[jqcoffey]

Hey, don't knock it just 'cause you ain't got it.

The fact is, the Europeans are living the "American Dream." I, for one, am tired of us Americans whining about it, when instead we can do something about it.

We lost our own "Dream" when we started electing politicians who pray to the God of Capitalism.

Fact is

[turbofisk]

no other cost-cutting comes close to cutting jobs. It costs a boatload to hire people. Not just in salery, you have vacation, workspace, pc-stuff, companycars, etc, etc... This is exactly what Swedish Ericsson had to go thru a couple of years ago - laying of half of it's staff.

Zbqf: lbh fhpx

[Anonymous Coward]

Nabalzbhf EBG13 xnezn juber

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Re:Zbqf: lbh fhpx

[Anonymous Coward]

What's with all the ROT13 comments today?

*yawn* guess I'll just take it in the keister then

[Anonymous Coward]

I really can't understand those of you who do not appreciate the value of the labour movement. Perhaps if the geek community hadn't been so keen to chase your impossible billions from your Aeron chairs and had thought of protecting yourselves from the now-blindingly-obvious greed of Corporate Land Inc., you might still have your jobs instead of them all moving to Bangalore. Even had it not stopped the crash (and I freely admit that's likely), it may have slowed its effects and allowed you to parachute into another job rather than being dumped ungraciously into the drainage ditch of the information highway.

But maybe I'm wrong. Maybe the guys in the Aeron chairs back at Headquarters really DO care about your life and really want to ensure you keep your wonderful cubicle job. But all objective analysis would indicate how high you would have to be to believe that.

Lets do some math

[Jaspers]

well, we have 10000 job cuts at minimum. With an average of 2000 dollars per month we have 20 000 000 monthly savings. At 12 months we find that we have 240 000 000 a year. That's a quarter of a billion. Does it worth for so many people to lose their jobs? Not to me ... but obviously it does to IBM.

Re:Lets do some math

[pavera]

I'm sure they are saving alot more than that... lets see:
#1 $2000/mo/emp is only $24000, I'm sure the average IBMer makes closer to $50000/yr.
lets say $40000 to be safe.

These jobs are in Europe, so either Pounds, or Euros, and with the current monetary state that will probably be more like $55000-$60000

Benefits: Add on at least $12000/emp
Taxes: Add on another $15,000 at least Europe taxes more than America and that is what it would cost in America

so, you're looking at $82000/yr/emp

That is 820,000,000/yr
Almost a billion a year... That is probably closer to what they will save.

Re:Europeans go on strike

[Anonymous Coward]

Attention: Pussy-whipped American who believes the lie he might one day a billionaire and so supports the power of the corporations.
Please go back to work. Slacker.

Yours, from the sun lounger sipping a G&T,
Random Eurotrash.

PS. The beauty of the situation is many of us own shares in American corps. Your ruined health and feeble family life are money in the bank for us.
PPS. C'mon, get back to work, I won't ask twice. Make me some money please.

Re:Europeans go on strike

[jqcoffey]

It sure would be a sad day if it doesn't help. Unions are what got us the 40 hour (cough, cough--50 hour work week if you're in the tech sector) work week, minimum wage, benefits, etc.

With US corporations able to force employees to TRAIN their outsourced replacements to receive their 4 week "notice" period, someone|thing|group needs to be able to fight for employees rights. The best, though clearly not perfect, solution we have currently are Unions.

Mayhaps, us slashdotters could come up with a technological replacement :).

I'm a grassroot programmer

[3770]

I'm a grassroot programmer.

And I feel bad about the general situation for programmers and loss of jobs in Europe and the U.S.

But their arguments aren't going to fly.

The workers say: The company is making money. Well, the company is constantly trying to make more money. Management will never keep people on the payroll just because they can afford it.

The workers say: There are other ways to save that amount of money. The managements reply will be great. What are they? Will do them too.

Re:I'm a grassroot programmer

[Anonymous Coward]

Cutting ridiculous executive stock packages is a good start. It only takes a few "global VP's" whose secretary actually does all the work to be fired, *without* that several million dollar golden parachute, to save the salaries of hundreds if not thousands of workers.

The salary range from lowest to highest paid full-time employee is what? That between $30,000 annually and about $30,000,000 annually? That's a hint right there of a problem.

Re:I'm a grassroot programmer

[Anonymous Coward]

You're right.

Any company that retains obsolete workers, and if they're not needed, they are obsolete, is not doing right by it's owners, the stock holders.

It's the same old Robin Hood socialism except the poor aren't poor. They had good jobs and plenty of opportunity to save and invest if they chose.

Those workers who know of other ways to save money shouldn't have been holding back or they'd still have jobs!

Re:I'm a grassroot programmer

[Anonymous Coward]

They had good jobs and plenty of opportunity to save and invest if they chose.

HAHAHAHAHAHAHAHAHAHAHA

Wait, mention Enron and WorldCom, that'll make it even funnier. I bet the CxO's get their investments back on those deals, Sucks to be the employees on "profit" sharing plans consisting entirely of Enron stock.


Those workers who know of other ways to save money shouldn't have been holding back or they'd still have jobs!

So wait, owning stock will guarantee I'll never be fired? Man, you tell such good ones, keep 'em coming!

Re:I'm a grassroot programmer

[Anonymous Coward]

plenty of opportunity to save and invest if they chose.

What bullshit. So basically instead of playing russian roulette with their job, they should be playing russian roulette with their money? I guess they can always take the "executive's way out" from the top of a tall building when they're left with nothing but a hungry family.

I currently make $40k in my job. I have no belief that I'm going to keep it. I live WAY below my means (single, have no life and don't particularly want to bring a family into this hell) and I'm currently putting away about $1500 a month. At this rate, if I keep this job at this pay rate and can always earn 6% on investments (fat chance these days, but lets say I have a crystal ball that always gives great stock picks, or the economy picks back up to the point where S&P can really grow year-over-year), I'll need about half a million dollars in the bank to become self-sustaining at about $25k/yr in investment earnings/interest.

Now do the math and tell me how many years I'll have to maintain stable employment to build up that kind of nest egg, then tell me again just how much opportunity these people, who have real lives and real families to support had.

Smart companies don't wait for losses

[G4from128k]

Yes, IBM may be profitable now, but that means nothing. IBM depends on long-term trends and long-term plans. If the company can't win service contracts or lets Dell get corporate contracts for servers, the impact isn't noticeable for several quarters or even years. That is why IBM is taking action now.

The point is that smart companies don't wait for trouble, they solve problems before anyone thinks they have a problem. If anything, IBM may even be late to the "solving" stage. Q1 2005 was not pretty for IBM because the future prospects looked dimmer than expected.

Another Lying Statistic

[Anonymous Coward]

To say that "IBM is a wealthy company" with "$9 billion in profit in 2004 is completely misleading. What IBM made in absolute dollars is not really relevant.

Let's say I offer you an investment. If you give me $X, I'll give you $X + 100 a year from now. What a great deal - you are guaranteed a profit. How could you possibly turn that deal down?

Sure, it's great if X = 100. Then you'll make a 100% return in one year. Cool.

What if X = 1,000,000,000. You give me a billion today, and I'll give you 1,000,000,100 in a year. Suddenly it doesn't sound like such a good idea, does it?

IBM made about $4.87 per share last year. At the current share price ($76.51), that means IBM's return was about 6.4%. Not too shabby, but not really all that great when risk-adjusted.

In fact, IBM's share price has gotten RIPPED in the last few months. A year ago it was trading ~90, which gives us a return of only about 5.4% - not very impressive.

Sure, $9 billion seems like a lot, until you realize how much capital is being employed to generate that $9B. And how many shareholders need to divide that up. Shareholders like pension funds, university endowments, and widows and orphans.

I'm not saying the workers are wrong here, I'm just pointing out that it's completely fallacious to call IBM a "rich company" just because it made a large number of absolute dollars last year. That money comes from or goes to someone - to everyone who holds an indexed mutual fund, for example.

Re:Another Lying Statistic

[imsabbel]

Well, stock price and market capitalisation is only gambling for idiots that think they dont gamble.

I guess in your eyes, amazon really was a bigger and better company then general electric back in the times of the bubble.

(btw: your whole posting style makes it rather sad that you posted as AC. Would have been nice to know one to put against to wall when the revolution comes. You are one of the people that lead to companies getting bigger and bigger monsters and pushing humans in the background)

Re:Another Lying Statistic

[Anonymous Coward]

Gee, with a comment like yours, maybe it makes sense for me to post as an AC. Glad to see that a "revolutionary" like you advances concepts like "free speech" and "open debate." Nice.

The important point, which has been made by others in this discussion, is that it is really quite incomplete to say that IBM made $X and therefore should throw money at something.

I agree that there are problems with global corporations, but I would find more sensible an argument that Sam Palmisano made $11mm last year or that IBM gives away an egregious amount of executive options than an argument that IBM makes "too much money."

By the way, your precious unions control an awful lot of money too. Did you know the AFL-CIO Housing Investment Trust managages over $3.6 BILLION? Me neither.

Even more impressive is the amount of money sitting in the public and union pension funds. CalPers is pushing $150 BILLION. The Teamsters are somewhere over $41 BILLION. And guess where all that money is invested? Or at least 46% of it? That's right - the stock market - in IBM and every other big, evil corporation.

Don't kid yourself, the unions are big business just as much as IBM is. At least IBM comes right out and says 'screw the worker'. Just like the Democrats, unions pretend to help out the working stiff, but they shaft him in the end just the same.

Re:Another Lying Statistic

[Rich0]

Shareholders like pension funds, university endowments, and widows and orphans.

You do neglect the fact that other than pension funds, the items on your list hold virtually no stock at all (compared to the total value of the market).

The vast majority of stock is held by people who individually make well over $100,000 per year.

The pension funds are of course the exception, but if you ask a worker which he would rather have - his 401k savings or a guaranteed job for life, he'd pick the latter. Collectively 401k's are still large, but most workers they make up only a small part of their total earnings.

If you give a billionare a choice of losing his stock or losing his salary, he'd drop his salary in a heartbeat.

If you give almost any other person picked randomly off the street the same choice they'd drop their stock in a heartbeat.

This is why anything which is good for stockholders isn't necessarily great for America - at least not directly.

Don't get me wrong, investment has all kinds of benefits to the general public. However, the whole "most people own stock" argument is really a falicious one. "Most people" would throw away their stock in an instant if it kept them from losing their jobs...

Re:Another Lying Statistic

[johansalk]

"orphans", huh?

Trying to appropriate my sympathy for "orphans" to a global corporation mighty enough to dismiss 13,000 European workers, the most protected in the world, in a single decision, only earns my disgust.

It's curious that these days orphans are mostly mentioned by the rich or their mouthpieces; I am yet to hear an orphan make much noise about his property, generally because real orphans usually live under the care of the state, or, if lucky, are supported by their relatives. Whenever I heard much mention of "orphans", it's usually been by the rich, about millions upon millions of dollars, and the "orphan" being someone in his forties suing an entity.

Perhaps big business should know that their lobbying of Washington to limit their social responsibilities is hurting the orphans. Perhaps the religious right, many of which regard the majority of real orphans as the abandoned fruit of "wicked" acts, should care more about orphans. Perhaps folks like you should stop mentioning them when discussing megacorps.

I am really disgusted.

Re:Another Lying Statistic

[mutterc]

There's also another fallacy people throw around in these discussions: "Rich people buy stock with their money, which provides capital for businesses, who provide jobs, etc."

There's only one problem with that - buying stock doesn't get any money to the company, unless you're buying into an IPO. The money goes (minus middlemen's commissions) to the former owner of that stock. Chances are that's another rich person...

Therefore, the stock market is (mostly; except for IPOs, middlemen and the occasional small investor) simply circulating money amongst the investor class.

Re:And you were expecting what...

[PornMaster]

As someone who quit his job at HP today, I'm not sure if I'm suffering from prefrontal lobe issues and missed the sarcasm, or if you don't know how it is to work for HP these days...

Re:Wealth and success

[Anonymous Coward]

So you're saying 10-13k people are "dead wood". Nice of you to jump to conclusions there. Hope your job is on the line next.

Re:And you were expecting what...

[rovingeyes]

If you don't like it, go work for HP

Do you work for HP? And even if you did, do you think if HP profited from laying your ass off, they wouldn't do it? I have seen so many comments here saying "who cares". As an individual and fellow IT person I do. Granted I am in US but hey that could be my ass on the line tomorrow if my company decides to lay me off.

There is a reason we have unions is that to stop corporations from exploiting hard working individuals not complain about losing jobs to Indians and Chinese. I sincerely hope and wish those Europeans succeed in their protest.

Take a look at the insider stock trading !!!

[gelfling]

http://www.marketwatch.com/tools/quotes/insiders.a sp?symb=IBM&vc=0&siteid=mktw&dist=dropmenu

$13 million in the proceeds of a stock grant sale and options exercize to J. Bruce Harreld alone.

Bruce Harreld came from Boston Market several years ago where he also helped drive that company straight into the shitter.

Most IBM employees got no annual increase last year and variable pay e.g. bonuses which is what most people count on, were cut to the bone - average awards were half what they were the year before and about one fifth of the people got them. This year IBM suspended annual increases to executives but stock and other equity awards were not frozen. In the meantime the employees are bracing for another year of no increases and no variable pay. Simultaneously, benefits cost were increased about 15-20% to employees. Moreover any employees sitting on options that were awarded after 1998 have worthless paper - priced around $132 which is where the stock was headed in 1999 before it had its relentless crash since then ($76 as of today). And there is a strong push to force employees to work from home so IBM can sell their real estate. Employees are expected to give up one room of their house to for a home office and the reimbursement of their office supplies to the employee is now imputed income.

Re:Take a look at the insider stock trading !!!

[Anonymous Coward]

Pretty much the story of most tech companies since 2001, I'd say. It's the same situation I'm in, but I'm not complaining. I've been laid off before and every time that it happened, I found something better.

Oh, and don't holler about insider trading until you know if it was a scheduled stock trade. Almost all executives set them up so that there will be no question (except from stupid people, but they don't count).

Re:Take a look at the insider stock trading !!!

[16K Ram Pack]

I could say this 1,000 times here:-

You don't like your pay, bonuses, benefits? If you think you can do better, leave. If not, put your head down, be glad you have achieved the best that you can get and STFU

Re:Take a look at the insider stock trading !!!

[adavidw]

...and variable pay e.g. bonuses which is what most people count on,...

Um, if it's variable, should you really be counting on it?

Re:Take a look at the insider stock trading !!!

[johansalk]

"$13 million in the proceeds of a stock grant sale and options exercize to J. Bruce Harreld alone. Bruce Harreld came from Boston Market several years ago where he also helped drive that company straight into the shitter."

The US is diseased and along this line may eventually be deceased. This is something that I had observed for a long time; a short-sighted corporate culture in the US that rewards executives for self-serving, soul-sucking practices. US company after US company are being driven into the shitter; the exceptions seem mainly those companies that are run by their founders or their family, but for those in which management is recruited, there's too often a streak of executives whose sole concern is their rewards during their term, and to hell with any hint of a future for the company or anyone else. The US will pay for this, as US company after US company will fold. Look at GM and Ford suffering now thanks to the shenanigans of the 1980s and since; you could develop products that people want and grow a viable business, or you could cook the books, sacking left and right, playing with numbers to show what you want, and too often US executives have chosen the latter. It's a shame for Ford and GM; they've done every henious thing, from addresses in the Cayman Islands to blaming unions and social responsibilities and lobbying washington, eventhough their competitors in Europe and Japan face bigger social responsibitilies and higher costs of doing business, yet their companies have prospered and are taking US carmakers to the cleaners, thanks to a stricter set of legal rules that forced their executives to focus on the essential and true ways of running a company. Warren Buffet, a man whose preferred holding period for a stock is "forever", has been yelling for a while now that executives need to be disciplined by a new set of rules encoded into law; and I wholeheartedly agree.

Re:Take a look at the insider stock trading !!!

[YrWrstNtmr]

And if we want to compare car companies and how poorly they are doing, let's not forget MG Rover, Fiat Auto, Peugeot, and Mitsubishi. I'm not saying GM and Ford are industry darlings...far, far from it. But a LOT of car companies are in the crapper.

Re:Take a look at the insider stock trading !!!

[gelfling]

None the less - when they are screaming for people to start counting paper clips, lavishing executives with 10's and 100's of millions of dollars is not a wise business decision. Let's not forget that the largest IBM site in the world now is in India and by next year India will have more IBM employees than any other. While they 'leverage' employee costs by a factor of 9:1 compared to the US and Europe, AND stock price continues to fall and fall and fall, awarding executives with ridiculously increasing compensation out of all measure of actual performance is a joke.

While I fully appreciate the Techno-Libertarians who defend and support the executive class of which they themselves will never occupy, it's simply bad business no matter how ideologically whipped into a frenzy they get.

Re:Take a look at the insider stock trading !!!

[eric2hill]

competitors in Europe and Japan face bigger social responsibitilies and higher costs of doing business, yet their companies have prospered and are taking US carmakers to the cleaners

I'm not saying you're wrong, but U.S. car companies have a large amount of overhead due to pensions that they must meet. Something like $1500 of every new car purchased from Ford or GM goes to pay for pensions. Japanese car makers do not have that burden. The Japanese government pays their employees pensions. Pensions are by far the largest cash outlay (with no return) that Ford and GM have to pay. I wouldn't call it an unfair advantage, but it would sure level the playing field if the pensions were handled elsewhere.

Re:And you were expecting what...

[l0ungeb0y]

"IBM is an American corporation. As long as they keep the shareholders happy, who cares about anyone else down the ladder. If you don't like it, go work for HP."

Say what?

Ohhh... I get it... you're being sarcastic -- yet serious -- or is that sardonic? And with such post-modern symbolism - or was that bitter bitter irony?

I think my head just exploded.

Umm is just me or...

[Anonymous Coward]

When will the Europeans figure out that their polite, silent walkouts, singing songs, sitting down in the corridors, etc... are viewed with a certain amount of amusement by US companies who are used to associating the word strike with picket lines? You know these protests seems sufficient to, in your words, to supply: very highly paid, work on average about 35 hours per week, get 5-7 weeks of paid vacation, and phenomenal benefits for decades. You're just jealous. Hell I'm not, a 35 hour week sounds like a nightmare! Heheh.

Re:Umm is just me or...

[winkydink]

Not in the least. I live in a country where one can become a millionaire without having to worry about hitting the 90% tax bracket.

Phenomenal benefits for decades? Yes, I guess it has been that way for more than two decades. Maybe three decades. Beyond that? Nuh-uh.

I'm not jealous. In fact, I don't feel my employer owes me anything more than my negotiated compensation package. The instant that stops being a mutally beneficial arrangement, then I expect out relationahip will end.

The global economy is changing, whether or not European employees of multinationals want it to.

Re:Umm is just me or...

[Anonymous Coward]

This always boils down to the same ideological struggle. What are the chances you'll become a multi-millionaire? Miniscule. Yet Americans, all Americans, talented/talented, skilled/unskilled, educated/uneducated all believe they are going to be the lucky one. But hey, perhaps you personally might make it. But then so might I. (There hasn't been a 90% tax bracket since the early 1960s by the way so I'm not too worried about that, the top tax bracket is 40%). Can you see why that looks ludicrous to us? Every American moron we meet who can't even spell "millionaire" thinks his lucky number is going to come up and nothing but "hard work" stands between him and the brass ring. Statistically the average American is walking about in a fantasy.

In Europe we recognise the probability of that happening is low. So we have the system that we have. Its just a different response to the same issues of limited wealth in society.

It has been five decades btw, most of this stuff started directly out of the war. Whilst you lot were driving cars with fins and going to the hop Europeans were promising their children things would be better, and so far they have been.

Ultimately who knows what will happen. Where I am we've had the longest period of sustained growth in recorded history and the dollar has never been cheaper, can't say I'm especially persuaded times are getting harder. Of course, Europe is just an idea really or at best a geographical convention, its a mistake to think we're all the same as the Germans, who frankly are having a torrid time of it right now and do need to change things quicksmart.

Re:Umm is just me or...

[cicho]

" I live in a country where one can become a millionaire without having to worry about hitting the 90% tax bracket."

Wake me up when the percentage of millionaires in your country exceeds the percentage of those living below poverty line.

Right, cause it was published...

[Anonymous Coward]

We obviously know that they haven't behaved in a business-like fashion at all, definitely haven't looked at the other options, and are most certainly being short sighted robber barons, because IBM didn't sit down with us and spell out their exact process leading up to this decision.

Oh wait, you might have a defective sarcasm gland. There's no hope ...

Where has honor gone

[Anonymous Coward]

It makes me sick how irresponsible employers (and sometimes employees) are.

I want the old Japanese companies back. Some CEOs killed themselves because they had to fire people.

I can not beleive that IBM suddenly realized today that 10,000 people are redundant and needs to fire them all tomorrow. How about staging it a bit and firing 200 per month. The goverment should charge a "polution" tax for companies that suddenly dump 10,000 people on the street.

Info on the union web site.

[winkydink]

Does this look familiar? US union, Euopean issue. YEt another attempt by the CWA to organize industries that have little interest in unions.

Domain ID:D9294190-LROR
Domain Name:ALLIANCEIBM.ORG
Created On:20-Aug-1999 14:42:38 UTC
Last Updated On:15-Apr-2005 14:30:15 UTC
Expiration Date:20-Aug-2006 14:42:38 UTC
Sponsoring Registrar:Network Solutions LLC (R63-LROR)
Status:CLIENT TRANSFER PROHIBITED
Registrant ID:5621098-NSI
Registrant Name:Communications Workers of Amer
Registrant Organization:Communications Workers of Amer
Registrant Street1:Attn. Beth Allen
Registrant Street2:501 3rd Street NW
Registrant Street3:
Registrant City:Washington
Registrant State/Province:DC
Registrant Postal Code:20001
Registrant Country:US
Registrant Phone:+1.2024341000
Registrant Phone Ext.:
Registrant FAX:
Registrant FAX Ext.:
Registrant Email:ballen@cwa-union.org

Re:Info on the union web site.

[redbeard_ak]

The unions (multiple) in Europe are doing the striking. They are faced with these layoffs and are responding.

The IBM employees in this country that have joined CWA through Alliance@IBM (a grassroots group that _choose_ to affiliate with CWA) are simply supporting their fellow employees - at the very least by publicizing the strike. That is what workers in unions do - they help each other out. That's the point. To work together to make things better for everyone at the workplace, even in the industry. Instead, the parent chooses to throw stones. Nice guy.

s/on strike/wearing black and blue ties/1

[sparkz]

That is not a strike. A 10 minute break at lunchtime and wearing black-and-blue ties.

RTFM (strike-HOWTO-1.4.23, by N. Kinnock)

Screm 'em all

[Anonymous Coward]

Frag 'em if they can't deal. The only thing that matters is profit. Loyalty, decency, family, the environment, human dignity, human rights are all secondary to the almighty dollar. As long as the shareholders are raking it in, who cares if this sort of thinking sends it all down the toilet, because you sure can't start worrying about bleeding heart abstracts like 'balance,' can you?

Re:Europeans go on strike

[Quantum Skyline]

As am I.

I'm kinda surprised at the lack of sympathy being given - our geek brethren (and sisters) out in Europe are being canned, and no one here seems to care much. Unionization comes up around here, and every time its shut down. I'd like to see if the union will help out those in Europe.

Then again, and I know I'm going to start a flame war or get moderated into oblivion, but most people don't care until the problem is in their back yard.

Eye-roll

[Anonymous Coward]

As usual, Slashdot is a font of incredibly well-informed political and economic insight.

Oh, no, wait, it's a bunch of tech yahoos who think they should get everything for free. My bad.

The company owes their workers nothing but pay

[Anonymous Coward]

Come on, guys, you can't have it both ways. Either there is loyalty between workers and employers, or there is no loyalty. You can't have no loyalty to your employer, *and* have the company responsible for their employees.

In the 21st century, there is no such loyalty, and we just have to face that fact. Who cares if the company has $1.4 billion net profits. It's their money. It doesn't belong to the employees. If the company wants to fire workers to make even more money, then so be it. Such is life.

Suck it up, cupcake. If you want tenureship, go work at an assembly line or become a professor.

Mod up insightful

[geekee]

I just saw Roger and Me, a Michael Moore film where he criticizes GM for laying off workers in Flint Michigan. He starts the movie showing the place where the UAW had a major victory in the 30s, but didn't seem to see the connection between the union activity and the fact that the plant were being closed in Flint because Mexican workers will do the same job for much less. American and Eurpoean workers have been priced themselves out of the market. To continue receiving these exorbitant salaries, they need to be more productive than people who are willing to work for less.

Re:Mod up insightful

[ndansmith]

To continue receiving these exorbitant salaries, they need to be more productive than people who are willing to work for less.

Indeed. The US and Europe need to be leaders in R&D to maintain their worth in the new global economy. For instance, the US is still a major agricultural leader because of genetically altered crops, pesticides, and harvesting technology. In the US, a single farmer can work hundreds of acres while growing the same crop in other nations can be much more labor intensive.

Since workers from other nations (China, India) can have the same output (or greater) in tech jobs as Americans and Europeans, it makes sense (according to a free market economy) to hire the workers with the highest efficiency (as measured by output per wage). That is the nature of the global free markey beast.

Re:Mod up insightful

[oblivionboy]

Thats absolutely rediculous. The workers in other countries are typically not going to be any more productive than anyone in first world nations. Human nature as it is, they may put in more hours (because they have no choice -- if you have a job at IBM and you're bosses are telling you that to keep your job at IBM Mexico you need to work long hours, otherwise you get the boot, and there's no other company out there, it doesn't become an issue of voluntary overtime), but ultimately you would never expect one group of human beings to be more productive than others. Not without modifying human beings themselves.

What are you really suggesting? My feeling is you really didn't think about it. Tell me, how are YOU personally going to be more productive than an equivilant worker in Mexico? I'd wager you have no idea. And even then, how would you measure it? Lines of code? Number of bugs found? We've been through all that, and we know its bullshit.

But this is besides the point. If we look at the "big picture" we see mostly a short sighted decision, which only makes sense because all the other companies are doing it. All the other companies are doing it, so of course why shouldn't IBM do it?

Of course the long term view is very dismal. If all companies are laying off workers in first world nations, who is going to be there with the spending power to buy things? You're killing off your consumer base. And then we can imagine that in ten years the Mexicans or who ever they are will increase their standard of living, and the jobs will have to be moved from there to..well..who knows...Africa or some other place. And there will come a time when EVERYONE will have the same average standard of living and then there won't be any places that are cheaper to hire people.

But the real issue is this. Unions came about because people finally realized that 80% of business is what you negotiate. I have no bleeding hard for IBM. If 10,000 of their workers decide to strike for x or y reason, I'm all for it. Its all just business, and if big business like IBM is going to leverage their "power" on the market to get favourable conditions, then for sure there's no reason why employees shouldnt either? Oh wait, it's going to ruin the business? Well, too bad. I won't miss IBM. Someone else will take their place, and a newcomer to replace their business might be very happy to take former IBM employees with favourable packages. But IBM won't fold. If they're forced to keep these employees, via union or whatever, then they will find other ways to save money. You want to force the executives to take a pay cut? This is the way to do it. Because they'll only do so when they're up against the wall.

Re:Mod up insightful

[bfree]

You forget that it is just as important to ensure that the wages levels (and hence standard of living) is going up in the less wealthy economies to close the gap. Encourage them to insist on equally strong social provisions (from social welfare and healthcare to workers rights), ensure that while they may be cheaper, the companies aren't seeing most of the savings, as the savings are taken in by the local economy. The problem as of now is that the poorest countries are selling each other out and hence gifting the savings to the corporations.

Re:Mod up insightful

[chriso11]

Maybe I am expecting too much, but if a technology was developed in my country, subsidised by my taxes (both directly and as tax credits), and developed by my fellow citizens, then the technology should be tied to my country. If the development corporation wants to export that technology, it should pay an export fee, based on the benefits it received in the development process.

If nobody in India helped develop the technology that they are getting, but they get the benefit, then they are being something like a parasite.

Re:Mod up insightful

[Tom]

What an excellent strawman!

That's a great argument if you think shallow, it really is. I'm sure it convinces a lot of people.

Until, of course, you start realizing that the very same companies who don't want us "expensive" europeans as workers at the same time crave us as customers. Ironically, for the same reason - high income.

So, from a "tragedy of the commons" point of view, these companies - collectively, mind you, not individually - are destroying the very market they need to survive.

Unfortunately, we have quarterly statements and quarterly business reviews, and stock prices changing by the minute and second. If we would count in years and decades and estimate share values at similar intervals, a lot of things would change.

Re:Mod up insightful

[Anonymous Coward]

American and Eurpoean workers have been priced themselves out of the market. To continue receiving these exorbitant salaries, they need to be more productive than people who are willing to work for less.

You know, that's the crazy thing, Americans are one of the most productive workforces on the planet. This is hardly in dispute; go look it up.

So, the problem isn't productivity. The problem is that when an American shows up for work at a factory, he got there not by public transit or company truck, but by a personal vehicle, fueled by expensive gasoline, repaired by expensive mechanics, and mandated by law to be insured, registered and licensed ... all of which costs money -- probably about $3000/yr on average. And said American went to the factory each morning from his private home (rent/mortgage payments, insurance, utility bills ... are you catching on yet, fuckwit?) instead of a company barracks where he has his cot, blanket and storage chest -- probably costing about $15000/yr, on average.

This is the price for having a First World infrastructure for your business -- said infrastructure is there for your workers, too, and it's expensive.

At any rate, shitbags like you need to lose their jobs to find out how wonderful Third World living really is. American corporations were doing JUST FINE, until hypergreed and unrestrained capitalism became the prevailing social diseases. And that's the real truth here.

But IBM is still hiring...

[Anonymous Coward]

Is one of the major complaints the people have that are being laid-off. Well, businesses change and sometimes you end-up with too many people with a skill set you need and not enough with a skill set you don't need. That's why, for example, IBM GS was laying off people as they were hiring people. It makes sense when you know the reasons.

PS: Posted for a blind friend that works at IBM. He can no longer post here because of Slashdot's anti-blind and anti-text browser policies. Just because someone is visually impaired is no reason to not allow them to participate.

Re:Europeans go on strike

[Anonymous Coward]

TANSTAFFL--a concept yet to be grasped by pampered Euro-weenies.

Re:And you were expecting what...

[__aaclcg7560]

Ohhh... I get it... you're being sarcastic -- yet serious -- or is that sardonic? And with such post-modern symbolism - or was that bitter bitter irony?

I'm not sure. I would call it the "tickle down" effect of working in corporate America: If Company A lays you off to keep the shareholders happy, go work for Company B. And if Company B lays you off for the same reason, Company C is hiring and so forth.

I think my head just exploded.

You're thinking to hard. That's really bad for /.'s to do.

Meh

[ignorant_coward]

I'd rather see companies like IBM have the proper amount of employees than see them subsidize thousands of idle jobs. At least that's better than governments that practically _never_ fire anyone. These people on strike should go for a good public job or get on tenure track at a university.

can someone answer?

[the-build-chicken]

what happens when a company buys back all it's stock? Is it answerable to no one?

Re:can someone answer?

[d1v1d3byz3r0]

The SEC.

Re:can someone answer?

[Will_Malverson]

What happens when a company buys back all its stock?

A company can't do that. A share of stock entitles you to 1/n of the assets, and 1/n of all the future profits that company, where n is the number of shares outstanding. A company's 'market cap' is the total number of shares outstanding * the price per share. It typically stays constant when a company buys or sells shares to the public.

If a company starts buying the shares up, then n becomes smaller, and the value of the still-outstanding shares goes up. However, if the company is a 'going concern', i.e. has a potential for future profits, then the value of the shares outstanding will *always* be higher than the value of the cash the company has on hand with which it might buy those shares.

Or to put it more simply: IBM's current market cap is around $122B. If IBM bought every share but the last ten, each share would cost around $12 billion.

On the other hand, you *do* sometimes see a company 'go private', where a single investor buys the whole company in one fell swoop. Usually, that investor will make an offer substantially above the current market price (10-30% might be typical), and if the board and shareholders agree, all existing share become the property of that one investor, and the shareholders get cash.

Re:can someone answer?

[lastninja]

Actually it is not that unusual that a person with insider knowledge (Chairman, CEO) uses the company cash to buy the company(keeping his/her own shares ofcourse), he/she just have to fool the other shareholders into thinking that the real value of company is lower than it actually is, which is pretty easy for a CEO, ofcourse speculating against the other shareholders is illegal in most countries.

Re:Easy Decision

[Anonymous Coward]

European workers are known for their inability to deal with change.

So then Americans are known for their use of stereotype as facts?

A story my manager told me about his brother who works for an international bank and was once sent to France.

...And apparently their use of heresay to justify their sad demented opinions as well.

Re:And you were expecting what...

[Anonymous Coward]

If you aren't a value-add to the company, I sure as hell hope they lay your ass off. The corporation doesn't owe you that job, they expect something in return for the salary they pay you. If they aren't getting good value for their dollar, they should trim away. If you can't figure out why this is important to the long-term survival for any corporation, nation, or even household budget, then I suggest a good course in remedial economics.

except IBM GS isn't putting money into employees

[cecirdr]

My spouse just left IBM global services. They've laid off so many people and had talented people opt to leave the company, that the folks who are left are *way* overutilized. Before she left, my partner was pulling 60 hour work weeks as the norm, while 70-80 were frequent. The endless round of meetings was taking it's toll since the folks who've been spared the ax aren't the doers. They're terrified to make a decision so they just waste time twirling and having meetings about the same issues over and over. They appear to be under the illusion they can keep doing the same old "nothing" every day and wake up one morning and somehow the work will magically have gotten done.

There may have been some dead wood in the company that needed to be culled, but quite a lot of those people are brown nosers who have figured out how to misrepresent their skills to managers who have no technical experience. Laying off massive amounts of people, hoping to cull these folks is like playing a shell game. It ain't working. It's demoralizing the employees that are left and the people with real talent are jumping ship...fed up with over work, pathetic management, endless meetings, and not enough talent left to actually implement designs.

So...if that's the results of appeasing stock holders here in the states, why in the world would you want to do the same thing in Europe? Yeah, there's a lot of peple just getting by; never really doing anything. But if management is not competent to figure that out and the en masse layoffs to get rid of them are failing and demoralizing...then you're possibly causing more harm than good by doing it.

IBM is too full of processes, too top heavy (duh as if y'all didn't know that already), and people are constanty job hopping in the company every year or two (or being restructured) with the result that no one know how the hell to do their job.

Re:Easy Decision

[lowmagnet]

Wine or beer at lunch is not a big deal in Europe. They even have a NA version of beer for the kiddies, at least in Germany. I don't see what the big deal is. I think we Usonians are far to uptight about such things.

Let's see here...

[rewt66]

According to IBM's website, they have 319,273 employees. Laying off 15,000 would be 4.7% of their employment.

So, um, doesn't Intel lay off 5% of their employees every year? So why is it different when IBM does it?

Re:Let's see here...

[Carewolf]

Because they do it in Europe, where the unions haven't yet given up (except in the UK).

Re:Let's see here...

[kindbud]

So why is it different when IBM does it?

Because IBM is doing it in Europe, where trade unions haven't yet fallen into disrepute.

Would you like fries with that?

Re:Let's see here...

[ultralame]

FYI, Intel has not laid of employees for years and years (1983 I think?). Intel is an extremely well-managed company. When they need to reduce workforce, they have done so by attrition (not replacing people when they leave). Now, if you are talking about Applied Materials or most other semiconductor companies, that is true. They will spend like mad when things are good, and inflate their employee numbers with dead weight. Then when the cycle turns down, they dump these people on their asses.

Re:Let's see here...

[Anonymous Coward]

cool.. i like how you repeated what the poster above you said 20 minutes earlier..
MOD UP -- HE HAS A LOWER ID THAN CAREWOLF

Re:Let's see here...

[Spectra72]

German auto worker unions are making concessions over work hours as we speak.

Unions are on the retreat all over Europe.

Re:Let's see here...

[Anonymous Coward]

Employmee yr change for intel (from year end reports)
2004 +11.28%
2003 +2.48%
2002 +6.36%
2001 -5.45%
2000 to 1996 between +4.61% and +28.56%

So only 2001 was a reduction. Grandparent pulls data from ass.

Re:Europeans go on strike

[Aldric]

Agreed. Most Americans seem to feel resentful about Europeans because we don't let employers walk all over us. If a US corporation wants to have a branch in Europe, they have to deal with European work views. They don't get to import the US view of work your emplyees like slaves then fire them when they complain. IBM can either accept this or piss off back where they came from.

Re:Europeans go on strike

[Anonymous Coward]

We lost our own "Dream" when we started electing politicians who pray to the God of Capitalism.

Maybe you lost your dream, but not me. My dream is to persue my various ambitions with the least interference from the government. So far I've been very successful at this, and I couldn't be happier with my life.

If you want a government that tells you how many hours a week and days a year you are allowed to work, go ahead and move to Europe.

You dream is to live under a nanny-state, I have no such dream, so be careful saying "we" when referring to your own dream.

Wasnt IBM the company

[MemoryDragon]

Which complained loudly that there will be a severe draught of engineers in the near future... If they have such a lack, they could start by reemploying their layoffs...

Re:Wealth and success

[Anonymous Coward]

Wow hold it...jobs are offered to us because we work harder and charge less. You high-maintenance, lazy and unmotivated ppl should be damned.

Re:Europeans go on strike

[Carewolf]

Not in Denmark. The government usually stays out of that mess. Vacations are settled by the employees unions and the employers union.

Re:And you were expecting what...

[__aaclcg7560]

Maybe I shouldn't have picked on HP that way. I was trying to point (maybe badly) that if being laid off at IBM is bad, try the next company over. Opps... same thing happening over there too.

IBM, HP and all the other companies like them are going to slice-and-dice their work force to keep shareholders happy until shareholders realize that the company is hobbled by not having enough experienced people to get the job done. The last company I worked for was on a buying spree for three years gobbling up companies for 2x to 4x their actual worth. These days, they are laying off people and closing down divisions to make payments on the debt. Go figure.

We need global unions

[MemoryDragon]

Situations like dumping jobs and moving them to the next country only work because unions still act on a local base of country per country... The corporations dont, what we need are global unions which could make a strike on a global or at least on a wider scale. IBM is not hurt by the current strike, but it would be if IBM employess in the US, all over Europe Australia and parts of Asia would go on a strike.

Re:We need global unions

[geekee]

" Situations like dumping jobs and moving them to the next country only work because unions still act on a local base of country per country... The corporations dont, what we need are global unions which could make a strike on a global or at least on a wider scale. IBM is not hurt by the current strike, but it would be if IBM employess in the US, all over Europe Australia and parts of Asia would go on a strike."

If I live in India, do you think I'm going on strike to protect the wages of someone making ten times the amount I am? Yeah, that sounds like it will work.

Re:We need global unions

[MemoryDragon]

You will as soon as the indian jobs are moved to Africa...

Re:Wealth and success

[Anonymous Coward]

Same thing with SPRINT in Kansas City. I work for a computer consulting firm and all the ex-employees in the area who have been laid off from SPRINT that we have interviewed for hire have been friggin retards.

I mean, come on! And one guy, who got in on the sales team was not only a bloody retard but spouted that SPRINT let him go becuase of 'age discrimination.' He lasted 6 months, which was 5 months 1 week too long.

Union servers on strike also?

[necromcr]

Seriously, I cant load that page. Are they ALL on strike?

Re:Wealth and success

[Ratbert42]

Yeah, and you don't get to be that way by employing dead wood.

I've been through about 6 rounds of layoffs. Not once did I look at who we cut and consider them all dead wood. Sure, some choices made sense, but at least a third of the people were painful to lose.

Re:Europeans go on strike

[Anonymous Coward]

Yes, they got us that stuff, but since the early to mid 20th century, they've pretty much served as an example of an anachronism that won't go away. What have unions done in the last 20 years? Let's see...um...uh...well...hmm...oh yeah, they've collected dues and financed political campaigns.

All unions do today is drive a wedge between employees and management. Look around at non-union shops and see what the level of employee satisfaction is compared to union shops. All that the unions can say is that management wants to break the back of the workers - funny thing, though, you'd think that everybody would be flocking to union jobs. Weird that it isn't happening...

Re:Wealth and success

[ScentCone]

So you're saying 10-13k people are "dead wood". Nice of you to jump to conclusions there. Hope your job is on the line next

It doesn't matter how many people it is. Unless you're suggesting that companies should be forced to employ people they don't need, what is your point? For a smaller company, laying off only 10 people might be a larger percentage of the workers. If the company needs to do it to stay fiscally sound for the future, should it instead be forced to make a small number of people happy, and thus jeopardize the long term prospects for everyone in the company? And, in doing so, kill off the value of the stock, which is held by people all over the world in their retirement portfolios, the mutual fund they're banking on to grow money for their kid's education, and so on?

This is the main problem with unions - they treat the job like an entitlement, and many of their positions seem to suggest that they'd rather see the company - and all of the jobs it provides - go down the toilet, rather than prune back staff in areas where they no longer need them.

If 10,000 people are that sure that what they're doing is absolutely so necessary in the market, then surely they're not worried about a job, right? If there's that much demand, then one of the competition will snatch them right up. But: what if, because of a thousand different variables, it's just that they're not that valuable? What if there really isn't a need for them at that moment, in that company, in that industry? As unfortunate as that is, should they penalize the company for it, and insist that everyone gets to go down with the ship?

Or, there's the people that say that if the company would just stop trying to profit so much, there wouldn't be a problem. But, if that's the strategy the company takes, watch the investors pull out their money and go somewhere else where that capital will be put to more productive use.

But mostly: if those 10,000 are so sure that they know better how to run a business that can compete in the incredibly awkward business environment in which IBM now finds itself, then they should also have no problem starting up a new company to do all that business that they seem to think that IBM wants to leave on the table.

Hardworking Candlemakers

[KrackHouse]

This is outrageous. The fact that a company is allowed by government to fire innocent workers is unacceptable. Evil corporations have a responsibility to put food on my table and dammit they had better be held accountable if they're not doing their job.

I make candles for a living and I need your help. Please join me in emailing our legislators in my bid to regulate sunlight, it's putting hard working people like me out of business.

Re:Hardworking Candlemakers

[TerminaMorte]

This was meant to be funny, apparently. And I find it as such.

Mod up to atleast a +2 Funny, eh?

Jackasses, can you atleast learn to read more than the first paragraph?

Why you should care

[redbeard_ak]

Any tech worker, employed or not, should care when 13,000 tech workers get laid off. No, I'm not talking about moral sympathy, I'm talking plain old self-interest.

Because 13,000 more unemployed will be 13,000 more competing for what open jobs there are. Knowing that there are 13,000 more desperate workers, companies will adjust the salaries they offer at whatever openings there are.

Furthermore, the same amount of work, or more, is going to be done at IBM Europe (unless they are closing a division, which I'm not aware of in this case). That means the standard job at IBM will either be that more intense or require more of that wonderful unpaid overtime. That also changes the job market, as other companies will begin to expect that same work load out of you.

Even if you work over here, as I do, better believe that conditions in other countries effect the job market here. Can you say India?

It's the prisoner's dilema. Remember your game theory? You succeed together, or you both fail. That's what the job market does when it's moved by the invisible hand job. Said invisible hand job being the result of decisions like these by IBM management.

Re:Why you should care

[redbeard_ak]

heh, funny that. _I_ forgot my game theory. Still, if the strike succeeds in convincing IBM that they will lose more in this than they would gain, then we will gain from the European worker's actions.

Re:Wealth and success

[Anonymous Coward]

Such an organization would be known as a "charity," except that not even charities can afford to throw away money by employing people they don't need

Being a former employee of IBM and then a former contractor at IBM I can tell you that recently IBM has been laying off their fulltime employees and rehiring contractors in their place at pretty much the same wages. This just cuts off the overhead of having fulltime employees, alows them to layoff/fire people currently working at their locations easier and with no unemployment, and they get a tax break for every contractor they hire. I'm pretty sure the "dead wood" they are cutting off isn't dead because the jobs aren't there anymore. IBM has just found a loophole to keep the people doing work for them super expendable.

Absolute numbers

[vlad_petric]

Sure, IBM has made a profit of 9 billion, with a global workforce that's estimated at around 300K

By comparison Google had a gross profit of 1.73B last quarter, with a couple thousand employees.

While IBM is doing fine, it's NOT very efficient these days.

Re:Absolute numbers

[Soporific]

So if you can't make money like you own a printing press then the company is inefficient?

~S

Re:Absolute numbers

[imsabbel]

You know, if google actually had a personal intensive buissness, they would have less bucks per employee.

Re:Absolute numbers

[stanleypane]

Apples to oranges:

IBM is in the business of selling hardware in addition to providing support services. It takes alot of people to manufacture and/or build things. And they need employees that interact with customers on a regular basis to continue providing to businesses on a personal level. Lets not forget that the service industry is where IBM seems to be hedging their bets lately.

Google is in the business of selling ad space, with some other business plans beginning to join in the mix. They don't sell anything concrete, therefore they don't have to spend anything on materials to distribute a concrete product. Moreover, they've built a business model wherein they rarely interact with their customers on a regular basis to the extent that IBM does.

It's two different worlds. Every business model has a different market with different profit margins. Saying that IBM is completely inefficient by comparing them to Google just doesn't make sense.

Re:Absolute numbers

[Anonymous Coward]

According this logic the most efficient company would be X Billion per quarter with 0 employees.

All the competitors should have the same or very similar ratio in order to stay in business.

The same goes to all industries in all countries, after all, this is the age of "global economy".

Anything wrong with the picture?

Well, only one, at least. Employees are actually customers. Customers who create the profit for these companies, by buying their products.

But if the ultimate corporate competitivness means to eliminate all employees, then all customers are eliminated, too. Sounds like catch-22.

Re:Absolute numbers

[Tom]

Profit per head is not the only measure of efficiency, you know?

Yes, it is one. But it is applied way too easily by managers whose salaries depend on short-term profit instead of long-term viability.

For one, your headcount depends a lot on the business you are in. Two, headcount doesn't scale linear with company size. You have overhead, you have automation and many other factors. Two people might dig a hole in half the time, but 50 people don't take 1/50th, they'll likely take forever. Likewise, 4 people can build something in a day that one person alone could not ever build.

And let's not even get into the questions of the kind of people you employ. There's a huge difference between having a few highly paid specialists and having a large workforce of minimum-wage slaves. Especially when it comes to efficiency per head.

So in summary, 9 div 300000 does not even begin to compare to 1.73 div x-thousand because there are a lot of other factors in that equation that you can not ignore - unless you're driving an agenda.

Re:Absolute numbers

[BrainStop]

To add to this ... if you have read the original press release with regards to the layoffs, there is a shift in focus from IBM (and no, I don't work for IBM) Yes, they are getting out of manufacturing things in France, but yes, they are also increasing their activities in Professional Services. It's all part of the new IBM vision of being a service company rather than a typewriter manufacturer. While getting rid of people in France and Germany, they're actually increasing the size of their operation in Switzerland. From an internal source in IBM, I have heard that, as a result of the upcoming layoffs, external hiring is not close to impossible, as they will first attempt to move people into open positions before actually laying them off. As a result, those open positions may get filled by less than ideal candidates, because IBM is trying to minimise the social impact. However, what does that do for the manager who's recruiting? He gets a lesser candidate, which will impact the performance of his group during the coming years .... Anyway ... there more than 2 sides to this, so I won't wear out my keyboard about it. Cheers, BrainStop

Re:Absolute numbers

[elpapacito]

By using this logic the cocaine industry is among the most efficient in the world

1. very little incredibly underpaid workforce (preparing the coca plant)
2. extreme flexibility and possibility to kill rioting workforce and/or easily replace them
3. only few expensive chemist employees whose cost per kilogram of product is insignificant
4. a demand that is literally dependant on the supply, so supply can make any price for almost an y quantity (it is often noted that in such condition the demand is perfectly elastic, but more often the problems related to the demand are forgotten)
5. the return per employed head is most probably enormous

Indeed from an financial and economical point of view it's a dream business..that's why government declare war on such businesses but NEVER really win the war..that would mean killing a profiteable industry that certainly pays a lot to the corrupt portions of governments.

So you see, efficiency is really a relative concept..because such an industry is certainly efficient for whoever benefits from it, but it's a complete disaster for those who sustain its weight and suffer its externalities.

can you IMAGINE this happening in modern America?

[Cryofan]

CorpGovMedia has most Americans so stupified, I doubt they can even imagine it. Not to mention that our treasonous politicians have already crippled the legal foundation of unionism.....

Conveniently Ignored Facts

[Lawrence_Bird]

Profitability
Profit Margin (ttm): 8.51%
Operating Margin (ttm): 11.02%
Management Effectiveness
Return on Assets (ttm): 7.97%
Return on Equity (ttm): 27.82%

A 10 year note yields about 4.1% and was over 4.5%
earlier this year and is risk free. Certainly people
who invest in IBM are taking risk. What profit margin
do our friends in Euroland think is fair for the company
that employs them to earn?

Yeah, that's smart...

[Dorsai65]

A boatload of jobs are going to get cut, so a bunch of idiots decide to go on strike.

Re:Yeah, that's smart...

[Anonymous Coward]

In case anyone forgets, in the real world, you would most likely get stomped to a bloody pulp for calling these folks idiots and making light of their situation:)

Re:Yeah, that's smart...

[Anonymous Coward]

No, remember, we're talking about socialists here.

They can't fight, or they fight like a bunch of sissies. They have been de-balled and generally consider agressive / violent male problem-solving to be an "unenlightened" option.

I'm mean, lets be real here. Give me some Euro protestor from France, with is tongue ring and nipple piercings. Sure, he screeches loudly in the street. But what would happen if he had to fight like a man, one on one, versus a soldier, or police officer? The little Euro brat would flee like a cockroach...

Re:Yeah, that's smart...

[Anonymous Coward]

idiots? you are a fucking moron. these "idiots" have families to feed, morgages to pay and you call them idiots for protesting against something which could be determental to their lives, and the lives of their children, all so some rich wankers can make more money?

Re:Europeans go on strike

[Anonymous Coward]

What European dream is that?

Unemployment at 12+%, non-competitive economies with virtually no growth, negitive birth rate, unsupportable welfare state, highly aging population, inferior health care (crappy free stuff is still crappy), and large, unassimilating population hostile to sociatal norms and values...

Did I mention a standard of living that is lower than all but 3 of the states in the US.

It may take another 5-15 years, but Europe is going to go through another cataclyismic reflex as the EUtopian model falls apart, and the proles make the streets run red (again).

TANSTAAFL is an economic reality, no matter how many "green" party and "socialist" party members try to tell you otherwise.

Who'd of thought I'd see the demise of the birthplace of western civilization in my lifetime? Like the lotus eaters of old, so goes the EU.

Rome burns, and they legislate the color and size of a banana in Brussels... Oh, and bitch and moan about how screwed up and evil the US is. It sure beats taking a hard look at themselves...

Enlightened? What a farce.

[AHumbleOpinion]

Not in Europe. They actually retained some ideals from the Enlightenment, beyond their immediate usefulness in fomenting rebellion. You know, things like human rights come before other considerations, like profits.

Your comments about Europeans retaining concepts like human right from the Enlightenment would have been more credible if not for the recently practiced concepts suchs as communism, fascism, racism, etc. Your view of history is quite seclective. Please do not interpret this as a slam against Europeans. My ancestors are from various parts of Europe, I've enjoyed visiting, and I've enjoyed meeting relatives. However history is history and everyone has their darker moments.

Re:Enlightened? What a farce.

[Luthair]

State enforced racism existed more recently in the U.S.

Re:Enlightened? What a farce.

[Anonymous Coward]

Your comments about Europeans retaining concepts like human right from the Enlightenment would have been more credible if not for the recently practiced concepts suchs as communism, fascism, racism, etc.

What do you think communism is? Serious question, I can tell you are a USA citizen that has had communism demonised all his life, but I can't quite work out what you think it actually is, if you lump it in with things like racism.

Re:Enlightened? What a farce.

[AHumbleOpinion]

What do you think communism is?

The ultimate entitlement system and the ultimate non-merit system.

Re:Enlightened? What a farce.

[Anonymous Coward]

It's an -ism! All -ism's are evil! Communism, Marxism, Racism, Terrorism, Sexism... by induction they're all evil! /Capitalism? //Shush!

Re:Enlightened? What a farce.

[Anonymous Coward]

That may be so, but you posted it as an example of something that violates human rights.

Re:Enlightened? What a farce.

[Anonymous Coward]

Not being rewarded for working harder than anyone else violates my human rights.

Re:Enlightened? What a farce.

[KarmaMB84]

State enforced attempted genocide occurred more recently in Europe.

Re:Enlightened? What a farce.

[Anonymous Coward]

State enforced fascism is occuring right now in the US.

Re:Enlightened? What a farce.

[Anonymous Coward]

Your comments about Europeans retaining concepts like human right from the Enlightenment would have been more credible if not for the recently practiced concepts suchs as communism, fascism, racism, etc.

I totally agree with you. Of course noone ever learns anything from their mistakes.

Sarcasm aside, an American lecturing me about racism? Yes it is a problem, but the two contries that pop into my head at the mention of racism are South Africa and America. Stones, glasshouses, and so on.

Re:Enlightened? What a farce.

[AHumbleOpinion]

Sarcasm aside, an American lecturing me about racism? Yes it is a problem, but the two contries that pop into my head at the mention of racism are South Africa and America.

Then you are a poor student of history, is 1939-1945 missing from your textbook? More recently we've had the Balkans (ok, we've had the Balkans for centuries). Turks have been complaining about racism for decades, and the North Africans as well. Muslims in general are subject to a bit of racism right now.

Stones, glasshouses, and so on.

Exactly why I posted, the fairy tale of European perfection being portrayed. There are good people and bad people on both sides of the "pond".

Re:Enlightened? What a farce.

[gid-goo]

And the turks complaining about racism is pretty rich considering the Armenian genocide which they won't even fess up about.

Re:Enlightened? What a farce.

[dotoole]

I'm sick of American's using the "Europe is great eh, what about gassing all those jews, eh?". Guess what, people learn from their mistakes occaisonally. Nearly all German schoolkids visit the camps. Why? To hammer into them the fact that when we prattle on about "human rights" it's to make damn sure it never happens again. Europe's history is steeped in blood, I like to think we've learned from it.

Re:Enlightened? What a farce.

[Anonymous Coward]

Which human right, exactly?

Re:Enlightened? What a farce.

[chefren]

My dad has a faster car than yours'!

Re:Enlightened? What a farce.

[AHumbleOpinion]

Europe's history is steeped in blood, I like to think we've learned from it.

You are aware that this was a popular sentiment during the 1920s, both in Europe and the US? Besides, football matches prove this to be yet another fairy tale.

Re:Enlightened? What a farce.

[Anonymous Coward]

Israel is not part of Europe - and they're sponsored by the US anyway.

Re:Enlightened? What a farce.

[Anonymous Coward]

Turks have been complaining about racism for decades,

Maybe you mean the kurds ?

Re:Enlightened? What a farce.

[deaddrunk]

Plenty of genocide in your history too.

Re:Enlightened? What a farce.

[AHumbleOpinion]

I'm sick of American's using the "Europe is great eh, what about gassing all those jews, eh?" ... Europe's history is steeped in blood, I like to think we've learned from it.

We don't have to go back to 1939-1945 to find European genocide, we only need to look back at the 1990s and the Balkans. You sure Europe has learned, sounds like wishful thinking not reality.

Re:Enlightened? What a farce.

[cicho]

", we only need to look back at the 1990s and the Balkans" ...bombed to hell and back by the US.

Re:Europeans go on strike

[ctr2sprt]

No, it's not difficult. The way I see it is as an alternate form of compensation. When the government doesn't mandate vacation days, you, as an employee, can negotiate with a prospective employer to get something that you both think is fair. For example, you can agree to get one less week a year of vacation time in exchange for a slightly higher salary. If the employer doesn't agree, then you go find one who will.

Believe it or not, most people do not take jobs based simply on salary. They consider the benefits package, location, and a host of other factors. It's very common - in the States anyway - for someone to take a lower-paying job because it doesn't require him to move or because it has a better health insurance program. The employee says, "It'll cost me $X to move and get insurance on my own, and that's more than the amount I'm 'losing' by taking the lower-paying job. So this is the best job to take."

It helps out the employee by letting him choose the best job for his unique situation; it helps the employer by giving it the freedom to offer the package it can afford. Thus people who are maybe "marginal" applicants can get jobs where otherwise they couldn't (because nobody could afford to take a chance on them). That's how I got my job. No severance package, retirement, or anything else, but in exchange I got a job, with zero experience, that usually needs five years of experience.

Note that I'm not saying our way is better than the European way. But many Europeans don't seem to understand that there are some advantages to the free(r)-market approach, and I wanted to explain some of them.

Uh, lets do some more maths

[Anonymous Coward]

(we have more than one sum in the UK...)

So how many people do they need to produce the goods? So how much lower is their production capability?

Side question. Big payments to the bosses because they are bosses of big companies and deserve the money. Now, however, they are a smaller company. Will their pay go down?

Re:Hardworking Propagandists

[Cryofan]

Umm, we OWN this country. It's OURS. Whatever happens in it, it happens because WE made it that way. The way I see it, if America can provide a cushy living for everyone, but makes NO ONE rich, that is fine with ME.

But the rich people and corporations have filled your head so full of elite-centered propaganda, you are like some kind of unthinking animal....

Re:And you were expecting what...

[PornMaster]

The unfortunate thing is that these large companies have far too much political bullshit and just simply don't get rid of the right people . Rather than cost cutting by cheaping out on benefits and doing mass layoffs dictated by accountants, if they had actual data about how their worst workers a) are a waste of money, and b) kill morale among the ranks, then perhaps they wouldn't be in the position to have to axe 10000 people regardless of individual performance.

If nothing else, an anonymous "review" of a person's manager annually would help tremendously... well, if someone had the courage to fire individuals instead of mass-printing pink slips.

Re:I HATE unions with a passion

[Anonymous Coward]

And it is fully within the rights of the union to strike.

Stop complaining.

Re:US fed and rebuilt Europe ...

[Anonymous Coward]

And not to mention has pledged millions in aid to other countries around the world such as Africa (what do you mean it's in patented GM crops and there are strings attached?) and the regions affected by the tsunami at christmas (you mean they didn't actually follow through on these?)

What happened 50 years ago means nothing when you're screwing up now.

Re:Europeans go on strike

[Anonymous Coward]

We lost our own "Dream" when we started electing politicians who pray to the God of Capitalism.L

Speak for yourself, cowboy. I'm doing pretty good and I got there on my own. I didn't have to rely on government largesse, which, in reality, is just socialism in disguise. I happen to appreciate my success because I know that I'm behind it.

You apparently didn't live through the '70s, with a Democrat president and years of Democrats running Congress. We went from inflation to deflation to stagflation, lost jobs and watched the economy tank in ways that make the last recession look like a party. Do you like how low our interest rates are now? Back then, they were at record highs. Imagine trying to buy a house at 18% or more.

I came out of that figuring that if I wanted to get somewhere and achieve my piece of the American Dream that I had to do the work myself, so I did. And so did a plenty of people that I grew up with, from dirt poor to filthy rich. Funny thing what you can do when you aren't so worried about where the next handout is going to come from.

The American Dream doesn't come from the government. It comes from you.

Well, now the worm has turned

[Anonymous Coward]

Funny how the European IBMers are now up in arms. They were notoriously silent during the bloodbath of the 90's that saw the death of IBM's full-employment policy and 10,000's of job losses... 35,000 in NY alone.

The European beemers sat smugly taunting the US workers by saying that we should have a union like they do. And there ya go.

This won't work.

[Captain Scurvy]

Have they gotten together more 10,000-13,000 strikers? Otherwise, wouldn't this strike be sort of ineffectual? ;)

Re:Wealth and success

[Anonymous Coward]

Put down the pipe. Jobs are offered to you because you charge less, period.

Re:Hardworking Propagandists

[KrackHouse]

Wow. Wow... You need to understand that America is the richest country in the world because of capitalism. Our poor people have cars and fridges because of the innovation of the greedy. This really isn't a very complicated concept to grasp so why don't people get it? Our taxes are low but 20% of a trillion is more than 70% of a billion. I guess I'm being harsh, I was a Deomocrat for a while except that whole preponderance of evidence thing finally got to me.

"everything else being equal"

[Anonymous Coward]

read the fine print.

Re:Europeans go on strike

[Anonymous Coward]

Mayhaps, us slashdotters could come up with a technological replacement :).

Here's a non technical replacement. Quit posting on Slashdot and get back to work. Then maybe you can keep your job.

Pardon?

[Anonymous Coward]

Ok your company decieded to lay you off. You know what, Life Ain't Fair. The best peice of wisdom i got were those three words. A companys job is to make money plain and simple, if your company has decieded that your employment is no longer needed, time to brush off that resume and start looking around. Whats that? your too important to lose? Your the only one who knows this one thing? Guess what with a work force of 300,000 im sure i can find someone else who can figure it out and more likely than not do it better than you did. Life sucks then you die, get over it.

Re:Pardon?

[Anonymous Coward]

Whats that? your too important to lose? Your the only one who knows this one thing?

Your - Belonging to you
You're - You are

Hey Dipshit, learn how to spell before you get on your soapbox next time.

Re:Pardon?

[Anonymous Coward]

Only a fag would bitch about spelling instead of going to the point of the argument.

Dipshit should only be capitalized if at the beginning of a sentence, DIPSHIT.....

At least INDIA is greatful for jobs- EUROs cry

[Anonymous Coward]

Fire them all and give the jobs to india

The devil is in the details

[davidwr]

If country X and country Y have mutually incompatible safety standards, that's a problem.

More frequently, the safety standards will require things like "inspections by this or that agency" and this-or-that-agency doesn't have the authority or budget to inspect facilities abroad.

Good proposal, but "the devil is in the details."

Re:The devil is in the details

[Locke2005]

Agreed, and there is also a possibility that countries would deliberately implement incompatible "standards" as a form of protectionism. But I still think that is the direction we need to move in. I'm not sure what to do about differing health insurance pratices. (E.g. companies in Canada have a competitive advantage over US companies, as US companies have to provide health insurance for all employees while in Canada it is provided by the government. But then, paying for health through taxes shouldn't be less expensive than paying for it through payroll deductions!)

Re:And you were expecting what...

[16K Ram Pack]

Ask yourself why you deserve that job more than the Indian or Chinese guy?

Re:Hardworking Propagandists

[Anonymous Coward]

it's more free enterprise than capitalism that's made america rich; when someone figures out free enterprise socialism sign me up pronto

Capitalism is NOT a geek's friend

[Anonymous Coward]

The way the market is going, the Internet allows you to do a job that doesn't require physical presence (ie mechanics, nurses, plumbers) remotely, allowing you to ship that job to the lowest bidder (ie, not here in the US).

That means jobs requiring specialized knowledge but not person-to-person skills will be easy to outsource to India, China, you name it.

Geeks now are like strong, stupid people when the industrial revolution came around.

We're not going to win, but we should delay this as long as possible to secure ourselves as much money as possible: the job landscape is turning against us.

Re:Europeans go on strike

[Anonymous Coward]

Exactly- IBM is taking your advice. I don't know why you would think "most Americans" are resentful towards Europeans about this, that's your own prejudices showing.

In any event, IBM has been downsizing for the last 10-15 years, so this is nothing new. In the early '90s they had something on the order of 1 million employees; at some point they stabilized at around 300,000 but they're still tweaking the formula (like selling off their desktop PC division).

They don't do this stuff for sadistic fun, they do it because there's no reason for them to be in markets that lose money. In my view they do have a social contract to no be complete dicks about this (like not giving people fair warning before a layoff), but at the same time they also have a contract of sorts with their shareholders and the rest of the company (yes, their own employees!) to stay successful and not slip back into the oversized bureaucratic morass that plagued them in the '80s and '90s.

13,000 skilled workers

[Senor_Programmer]

sounds like the beginning of a new company to me.

If any of your fire-ees are reading this and want to have a go, let me know. With all those years in at IBM you should each have a couple of hundred thousand Euros accumulated net worth to get the ball rolling.

Hell, with three billion dollars and a bit of a loan, we could buy Novell, or RedHat, or maybe even Sun!

Re:Europeans go on strike

[rtb144]

Having grown up in "Europe" (Austria and Germany), I am very familiar with the "law". From my experience the "law" governs every part of your life from what you can eat to how long you work and what type of toilet paper you wipe your ass with. America is slightly better in most of these regards.
Look at the double digit unemployment in most of the countries in continental Europe and tell me how much the "law" is helping most of them.
Most of these strikes remind me of an Onion article where the French are striking against low productivity.
A strike might win you short-term concessions, but as most American auto workers are finding out, the union is cutting their throats in the long run with decreased competitive ability.

Not striking, bargaining

[Anonymous Coward]

I've finally read the article, and they're not striking, they are starting to bargain as dictated by laws -I presume- in most of Europe.

Since a lot of people will be fired in a relatively short period of time, the employees have the right to demand information, negotiate with the employers about the amount of people being fired, suggest alternative solutions and/or negotiate some form of compensation packet (money and/or appropriate (re)training, etc.).

This is just a show of force saying: 'We know our rights, let's bargain.' And, 'We've got laws here and we _can_ make this extremely difficult for you.'

Re:Europeans go on strike

[Tim C]

No, it's not difficult. The way I see it is as an alternate form of compensation. When the government doesn't mandate vacation days, you, as an employee, can negotiate with a prospective employer to get something that you both think is fair. For example, you can agree to get one less week a year of vacation time in exchange for a slightly higher salary. If the employer doesn't agree, then you go find one who will./i.

I am in the UK, employed by a UK company. I have sold 5 days of holiday time back to my company in return for 5 days worth extra money, spread over the year.

I still get my government-mandated holiday time; this was an extra 5 days that my company gave (as a benefit) over and above that.

Personally, I'll take our way, thanks.

Re:Hardworking Propagandists

[Anonymous Coward]

I suggest you re-think again. Preponderance of the evidence is that both parties are essentially identical in their economic ideas, except that Republicans are blunt about pissing people off.

Can you really say we are the wealthiest nation in the world, given that about 40% of us can't go to a doctor? Or that about half of us can't take any vacation in a year? Or that we have a savings rate of 0.6%, a consumer credit debt of $2 trillion, and a government debt approaching $8 trillion?

Does our economy end at our borders? Do Malaysian and Central American sweatshops count as part of our economy? How about the gazillions of goods sold at Walmart made in China?

Will you be able to retire before you are 60 and enjoy the same standard of living as you had at 40? Can you take more than two weeks vacation without jeopardizing your performance rating? Is your house paid for? How about your car?

Re:Hardworking Communists

[Anonymous Coward]

What are you, some kind of communist? Our forefathers bled and died wishing to secure for us as rights corporate life, liberal profit margins and the pursuit of the almighty dollar, not your bleeding heart life, liberty and the pursuit of happiness. And we're all better off for it. Just consider the $8,000,000.00 USD a year CEO who improves the company's bottom line by getting rid of 250 of us who make $32,000.00 USD a year. It's better for everyone because the CEO rents or buys 250 houses and 350 cars, buys enough groceries to feed 750-1,000 people, buys enough clothing to clothe 750-1,000 people, pays on 350 auto insurance policies, buys 1,200 magazine subscriptions, goes to see thousands of movies, eats a couple thousand meals at local restaurants, and so on, all of which dumps tons of money into OUR local economy, whereas the 250 of us all live in one giant house and spend most of our time out of the neighborhood on the beaches of sothern France. Oh wait...

Re:I HATE unions with a passion

[Anonymous Coward]

Unions are like big complainers. I hate complainers. I mean, unions have their place, but that place is not to bully companies around. That place is to ensure fair wages and treatment for employees.

My head hurts at the sheer ignorance displayed. Like, you actually have to think logically for a living, and you can't see the contradiction above? Sheesh.

How do you think "fair wages" are be ensured without "bullying" companies around? Read up on the history of the labor movement. Enjoy the long list of things your "complainers" brought you: pay for overtime work, pay for hazardous work, the standard 40 hour work week, medical benefits, pension plans, OSHA, NLRB, child labor laws, unemployment insurance, air conditioned work areas. But hey, I'm sure management will listen to a reasonable argument if someone as smart as you puts it forth, right?

Suppose that a company uses technology perfectly and has perfect innovation. What is going to be their #1 production cost? Hmmm....labor. Even in a company of 1, with 100% automation driven by solar power and nano-whatever, the highest cost will still be labor. Yet -- just like in the 1780's -- the CEO of this perfect company will constantly complain about unsustainable labor costs. One Fortune-100 company of today can produce more than an entire nation could in 1780, yet the arguments about labor have not changed a bit in 200 years: it costs too much, we can't compete.

Back on topic: did you ever think that those 10,000 just might in fact have every reason to believe that they are critical to normal operations? That their 40 hours/week are put to good use, and they can easily quantify their contribution to the bottom line? That maybe the majority of them have excellent performance reviews?

Re:Wealth and success

[Anonymous Coward]

I got tagged in a layoff a few years ago. 3 different division heads all raised bloody hell with the VP's when they saw me leaving the building, but other people in my department had attached their names to core money making projects or pet projects of VP's. I told one VP his pet project was a complete waste of man hours and proved it, documented my previous work so it could be continued if I got run over by a train, made my code modular and documented my tools so other people could use them, and had 2 other departments specifically ask me to transfer to them.

Guess who got laid off? Not the employees who deliberately failed to document and made sure their projects took hand-on manipulation, which they admitted doing privately. Not the ones who didn't have a family to go home to so couldn't stay in the data center for a 36 hour shift. Not the ones who wrote letters to management detailing their software viiolations and handing them the open source ways out of the problem.

As near as I can tell, some of the VP's actually invented and implemented a "no rehiring" policy so that those other departments couldn't hire me back.

TANSTAAFL?

[Anonymous Coward]

Wildcard Tango Foxtrot.

Re:TANSTAAFL?

[Adam9]

TANSTAAFL /tan'stah-fl/ [acronym, from Robert Heinlein's classic "The Moon is a Harsh Mistress".] "There Ain't No Such Thing As A Free Lunch", often invoked when someone is balking at the prospect of using an unpleasantly heavyweight technique, or at the poor quality of some piece of free software, or at the signal-to-noise ratio of unmoderated Usenet newsgroups. "What? Don't tell me I have to implement a database back end to get my address book program to work!" "Well, TANSTAAFL you know." This phrase owes some of its popularity to the high concentration of science-fiction fans and political libertarians in hackerdom (see A Portrait of J. Random Hacker in Appendix B).

-- jargon files

Re:Europeans go on strike

[Anonymous Coward]

Umm sorry, but that's the way it's done in Europe too. It's not like the governments assign you jobs and force you to work somewhere. It's just that they regulate some things which they believe should be the same for everybody. Like medical insurance and holidays.

Re:Europeans go on strike

[Anonymous Coward]

So the american dream is socialist? You must be one of Dennis Kuciniches sock puppets...

The countries living the American Dream right now are Japan, South Korea, India, etc. Europeans are hardly living an American dream with their progressive handlers in France and Germany.

Nice try though! I haven't lost the dream, I've reproduced here in America, I have a wife, children, money, and a house. Just because your little gutter-troll ass is still leeching off of mom and dad, doesn't mean that you are in the majority.

Hahahaha!! How pathetic liberalism has become. Reduced to lashing out at america on message boards. Reduced to complaining and whining at other peoples success.

Go Dean!! YEAAAAAAAARRRRRGGG...!

Wage slaves quoting Frederick Douglas. Now

[Anonymous Coward]

that's a laugh.

The Realities of Globilization

[Shihar]

I imagine parent was a joke, but I would suggest recognizing the kernel of truth in it. Europe has a problem. The rest of the world is catching up in productivity or in price. The European economy is facing pressure from both ends of the stick. On one hand you have emerging third world economies like India where people will work long hours for cheap. On the other hand you have the Americans who are famously productive, but work for a high pay. Europe is losing on both ends. On one hand the richer or comparable priced American employees are working longer and are more productive, and on the other hand there is cheap labor in third world nations that are quickly catching up in terms of productivity. If you want to see this principle in action, look at Frances attempt to institute a 35 hour work week. It was a horrible disaster that at this point is dead in the private sector.

The rest of the world is moving towards an American work mentality. Wages go up, productivity and education go up, but hours are long and vacations are slim. In a globalized world I think Europe is going to continue to have a harder and harder time competing unless it starts to loosen up on its labor laws to stuff more work time in the year.

The other alternative of course is for Europe to move away from the globilized world (or at least hold the line). The French populace (from my outsider position) seems to be leaning this way with their leeriness towards the EU. If your nation is not dependent upon IBM or other multinational corporations that can book it once your labor starts to cost more then it is worth, then stuff like this is not a problem.

Whatever the case, I think Europe has some soul searching to do. I don't think rising globalism is going to be gentle to Europe. Europe needs to either adopt a more globalist attitude (especially in their labor laws), or makes preparations to deal the reality that there are more and more places in the world with educated and productive populaces willing to work either longer, harder, or for less. If corporations have the choice, they will pick these places over Europe. Europe certainly got to the top first, but having been first isn't going to be an advantage they can hold on to forever. The rest of the world is catching up.

Re:The Realities of Globilization

[Anonymous Coward]

US education is second rate compared to Europe though. US healthcare is also poor compared to Europe, at least in Europe you get cared for whether you are rich or not. The US standard of living is quite some way down compared to European countries, most notably compared to the Scandinavian countries.

You may not have noticed it, but the US is looking like falling apart financially, record debts, record trade deficits, and the same problem with globalisation and out sourcing.

Take your blinkers off. The US is in just as deep shit as Europe. Move to China.

Re:The Realities of Globilization

[Shihar]

I think you have missed my point. I didn't claim the Americans live the good life or that they are not all going to die at the age of 50 from heart attacks brough on by a shitty diet, too much work, and crappy healthcare. My point was when it comes to corporations looking for a place to set up shop, Europe is causing companies to flee. While anticdotal, notice that IBM is cutting jobs in Europe, but not the US or developing nations.

The power houses of this centaury are multinational corporations. Multinational corporations by their very nature seek out the very best workers. The best workers are defined by their cost and their productivity. Americans survive off of ever expanding productivity. Developing nations survive off of expanding productivity and low cost. Europe's problem is that it certainly isn't getting any cheaper to employee Europeans in most European nations, and their productivity gains lag behind that of the US.

The advantage that Europe and the US have had is superior education and infrastructure that is 100 years ahead of the rest of the world. That advantage is rapidly diminishing. A technology degree from Indian or China is no longer laughable. The infrastructure of these nations is rapidly catching up. To make matters worse, they are much much cheaper labor. In short, the "we were here first" advantage is rapidly vanishing.

My point is that Europe is on the cusp. They are not growing their productivity fast enough. Corporations will leave if they can hire two Indians to do the job of one European for the same price. They will leave if they can hire American to do the job of two in Europeans for the same salary.

The US clearly has a plan to deal with the problem. Ramp up productivity and control as much of the financing of globalization as possible. Europe on the other hand is tittering between their more socialistic tendencies of old Europe, and the more globilized principles of the new EU. I am not saying that Europe is doomed, simply that it is sitting on the verge of a turning point. They need to jump one direction or the other before the rug is dragged out from under them. A dying population and stagnant productivity is going force change one way or the other.

Re:The Realities of Globilization

[zero_offset]

While anticdotal, notice that IBM is cutting jobs in Europe, but not the US or developing nations.

In 2002 they whacked about 16,000 people in the US.

And it's "anecodotal".

Social question

[Anonymous Coward]

It has been clear, that corporations, especially the largest multinational corporations will cut as many jobs as possible - regardless of their profit margin.

This is simply the logic of Wall Street. At the end of the day corporations pay attention only to Wall Streets quarterly expectations: increasing shareholder value. That's the single indicator of success at Wall Street.

In the Wall Street philosophy buying machines, any kind of property, even outrageous CEO bunuses, perks and corporate jets are more favourable "investments" than the hated cost of labour.

Therefore the first thing corporations will continue to cut is workforce. In the dream of shereholders and the the board all employees completely emilinated: that's the ultimate most successful corporation.

It's not accidental, that the USA is the Eden of multinational corporations. In Europe history taught people to fight for strong unions in order to be able to represent their interest, in Asia, particularly in Japan, the regional culture lead even the largest corporations to be loayal to their employees.

On the other hand, in the USA the cowboy myth was kept alive, pushing all liabilities to the individuals. Corporations love this myth and they were relentlessly shed all the cosial contract obligations, as was defined after the 1920's crash and New Deal.

The latest deal with multinational corporations is that There Is No Deal. If you are smart, you can be a millionaire, if not, then just dye. Possibly as quietly as you can.

The American middle class is taking all the blows with this quiet shame: they seem to believe that actually everything is their own, personal fault.

Nobody seems to ask the question: okay, the corporations are doing better and better, while ever growing segment of the population - not only in America, but around the globe - is working harder and harder for less.

Nobody seems to ask the question: with the ever increasing automatization how come it's not easier and easier, how come the wealth is not growing, but shrinking globally for bigger and bigger segment of the world population.

Nobody asks, where is all the profit going?
How come that in the era of ever increasing productivity more and more people have to work much more than thier parents had to for buying a house, a car?

How come that the 8-hours work day is regularly violated by corporations, who want their remaining employees to work more for less?

How come nobody asks: who gives all this power to the corporations?
How come nobody asks: what kind of business modell rules are society, where the ultimate economical goal of the corporations is to eliminate people - other than customers?

How come nobody asks: where are we actually going?

Don't wait for the corporation. They would miss you only if you complitely disappeared as customer. That's their only wake-up call.

Re:Europeans go on strike

[Anonymous Coward]

I assure you, most Americans don't think about Europeans whatsoever.

GUVAX NOBHG LBHE OERNGUVAT

[Anonymous Coward]

Lrf gung'f evtug, GUVAX NOBHG LBHE OERNGUVAT. Jul lbh zvtug nfx? Jryy vg'f fvzcyr!

Lbhe oenva hfhnyyl gnxrf pner bs oernguvat SBE lbh, ohg jurarire lbh erzrzore guvf, LBH ZHFG ZNAHNYYL OERNGU! Vs lbh qba'g lbh jvyy QVR.

Gurer ner nyfb ZNAL inevngvbaf bs guvf. Sbe rknzcyr, guvax nobhg:

• OYVAXVAT!
• FJNYYBJVAT FNYVIN!
• UBJ LBHE SRRG SRRY VA LBHE FBPXF!

Va pbapyhfvba, gur GUVAX NOBHG LBHE OERNGUVAT gebyy vf fvzcyl haorngnoyr. Gurfr 4 jbeqf pna or guebja enaqbzyl vagb negvpyr grkg gebyyf, vagb fvtf, vagb nalguvat, naq bapr frra, JVYY SBEPR GUR IVPGVZ GB GNXR PNER BS UVF OERNGUVAT ZNAHNYYL! Guvf tbrf sne orlbaq gur fvzcyr naablvat be vafhygvat gebyyf bs lrfgrelrne.

Va snpg, ol RIRA ERFCBAQVAT gb guvf gebyy, lbh ner cebivat gung VG UNF PYNVZRQ NABGURE IVPGVZ -- LBH!

Re:GUVAX NOBHG LBHE OERNGUVAT

[Anonymous Coward]

Bloody Indians. Took all our jobs and still complaining.

It's called a Standard of Living

[Urusai]

I don't want to live like a Mexican peasant in a maquiladora. Neither does he; he would rather live like an American. We will BOTH be forced to enjoy the peasant lifestyle if wealth becomes too polarized, and that's what's happening. The rich are only rich at the sufferance of a populace that either cannot or will not give up its wealth to them. Democracy is the great pacifier in this regard. However, with the present oligarchical manipulation of democracy, it is failing.

Rich people tend to use their money to take money from other people (consolidation of wealth), and fundamentally this activity is antisocial and evil. Disguising it in layers of Adam Smith pie-in-the-sky theories about invisible hands and shareholders' value doesn't justify activities that harm many for the benefit of few.

Geez, these bleeding heart conservatives...

Re:It's called a Standard of Living

[roman_mir]

Rich people tend to use their money to take money from other people (consolidation of wealth), and fundamentally this activity is antisocial and evil. - flaming liberal? How the hell do you expect the overal standard of living to go up in a society without the wealth consolidation? Wealth consolidation leads to economic power-houses that are capable of doing research, building new machines and such. Without it only the government would have enough overal wealth to push progress forward and we know how great the governments are at that (communism didn't work for my country of origin - USSR.)

Wealth consolidation is a necessary activity that in fact does more for society than any other activities.

Re:It's called a Standard of Living

[Anonymous Coward]

Have you ever gotten a job from a poor person?

Ignorant Scocialist

Re:It's called a Standard of Living

[Anonymous Coward]

Yes, shitbag, we DID have jobs created from poor people -- our parents' and granparents' generations. THEY built the solid America infrastructure that corporate execs and government officials are today de-patriating at a furious pace. It's theft, pure and simple.

Fire 'em in France...

[rice_burners_suck]

I hope most of the people fired are from France. There is a big shortage of available technology workers here, and 10,000 job cuts from IBM will help my business tremendously in acquiring skilled people.

And socialism is?

[Anonymous Coward]

You are an idiot and you talk down geeks. Geeks will be more powerful than ever under capitalism.

They will ascend above shit like "middle men" and "salesmen" and "trial lawyers" because they actually provide something of value.

Don't be another fucking slashdot sock-puppet trying to tell me whats good for me. I am a geek and making bank at capitalism.

If it ever stops working, I'll call you and John Kerry and Howard Dean, and Gerhardt Schroeder...

Don't hold your breath, dipshit...

Buy the company

[Anonymous Coward]

If the union is so concerned about IBM shareholders profiting at their expense, why don't they just buy shares? That way, they'll reap all the benefit so wrongly taken from the workers. There's no way to benefit the shareholders without benefitting the workers, because the workers are shareholders.

And they'll get more control over the company as well.

Getting Laid off is not a Strike

[thelizman]

That's real genius from our friends in Europe. They're going to protest getting laid off by going on strike. At least IBM knows who to let go now. The irony is that Unions are getting in on the act. Strike that, that's not ironic: All unions care about is preserving their Union dues, and 13,000 laid off workers can't pay dues.

Here's the deal: it costs too much money to do business in Europe. That's why European firms like Axxa, Ikea, and Ericsson are moving across the pond. Liberalize your economy, and you'll find more jobs.

Re:Europeans go on strike

[Anonymous Coward]

"I assure you, most Americans don't think about Europeans whatsoever."

That's because most of you can't even find Europe on world map.

Management/Employee Relations

[cmholm]

All unions do today is drive a wedge between employees and management.

This is a classic anti-union argument, and can be quote verbatum back to the "robber barron" days of the late 1800s. On its face, it assumes that the union leadership dictates, and the rank-and-file follow like sheep, being too stupid to consider their "best" interests. If true, then one might as well eliminate the middle man since management is already perfectly capable of dictating.

On the other hand, it just might be that the rank-and-file are as capable of recognizing their best interests as a stock market is at allocating capital resources.... that is to say, usually they can, occasionally they lack 20/20 vision to think through new circumstances, and sometimes a small clique can fool everyone for a while.

Circumstances since the end of the Cold War shows that you can only count on management (and stockholders) to look after their own interests. Now that there's not even the mirage of "another way", w/in the US at least quite a few of them seem to feel that putting the screws to their employees isn't only possible, it's a mandate from the Almighty.

I'm sure that a portion of the labor pool doesn't want to work in a union shop. The size of that portion is difficult to assertain, given the tread towards smaller work sites (you're easier to single out) and legal roadblocks (in legislatures, executive branches, and courts).

Re:Management/Employee Relations

[Anonymous Coward]

Someone once asked what the union wanted. The simple reply was:

"More"

Unions are short sighted corrupt fuckers that only want the here and now, and have no desire to think of the long term things, such as GROWTH that will open more facilities, create more jobs, and get more dues for the bloodsuckers. They refuse to take short term pain for long term gains. (hey, I made a rhyme.)

What's worse is when your board of directors gets full of union officers and starts meddling in the affairs of the business. Can you say conflict of interest? Sheesh ...

Re:Management/Employee Relations

[BlightThePower]

See, thats not necessarily true.

At the Vauxhall plant in Ellesmere Port (UK car manufacturers) about ten years ago times were hard, and management tabled job losses. The union objected and at which point someone like you thinks, oh, greed again etc etc. Whining. A free lunch blah blah.

What actually happened was the unions together with the workforce came up with an alternative package of voluntary pay freezes, productivity improvements by cutting some conditions issues about the seperation of night shift work and some other employee efficiency suggestions. This isn't what would happen in backstabbing America where everyone is out for themselves and wants to be the one guy who keeps his job and gets a small pay rise for doing his destitute colleague's work, but at Vauxhalls the workforce via their unions as a whole decided was the better plan. Management agreed to give it a shot and it came to pass.

Result? Today everyone still has a job, there are excellent industrial relations in the plant (so the workers are happy) they have the most efficient car plant in the country (management are happy) and pay was unfrozen as market conditions allowed. Eventually Vauxhalls did have to offshore some of their work...but they didn't close the plant with the strong union, they closed the plant in Luton that had meekly buckled ten years previously. They were inefficient you see and in consolidating their UK activities they'd have needed to hire more people in Luton, at great expense. But thanks to the actions of the unions they had a fully staffed facility in Ellesmere Port to fall back on.

It can work it, I've seen it. Very similar things happened with unions in the steel industry but alas they can't be reported as success stories because in the end no amount of productivity gains could offset the American's predilection for crazy socialist-style protectionism, which is a great shame.

Re:Easy Decision

[dabigpaybackski]

It's called "vestigal Puritanism." It infects us to this very day.

Re:Wealth and success

[bigmammoth]

by the same argument the corporation could "suck it up" and deal with the unions. Nobody owes a corporation individual negotiations.

Europe's Economy is the Problem

[Anonymous Coward]

The key are reports that most of the layoffs will be in Europe, especially Germany. The European economy is in a mess. Morbid economies mean less work for corporate service companies like IBM. And in western Europe many social programs are funded by covert taxes on employees. So laying off people makes all too much sense.

Both France and Germany have double-digit unemployment rates and unemployment in Germany is the highest it has been since the early 1930s when (cue spooky music) Hitler took power. That's why Schroder's socialist party just lost badly in a district they've carried in every election for the past 39 years. It's also why French and German politicians rant so much about the US. They're trying to deflect voters' attention away from their own economies. Visit: Medienkritick for more details.

If France and Germany don't create more productive economies modeled on those in the US, UK and much of Asia, they'll end up in a death spiral. Poor economies demand more social programs, which mean more taxes, which create an even weaker economy. And that at a time when baby boomers are about to retire. But given the 'hate Bush and the US" mindset of many French and Germans, change is unlikely.

A century ago, some warned that "anti-Semitism was the socialism of fools." Today it's anti-Americanism that draws fools like moths to a flame.

--Mike Perry, Seattle, Untangling Tolkien

P.S. And what will France and Germany do if the Middle East democraticizes and there are no corrupt regimes eager to buy weapons from them to crush internal dissent?

Equity Strike

[Doc Ruby]

Their union should invest their pension plan in mutual funds that own IBM stock. Then they'd be owners, and the company might listen to them. Especially if firing them meant they might dump all their shares, sending IBM's price down. That would, of course, hurt the union, but the union would be diversified through the different funds, multiplying their power by joining with all the other owners, too. Labor strike brinksmanship would change to equity strike brinksmanship. And actually be based in laws and economics the corporation can't really ignore.

Re:US fed and rebuilt Europe ...

[AHumbleOpinion]

"I thought European nations had a good educational system, I guess not where history is concerned. After the last major European effort to level its own continent it was the United States that provided enormous humanitarian aid to feed the hungry and enormous reconstruction aid to restore industries and economies. I realize the far left is still in a hate America cold war mode but try not to confuse Soviet era propoganda with a legitimate disagreement over the invasion of Iraq."

What happened 50 years ago means nothing when you're screwing up now.

I guess modern history is not well covered in school either, consider the Balkans. Prior to a US commitment there was more talk than action. Again, try to separate ultra-left politics and honest disagreement over the Iraqi invasion from reality.

Easy solution to the problem

[Anonymous Coward]

Outsource the CEO and other execs.

Re:Easy solution to the problem

[WillAffleckUW]

I don't think they'd go along with that idea, sadly.

Slave pen countries don't make good free trade.

[Anonymous Coward]

In India, you can't just go and start a business, you need to get approval from a hideously obstructionist bureaucracy. China's economy is also subject to heavy government interference.

The result? Big slave pens of people who don't have the freedom to start their own businesses, who can be rented out by government or megacorps to foreign businesses.

This is not good for anybody in the long term.

Re:Slave pen countries don't make good free trade.

[Edward Faulkner]

In India, you can't just go and start a business, you need to get approval from a hideously obstructionist bureaucracy. China's economy is also subject to heavy government interference.

True. But both India and China are getting wealthier rather quickly. Both have a growing middle class. And historically, the rise of a middle class is the only route to lasting political freedom.

We live in interesting times...

Re:Slave pen countries don't make good free trade.

[Anonymous Coward]

lasting political freedom.

You owe me a new keyboard.

Show me a country where a middle class generated a "political freedom". The US is disqualified, since the neocons took over wearing the disguise of Republicans, and now openly discuss on their radio shows the imprisonment of people for the crime of being anti-american (aka "Liberal").

huh

[UltimaL337Star]

wasn't there just a story on slashdot about IBM predicting a shortage in the coming years?

Re:Europeans go on strike

[Anonymous Coward]

No worries! Our president can't find Europe - or Texas - on the map either.

Erm...

[Anonymous Coward]

Whiskey Tango Foxtrot. At least the way I learned it. :)

Re:Europeans go on strike

[nbert]

How insightful, but it's not like we didn't see it coming. Europe has faced problems like this for decades (though I must admit that it used to be about dumping in the low salary sector). We are aware about this problem for quite a while and there's no reason to reinvent the wheel. Most of us are quite surprised about the outsourcing discussion in the states btw, because we are simply used to the fact that someone on the globe will perform the same task cheaper.
IMO the general development is rather shortsighted. Instead of improving the current structures thousands of people are fired because it might look better at the end of the fiscal year. If those tendencies of shrinking (in the western world) will pay off is a totally different question. Possibly it's more a question of "work culture". There are some states in the EU which are more productive than the US per working person, even though he/she might enjoy ~30 days of vacation a year + various holidays. Most people want to work and they are usually worth their money.
Apart from that most so called doles barely help an unemployed person to stay alive. You might want to call that generous, but for me that's just the minimum of what companies like IBM can do by paying taxes.

Really the same work?

[Paradox]

But here's the thing. Sure, you may pay less right now for that work. But what about the long term cost?

My father, who's highly placed in a company that makes medical devices, has told me that they've sworn off outsourcing to India and instead are preferring consultants now (at less-than-stellar consulting rates). The simple truth is they tried twice to get outsourcing working, and every single time the communication obstacles hit them hard and significantly delayed schedules.

Not to mention that the code they made and the hardware interfaces they designed were way under the company's quality standards. This was less than a year and a half ago, so the experience is fairly current. They also tried two significant companies when doing this. So it's not like it was a single bad experience. In both cases, they had to scrap the work almost entirely. It cost them nearly 150% the original non-outsourcing estimate to fix.

I know there are a lot of smart Indian folks out there, but the simple truth is that in India, lots of people are jumping on the coder bandwagon to make money, just like during the dotcom bubble here. As that happens, the number of well-trained and intelligent workers per unit sample will drop.

If IBM moves the jobs elsewhere and they end up getting a crappy product that they spend a bunch of maintenance budget on, then did they really save money? Were they really justified in firing those people? Not ethically justfied, I mean justified in the eyes on the shareholders who want to make money.

profitable?

[BlakeCaldwell]

maybe they're a profitable company because they forsee losses and cut staff to avoid them?

Re:Hardworking Communists

[Anonymous Coward]

your forefathers ignored patents and other forms of intellectual property when it suited them, because they wanted to make money. now when they have the money they come crashing down on anyone who dares even think of something that they might have also thought of. the CEO spending money doesn't make it any fucking better. how does it help the 10k people that die each year in the US due to lack of health insurance? fuckwit.

Implicit Bargain

[amightywind]

In the US there has an implicit bargain between employers, employees, and the government since Reagan and Volker in the early 1980's: employers are free to expand and contract payrolls as they see fit (including outsourcing); employees are free to pursue the highest wages possible in a mobile labor market; government may tax at a high level - all as long as growth remains high and employment remains full (structural unemployment at ~5%). When this equilibrium fails you will see unionization of professionals at companies like IBM.

In the aftermath of the tech bubble I think we can very close to breaking this equilibrium. Fortunately most other sectors of the US economy, and steady growth in the world economy were able to take up the slack.

Re:Wealth and success

[tha_mink]

So you're saying 10-13k people are "dead wood". Nice of you to jump to conclusions there. Hope your job is on the line next.

So you're saying that IBM is laying off people that they NEED? What if you were one of the people at IBM that still has a job. Wouldn't you want IBM to make financially responsible decisions to protect *your* job AND increase the value of your stock? It's like...sorry to see you go but seriously...nobody owes you a job.

someone please explain to me...

[spirit_fingers]

Why should a publicly traded corporation, which is profitable, even be PERMITTED to layoff anyone? Why should the desire for higher profits be allowed to trump an employee's livlihood? Why should profitable companies be allowed to inflict hardship on their employees? Even if a company is losing money, why shouldn't they have to submit to an independent audit to determine the lowest number of layoffs needed to restore profitability? Why should corporate greed take precedence over jobs? WHY???

Re:someone please explain to me...

[omega9]

Let's say you have stock in IBM, maybe not bought right out but as part of something like a 401k retirement fund. You're counting on that fund to build as large and fast as it possibly can for a comfortable old age. You receive a letter in the mail, as a shareholder, explaining that IBM needs your help making a decision.

Even though they've been acceptably profitable in recent quarters, IBM has determined that it's in their best business interest to cut 12,000+ jobs. They could want to do it for any number of reasons: newly discovered efficiency, poor localized market performance, wanting to exit a portion of the market, or simply because they *want to*. This move would contribute to the financial wealth and/or stability of IBM, therefore potentially increasing their stock value and by extension your fund.

Or, they can continue to employ those 12,000+ people... just because they can. Even though they've concluded that they're unneeded for whatever reason, you could tell IBM to keep it up at the expense of your retirement.

Quite simply, what do you honestly think most people are going to tell IBM to do?

How about this: IBM becomes extremely profitable, and discovers that they're able to stay that way without hiring new people. Should they hire new people anyway based on the idea that they can afford it? Of course not. So why should they keep people employed just to keep people employed?

Re:someone please explain to me...

[chez69]

because we don't live in a perfect world. bad things happen. The guy doesn't always get the girl.

Re:someone please explain to me...

[m50d]

The two are completely different. People who have jobs now are depending on them. People who haven't got one are not.

Re:someone please explain to me...

[bhima]

Simply put: Incorporation creates a legal entity which by other legal definitions is sociopathic. Corporations can only have one motivation, profit and have no requirements to have remorse.

Re:someone please explain to me...

[goldspider]

Because businesses don't exist to provide as many jobs as possible to society. They exist to provide as much money as possible to owners and shareholders.

How they accomplish that is up to the said owners and shareholders, not some third-party (government?) committee.

Are you suggesting that government should now regulate profit? I hear they tried that in the Soviet Union too, and we see how well that worked out.

Re:someone please explain to me...

[spirit_fingers]

I'm not suggesting anything of the sort. And it's quite a stretch to suggest that somehow what I propose is anything like what the Soviets did. They did much more than simply regulate profit. They got rid of private ownership altogether. I'm not proposing that. I'm all for companies making profit. What I'm against is profitable companies throwing people out of work on a whim. So far no one has convinced me that that's a good thing. I think people working is a good thing for the individual and the nation as a whole. We should be looking for excuses to keep people employed rather than excuses to lay them off.

Stock Market is Broken

[Luthair]

Isn't their job to be certain they can provide profit in the future for their shareholders (the owners of the company). Why would a company want to keep 10~13K employees that are obviously not necessary in the daily business? Simply because they are making a profit?

Here, I'll say it, the stock market doesn't work. The concept, people purchase a share in the company to receive a portion of the profit; the reality, investors don't care about dividends, they care about increased value in their 'share'.

Increased share value is linked to increase in profits and growth does have a ceiling. This is a big factor in western nations pushing for the 'modernization' of Asia, Africa, etc.

The 'financial advisers' we hear on TV or read in print aren't doing it for the meager wages, they manipulate the system to forward their interests.

CEOs are part of the problem, most are paid in part with shares. This may seem a smart plan, provide a vested interest in the company, unfortunately its also a reason to give the appearance of growth. This happens often but usually aren't as public as Enron, Worldcom, Bre-X etc. nothing happens to them, profits are hidden offshore and fines aren't paid.

Isn't their job to be certain they can provide profit in the future for their shareholders (the owners of the company). Why would a company want to keep 10~13K employees that are obviously not necessary in the daily business? Simply because they are making a profit?

Here, I'll say it, the stock market doesn't work. The concept, people purchase a share in the company to receive a portion of the profit; the reality, investors don't care about dividends, they care about increased value in their 'share'.

Increased share value is linked to increase in profits and growth does have a ceiling. This is a big factor in western nations pushing for the 'modernization' of Asia, Africa, etc.

The 'financial advisers' we hear on TV or read in print aren't doing it for the meager wages, they manipulate the system to forward their interests.

CEOs are part of the problem, most are paid in part with shares. This may seem a smart plan, provide a vested interest in the company, unfortunately its also a reason to give the appearance of growth. This happens often but usually aren't as public as Enron, Worldcom, Bre-X etc. nothing happens to them, profits are hidden offshore and fines aren't paid.

Re:Stock Market is Broken

[Anonymous Coward]

It is incorrect to say that investors do not care about dividends. Some of my investments are very stable companies that provide a steady dividend. These stocks will not fluctuate wildly in price and the dividends are pretty consistent. As I get closer to retirement, more of my stocks will go into this group. The dividends are a consistent source of income. I also have invested in stocks that I expect a large increase in the share price. I trade in this group fairly actively and try and capture gains when I think a stock has gotten close to a peak. This group is significantly more risky, but I expect a higher reward for that risk.

You are correct that the talking heads who tell you what stocks to buy have no clue what they are doing. They are predominantly trend followers. If a stock has been going up for a while, it is a buy for them. I do pay attention to what they are saying because the higher a percentage of them recommend buying a stock is a strong sell signal for me.

Re:Wealth and success

[tha_mink]

Guess who got laid off? Not the employees who deliberately failed to document and made sure their projects took hand-on manipulation, which they admitted doing privately. Not the ones who didn't have a family to go home to so couldn't stay in the data center for a 36 hour shift. Not the ones who wrote letters to management detailing their software viiolations and handing them the open source ways out of the problem.

Sucks for you but you learned a great lesson. Being a good "company man" gets you exactly dick these days when your work for a large company. I feel for you but that's the way it goes. I mean you admit you paved the way for your release.

Re:can you IMAGINE this happening in modern Americ

[Anonymous Coward]

Oh give me a break. Unions are the crippling factor in modern America. Witness the effect. The way I see it, if the union workers don't want to work, but someone else does -- hire the guy that wants to work. I am the one -- along with all other consumers -- that have to pay those union workers' wages when they don't work. And that pisses me off.

Be careful what you ask for

[Anonymous Coward]

Not being rewarded for working harder than anyone else violates my human rights.

Chances are, you don't work harder than about 200,000,000 Chinese and about 75,000,000 Indians.

Anyone with Internet access and the leisure to post on Slashdot has a lot farther to fall than they think.

Re:Be careful what you ask for

[Anonymous Coward]

But you miss the point. Although some may work harder than me, communism won't compensate me for working harder than X-number of people. Not being rewarded at my work level is how communism violates my human rights.

Re:Be careful what you ask for

[Anonymous Coward]

How much are you being paid, relative to your quality of life? How many dollars a week does Nike pay their Chinese shoe-makers, and does it buy them a college education? A house of their own? Car(s)?

You ride to comfort on the back of cheap foreign labor, and then have the balls to claim you're paid relative to your effort.

I suggest you quit praying to your god of capitalism, not only is it a false one, but the incense you burn to appease it reeks like hell.

Re:Be careful what you ask for

[curious.corn]

Very Insightful...

What strike???

[tha_mink]

It's not even a strike. From the article...

"The day of action includes staff wearing black and blue to express their bruised state, have a 10 minute "silent break" at 1PM Eastern Daylight Time, and getting their spouses to drop a line to CEO Sam Palmisano."

mmm...ballsy

unethical my ass

[EccentricAnomaly]

when you are making $9 billion in profit a year it is bloody unethical to lay off the people who help make that profit

It isn't unethical if those people are just free riders. What if that $9 billion in profit was mostly because of the work of the people who didn't get laid off?? Is it ethical to to keep on extra people who aren't really contributing to that profit at the expense of those who are doing the hard work??

If those people who are laid off were contributing to that profit, I'd expect to see IBM's profits to go down in the long term. If they weren't I'd expect the profits to go up. We can wait and see what happens and find out if IBM is making a mistake... but either way they aren't being unethical.

I know what it's like to work with dead wood. And I think it's perfectly fine to get rid of the dead wood. Now, some of those laid off are probably not dead wood, but they can get another job (maybe even with IBM). Skilled, hard working people are always very hard to find.

What is unethical is how so many people think a job is an entitlement and drive whole companies under with their selfishness. When whole divisions fail, it's because of a pervasive culture of this selfishness. It's because of free rider leeches who do nothing but enrich themselves at the expense of the common good.

(bracing for negative mods... but please look up what troll and flamebait really mean before hammering away at my rant)

Re:unethical my ass

[Fallen_Knight]

such as you describe is RAMPANT in goverment and the public sector....

Re:unethical my ass

[Anonymous Coward]

Yes.

A troll is somebody who says ridiculous things to get responses. By that definition, you're a troll.

IHBT. IHL, HAND.

Re:unethical my ass

[Mac Degger]

"It isn't unethical if those people are just free riders. "

Yeah...but how likely is it that all 10.000 are dead wood? Either the personell department needs to be fired en-masse, or (more likely) 10.000 totally redundant employees is statistically impossible. Something fishy is going on here, and I really think it's upper management's golden handshake/stock options/IBM's stock price which is being looked after, rather than the companies health.

Re:unethical my ass

[Hast]

It isn't unethical if those people are just free riders. What if that $9 billion in profit was mostly because of the work of the people who didn't get laid off?? Is it ethical to to keep on extra people who aren't really contributing to that profit at the expense of those who are doing the hard work??
Say you run a hard project for a few months and get a good product in the end. Puring that time you have to push the team hard in order to get finished on time. After that you fire the coders as they are now "not needed" and "dead wood".

Does that seem reasonable to you?

Re:unethical my ass

[EccentricAnomaly]

This doesn't seem wise to me since good coders are very likely to know each other (from school / conferences / slashdot) and talk on the grapevine will make it very hard for such a company (e.g. Boeing in aerospace) to recruit good people in the future.

Re:unethical my ass

[Anonymous Coward]

Well spoken.

Re:unethical my ass

[Hast]

Only if people aren't desparate enough to get a job. Look at the gaming industry for instance, they seem to be using up people at an alarming rate.

Dept Tag Correction--Euros!

[adavies42]

It all boils down to *euros*!

Sympathy doesn't mean IBM is wrong

[Mr. Underbridge]

I think some sympathy is in order for these folks.

Yes, sympathy is justified. And I say this as my brother in law was just laid off. But just because we feel sorry for them - and I do - doesn't mean IBM is wrong to let them go. The unionists point to the fact that IBM is making a profit to justify their jobs. But that's irrelevant - should IBM wait until they're in the red overall to reduce their payroll? Is the situation of the overall company more important than individual divisions? What if IBM is okay but they have a division hemhorraging money? Can they get rid of that division or not?

Bottom line, there comes a time when a company needs to change direction, and unfortunately that means bad things for people. And yes, we should feel sorry for them. And yes, IBM should provide them with decent severance. But it doesn't mean that IBM has to keep them on forever.

Re:Sympathy doesn't mean IBM is wrong

[Anonymous Coward]

IBM is making more and more profit, despit keeping all employees. So? Apparently the employees don't reduce the earnings.

Re:Sympathy doesn't mean IBM is wrong

[Mr. Underbridge]

IBM is making more and more profit, despit keeping all employees. So? Apparently the employees don't reduce the earnings.

I'll introduce you to the concept of "causality" sometime.

Re:Europeans go on strike

[Anonymous Coward]

Is that supposed to be an insult? Most people can't point out the locaion of Monaco either. But thats just because it's an insignificant speck of dirt, just like Europe.

Good Day

there's a limit to cutting executive salaries

[EccentricAnomaly]

There is definitely a pervasive looter mentality in corporate boardrooms in setting these outrageous salaries... these salaries are for the most part too high. However, barring the current abuses, good leaders should make a lot more than most other employees. There is a severe shortage of them, and they can increase profits by way more than they're paid.

Just look at Apple pre Steve Jobs vs. post Jobs. How much was his leadership worth? Apple's massively turned things around... not only protecting the jobs it had, but adding tons of new ones around the world.

Of course, since they're on such a hiring binge now they surely are not always hiring the best people... and they will probably lay off a lot of people as soon as their growth slows enough to let them do so. If such layoffs are unethical, they should not be hiring people that they don't plan on keeping around... but that sort of wrong-headed ethic would be bad for Apple and bad for the people who are going to get laid off (they wouldn't have a job right now).

Re:there's a limit to cutting executive salaries

[jenesuispasgoth]

just so you know, Jobs earns his life well, but allows himself to be paid a symbolic dollar a year from time to time, just like last year... So this guys not only is a good CEO, he is also clever enough to show that he, contrary to many other CEOs, isn't overpaid (ok, so he is only multimillionaire and not multibillionaire... :-) )

Re:there's a limit to cutting executive salaries

[Anonymous Coward]

http://www.appleinsider.com/article.php?id=478

In 2003, he was california's highest paid CEO, making $75 million because of stock options.

Re:there's a limit to cutting executive salaries

[Anonymous Coward]

There sure is a "severe shortage": Many of the outrageously paid execs simply don't perform in line with their compensation. Yet they continue to be rewarded with multiple lifetimes of the average worker's yearly wage or salary. THIS IS THE PROBLEM.

As for "good leaders" making "a lot more than most other employees", how much is enough? The average CEO pay is over 400 times the average pay of the other workers. When does the word "outrage" enter your description? At 1000x? At 5000x? Give us a number, pal!

You were 101% on target with your observation about the "pervasive looter mentality in corporate boardrooms". America's corporations are being looted from the top down. That's why AT&T, HP and so on are the shells they are today. The very stable America corporate assets are being "de-patriated" with frightening speed, and the worst thing about it is that the US Government is 100% behind this fraud. The American worker is doomed. Even the predatory legal classes can't get blood out of millions of turnips, if those turnips can't even get jobs that are worth garnisheeing.

atavistic thinking

[Chris Y Taylor]

"The problem is not with indians getting jobs, but people who were already employed getting laid off in order to find cheaper labor outside of the country."

Ah yes. The I-was-here-first school of playground ethics. Derived from the "I call 'dibs'" axiom if I recall. I'm at a loss. Everyone knows there's no ethical rebuttal to the statement "I had it first."

Re:atavistic thinking

[arose]

What the hell do you think property is?!

Re:atavistic thinking

[TerminaMorte]

Everyone knows there's no ethical rebuttal to the statement

"I know you were at this drinking fountain first, and already drinking, but we're going to let someone interrupt you and drink."

"Ah, you were using this pay phone? Too bad, I'm going to make you hang up and make my own call."

Re:atavistic thinking

[Chris Y Taylor]

Exactly!

I don't know if we "default" to this mode of thinking even when it is logically inappropriate to the situation (like businesses being upset at someone stealing "their" customer, or as in this case) because we learned it early in our own life or it was such a successful strategy for social behavior historically that we have evolved some extraordinary "sympathy" for it. Either way, I think the term atavistic can be applied, though technically it should be "atavistic feeling" since it is not really a method of rational analysis of this sort of modern, adult situation.

Re:can you IMAGINE this happening in modern Americ

[gatkinso]

You have obviously never heard of GM.

US == Highest Corporate Taxes?

[cmholm]

How on earth did you deduce that? Consider the rate structure. As a whole:

Corporate income tax: US < EU

Individual income tax: US < EU

Public retirement tax: US < EU

Public medical tax: US < EU

VAT/Sales tax: US < EU

That you pick out the corporate (presumably income) tax is particular egregious, since the US as always been known for having a considerably lower rate than virtually any nation in western Europe.

Re:US == Highest Corporate Taxes?

[Anonymous Coward]

Something you have left out which is significant are the following: local income taxes and property taxes. Certainly compared to the UK both are higher in the USA than the UK. I don't know how they compare with rates in other European countries.

Also with regard to sales taxes it is important to note that whilst VAT is higher in Europe on some goods, typically a smaller range of goods is covered. So over a typical household spend the ratio of VAT to sales tax is quite a bit closer than the headline VAT rates would suggest.

As far as the average person goes then the thing to look at is the proportion of tax paid by the average person relative to the benefit received, e.g. factoring in all the above forms of tax but also taking into account that you generally have to top up health care with more insurance costs in the USA. For median incomes you still end up with the USA having a lower tax take, but the difference compared to some European countries (notably the UK) narrows somewhat.

Looking at healthcare (since you mostly need to have it it isn't very voluntary), it's probably worth looking at the total percentage spent as a proportion of GDP for both private and public healthcare. This puts the USA on 14.6% of GDP, and the EU average around 8%. The difference is that in the EU a greater proportion is public. In terms of health outcome France (9.7% GDP) ranks better for healthcare outcomes than the USA, so the money seems to be spent more efficiently. In both Europe and the USA healthcare spending is likely to increase with changes in population demographics and the USA is (unless provision is cut) likely to be spending around 15% of GDP on Medicare and Medicaid (public provision) by the middle of the century.

You think IBM is paying for training?

[cecirdr]

"What about all the training and investment IBM made in those people, do they think it was free?"

I don't know where you got the idea that IBM is funding training for employees. For the last several years, money for training has been virtually non-existant....at least in global services.

In what is presented as an attempt to cull the dead wood from the company in order to make stock holders happy, IBM has instead allowed many talented technical people to be culled or choose to leave. There's a major brain-drain going on right now. A nice "healthy" percentage of the inept and loafers have found a way to survive the layoffs in the US, so there's not enough talent to go around any more. Trying to cull these people is like trying to remove a malignant cancer. You can get the tumor and have to sacrifice some healthy tissue to make sure you got the whole thing... but...to get those sneaky, insidious metastisized cells, ya gotta do chemo or radiation. Do it too strong and you could kill the patient/company.

Right now budgets are also cut to the bone...too little money on big outsourced deals to even get the jobs done, much less make a profit. So, less people, less money in global services to do the job/account, more unpaid hours getting worked, morale plummets and training is gone. Send more jobs to Brazil to make things cheaper (numbers on paper are more important than whether the Brazilians can actually do the job or get the training to do the job). Variable pay is the pits, folks aren't even seeing cost of living raises. The folks with talent (not necessarily paid for training...they taught themselves quite often) are jumping ship.

In the long run (to me) this does not look like it will return a company to health. You gotta spend money to make money. Invest in training and retaining your talent. Right now, IBM is doing neither.

Business in EMEA

[Anonymous Coward]

IBM is cutting staff in EMEA simply because its business there has been doing very poorly. It's been losing ground to SAP and as a result many of its employees, especially in global services, are idle.

Global Services works by having various folks that it rents out to companies to install systems etc. If IBM cannot win those deals, then these people sit idle on the bench.

IBM has not been winning these deals, so IBM will staff down until it can figure out how to win the business. If it does figure it out, it'll hire the ppl back.

Query:

[zippthorne]

Assuming the jobs are being transferred 1for1 and not being replaced by expansion of other similar companies... Is it better to be poor/unemployed in India or Europe?

Strikes work well in Europe.

[Husgaard]

I live in Denmark, and here strikes have really helped reaching a reasonable balance between the rights of employers and employees.

We now have a 37 hour work week, and 5 week of paid vacation.

The last (like most previous) extra week of paid vacation was due to a general strike. It basically shut down our country for a few weeks, but most people in Denmark were supportive of the strike.

As an employer (owning part of a company employing some employees) I guess I am supposed to oppose this. But I am also employed by the company I own a part of, so I also gain the advantages.

Re:Strikes work well in Europe.

[KlaymenDK]

"We now have a 37 hour work week, and 5 week of paid vacation."
In addition, you may take a 6th week of --unpaid-- vacation. Most companies demand a certain percentage (say, 50%) of vacation spent before midsummer.

"It basically shut down our country for a few weeks, but most people in Denmark were supportive of the strike."
A few weeks? Where I was (in the capital) it lasted one week, if even that. And the effect it had on the population was a mad panic to hoard (of all things) petrol and yeast. (One guy even blew up wis house because he filled a bathtub in his cellar with petrol, and the fumes ignited. Tsk, but that's Darwin at work right there.)

Let it also be known that I had NO IDEA about this strike until I checked /. AFTER I came to work today. And I'm not exactly alone in the building, either.

Re:except IBM GS isn't putting money into employee

[mikael]

and people are constanty job hopping in the company every year or two (or being restructured)

IBM wasn't nicknamed "I've Been Moved" for nothing.

there's a limit to permanent employees.

[Anonymous Coward]

There's something the majority around here keep forgetting.* A lot of businesses are cyclic. Demand goes up and down for various reasons. Holidays for example. People going on vacation. For that reason, and others. Companies are using temporaries more and more.

*Mainly because the majority can talk about a business, but they couldn't run one to save their lives.

Re:Social answer

[Anonymous Coward]

Your a freaking sock puppet...
A by-the-books American response, I guess...

Americans are the richest in the world. The american middle class is the most sophisticated and powerful and free and self-reliant.

I guess, you did not even understand what I was talking about. That was not the issue. The issue is how this is changing...

Not only that the population of the world can benefit less and less of this wealth, but the American Dream is less and less shared even by the Amercican middle class.

Can you tell me why your middle class dad could make enough money all by himself to buy a house, car, raise a family, while your mom stayed home - and why most American middle class families can't do this today?

Can you look up the statistics, how many hours your dad's generation had to work for a house or for a car, how the company they worked for used to provided them much more money for decent retirement - something you'll never see from your current employer?

Can you tell me why your middle class generation is worst off than your parent's generation?

This was the question and the issue...

Business models are evolutionary. We dont artificially interfere. If you are bitching about america when we have an $11,000,000,000,000 /yr GDP and a 5.xx% unemployment rate,

I don't think so. Come on, you can't be that naiv.
"Business models" are the reflections of the laws of a society.
The laws of a country provide the framework of a "business model". The point of the whole legislation is to interfere with "the evolution".

Companies don't lobby for "evolution of a business model". They lobby for legislation that gives them as big piece of the cake as they can get.
They will, of course cite all kind of ideologies in order to justify the size of the piece they want. Including the ideology of this "business models are evolutionary, we don't interfere... ".
Only fools don't interfere - everyone else does. The unemployed, hungry, who won't even go to vote is the only one who actually don't interfere in this "evolutionary business model" - everyone else does. The bigger or richer the more heavily.

Well, it's the evolution of the business model that allows us not to pay tax... there is nothing we can do about it. Climb higher on the foodchain - I mean "evolution of the business model" - and you'll get rich, too, sucker.

Don't be naiv. Everything is artificial in a society - even in the "free" America: tell me anything you can think of as a "free business model", I'll tell you the laws, regulating that big freedom. I'll tell you how the dice is loaded - with "evolution".

you must be some kind of freak who lives off of mommy and daddy in the basement, or else in canada just hating us for our success.

I wish you could be some kind of a thinker, who breaks away from brainwashing, so that you could think of other reasons for asking qustions, beside "hating you" or being "Canadian".

Or at least if you could read and understand something from the beginning to the end, without spitting out the first knee-jerk rection.

Re:Europeans go on strike

[dcam]

This assumes that you are bargaining from a position of equal strength. While this might certainly be the case, I think that more often than not the employee is at a disadvantage.

flashing BUY signal for IBM

[bohemian_observer]

These huge outsourcing moves always makes me buy, stock will soar like an eagle. And that Ukraine university grad from Minsk will finally receive the job he dreamed of and for big 5000$ dollars a year, vivat board geniuses, vivat chairman, vivat another winning stockholder move, and u know I am a Saudi/Quatar prince with 10% share slice and this brings me more dollars and also brings me closer to another sore poverty shaken European daughter I may abuse.

Re:Wealth and success

[pete6677]

You violated the number one rule in corporate America. Never make a VP feel threatened. Someone who goes around shaking things up and pointing out mistakes, even if they are trying to make things better for everyone, is going to get canned. What those VPs were thinking is, "what if he starts doing this with MY project? What if he proves that MY job isn't necessary anymore?" Many large corporations that are no longer run by the founders are not run in the best interests of the company as a whole, but instead to protect the mini-empires of the various executives. Turf wars are common, and sometimes innocent employees are fired when an executive loses a power struggle and is punished by having his entire department eliminated. It's a sad state of affairs, but this is why the big shots wanted you gone rather than some do-nothing asskisser who praised all of their half-baked schemes.

those numbers don't mean anything.

[YesIAmAScript]

Outsourcing makes these kind of measurements useless. IBM could contract out all their work, and thus they would have less than 5% the employees they have right now. And they would seem to be 20x more efficient, even though it wouldn't change anything. Return on working capital is a better measure. Google will still destroy IBM there, due to being in markets with a lower cost of entry.

Layoffs are the only way left to improve workforce

[RhettLivingston]

One effect of it having become almost impossible in modern times to fire anyone is that a longer term view has to be used to maintain the health of a large corporate workforce. At the same time, over the last couple of decades in America at least, the percentage of entry level recruits of high quality and strong work ethics has declined. It has always been true that some portion of those hired should not have been. That portion has now increased at a time when getting rid of them to try others has become far more difficult.

I've been through multiple large scale layoff cycles with corporations and, though some good folks were caught too and others who didn't understand that they were safe left due to needless fears, in general, the average quality of the employee pool was increased dramatically during the layoff period by the elimination of those who were dragging the good people down. And, in general, the job the good people had to do got easier as the net work output of the lower third or so of the labor pool was negative. Over another decade the work force built back up some and the pay has gotten vastly more competitive with other companies.

More interestingly though, I saw some people who had been coasting along and not trying get laid off and suddenly buckle down and make very good for themselves. Many have told me that getting laid off was the best thing that ever happened to them.

In short, this is the cycle of life and it usually happens to have a good effect, at least when looked at from the overall statistical view that actions at this scale should be viewed from.

Re:except IBM GS isn't putting money into employee

[Anonymous Coward]

I know some who've worked for IBM who thought it meant "I've Been Molested".

US is low-tax compared to EU

[BreadMan]

Here's an cite (you may need to watch a ad) for this claim. This is % of GDP taken by taxes, thus avoiding the corporate/sales/income tax shell game.

From the article:

The average tax burden throughout the OECD was 37% of GDP in 1998. In the European Union it was 41.3%, whereas in America it was 28.9%. Sweden takes the prize for the highest tax burden in 1999, at 52.1%.

The data's a bit old, but I don't think things have changed that much since the survey.

Re:US is low-tax compared to EU

[Anonymous Coward]

Actually, the tax burden in Sweden is much higher.
About 30% municipality tax (depending on where you live), 34.6% in employee tax (taken from the salary). If you earn more than 23 500 SEK (about $3 500) per month, then that money will be taxed 55% (plus 34.6% ).

No point in honest work here.

Re:US is low-tax compared to EU

[Anonymous Coward]

And how much of the average US wage atken up in health insurance and similar "stealth taxes"?

The tax paid here keeps the hospials working ad gives me the dole to cushion the fall when efficiency kills my job.

Re:US is low-tax compared to EU

[ekonom]

Comparing taxes as percentages of GDP between countries is not very useful because of different welfare systems and other factors. For example, in Sweden subsidies are taxed, unlike some other countries, which means that Sweden will appear to have much higher taxes compared to some other countries.

Re:US is low-tax compared to EU

[Anonymous Coward]

Here's an cite

The word "cite" is a verb. It is NOT A NOUN!!!

Ok, wait a minute...

[DesScorp]

Years ago, business critics screamed that CEO salaries should reflect their performance. The better the performance, the better the salary. This came mainly from LIBERAL critics of business.

So business complied.

The very best made LOTS of money. Jack Welch was revolutionary in this area. Survival of the fittest. Look at your executives. Pay the good ones lavishly to keep your competitors from them, can the rest.

And now these same critics are screaming CEOs make too much! Make up your minds.

Actually, it doesn't matter what you think anymore. If we started mandating caps on CEO compensation, the inevitable result would be the flow of of said CEO's and other executives abroad, probably to Asia, where they'd pay a killing to get a Jack Welch or a Steve Balmer.

And then the investment cash would follow them there.

The following refrain from you guys, of course, would be "don't let CEOs leave the US! It's unfair that investors are following them!"

Europeans are overpaid, compared to any other market in the world, including Japan. And their lavish social system, popular as it is here in the red tides of slashdot, is killing the economies of those countries. IBM is simply being smart canning those overpriced jobs.

Re:Ok, wait a minute...

[Lemmy Caution]

What should happen is that you should have to compete with people willing to work for a fraction of your income, and then the market will decide that you are overpaid.

That's the scenario we are moving to: a few very wealthy executives in the first world essentially making money off of work done by people in the third world. You think that CEO's who are making in the low 7 digits aren't getting paid enough, and that Europeans getting paid in the mid-5 digits are overpaid. I thik this suggests a kind of fascination with authority and power that has distorted any sense of fairness, or any idea that economics should serve people, not vice-versa.

Re:Ok, wait a minute...

[Anonymous Coward]

And now these same critics are screaming CEOs make too much! Make up your minds.

Durrrr.

HP ejected its last CEO that nearly killed the company with $21 million in hand. Thats payment for performance?

Re:Ok, wait a minute...

[EccentricAnomaly]

I thik this suggests a kind of fascination with authority and power that has distorted any sense of fairness, or any idea that economics should serve people, not vice-versa.

That's like saying gravity should serve people and not vice versa!

Economics isn't just a philosophy... it's a mathematical description of reality. If economics tells you you are inefficient, then you should listen or risk going out of business... or worse yet in managed economies like North Korea and the old Soviet Union risk people starving.

If you want to have the highest possible standard of living for the most people, then you should develop a plan with economic rigor... don't just rely on wishful thinking.

Re:Ok, wait a minute...

[Lemmy Caution]

Don't be disingenuous. There is a real prescriptive aspect to economics, as well as the analytic one. The prescriptive one is the one that treats people as both completely rational and completely instrumental: as both agents and resources, and advocates for political choices based on the optimization of certain statistics. The term "standard of living" is just one of those statistics, since often, in practice, it relies on some standard of gross productivity over lifetime, or gross income.

There's nothing wrong with efficiency, but turning efficiency into an end rather than a means is part of the pathology of the modern.

Re:Ok, wait a minute...

[EccentricAnomaly]

The prescriptive one is the one that treats people as both completely rational and completely instrumental: as both agents and resources, and advocates for political choices based on the optimization of certain statistics.

That's just simple-mided economics. People clearly make irrational choices all of the time. How else would some car salesmen and mortgage broakers stay in business? You can do analysis with better statistics where you assign a probablity to a rational verses an irrational decision. Similarly you don't have to be completely instrumental... you can use Kalmen filters and the like to estimate quanities that you cannot directly measure. (math is cool).

There's nothing wrong with efficiency, but turning efficiency into an end rather than a means is part of the pathology of the modern.

What's wrong with efficiency as an end? We are only going to live a finite life, why not seek the maximum efficiency in doing good with the time we have here? Why shouldn't socieities set policy on maximizing economic efficiency? That would keep the most people fed verses any other policy.

Children are starving right now all over the world because of economic inefficiency. Good, hard working people in 3rd world countries can't find a job because of economic inefficiency. Economic inefficiency is one of the greatest sources for suffering and dispair in the world.

Re:Ok, wait a minute...

[Lemmy Caution]

Often, people are starving because of efficiency: of someone else's, or because of the efficiency of an abstract entity (a "nation", for example) which measures the goal as increasing GDP, rather than making sure that local markets are met. Children are starving because many locales thought it would be more efficient to convert the national economy to goods and crops for export. And, if you conglomerate the income of the wealthy, and the wealth taken by the kleptocratic governments in those countries together, you'd be numerically right. It would be "more".

But economics regulary chooses abstractions as its objects of analysis, knowing that they're wrong (and tweaking the models numerically, like medieval astronomers adding more and more little concentric circles to explain the movement of the planets) but doing it anyway.

Re:Ok, wait a minute...

[v1z]

> Economics isn't just a philosophy...

You mean, economics, as you see it, and use the term here, isn't a philosophy at all. It's descriptive, not normative.

> it's a mathematical description of reality. If economics
> tells you you are inefficient, then you should listen or risk going out of business...
> or worse yet in managed economies like North Korea and the old Soviet Union risk people starving.

This is statement makes no sense without context; the ways to define "efficient" are way too many, and most of them to wage, for anyone to understand what you want to say.

And, if you look at the numbers, from the standpoint of a corporation, it usually makes the most sense to exploit the weak, and externalise all costs to (often poor) governments and other corporations. Problem arises when the people that make money from corporations (from stocks, or as sallaries) make the political decisions.

Their perspective skews what "efficient" is, and when you have the wrong paramaters, you get the wrong answer, even if the equations are right (which we don't even know for certain that they are).

I generally find that what modern economists find "inefficent" translates to long-term, sustainable global development.

> If you want to have the highest possible standard of living for the most people, then you should
> develop a plan with economic rigor... don't just rely on wishful thinking.

Yes, unfortunately it will most likely take an armed uprising to pry wealth and power from the miniscule elite, not just beautiful words. It's sad, but true.

And I hope you're not so deluded as to think that most political and economical decisions in goverments and corporations today defines their goal as "the highest possible standard of living for the most people". That would contradict the charter of both goverments and CEOs.

Re:Ok, wait a minute...

[EccentricAnomaly]

You mean, economics, as you see it, and use the term here, isn't a philosophy at all. It's descriptive, not normative.

The wikipedia says economics is a social science. Being a science would make it a subset of philosophy, but would also make it not normative (it is testable).

This is statement makes no sense without context; the ways to define "efficient" are way too many, and most of them to wage, for anyone to understand what you want to say.

sorry.. efficiency is to maximize wealth. for a company profit, for a society GDP. I hypothosize that greater equitiy in access to the means of production leads to the gratest wealth for a society as a whole... (i.e. to maximize wealth you want the greatest probability that someone very talented will have access to the resources needed to succeed). I also posit that a system that would maximize wealth also maximizes social justice along the lines of a meritocracy.

And, if you look at the numbers, from the standpoint of a corporation, it usually makes the most sense to exploit the weak, and externalise all costs to (often poor) governments and other corporations. Problem arises when the people that make money from corporations (from stocks, or as sallaries) make the political decisions.

only if you think short term... in the long term such policy in untenable just like all other forms of looting.

Their perspective skews what "efficient" is, and when you have the wrong paramaters, you get the wrong answer, even if the equations are right (which we don't even know for certain that they are).

if the 'equations are right' they should tell you relationships between cause and effect that are correct even if you have the parameters wrong. They should also help you test the parameters that you have to see if they're right.

I generally find that what modern economists find "inefficent" translates to long-term, sustainable global development.

If you can't buy decent beer in your town, it doesn't mean all beer is bad. There is merit in the basic idea of beer, even if the execution is often flawed.

Yes, unfortunately it will most likely take an armed uprising to pry wealth and power from the miniscule elite, not just beautiful words. It's sad, but true.

such violence leads to long term instability, and makes it very likely that one elite will simply be replaced by a new elite (think of the French revolution). Sustainable change happens slowly.

And I hope you're not so deluded as to think that most political and economical decisions in goverments and corporations today defines their goal as "the highest possible standard of living for the most people". That would contradict the charter of both goverments and CEOs.

the best decision a company can make is one that is most likely to make a company prosper... this makes it most likely that a company will endure.

the best decission a government can make is one that makes a country prosper and thrive... i.e. to maximize the standard of living for its people... this makes it most likely that the government will endure.

Re:Ok, wait a minute...

[ynohoo]

Economics isn't just a philosophy... it's a mathematical description of reality.

It may be a mathematical description of human behavior for people whose most important value is greed, at the expense of all other social and environmental concerns.

While that may describe life in Western society, it's a long way from reality. Economics is actually an umbrella covering a range of differing socio-economic theories (including that "inefficient" Communism), none of which can claim to be "reality".

Re:Ok, wait a minute...

[EccentricAnomaly]

It may be a mathematical description of human behavior for people whose most important value is greed, at the expense of all other social and environmental concerns.

Being a science, it should solely seek to be descriptive and predictive. It shouldn't bias itself for or against greed.

While that may describe life in Western society, it's a long way from reality. Economics is actually an umbrella covering a range of differing socio-economic theories (including that "inefficient" Communism), none of which can claim to be "reality".

Seeking to describe reality does not make a theory the same as reality. Communism is an ideology not a science. It tries to use economics to justify its policies, but the policies themselves are not open to the rigor of scientific testing. Same thing for Capitalism.

Re:Hardworking Propagandists

[otis wildflower]

The way I see it, if America can provide a cushy living for everyone, but makes NO ONE rich, that is fine with ME.

Well tough shit. I wanna be rich, and I want the ability to be rich. If you don't like it, vote. If you lose the vote, stop whining.

There's a much larger societial problem here

[jesterzog]

I'm not a fan of layoffs either but a company is there to make money, nothing else.

I agree with you in this instance and probably most others like it, but only very reluctantly. A company is there solely to make money, but this is only the case because society has decided to put companies into such a position.

I find it quite reprehensible that the law treats corporations as legal people, with nearly all the rights but few if any of the conscious responsibilities and attitudes that one would typically expect from a real person in society, even if it's not enforced.

The fact that corporations are only there to make money for shareholders, as the law sees it, is what causes so many of our problems today. For instance, businesses don't "care" about the environment because they actually care. Businesses aren't even alive, so they can't care. They're abstract entities that "decide" to take it into account, in some cases, because they think it'll increase their profit margins and thereby their return to shareholders. The current system is why businesses such as Microsoft, but also many others, treat legal penalties for illegal practices (perhaps ones that weren't definitely established as illegal, for however dodgy they might have appeared) as "business expenses" or "business risks" rather than serious punishment to stop them doing the same things all over again. But the shareholders still get their money, and probably more of it.

At any time when it becomes more profitable to ignore good societial ethics in favour of profit, a corporation isn't just likely to ignore them, it's legally required to. The weirdest thing is that the shareholders themselves, to whom the company is supposedly responsible, are kept so abstract from the companies that they own that actually directing them to aim for anything other than profit is a near-impossible exercise.

I'll be one of the first to admit that the current market system is responsible for some huge leaps in efficiency of businesses, and their ability to do things well and give certain things back to society. That said, it's also the cause of some serious problems that are coming back to haunt us, and it'll keep happening for as long as people let their governments be run by abstract corporate dinosaurs that have leaped out of control.

Stock market is a pyramid scheme without winners

[Anonymous Coward]

$70k saved becomes capital for job creation?

Did it? Or did it go into the CEO's stock portfolio where it will be traded back and forth between rich people, who if they're lucky MIGHT get in on an IPO and invest that money into a company that creates jobs?

Corporate Morals

[MrKaos]

The first thing to remember is that a Corporation, like IBM, is legally bound to put profit ahead of ALL other considerations. Executives may have the same considerations as employee's but they are legally bound to behave in the shareholders interest.

The second thing to remember is that the operational basis of for profit, liability limited companies and corporations is minimising risk to shareholder return by externalising it.

Or simply put "A corporations first loyalty is to profit and considers only minimising risk of losing profit"

For example if the projected amount of available work over the next, say two years, is in decline or an indian/chinese outsourcing option is available then the directors are legally bound to maintain profitability (for the next 8 quarters), shed 13000 workers and let the former employees shoulder that risk (and also all citizens through unemployment benefits paid) - it's has nothing to do with thier ability, it's all about externalising risk.

If something changed that risk equation, for example the government of EU imposed a "mass unemployment levy" where the company had to contribute some percentage of the projected unemployment benefits to the government then the decision may be different as the risk to profit equation changes.

It's situations like these that illustrate one of the many flaws in the first industrial revolution. All employees suffer the same threats (not just IT workers) where first world countries with established pay and working conditions are now competing with third world countries that do not have those conditions. Implementation of free (mercantile in reality) trade agreement's do not include creating the same legal framework for third world workers that exists for first world workers.

The downside of all this is that it is inevitable that working conditions in first world countries will continue to deteriorate until the contracts that make global trade possible factor in those conditions. This decision is another symptom of that problem.

Re:Wealth and success

[argoff]

by the same argument the corporation could "suck it up" and deal with the unions. Nobody owes a corporation individual negotiations.

But by the same argument again, if all the corporations "group negotiated" (translation acted as a cartel) for a locked in high price for the products they made, even if it was legal, most people would still see it as a crappy way to do business.

When life gives you shit, make...

[xenocide2]

Specialization is for insects. 2000 unemployed people is a freaking boon to the entrepeneurial world. Silicon Valley became a mecca specifically because of the talent pool in the area. Economists will tell you that low unemployment will put serious strains on the appearance of new firms and the growth of existing ones. I realize that Europe is hardly suffering from such a malady, and that high unemployment often leads to things that economists rarely consider, such as political overthrows and revolutions.

Seriously, if you think your management is prone to fuck ups, then why the struggle to stay on board with them? You're only even paying attention (or at least acting upon) the actions that directly affect ya'; why are they so much better at making other decisions? I realize this is Europe, where so very few start their own business. There's certainly no shortage of ideas for new things. At the very least, it's an opportunity to grab four of your buddies and start a consulting firm, if you're not sure just what you can make and sell.

But cutbacks rarely salvage a failing company. Usually it's a smarter deal to package a unit up and sell it, but that can be difficult to do with backoffice departments and businesses largely operating on human capital, such as consulting. I don't know the details of what's going on at IBM, but from what I'm gleaning off of the web, it appears that IBM is laying off significant amounts of management and place more of that burden on the underlings remaining.

If I may use an allegory, it sounds a bit like they're given the foreman of construction the added responsbilities of sales, pricing and client targeting. Of course, this becomes a far worse scenario when you translate the allegory to the world of software, where the map is the road and things are generally far less plannable. I don't know exactly what field operatives in IBM Europe do, whether they do database design on-site or if they simply deploy prepackaged hardware and software. Hell, it could be that the plan is to cut the bottom layer off and have the old managers start doing the grunt work in addition.

All of this wouldn't be a problem if Europe was actually growing meaningfully; these days, IBM can provide computer systems for just about every business. Layoffs like this will wind up putting a screw on consumer spending and outlook, which only prolong the disaster. If Europeans felt more in control of their own destiny, then I suspect they'd be more resiliant to these sorts of downturns.

Why I don't care...

[hagbard5235]

IBM is cutting those 13,000 jobs in Western Europe for two reasons:

1) Those workers are hugely expensive.
2) The market for their goods and services isn't growing in Western Europe (as Western Europe isn't growing appreciably).

I don't feel threatened because as an American Worker I
1) Am cheaper.
2) Am in a growing market.
3) Am still experiencing strong productivity gains.

Thus these 13k laid off IBM workers are not competing against me, because they aren't competetive with me.

As to offshoring and India... I've worked with offshoring efforts to India, they're great for some things. They are not currently great for what I do. If things reach the point where my value can be replicated at lower cost in India, ship my job offshore, I'll find something else to do.

Re:Why I don't care...

[Anonymous Coward]

Actually, you've proved the point of the parent poster admirably.

You're just too short-sighted to see the link.

Re:Why I don't care...

[Anonymous Coward]

ship my job offshore, I'll find something else to do. ...he said and din't find anything.

I agree!

[Harish Mallipeddi]

I'm an Indian student living in Europe now and the first few months I should say I was alarmed at the kind of benefits and the kind of social security Europeans get to enjoy! On the other hand, I know people in India, working at IBM, Bangalore, who slog well into the wee hours of the morning every single day, including Sundays, 365 days a year and earn a fraction of their European counterparts (ok I agree this is not that unfair to Indians partly because of currency valuations). That a kindof sounds like they deserve to get their pay for their work. But, if you're going to talk about 3 week long paid vacations (as they do in Europe), why do you think IBM would not resort to move jobs away to a more economical place?

not a troll

[Anonymous Coward]

A troll is somebody who says ridiculous things to get responses. By that definition, you're a troll.

A troll spews bullshit that they probably don't believe, and that probably isn't true trying to get a bunch of knee-jerk responses.

Wikipedia even has a special section on slashdot trolls you can read to get the finer points of troll identification: http://en.wikipedia.org/wiki/Slashdot_trolling_phe nomena

too many start wars things

[Anonymous Coward]

I thought this story said something about the "Empire" strikes back....

in a way - i guess it does..

bad economics starves children

[EccentricAnomaly]

Children are starving because many locales thought it would be more efficient to convert the national economy to goods and crops for export.

This doesn't make sense. If it is more efficient to make goods for export, then you will make enough money to buy more food than you can grow yourself.... otherwise you would grow food instead of making goods for export. That's what being more efficient means.

And, if you conglomerate the income of the wealthy, and the wealth taken by the kleptocratic governments in those countries together, you'd be numerically right. It would be "more".

Such things are precisely what I mean by inefficiency. Inefficient distribution of the means of production to a wealthy elite that lets good land lie fallow... corruption that takes away any incentive for people to work hard. This is the sort of inefficiency that starves people.

Perfect economic efficiency would lead to everyone being employed to the maximum of their ability. This is a goal to shoot for that benefits everyone except looters who make more stealing from others than they could ever get working on their own ability.

But economics regulary chooses abstractions as its objects of analysis, knowing that they're wrong (and tweaking the models numerically,

Models are predicitve tools. The tweaking improves them and makes them better at prediciting the outcome of a certain policy. It's better to use a less than perfect model to evaluate a policy than some ideologically based gut feeling.

Airplanes are designed with imperfect models, rather than aesthetic notions... and this is the responsible thing to do since lives depend on the design of airplanes. People's lives also depend on economic policy and it should be held to the same standard of rigor.

like medieval astronomers adding more and more little concentric circles to explain the movement of the planets) but doing it anyway.

Ptolemy was in ancient, not medieval times... and his epicycle system is mathematically equivalent to Fourrier series approximation... and it is actually much closer than Copernicus to the modern system of using Chebychev polynomials to predict planetary motion.

Re:bad economics starves children

[Lemmy Caution]

Without going into the digression (i.e., Ptolemy was, of course, Greek: but the epicycles were pushed during the medieval epoch) here's a great example of the problem:

Perfect economic efficiency would lead to everyone being employed to the maximum of their ability.

You know, I don't want to be employed to the maximum of my ability. I kind of want to actually enjoy this life-time. I think you do too. Are you being maximally efficient by engaging in this discussion? I sure as hell am not.

As far as the "tweaking models" goes, it constantly runs afoul of the fact that the models are themselves inputs into the behaviour they are trying to model! Tvarski noted that a formal system cannot refer to itself, and economics breaks this rule by its nature. Also, the application of models to a human science on the level of granularity which economics limits itself to runs into the same problem that methodological behaviorism did when trying to analyse human cognitive function.

Re:bad economics starves children

[EccentricAnomaly]

Without going into the digression (i.e., Ptolemy was, of course, Greek: but the epicycles were pushed during the medieval epoch) here's a great example of the problem:

huh? epicycles orginated with Ptolemy, not during medieval time... it's even a greek word.

You know, I don't want to be employed to the maximum of my ability. I kind of want to actually enjoy this life-time. I think you do too.

Someday you will die. Don't you want to live your finite life to its fullest and do the most good you can with your time here? Live each day like it's your last, etc, etc.

As far as the "tweaking models" goes, it constantly runs afoul of the fact that the models are themselves inputs into the behaviour they are trying to model!

no problem with that. this happens all of the time in many mathematical systems (e.g. missile guidance). math can cope with this.

Tvarski noted that a formal system cannot refer to itself, and economics breaks this rule by its nature.

whoever Tvarski was, he sounds like a twit. So economics isn't
Tvarski's notion of a formal system... whatever that means. So what. Math can still handle it. Math can handle anything... it's cool like that.

Also, the application of models to a human science on the level of granularity which economics limits itself to runs into the same problem that methodological behaviorism did when trying to analyse human cognitive function.

This is a big wad of liberal arts b.s. like you see in term papers from students who never read the book. Basically you're drawing some sort of conclusion based on a definition of economics that you chose in such a way as to lead to the conclusion that you wanted. The big words are just terminology thrown in to try and cover your tracks. ..not to imply that this b.s. is intentional, but it's still b.s.

besides -- no matter how much you try and take down economic methods... unless you propose some better system, it's still better than ideology in that it gives an objective method by which to evaluate policy. So if you don't like economics you need to come up with some alternative that has better predictive power if you'd rather economics not be used.

In the absence of something better, It is the moral thing to use econimc models... in that such policy decisions effect people's lives in very real ways and should be decided on an objective basis.

Re:bad economics starves children

[Anonymous Coward]

I think you are misstaken. Mathematical logic cannot be used to deduce the truth of it's own logic. That would be akin to using a theorem to prove said theorem.(Ie. using Pythagora's theorem to prove itself). This was investigated by Goeddel and led to the conclusion that every system that relies on axioms is by nature flawed, however these flaws cannot be corrected without accepting new axioms. As for economics. I don't know if a science that has "ceteribus paribus" as a guiding principle deserves to be taken seriously.

Re:bad economics starves children

[Lemmy Caution]

I meant Tarski, not Tvarski, and he was one of the major logicians of the 20th century, not a liberal arts geek. He was trying to formalize a system of logical truth that would resist the Cretan paradox. And what I said about methodological behaviorism is infomed by my background in cognitive science, not "liberal arts." The words that I've thrown around are basic ones: methodological behaviorism is the "black box" approach to analysis, which is, essentially, what the use of formal models in economics is. You avoid questions of human difference, of actual thoughts and beliefs, and hope that you can either treat people as rational agents, or at least model their "irrationality" (that is, their tendency to be motivated by things other than sheer efficiency in production) without doing any real study of what those motivations might be.

I'm not an economist, but I speak with one regularly (someone doing work in computational economics) and he's the very one who explained the limitations in economic practice to me.

Characterizing this as "a big wad of liberal arts" isn't only incorrect, it's pretty much just ad hominem.

Re:bad economics starves children

[EccentricAnomaly]

I think you are misstaken. Mathematical logic cannot be used to deduce the truth of it's own logic.

Mathematics can be proven or disproven to be internally consistent or not. That's all it needs to be useful.

This was investigated by Goeddel and led to the conclusion that every system that relies on axioms is by nature flawed, however these flaws cannot be corrected without accepting new axioms. As for economics. I don't know if a science that has "ceteribus paribus" as a guiding principle deserves to be taken seriously.

how about you say what you mean instead of just trying to get into some sort of intellectual pissing contest.

Re:bad economics starves children

[EccentricAnomaly]

I meant Tarski, not Tvarski, and he was one of the major logicians of the 20th century, not a liberal arts geek. He was trying to formalize a system of logical truth that would resist the Cretan paradox. And what I said about methodological behaviorism is infomed by my background in cognitive science, not "liberal arts." The words that I've thrown around are basic ones: methodological behaviorism is the "black box" approach to analysis, which is, essentially, what the use of formal models in economics is.

I still don't understand what you're trying to say here. I'm not an economist or a scientist... I just use a lot of math in my job. And I know that math can describe economic behavior well enough to be used as a tool to weigh policy decisions.

Using differential equations you can model any economic system... although you may not know all of the variables in the equations... however you can estimate the unknown parameters and eventually get a fit that is reasonably accurate in the domain of the problem that you are studying.

You avoid questions of human difference, of actual thoughts and beliefs, and hope that you can either treat people as rational agents, or at least model their "irrationality" (that is, their tendency to be motivated by things other than sheer efficiency in production) without doing any real study of what those motivations might be.

if this is the current state of the art in economics, then the learned minds doing this ought to go back and learn some more math. You can model individual decisions as a probability distribution and then combine the distributions to get a probability distribution for a collection of individuals. And although you may not know how an individual will decide, you can still say things about the probable behavior of large groups.

If these people are spending their careers doing economics, they can spend a couple years learning enough math to do their job correctly.

Characterizing this as "a big wad of liberal arts" isn't only incorrect, it's pretty much just ad hominem.

sure, but this is slashdot :)

But it's not exactly ad hominem, I meant that you are using jargon without defining it... and also that your argument is bordering on sophistry.

Re:bad economics starves children

[Anonymous Coward]

Acctualy mathematics cannot be proven to be entirely consisent using the logic dictated by mathematics(mainly arithmetics). In order to build mathematical logic you have to accept certain axioms, which can be flawed, but nontheless have to be accepted without proof. That said mathematical logic cannot be used to incure the truth of itself. As said earlier.

Re:US fed and rebuilt Europe ...

[Anonymous Coward]

Unilateral action.... some of us don't do it....

The action in the balkans was a NATO thing. Not just the United States... what was that you were saying?

Start their own company

[Charles Jo]

The alumni association should get together and create their own company.

CharlesJo.com
Jobs & So Much More

Re:US fed and rebuilt Europe ...

[AHumbleOpinion]

Unilateral action.... some of us don't do it.... The action in the balkans was a NATO thing. Not just the United States... what was that you were saying?

That there was no substantial commitment until US air/ground forces were promised. It was not a case of "unilateral action", it was a case of European nations failing to act collectively unless they had their US safety net. It's not like it was halfway around the world and no one had air/sea lift capabilities, it was genocide on European soil. To be clear I am being critical of European political leadership, not the European public.

IBM's Layoffs Just a Symptom

[Anonymous Coward]

This partly explains why IBM is cutting jobs in Europe.

The economic paths of the United States and Europe began to diverge in the 1990s. Right now, the Eurozone economies have growth rates that are a third to a half that of the U.S.

In the 1990s, the U.S. economy experienced a quantum increase in productivity. European investment in information technology as a percentage of gross domestic product is considerably less than in the United States and is declining. The European Commission estimates that, as of this year, labor productivity per hour in the European Union will have declined from 97 percent of the U.S. level in the mid-1990s to only about 88 percent.

The E.U. produces only about 70 percent of the U.S. GDP per capita. It has a smaller portion of its population in the workforce and much higher unemployment among those wanting to work.

Europeans work fewer hours per year and retire earlier. Over the course of a lifetime, American workers put in 40 percent more hours than their European counterparts.

That's from an article at Jewish World Review

The EU and the US are each reaping what they're sowing. IBM's layoffs are merely a symptom.

-- Mike Perry, Seattle

Re:Wealth and success

[blahplusplus]

"This is the main problem with unions - they treat the job like an entitlement, and many of their positions seem to suggest that they'd rather see the company - and all of the jobs it provides - go down the toilet, rather than prune back staff in areas where they no longer need them."

The problem is not with unions, lets get over that OK. There is a fundamental contradiction about our social orders and economic systems and state of the world that keep these same problems going, ad nauseum into the future. Imagine if there were no other countries to outsource to, no curreny disparity, the world was one nation, where would the corporations run to since they now can't find anyone cheaper through the sheer benefit of a divided world with growing and deflating (devestated) economies with which to exploit workers?

We are unconscious of a lot of this but the state of the world allows for corporations and the elite to play workers of countries off one another, and it is to corporate benefit to war with other countries purposely to deflate their currencies or devestate their economies.

It doesn't take a rocket scientists to add 2 and 2 together to see that the state of the world as it exists is ripe for corporate domination.

On strange thing...

[JollyFinn]

How much they save?
700M$ a year estimated.
How much it costs for the action to happen?
Do they loose the good ones instead of bad ones?
There has been more or less common to loose the people you don't want to get rid off because there are layoffs.
Next question is that DO they loose some of their business because of layoffs, by loosing more talented persons willing to jump ship?
Are competitors getting insights by hiring people IBM just lost?

They are risking 9B$ profits by cutting 0.7B$ thats the effect. They cut costs but same time they cut their sales. Now there is risk of loosing more in sales than getting by cutting employees.

Re:On strange thing...

[Karhgath]

So by your logic, a company shouldn't fire someone because it's risky? Yay for the ultimate job security!

I could argue that it is also risky to keep those employees, so we're not really going anywhere with that argument.

Re:On strange thing...

[JollyFinn]

Mass layoffs are bad, not by virtue of having chance of loosing the good staff but by virtue of loosing SIGNIFICANTLY MORE of the good staff than incompetent as in % vice of their existence in company.

so what....

[Anonymous Coward]

So 10-13K are getting fired, and are saying that they shouldn't be fired because the company is making a profit! WTF! Who said that they got to keep their job so long as the company is making a profit?

Obviously they're not necessary any longer so they're being let go. If any of them had half an ounce of brains, they'd try to SAVE their personal job by telling the company how they could save 2x their present salary - if they keep them on...

Companies hire people to solve problems, not to just pay out all kinds of salary, beny's, taxes, etc... If you're not solving a problem or you're creating a problem, you're gone.

Anyone know if these are redundant as a result of the Lenovo spinoff? If so, then they ought to try to ply their skills to the company that acquired their division... ....but no - they'll go on strike. as if IBM gives a shit - they're firing them all anyway - so why would they even care at all?

And by the way - that moronic "confirm you're not a script thing" totally blows for those of us with poor eyesight....

No shame anymore

[pkphilip]

At one time not so long ago companies took pride in not laying off people. The boast was that X company hasn't laid off a single work in so many decades.

Management tried not to layoff people as much as possible because laying off people was seen as a shameful thing to do - an admission of failure on the part of the management to run the company profitably.

To avoid this loss of face, companies resorted to cutting management pay, selling assets and so on. The moment a company announced a layoff, it would appear all over the papers - the market will see it as a sign that the company is down in the dumps.. analysts would rate the company down.

But now the situation has completely reversed. When a company announces huge layoffs, analysts actually rate the company higher. Also, the management will now gloat about how they have "streamlined" operations.. cut of the extra "fat".. become "lean and mean".. etc.. The implication is always that the layoffs were a smart thing to do.

There is no shame anymore..no accountability on the part of the management. The fact that thousands just lost their jobs because the business strategies framed by the suits came up a cropper does not seem to fill the management with a sense of shame or remorse. Fact is, after a round of layoffs, the executives might even give themselves a pay hike!! They will also announce proudly about how they have "increased" their profitability and worked on the "bottomline".

It is quite sad. There is very little honour anymore.

Re:No shame anymore

[zero_offset]

Very well-said. I have long held the opinion that the decline started roughly about the time we began hearing the term "Human Resources" -- a concept which, in effect, treats a human being as having roughly equal individual value to a box of pencils.

In the US, this closely coincided with the near-total elimination of small business employment over the long term (roughly 30 years, ending with what now appears to be a leveling-off in the late 90s). Another trend which I believe is suspicously coincidental is the "get in / get out" mentality amongst the higher levels of management. Their involvement is purely financial and short-term; they are essentially hatchet-men, which directly supports your conclusion.

Re:military economics starves children

[Anonymous Coward]

You are running the government of a third world nation, you can choose to grow food for your people or cash crops for export. You also need machine guns and helicopters to ensure that you will never need to face an election because sure as hell you don't have a mandate. Since your country does not have the necessary manufacturing capability to supply you with decent military hardware you must shop around on the international market and you will need some cash crops for export. Oh well, guess the food isn't so important after all.

Individual farmers are likely not to be in agreement with your choice of priorities but none of those individual farmers own the land they are working on. The land is owned by large businesses, most of which you have shares in. Those business are managed partly by your extended family and partly by imported managers from the countries that are selling you military hardware. These foreign managers have explained to you why you also need to export 80% of your mineral resources as well. If the farmers get too annoying we call them rebels or radicals or communists and we put those helicopters and machine guns to work.

By the way, just in case you were thinking about saving money and buying less guns than you need, it happens to be known that an "investment" company is willing to provide an extended credit contract to assist the opposition party in the purchase of said military hardware...

Don't bother looking this up in your economics textbook, they don't bother making mathematical abstractions for this one. Of course economics always makes the most efficient decision, but who gets to decide what is efficient?

Economics and Responsibility of Business

[JLawrenceIV]

Corporations' sole responsibility is to increase the wealth of the shareholders. Given, therefore, any aspect of their organisation which is underperforming and not contributing optimally to the bottom line, it should be cut. While this is not great for the European workers, this frees them up to contribute more effectively to some other aspect of the economy. How much money IBM makes as an entire multinational corporation is irrelevant. It is not the stockholders jobs to subsidise European laziness. Personally I appreciate European laziness, but it must come at a price given a competitive world market where 2/3 or the world lives on less than $2/day. Striking workers are highly inefficient and given that European workers are prone to strike, this should contribute even more to disinvestment in the European labour market. I love Europe and I know that I would love to live and own property in Europe, but owning a business in Western Europe: I do not think so. India, China and Tax Free zones are much more preferable.

How to get an US MBA

[Coeurderoy]

Question:

• You have 13 000 Trained employees (quality varies, but the really bad ones have been allready fired).
• You have approximatelly 100 000$ per employe. Most employees are in Europe, so you need extra insurance against french cheese, bavarian beers, multiple language disorientation.

You can:

1. Start a new distribution channel for your existing products
2. Create a new product
3. Start a new service activity
4. Fire every body and dump all the cash in a big hole

Your mission is to maximise something for I forgot who, and of course line your own pockets.
Answer:

1. WRONG: New channels should be outsourced to india.
2. WRONG: What do you think "Education by Work" centers in China are for ?
3. WRONG: Once we have burdenned the European economy by dumping all our employees on them, they will not have any money left to buy services
4. RIGHT: You get the 40 000 000 $ CARLETON arward, you are a true thoughleading economist !!

Re:Europeans go on strike

[Anonymous Coward]

I am in the UK, employed by a UK company. I have sold 5 days of holiday time back to my company in return for 5 days worth extra money, spread over the year.

I do hope you've got a sainted mother that you're desperatly working to pay for an operation for or something. Otherwise giving up those 5 days in exchange for something as small as normal wages seems like a terrible waste. I suppose it's your life though, at least until the army of flying monkeys research continues.

The computer is your friend

[straybullets]

I think we should remember that most of IBM's buisness is to provide competitive edge and buisness automation to OTHER companies, who produce, offer services and in turn will lay off all low profile workers.

In the USA it seems that profit thru buisness is in itself a goal . But what will happen next, when there's no oil anymore (pretty soon) , when everybody is working 2 low pay jobs, et al ?

I strongly doubt that the benefit of shareholders has a good impact on something else than their own private wallets. As before in history except for some profiting elite it will bring WAR and MISERY to the rest of the world .

MODERATOR ABUSE ALERT

[Anonymous Coward]

some head up the ass moderator is down rating this whole discussion as offtopic -- even though it flows logically from the parent posts.

Of course, offtopic is chosen because that way one can down-rate posts for political reasons while minimizing the risk of negative meta-moderation

MODERATOR ABUSE ALERT

[Anonymous Coward]

This is not flamebait... it has been up for a while and spawned a lengthy discussion.... all of it without any flames. Therefore some moderator has his head up his ass and is trying to silence views he disagrees with.

Such moderator abuse is why you never get an intelligent discussion about microsoft and many other contraversial topics on slashdot anymore.

Would some moderation angle fix the abuse by this asshole, and save a very interesting thread.

Already this story is full of AC posts by ppl clearly afraid of being penalized for thier opinions.

Re:military economics starves children

[EccentricAnomaly]

Don't bother looking this up in your economics textbook, they don't bother making mathematical abstractions for this one.

I'm no expert in game theory... but this seems like a problem for game theory. I think you can prove that Mr. Dictator is not acting in his long term best interest. In all likelyhood he's going to end up dead acting this way because someone else is going to coup d'etat his ass. There's some math somewhere that can study this problem. If it can be imagined, math can handle it.

Of course economics always makes the most efficient decision, but who gets to decide what is efficient?

Economics doesn't make any decisions... it's a tool to help you decide. You decide what you think is best for you... companies decide what's best for them... governments, religions, etc. all have their own individual priorities which govern their decision making process.. and economics helps with that process.

Wll, layoffs are result of shortsighted visions

[Pecisk]

I have thought about this many times and, well, it is not clearly only about money. As many posters already pointed out, it is not all neccessary those workers' fault. It is usually common that fellow workers pay about failures of the higher management, as it has more possibilities to blame someone else for their misfortunes.

Humbug

[DABANSHEE]

The US is full of hidden local & state taxes that can really addd up, that of course never get counted because they're not universal nation wide. Do any sort of transaction in the US & it always worked out higher than the agreed price because all of a sudden these state 'n county fees, surcharges & taxes pop up from nowhere. Even things like a county road surcharge & a state emissions surcharged added to cab fares in some places. Then there's the local land taxes to fund local public schools (that can vary by a huge degree between even 2 neihbouring satalite towns with similar socio-economic mixes), where as in the rest of the world public schools are mostly simply funded directly from consilidated revenue of the national treasury.

Ontop of which employers in the US have to pay for the employees healthcare insurance, in a country with the highest health costs in the world, both per capita & as a percentage of GDP, both by a significant margin than anywhere else too. Where as in much of Europe employees healthcare is covered again by consilidated revenue of the national treasury.

Re:Humbug

[BreadMan]

>> never get counted because they're not universal nation wide
The report shows tax collections as a portion of GDP, so the figure includes all taxes, no matter how the taxman tries to hide them.

>> Then there's the local land taxes to fund local public schools (that can vary by a huge degree
This is true, letting market forces work, muni's with lower taxes that provide similar services compared to others attract residents. This trend is writ large in the migration of folks out of the high-tax/poor-service cities into the suburbs. I'd rather live in town too, but even after paying for a commute, my kids get a better education in the burbs than in the city at a lower cost. Where I'm at, the property tax is 1/3 that of the urban center, plus the services are better, or they muni doesn't provide services I don't want anyway.

>> employers in the US have to pay for the employees healthcare insurance
Employees pay for insurance in the form of lower wages. Health benefits provided by your employer are not taxed so this is a nice way of compensating people without paying taxes. Furthermore, employers aren't required to offer health benefits (some don't!), it's a way of attacting and retaining good employees.

>> highest health costs in the world
I'd also argue that the costs pay for better services. Let the price system ration medical services not the gov't.

The new world order

[Anonymous Coward]

What IBM is really doing is to temporarily cut down on their number of employers. Temporarly, because the work those 13,000 workers are doing is surely needed. Soon they will be rehired, but then with much less job security. Probably as hourly workers or standins because IBM can fire those atwill. IBM like most other IT companies in Europe are going very well but are trying to renegotiate the contract between them and their employers.

In the end it means that the 50 hour week is increased to 60 while the pay is decreased with X% and all job security is gone. It is excellent for the companies but horrible for the workers. But what will stop them? A measily 10 MINUTE strike surely won't.

10,000 freeloaders is impossible

[Anonymous Coward]

One of two things has happened here. Either upper management or Human Resources has made an error (in which case they're the ones who should be fired), or top management has a new business plan that requires those particular jobs to be terminated (eg. downsizing, or out-sourcing).

In neither case are those 10,000-13,000 employees at fault; quite the opposite, they will have pulled in their share of the good profits so far.

If they had been freeloading then that would be a different matter, but with numbers as high as these, it's simply impossible that this is the case.

What is a Right?

[spotvt01]

This is what differentiates European and (traditional, although changing) US beliefs. In the US you have the right to pursue happiness, not the right to happiness. There's a critical distinction there. In the US you have the right to work and that does not extend to the guarantee of a job. Bluntly put in the American psyche: It's the owners' company and the E-class was put into position to execute in the best interest of the owners, NOT the employees. Because .... the owners OWN the company. By virtue of working FOR them, you have at -some level- subjugated yourself to their decisions, which inevitably revolve around how to make the owners happy. Such level of subjugation of course depends on cultural norms and legal process and THAT is where the European model is different than the American model. Europeans feel they have a right to continue working for a company once they have been hired. Which is why new jobs are far more uncommon in Europe than in America. This is because it is far harder to get cut jobs in Europe than in America. In almost every manner that I have ever seen (and I have spent a 3rd of my life in Europe), European companies and their governments are FAR less flexible than their American counterparts. They tend to favor equity and process whereas the American system tends to favor flexibility and results. Here's what it comes down to: America respects and rewards risk takers. Europe (by and large) wants to look after the little guy. Here's a case in point: In America the corporate cleaning crews go to work after I'm done my day. In my European experience, they have always been working a 9-5 and based on my American way of thinking, they get in my way ... I do not like hearing a vacuum running while I'm trying to work, it's disruptive. When this happens, my European co-workers don't have a problem, they go take a coffee break. This whole scenario would never fly in an American office (of the type I work in). -Spot

Re:What is a Right?

[spotvt01]

This basically sums up our view of each other: SOCIALISM : You have 2 cows and you give one to your neighbor. COMMUNISM : You have 2 cows, the Government takes both and gives you some milk. FASCISM : You have 2 cows, the Government takes both and sells you some milk. NAZISM : You have 2 cows. The Government takes both and shoots you. BUREAUCRATISM : You have 2 cows; the Government takes both, shoots one, milks the other and throws the milk away... TRADITIONAL CAPITALISM: You have two cows. You sell one and buy a bull. Your herd multiplies, and the economy grows. You sell them and retire on the income. AN AMERICAN CORPORATION: You have two cows. You sell one, and force the other to produce the milk of four cows. Later, you hire a consultant to analyze why the cow dropped dead. A FRENCH CORPORATION: You have two cows. You go on strike because you want three cows. A JAPANESE CORPORATION: You have two cows. You redesign them so they are one-tenth the size of an ordinary cow and produce twenty times the milk. You then create a clever cow cartoon image called Cowkimon and market them World-Wide. A GERMAN CORPORATION: You have two cows. You reengineer them so they live for 100 years, eat once a month, and milk themselves. AN ITALIAN CORPORATION: You have two cows, but you don't know where they are. You break for lunch. A RUSSIAN CORPORATION: You have two cows. You count them and learn you have five cows. You count them again and learn you have 42 cows. You count them again and learn you have 2 cows. You stop counting cows and open another bottle of vodka. A SWISS CORPORATION: You have 5000 cows, none of which belong to you. You charge others for storing them. A CHINESE CORPORATION: You have two cows. You have 300 people milking them. You claim full employment, high bovine productivity, and arrest the newsman who reported the numbers. AN INDIAN CORPORATION: You have two cows. You worship them. A BRITISH CORPORATION: You have two cows. Both are mad. -Spot

What's with the modding?

[Anonymous Coward]

Oh dear, if an AC gets modded like this with a post like this.. uh

Even i may get modded up !!!

Reducing cost by moving jobs

[Ham_belony]

There is some truth that they will save money with moving headcount to India. But the main savings will not be from the cost of employees but in the taxation on the employees work. The low educated people are very well protected in most european countries, which are payed by the higher class of incomes. Although this might seem more expensive for big corporations like IBM they do have to take into account that this does generate extra revenue for them as well whereas the lower incomes and lower educated people in India do NOT contribute to the revenue of these corporations. There is no welfare for these people in those countries, they do not receive any government social income for the time they are unemployed or can not find a job. This also is part of why they save so much money on taxations. They do provide basic healthcare for these people but you can not compare that to the healthcare we have. At this point the infrastructure in those country is lacking any means to even collect taxes from the workforce so they do tend not to pay any either and this means they don't need to be payed more, but we will see changes in a further future when the indian government will start taxing everything with VAT. By that time, we will have become a developing country again with no resources, little well educated people and depending 99% on help from outside our continents.

Quick fix

[BlightThePower]

I agree with you about the laughable statement quoted: All unions do today is drive a wedge between employees and management. That wasn't even true at the time of the birth of trades unionism in England when the boss was known to all and wore a big black hat just in case you weren't sure. Further, management themselves are usually in professional unions in Europe, the problem is defence from the boardroom and faceless institutional shareholders whose only contact with the corporation is a cell in their spreadsheet and by definition care only about the bottom line. Health & safety and the implementation of national laws aren't things they care anything at all about.

I think what people in the US object to is the "closed shop". The fact its American synonym is "union shop" speaks volumes. Simply outlaw the closed shop (or if its already outlawed then actively impose the law) and problem solved. Workers representation without the perversions and excesses of American tradesunionism which is barely recognisable as the same thing we have here in the UK. I support trades unions but I must say what I read from the US is a bit shocking (the crap as regards teamsters and construction workers especially). Thats not trades unionism, thats mob rule at the behest of another boss you have to obey. It could be certain unions will need, frankly, dealing with. Thatcher did this in the 1980s in the UK. Its not nice but it can be done.

Just a few points..

[SillyNickName4me]

Now I can't say I'm big union guy, but they do make some interesting points on their site.

First of all, this union is a union of IBM workers, it originates in the USA, was created with support of IBM and usually uses other means then strikes to achieve their goals.

Second, I have heard a bit about the way in which unions in the USA work and the way in which they try to enforce their view on things. We have seen similar issues in the UK untill a few decades ago, but this is not how unions work in a large part of Europe.

Unions are a rather usefull thing to have. Big corporations have a lot of power over their employees, and unions generally serve to offset that power a bit so that they have to respect the rights of such employees.

You can look at the extremes only and judge based on that, but that generally means you are ignoring virtually everything, an out of hand situation like it seems to exist in the USA is the exception and not the rule.

If you are so intent to look at exceptions, then maybe take a peek at what happened in Poland during he 80s and realize that the communist government there was in the end brought down by a union.

IBM Global Services, now IBM Europe

[christoofar]

IBM is going to take their slash-and-burn cost cutting tactic throughout their entire organization, wherever they see that they can minimize their payroll expenses.

It's obvious IBM's payroll is enormous, and that slice of the pie is gigantic compared to all the other costs IBM has, it's too hard for the PHBs at IBM to ignore it. IBM Global Services got thinned out after employees there started complaning about the multi-state income tax conumdrum they were being forced to pay and their recent litigation over their pension changes.

It won't be long before IBM's operations in Latin America is trimmed as well as their US operations. Sure, that payroll pie slice will get a lot thinner, but I suspect it will be a very cold winter coming for Poughkeepsie and Armonk residents. Better get a blanket.

Did Anyone Ever Think...

[Wicked187]

...that maybe IBM just doesn't like Europeans? Not that I have anything against Europeans. I do have quite a bit of resentment for their politics, but that is another issue. These people obviously want to keep their jobs, but, IBM is trying to finish their transition to a services-oriented company. I am not entirely sure if these layoffs are part of that transition, or not. Just something to think about.

This is the EUs fault

[The Woodworker]

I hate to say it, but Europe has itself to blame. Since the GE/Honeywell merger was killed by EU regulators, and other industries have come under the gun in a severe way (i.e. the US cosmetics industry), large corporations from the US are seeing the EU as a necessary market, but a market that doesn't welcome them. Compound on this the anti-US sentiment over Iraq.

Now where should IBM cut jobs from? The US where it has a good deal of pull, or the EU where it is just another evil US megacorporation. Also, with the rising euro and declining dollar it costs alot more to employ those citizens then it did a year ago.

And before you say "just another US dimwit who hates Europe", I lived and worked in Germany and Switzerland for 16 months, speak three languages, and would love to move back there if I could find a job. My old employer (in Germany) was unable to get me a work visa because of high unemployment and bureaucracy made it next to impossible to obtain one. I view Europe as my second home, but like the US, Europe has problems and those at the top exploit them for power.

Let me know what you think.

Re:This is the EUs fault

[bhima]

I'd rather take a dead end, minimum wage job here in Austria than go back to the US and work.

And before you say "Just another Eurotrash Dimwit who hates the US". I am a naturalized US citizen, and I lived, went to school, and worked in the US for over 14 years. Quite frankly the US is not what it used to be. Sure some companies lay people off, sure in some areas of Europe unemployment or inflation are high. But things move on, new companies hire workers and people get jobs. I'll take the over 5 dollars per gallon fuel cost and the higher taxes with a huge grin on my face, just to get out of the insanity that the US has become.

Re:This is the EUs fault

[The Woodworker]

You're right, and that's why I said I would love to go live in Europe again. I love it there. The people are friendly, I usually don't need a car in most places I've lived (gotta love those strassenbahns), and I can get REAL beer.

Unfortunately, I have $50K in student loans so I can't take that $8/hour job. If I get a job in Europe, it has to be one that pays at least $20/hour, or I just couldn't live on it and continue paying off my debt.

Also, your monologue didn't address any of the key elements I brought up regarding large US companies in the EU.

Just my other 2 cents.

Re:This is the EUs fault

[bhima]

That wasn't a monologue, that was a diatribe! But you're right so let me try again, now that I'm home and have a "Real Beer" (tm)

The GE merger was seen in the EU as not good for the marketplace but honestly I don't much about it, having only vaguely heard about it on the news. However I do have inside information on a gigantic fined levied against the (European) company I work for and knowing what I know, I can honestly say that we didn't loose money on the deal. The fact of the matter is, that many times these large corporations are acting in ways that are contrary to the public benefit (but profitable). So it's not that the EU is anti-US corporations as it is Anti-Large arrogant and predatory corporations who try to tell them to shove off.

As far as the Anti-American sentiment... you are right it does exist, but not all of it comes from the debacle in Iraq, personally I think American Foreign policy is much like the attitude displayed by large corporations that gets them in trouble and given that I also think Americans deserve *much* more criticisms than they get.

On a side note if the dollar continues the way it's going you'll only have to earn around 35K Euros to pay the loan back...

Simple really.

[Martin Spamer]

they have succeeded to setting the econo-political agenda such that the majority of people actually believe they are part of that elite, and let greed do the rest.

Fabrication not Insightful

[Martin Spamer]

The figure of 80% for employers national insurance contribution is a complete fabrication.

The employers NI rate for the UK is between 11% and 12.8% and that is without any allowances which typically reduce this by more than half.

How to make some profit ....

[ggzeama]

There was a joke that Belgians use to tell about the French:
Q: What's the best deal to do with a French guy ?
A: Buy him at what he's worth and sell it at what he think he's worth


Letting the joke aside, EU economy is pretty inefficient these days. Maybe it's time for them to give a blow to the American economy, by founding their own IBM in US, then cutting jobs ;)

Most businesses *DON'T* comply.

[Richard Steiner]

Executive pay is increased when things are good, but only rarely is it decreased, and senior executives are rarely held accountable for mistakes.

The example of Carly at HP has already been given, and airline executives are still making big bucks even as their companies are flirting with (or are already in) bankruptcy.

I don't know that caps are the best idea, but some concrete level of accountability would be nice. If a CEO screws up and costs the company millions of billions of dollars, they should have to pay a real price, not a purely symbolic one.

Re:Most businesses *DON'T* comply.

[Lemmy Caution]

See, the meritocratic rhetoric is very one-way. CEO's (and not the rank and file) are given extraordinary credit for increasing the value of the company (in practice, only its stock price), but only marginal blame for its failures, which are usually attributed to environmental factors. It's a pretty sweet deal, and again I think the real causes are socio-cultural: the CEO's are more or less cohorts of the people who would hold them responsible. People are pretty slack with people who remind them of themselves.

Re:Hardworking Propagandists

[Anonymous Coward]

Well tough shit. I wanna be rich, and I want the ability to be rich. If you don't like it, vote. If you lose the vote, stop whining.

Yeah, so how is that "getting rich" thing working out for you?

Re:Europeans go on strike

[yog]

Re:Europeans go on strike (Score:0) by rtb144 (456739) on Monday May 23, @07:05PM (#12618351) Having grown up in "Europe" (Austria and Germany), I am very familiar with the "law". From my experience the "law" governs every part of your life from what you can eat to how long you work and what type of toilet paper you wipe your ass with. America is slightly better in most of these regards. Look at the double digit unemployment in most of the countries in continental Europe and tell me how much the "law" is helping most of them. Most of these strikes remind me of an Onion article where the French are striking against low productivity. A strike might win you short-term concessions, but as most American auto workers are finding out, the union is cutting their throats in the long run with decreased competitive ability.

Yes, your final point is quite valid and relevant to this news article and discussion, and all you get for it is one "overrated" moderation. These slashdot political "discussions" bring into sharp focus the flaws of the moderation system. Well, I'm off to metamoderate and hope I find a live one.

Re:No shame anymore (Why?)

[bored]

Cutting the fat is seen as acceptable because people assume that there is fat. That is accually a mangement failure too. It seems to indicate that there are a large number of people in the company that arn't doing their fair share of the work. This is probably true in a lot of these companies, but that accually stems from bad managment. If managment was accually keeping tabs on what everyone was doing they would know who just shows up and surfs /. all day instead of being productive. That situation would either be corrected or the person would be let go. Having people who were useful 10 years ago just sit around and surf is a bad idea for profitibility.

Sarcasm Alert!

[jgoemat]

Read your parent post again. The "Oh, wait..." at the end should be a clue if you can't figure out the numbers.

how does it help the 10k people that die each year in the US due to lack of health insurance?

I didn't know lack of health insurance was a disease. Oh, I see, you mean that 10,000 people that died could have been saved if they had adequate health insurance. Well, my employer spends $12,000 a year (up about 10% from last year I think) on my health insurance and I have yet to use it. Meanwhile the insurance companies are showing record profits. My money is taken up by people that get every expensive test known to man and that get expensive prescription medication. Pharmaceutical companies say they need to charge that much so that they can come up with better drugs, yet they spend less than 20% on research (sometimes as little as 10%). They usually spend 2-3 times as much on marketing as they do on research. When is the last time you watched a network TV show without seeing an ad for a prescription drug?

The parent tried to make the point that we are now all about money, and no longer "life, liberty and the pursuit of happiness". If you read that however, you are only guaranteed life, liberty, and the pursuit of happiness. You are not guaranteed happiness, you have to make that happen yourself.

No strike, yet

[jgoemat]

Some strikes to express solidarity are being planned.

I also read this to mean that actual strikes were being planned, in addition to the 10 minute work stoppage and black-and-blue dress.

rofl

[Anonymous Coward]

"UK, as all the rest of the European cuntries have laws"

i know its very lame to talk about peoples speeling but man that had me laughing for a solid minute. thats not even pretending to be spelled right. after reading all this boring dolla dolla bill shit you have successfully woken me up! *hats of*

Same old same old

[mzinni]

Isn't this the same arugement that's been going on over here? A company is profitable but they still send the operations off shore and lay off the local workers so that they can be even MORE profitable for the shareholder?

*sigh*

[zippthorne]

We want not only jobs, but also jobs in areas that benefit society. Jobs that are makework do not add to the general wealth and therefore do not contribute to improved standard of living. There is no difference between ineffective jobs and welfare in that respect.

Here is the principle difference between communism and capitalism: Property rights. Your property (land, items, etc.) is yours to do with as you please. (actually some would argue this is the only tennet of capitalism, everything else is just a corollary) Sometimes, (and always for noneconomic reasons) governments choose to limit property rights. This can be beneficial to society, but must be kept to a minimum if capitalism is the economic model you choose.

OK, so how does this benefit society? You have specifically asked the question about how does it generate jobs, and I will discuss, but I would point out again that 'jobs' in and of themselves are not the goal. The maximum amount of 'good' for as many people as possible is the goal.

If property rights are secure, it does not matter whether the wealthy choose to buy yachts, houses, philanthropic organizations or squirrel the money away in investment accounts. As long as they act in their own economic best interest, society benefits. If they buy yachts, there will be increased demand for yachts and boatbuilders, designers, marinas will benefit. More to do means more jobs.

If they invest the money in a company (as shareholders they expect some kind of return of course) say that makes yachts for the other rich people, they provide the capital for those yacht companies to expand and grow jobs for yacht builders. The supply of yachts increases, price drops and allows more people to buy yachts. If they buy shares at market prices, they are buying them ultimately from the initial investors, freeing up that investment money for other perhaps riskier endeavors.

If they put the money away in a bank, the bank invests the money to same effect or 'invests' the money in loans to people buying houses or starting businesses. The more money available for this, the lower the interest rates will have to be to attract more borrowers, so more people will be able to afford houses or to start businesses. If they invest in rental houses, they increase the supply of such in a given area allowing more people to move in, more choice among people already there or lower prices (somewhere) for people that need housing.

Obviously philanthropy benefits others, but even it need not be done for selfless reasons. Vanity philanthropy benefits society at least somewhat as effectively as the selfless variety and is certainly better than none at all.

In short, the free market Korea (mostly) efficiently directs the capital and effort toward the areas where it is most needed/wanted by the population. Failure to understand that this could work (and has been shown to work) is what leads to the ideas of central planning and social 'equity' so common to Marxist philosophy that have largely failed wherever implemented. Communism isn't bad because it's evil, communism is bad because it's been shown to be inferior at generating and distributing wealth than capitalism. USSR, China and N. Korea are the most glaring examples.

Re:I HATE unions with a passion

[tuxedobob]

I just hate jobs where you're required to join a union (and pay them money) in order to get the job. UPS, for example.