My relief over the last minute legislation from Congress last night is being tempered by two things. First is fear that the Republicans still have not learned their lesson that their job is to cooperate in governing, not obstruct it. I’m trying to develop hope that the budget conference committee will finally arrive at a more just and equitable budget by December, so that sequestration ends and other badly needed legislation can be debated and enacted, but I keep thinking about the Supercommittee that was supposed to have solved this because sequestration was too horrible a threat and didn’t.
The second is that, on a day when I expected the stock market would be trending up in relief at last night’s deal, IBM is tanking, down twelve points at the moment, after earnings fell short of expectations. IBM is very important in my area, which is its original birthplace. Virtually everyone who lives here has a connection to IBM, personally or through family, friends, and/or neighbors. For decades, employees here were loyal to the company and the company was loyal to them. That all changed when Gerstner became CEO. Instead of being valued assets to the company, employees became expenses, to be gotten rid of to cut costs or replaced by lower-wage workers overseas. In our area, workers retained their traditional loyalty to IBM longer than in other parts of the country, despite sale of divisions, offshoring, “resource actions” AKA terminations, buy-outs, the dissolution of the pension program, cuts in benefits, continual monkeying around with the salary plan, sale of IBM properties, and other indignities. Now, the last vestiges of that loyalty have crumbled, even here in IBM’s birthplace. Wall Street didn’t help, cheering every time more lay-offs were announced or more stock bought back. Instead of the traditional long view that IBM took, everything became about the next quarter and projecting a year ahead became long-range planning.
Today, the pigeons came home to roost.
Analysts are finally realizing how much of IBM’s gains have been from “financial engineering” rather than from the traditional strength of the company, its superior products, backed by the exceptional training, intelligence, and dedication of its committed workforce. The question is has IBM gone so far away from its traditional core values that it will not be able to regain its footing and continue as a driving technology force in the coming years. IBM workers here will continue to work hard for their customers, despite being overburdened with work as more and more workers are laid off with no reduction in the amount of work that needs to be accomplished. Will upper management finally notice?