The entitlement mentality at AOL

Nothing much surprises me these days but I must say I was taken aback at the response to comments recently made by AOL CEO Tim Armstrong. Taken aback is, perhaps, too mild. I was actually infuriated. Tim Armstrong was conducting a town hall meeting with employees and tried to explain why they were restructuring their 401(k) contributions. Instead of the company contributing each paycheck, they were going to make a lump-sum contribution at the end of the year.

He didn’t elaborate but I assume it was an effort to hold on to the cash throughout the year and monetize it before giving it to the employees. He explained that measures needed to be

taken because their healthcare costs had taken a big hit. He noted an additional $7.1 million per year because of Obamacare and added that the company paid out $1 million each to two AOL families for “distressed babies” during childbirth.

Oh, my Lord, the press went nuts over the “distressed babies” comment. Forget that that’s exactly what doctors call it: fetal distress.

Not only did the press go nuts but one of the mothers, who would’ve otherwise remained anonymous, wrote a piece for Slate.com raking Mr. Armstrong over the coals. The backlash over the 401(k) deal sent AOL into damage control and they backed off their plan. Then Armstrong apologized for the “distressed babies” comment. People screamed that he’d somehow violated HIPAA rules for disclosing that a couple of employees had experienced difficult pregnancies. With 5,600 employees it’s doubtful anyone would have any idea who those people were had it not been for one of the mothers lashing out on Slate.com.

But all that is really secondary to the real problem. The thing that’s so amazing is the sense of entitlement. Had my company just spent $1 million saving my child I would’ve already been to the CEO’s office thanking him profusely for helping us out in a time of need. It’s bad enough to go through a difficult delivery but can you imagine being saddled with over a million dollars in medical bills? Where’s the gratitude?

There was none. It was merely an expectation that such gargantuan bills be paid by someone else. That “someone else” is the company by way of higher insurance costs. All Armstrong was trying to do was find a way to make up the difference as painless as possible. Ironically, all the folks at AOL who were so outraged by his mentioning the “distressed babies” were not even willing to be inconvenienced by having their 401(k) match deferred until the end of the year. They’re ALL ingrates. 

We had an employer match when I first started with my current company. When the Great Recession hit they made the decision to suspend the match until the company was back on more solid ground. People raised holy you-know-what over it. Me? I was grateful there had been a match in the first place. I didn’t look at it as a right. I saw it for what it was; a benefit. Eventually they resumed the match and I was delighted when they did but I never expected it nor demanded it.

I guess it’s just human nature. You start getting something for free and you come to rely on it. That’s true whether it’s the government or your employer. All I expect in return for my work is the salary that was agreed upon when I took the job. Everything else, in my mind is gravy.

Apparently, gravy is now considered a God-given right.

Phil Valentine is the host of the award-winning, nationally syndicated talk radio show, The Phil Valentine Show.

Ryan budget not good enough

There's much fanfare over Rep. Paul Ryan's budget.  Although it's infinitely better than anything the Democrats have put forth it's not good enough.

For starters, it continues to increase spending, though not at the current rate of growth.  Right now we're increasing spending at 4.9 percent per year.  The Ryan budget increases spending at 3.4 percent.  How about increasing spending at zero percent?  Better yet, how about decreasing spending?

Oh, but Phil you don't understand.  Entitlement spending is the problem.  Oh, I do understand but everyone talks about entitlement spending like it's this runaway train that nobody can control.  Congress created all of it and they could end all of it if they wanted to.  If they can end it surely they can mend it.  We're going to have to increase the retirement age for Social Security and Medicare.  That's a given.  We're also going to have to start rapidly moving toward privatizing those programs if we ever hope to pull out of this yet the Ryan plan calls for "means testing."  That's Washington-speak for welfare.

Basically, what means testing means is if I work hard all my life, keep my financial house in order, fund my 401(k) and otherwise prepare for my retirement then I get nothing back for all the Social Security money I paid in.  The government deems me too wealthy to participate in the program.  For those who save nothing and have nothing to show for their life's labor they get everything they paid in plus mine.  That turns Social Security and Medicare into welfare programs.  There has to be meaningful Social Security and Medicare reform if we're ever going to get control of spending.

Ryan's plan also asks federal workers to begin making some contributions to their pension plans by the end of the decade.  The end of the decade?  I literally laughed out loud when I heard that one.  Federal workers should be required to make 100 percent of the contributions to the pensions starting today!  That's a no-brainer.  When the recession hit in 2008 our company cut out the 401(k) match.  Although some of the employees got mad, I always looked at the match as a gift.  I was thankful I had it for the time I did. (They eventually reinstated it.)  Any contribution we as taxpayers make to the federal workers' pensions is a gift.  When you're $16 trillion in debt there are no more gifts.  End the pension contributions and end them now.

Ryan's budget purportedly balances the budget in ten years.  Ten years?  We can balance the budget in ten minutes.  Don't raise the debt ceiling.  And don't tell me we'll default on all our debt.  That's like saying you have a house payment and two car payments.  You go to the dealership, sign the papers and drive a new car off the lot then drive over to your bank and tell them you need 30 grand for a new car.  The loan officer informs you that you have too much debt and he's not going to loan you money for the car.  Do you default on the house and the other two cars?  Of course, not.  You might default on the car you just bought if you can't talk the dealership into taking it back but as long as you have an income stream you don't default on all your debt.

We have an income stream of about $2.5 trillion.  If we don't raise the debt ceiling it simply means that we have to live within that $2.5 trillion.  Oh, sure, things will have to be cut because we're spending over $3.5 trillion a year but we still have plenty of money coming in and we won't default on all our debt.

The pitiful whining about the recent sequester and its accompanying cuts made most Americans sick to their stomachs.  What a bunch of spoiled brats.  We've seen furloughs and layoffs in the private sector over the last few years and we had to cope.  The problem is we have a government hooked on the crack of taxpayer dollars and, let's face it, there will never be enough money to satisfy its spending jones.

It's time for the House Republicans to stick their foot in the revolving door of debt.