Five Tech Companies That Milked The Stimulus


IBM would not comment on the total funds it received from the ARRA, how many jobs it reported funding to the federal government or even its U.S. employee headcount. An IBM spokesperson in an email said that the company no longer "breaks out its workforce number by country."

"The geographic distribution of highly skilled employees required to be successful in this industry is guarded, competitively, by companies that operate globally," wrote the IBM spokesperson. That noted, the IBM spokesman pointed out that IBM believes it is "the largest tech employer in the U.S. and the world."

IBM's ARRA funds came with the company spending $18.98 million in lobbying expenditures during the Obama administration, according to the Center for Responsive Politics. In 2009, IBM filed eight lobbying reports related to ARRA. The lobbying efforts included "additional funding" for the digital TV transition. That lobbying effort appears to be related to the $43.51 million award under ARRA for a $120 million contract that was awarded two years before the stimulus to administer the federal government's digital TV converter coupon program. IBM, in effect, received those funds as part of a contract to administer the digital TV converter coupon program that provided U.S. households up to two coupons worth $40 each to be used for TV converter boxes.

As for the IBM hardware, software and even services related to ARRA that were purchased by the government, among the awards listed on the Recovery.gov website include a $6.98 million award from the Department of Homeland Security for a contract related to a "commercial off the shelf (COTS) Integrated Workplace Management System" with "special emphasis" on integration with an SAP/ERP system; a $799,525 award with the Department of State for an IBM Blade Center 8677-HC1; a $259,419 award with the Department of Interior for IBM Blade Center systems; a $187,499 award from the Department of Transportation to "develop and execute grant accrual and estimated liability methodology for Recovery Act funds;" a $113,674 award with the Department of Transportation related to in part "analysis of data and accrual preparation for Recovery Act and Discretionary Tiger grants;" an $85,137 award with the Department of Interior for IBM X Series Servers; and a $38,520 award from the Department of Education for a "system enhancement" related to in part to "e-Grants and e-Application" to support "new requirements resulting from stimulus funds."

Contributions to the Obama campaign were strong in the 2008 and 2012 campaigns from IBM employees and their families, coming in at No. 15 in the list of contributions from companies and universities for both election periods, according to the Center for Responsive Politics.

Donations to Obama's 2008 campaign from IBM employees and their immediate families accounted for $532,372, according to the Center for Responsive Politics. Those donations to the Obama campaign so far in 2012 amount to $218,761, according to the latest figures from the Center for Responsive Politics.

During the Obama administration, Palmisano is listed on the White House visitor's log for 11 entries, including an Oct. 7, 2009, meeting with President Obama and then-director of the White House Economic Council Lawrence Summers. Palmisano also attended a state dinner at the White House for Chancellor Angela Merkel of the Federal Republic of Germany on the evening of June 7, 2011, and a private luncheon with the president on the evening of July 12, 2011.

In a Sept. 14, 2010, interview on a Wall Street Journal Live video segment, Palmisano said his visits to the White House were part of the Obama administration "reaching out to the business community."

"I was one of many [business leaders focusing on] economic-related issues. So we were having lots of input and lots of exchange. And that was what we were all working on at the time. Like everybody, you always have to have a diverse audience so I could represent the minority [Republican] party," he said.

Palmisano told Wall Street Journal Live that he does not make any political contributions nor does IBM have a Political Action Committee. "It is back to the IBM philosophy," he said. "If you are in 170 countries, where do you have a PAC?"

As for how Palmisano viewed the progress that the administration was making at the time in improving the functioning of government, he told Wall Street Journal Live: "We haven't made any progress. It doesn't mean there hasn't been a lot of interaction." That's because, Palmisano said, IBM has not been in "sync" with the administration's "priorities."