Thread: Swiiss voters back crackdown on "fat cats pay"

Originally Posted by Voland

And executive pay is coming under fire twice in one week in Europe. Switzerland, hardly a socialist alpine utopia, has voted on the heels of the EU move, for one of the fiercest set of rules in the world. Voters have banned "golden goodbyes" and "hellos" for top executives, given shareholders a binding say in top management pay and bonuses, demanded yearly elections for companies board of directors and other measures. Other european nations, such as the Netherlands and Germany, both involved in multiple bank rescues with tax money, are now even considering to go beyond the EU plan and have expressed satisfaction with the swiss move :

Swiss vote for corporate pay curbs - FT.com

BBC News - Swiss referendum backs executive pay curbs

ahoy Voland,

so then i'd guess that German bankers be okies dokies with this?

if so, i find this development somethin' that might take flight across the EU.

i like it, me hearty.

is thar a chance, though, that Europe's top's bankin' talent will lift anchor and depart fer the United States, whar top executives can fill thar pockets to thar heart's content, unfettered by notions 'o fairness and fiduciary duty to thar shareholders?

- MeadHallPirate

This is completly outrageous.

If a company takes public funds in the form of a "bail out" I have no objection to the taxpayers placing whatever conditions they want on the loan.

But short of that point voters don't have any business dictating how a business should be run.

Those that support this legislation have no idea how large the snowball will be once it gets to the bottom of the hill. It will not stop once you start this nonsense of legislating pay limits, just as they did not when they started in on minimum pay.

Originally Posted by soot

This is completly outrageous.

If a company takes public funds in the form of a "bail out" I have no objection to the taxpayers placing whatever conditions they want on the loan.

But short of that point voters don't have any business dictating how a business should be run.

Agreed. This is starting down the road of mob rule.

Originally Posted by Voland

And executive pay is coming under fire twice in one week in Europe. Switzerland, hardly a socialist alpine utopia, has voted on the heels of the EU move, for one of the fiercest set of rules in the world. Voters have banned "golden goodbyes" and "hellos" for top executives, given shareholders a binding say in top management pay and bonuses, demanded yearly elections for companies board of directors and other measures. Other european nations, such as the Netherlands and Germany, both involved in multiple bank rescues with tax money, are now even considering to go beyond the EU plan and have expressed satisfaction with the swiss move :

Swiss vote for corporate pay curbs - FT.com

BBC News - Swiss referendum backs executive pay curbs

It shouldn't be too hard to get a bunch of people to vote against a small minority that everyone envies. It's happening here every day.

Originally Posted by ThorHammer

Agreed. This is starting down the road of mob rule.

Tocqueville and J.S. Mill called it the "tyranny of the majority".

They considered it as fatal to democracy as Franklin did the idea that citizens of a democracy would eventually figure out that they could vote themselves money.

As we were discussing the other day, America as we know her is on her death bed.

We're already too far gone to roll shit back and return to this nation's founding political values.

I think now it's just a matter of whatever comes next being either better or worse.

Fortunately, I don't think it's a foregone conclusion that things will necessarially have to be worse.

Though I can't imagine how things would be better when the foundational principal of the "new" America seems to be the elevation of "getting over" to an artform.

It always amazes me how many people envy and scorn anyone who has more than they do. I don't understand it.

Originally Posted by OldmanDan

It always amazes me how many people envy and scorn anyone who has more than they do. I don't understand it.

Neither do I, I always thought of people who were Rich as setting the bar for where I wanted to be.

Bill Gates has set it pretty high but there is no reason I cannot aim at it. Like the say "Always aim for the moon, even if you miss, you'll land among the stars."

Originally Posted by soot

Tocqueville and J.S. Mill called it the "tyranny of the majority".

They considered it as fatal to democracy as Franklin did the idea that citizens of a democracy would eventually figure out that they could vote themselves money.

As we were discussing the other day, America as we know her is on her death bed.

We're already too far gone to roll shit back and return to this nation's founding political values.

I think now it's just a matter of whatever comes next being either better or worse.

Fortunately, I don't think it's a foregone conclusion that things will necessarially have to be worse.

Though I can't imagine how things would be better when the foundational principal of the "new" America seems to be the elevation of "getting over" to an artform.

ahoy Soot,

i think, at the moment, this country suffers from the "Tyranny 'o the majority", to some degree. then again, i feel that majority rule be preferable to "Tyranny 'o the minority", which i also think this nation suffers from.

i read Voland's article, and really, it sounds like sensible folks are talkin' sensibly.

One of the organisers of the referendum, Brigitte Moser Harder, told the BBC she thought the Swiss people agreed with the proposals because the gap between rich and poor had become wider.

"From the beginning, 2006, we had the support of the people of Switzerland because you know not everybody in Switzerland is rich.

"It's also a social problem because the high wages got higher and the small ones sometimes just got lower. I think people have the support of the Swiss people because of that."

BBC News - Swiss referendum backs executive pay curbs

imma no communist and imma no socialist, but i do believe that the chasm 'o wealth inequality in our nation be a negative thing. it almost guarantees a grim future fer most Americans. have ye ever been to India, matey?

i thought it was an absolute shithole, with vast, teeming acres 'o poverty with tiny dots 'o extreme, almost pornographic wealth scattered throughout the landscape.

i don't want that fer this nation.

In a series entitled "The Great Divide: Global Income Inequality and Its Cost," GlobalPost takes a unique approach to the issue, putting the state of economic inequality in the United States in a global perspective.

The results may cause us to rethink America's place as a global economic superpower. According to GlobalPost's report, the gap between rich and poor in the U.S. rivals that of developing nations, ranking America as a whole toward the bottom of the income inequality barrel. Among developed nations, only Chile, Mexico, and Turkey have higher income inequality than the U.S.

Global Income Inequality: GlobalPost Puts America's Gap Between Rich And Poor In Perspective

aye.

- MeadHallPirate

Originally Posted by MeadHallPirate

is thar a chance, though, that Europe's top's bankin' talent will lift anchor and depart fer the United States, whar top executives can fill thar pockets to thar heart's content, unfettered by notions 'o fairness and fiduciary duty to thar shareholders?

- MeadHallPirate

Not really, as long as they also want to do business in their home countries Anyway, the EU move applies to investment banks, the new swiss rules to ALL swiss companies above a certain size ( "too big to fail") that are publicly traded. Switzerlands new law bans manager bonuses and "golden handshakes" in cases where companies a) have been rescued with public (tax) money b) have been overtaken or sold by competitors ( that means management sucked at their job, but still wants a "golden handshake"), since both has happened in the past, and the sums in question have risen to heights beyond any sense of proportion. In all other cases the board of directors cannot just directly award itself bonuses like in the past (76 million for the former CEO of the pharma company Novartis just for NOT working for another company for a certain amount of time ON TOP of his salary has had even the wealthy Swiss scratching their heads f.e ), but rules on bonuses, extra payments etc. have to be passed by the shareholders of a company as well and require their consent :


Swiss vote to skim salary cream for 'fat cats' | News | DW.DE | 03.03.2013

Originally Posted by Sluggo

Those that support this legislation have no idea how large the snowball will be once it gets to the bottom of the hill. It will not stop once you start this nonsense of legislating pay limits, just as they did not when they started in on minimum pay.

Actually swiss voters are rather unlikely not to have had "an idea", since the referendum, and its pros and cons was all over national media for months. You should also note that the initiators of the referendum were a group of middle class entrepeneurs around a center-right MP ( and company CEO himself), hardly activists for an alpine socialist utopia. These people have zero problems with managers and other executives getting good money for good work ( and have always underlined that). What they have a problem with is this sort of "entitlement culture for the higher ups" that has developed in recent years. Like "golden handshakes" and bonuses NOT for actually achieving something for the company and NOT for good work, but just for coming and going. Especially in cases where the company has had to lay off workers for dismal performance, been sold or rescued by taxpayers. Switzerland owes its long-standing independence as a small nation not least to a social contract that establishes certain rules which Swiss don´t view as anti-business or in contradiction with conservative values. Like that it is perfectly acceptable to profit from tax benefits or to be having to sack workers f.e. but NOT to pay out EXTREMELY generous sums from the company coffers without EXTREMELY good performance. Not least because this practice endangers ordinary peoples trust in the system that is supposed to be based on values (like value for work). And since voters were not as clueless as you claim they based the ultimate word on executive pay ( except in cases of company rescues or takeovers etc., where bonuses are banned), in the hands of the shareholders of a company, that have to give the green light to generous handouts in advance, and based on company performance. That is in line with Switzerlands tradition of direct democracy, and actually makes quite a lot of sense.
I also wouldn´t hold my breath that the new law will result in an exodus of businesses from Switzerland ( as the right-wing part of the US/UK press is claiming), since the benefits of doing business in the country remain unchanged ( like low corporate taxes etc.). And investors ( like shareholders) usually like it, if their rights are strengthened ( compared to the US/UK f.e.), right ?


http://www.nytimes.com/2013/03/04/bu...-pay.html?_r=0

Originally Posted by soot

This is completly outrageous.

If a company takes public funds in the form of a "bail out" I have no objection to the taxpayers placing whatever conditions they want on the loan.

But short of that point voters don't have any business dictating how a business should be run.

From what I´ve read, it´s not up to the voters to decided if a CEO gets a big bonus or not. They simply voted for a piece of legislation, which would give a company´s shareholders influence over the bonuses and such.

I own shares in a couple of different banks myself, and as a shareholder I like to see the company use the available funds in an appropriate manner. That doesn´t include the many instances these last few years, where a banking CEO somehow has managed to get away with a giant bonus, despite a big deficit.

So yes, more power to the shareholders (also known as the owners...).

Originally Posted by Voland

Actually swiss voters are rather unlikely not to have had "an idea", since the referendum, and its pros and cons was all over national media for months. You should also note that the initiators of the referendum were a group of middle class entrepeneurs around a center-right MP ( and company CEO himself), hardly activists for an alpine socialist utopia. These people have zero problems with managers and other executives getting good money for good work ( and have always underlined that). What they have a problem with is this sort of "entitlement culture for the higher ups" that has developed in recent years. Like "golden handshakes" and bonuses NOT for actually achieving something for the company and NOT for good work, but just for coming and going. Especially in cases where the company has had to lay off workers for dismal performance, been sold or rescued by taxpayers. Switzerland owes its long-standing independence as a small nation not least to a social contract that establishes certain rules which Swiss don´t view as anti-business or in contradiction with conservative values. Like that it is perfectly acceptable to profit from tax benefits or to be having to sack workers f.e. but NOT to pay out EXTREMELY generous sums from the company coffers without EXTREMELY good performance. Not least because this practice endangers ordinary peoples trust in the system that is supposed to be based on values (like value for work). And since voters were not as clueless as you claim they based the ultimate word on executive pay ( except in cases of company rescues or takeovers etc., where bonuses are banned), in the hands of the shareholders of a company, that have to give the green light to generous handouts in advance, and based on company performance. That is in line with Switzerlands tradition of direct democracy, and actually makes quite a lot of sense.
I also wouldn´t hold my breath that the new law will result in an exodus of businesses from Switzerland ( as the right-wing part of the US/UK press is claiming), since the benefits of doing business in the country remain unchanged ( like low corporate taxes etc.). And investors ( like shareholders) usually like it, if their rights are strengthened ( compared to the US/UK f.e.), right ?


http://www.nytimes.com/2013/03/04/bu...-pay.html?_r=0

Everything you have said here is subjective, up for debate on each individual case of executive pay. The article write up in the NY times link you have provided is the same way. Understand I am not here to defend or attack executive pay rates, just saying that legislating "fat cats pay" will have an eventual consequence of doing so in other areas. You probably disagree, not a surprise really to see you support this. But my concern is now that this is realized, who's pay is next to be regulated? There is only so far one can go to legislate "performance" in any industry.