In neighboring Germany, Europe’s largest fiscally solvent country, political leaders announced that they would raise the executive pay issue in the next parliament, with Chancellor Angela Merkel stating that: “Exhorbitance cannot be allowed in a free and socially minded society.”The Dutch government, meanwhile, announced new legislation is in the works that would cap golden parachutes at a maximum of 75,000 euros ($98,000).
In the land of fire and ice, Icelanders overcame a major economic crisis that saw the stock market tank by 90 percent and increased unemployment nine-fold with a “peoples’ bailout” that included debt write-offs and mortgage subsidies. Iceland took IMF money (which they’ve already repaid), but wisely refused structural adjustment. And it prosecuted bankers at the center of the crisis, some of whom are now doing jail time. Perhaps most telling, the country’s leadership engaged the public in a rewriting of the country’s constitution, setting the foundation for a radical grassroots system of direct democracy.
French President Francois Hollande has also begun to address his country’s widening wealth gap, Reuters notes, by limiting executive pay at state-controlled companies to 20 times that of the lowest paid worker – putting the hurt on CEOs in a big way. According to TIME, Henri Proglio, CEO of Électricité de France, for example, could see his annual salary cut by 68 percent – from $1.9 million to $621,000 – in order to comply with the 20 to 1 ratio. Areva President Luc Oursel could see his salary halved.This recent flurry of legislation on disproportionate CEO pay comes on the back of a new deal among members of the European Union to cap banker bonuses to no more than a year’s salary, down from the typical five to ten times their fixed pay rates. And, last December, a critical majority agreed to implement a tax on financial transactions to raise recovery funds (it’s expected to raise $45 billion annually) to curb the kind of wild speculation we saw in the housing market. Similar legislation has been introduced here in the U.S., but to no avail.