Swiss referendum may limit executive pay

Thomas Lifson
The green eyed monster, envy, is inflaming people all around the world, even in usually sensible, pro-business, rich Switzerland. The Swiss, great believers in direct democracy, are going to the polls this week to vote on a referendum that would limit executive pay to a multiple of 12 times the pay of the lowest-salaried worker in an enterprise. Neil Maclucas of the Wall Street Journal writes:

On Nov. 24, voters will be asked to approve or reject the 1:12 Initiative for Fair Pay, which organizers say would address a growing wealth gap in Switzerland. The initiative is premised on the idea that no one in a company should earn more in a month than others earn in a year.

"Switzerland's wealth is very unfairly distributed," said David Roth, president of the youth wing of the Swiss Socialist Party, which gathered the 100,000 signatures needed to launch the ballot. "While top Swiss managers earn millions, more than 300,000 people in Switzerland have to work for a mere pittance."

The measure is unlikely to be passed, and has been losing support, probably because voters realize there would be an exit of corporate headquarters, and with them good paying jobs:

The latest poll released Wednesday, which was conducted between Nov. 1 and Nov. 8 by polling group gfs.bern for Swiss television, shows 36% of respondents in favor of the initiative, 54% against and 10% still undecided.

The group's previous poll in October showed 44% in favor, 44% against and 12% undecided.

The initiative needs a simple 50% approval rate to be adopted, and is then automatically written into the country's constitution. It doesn't require any subsequent parliamentary approval.

Underlying all such measures is the silly notion of a zero-sum economy -- that if somebody is creating wealth and getting rich, that makes other people poorer. That was true prior to the Mercantile and Industrial Revolutions. It is true when government makes transfer payments. But when free enterprise allows voluntary transactions, it becomes a pernicious lie.

The entire world, even the world's poor, is far richer than ever before in  history. That enables some people to enjoy unimaginable wealth - private jets, yachts, multiple mansions, and collections of luxury cars. So what! If someone feels poor because Mark Zuckerberg has a lot of toys, that is a self-destructive emotion.

But the left thrives on pathological envy. Thus, we expect more efforts to enact laws limiting what high earners can make. The usual suspects on the wealthy left - people like George Soros and George Clooney - remain silent, of course.

Hat tip: David Paulin

 

The green eyed monster, envy, is inflaming people all around the world, even in usually sensible, pro-business, rich Switzerland. The Swiss, great believers in direct democracy, are going to the polls this week to vote on a referendum that would limit executive pay to a multiple of 12 times the pay of the lowest-salaried worker in an enterprise. Neil Maclucas of the Wall Street Journal writes:

On Nov. 24, voters will be asked to approve or reject the 1:12 Initiative for Fair Pay, which organizers say would address a growing wealth gap in Switzerland. The initiative is premised on the idea that no one in a company should earn more in a month than others earn in a year.

"Switzerland's wealth is very unfairly distributed," said David Roth, president of the youth wing of the Swiss Socialist Party, which gathered the 100,000 signatures needed to launch the ballot. "While top Swiss managers earn millions, more than 300,000 people in Switzerland have to work for a mere pittance."

The measure is unlikely to be passed, and has been losing support, probably because voters realize there would be an exit of corporate headquarters, and with them good paying jobs:

The latest poll released Wednesday, which was conducted between Nov. 1 and Nov. 8 by polling group gfs.bern for Swiss television, shows 36% of respondents in favor of the initiative, 54% against and 10% still undecided.

The group's previous poll in October showed 44% in favor, 44% against and 12% undecided.

The initiative needs a simple 50% approval rate to be adopted, and is then automatically written into the country's constitution. It doesn't require any subsequent parliamentary approval.

Underlying all such measures is the silly notion of a zero-sum economy -- that if somebody is creating wealth and getting rich, that makes other people poorer. That was true prior to the Mercantile and Industrial Revolutions. It is true when government makes transfer payments. But when free enterprise allows voluntary transactions, it becomes a pernicious lie.

The entire world, even the world's poor, is far richer than ever before in  history. That enables some people to enjoy unimaginable wealth - private jets, yachts, multiple mansions, and collections of luxury cars. So what! If someone feels poor because Mark Zuckerberg has a lot of toys, that is a self-destructive emotion.

But the left thrives on pathological envy. Thus, we expect more efforts to enact laws limiting what high earners can make. The usual suspects on the wealthy left - people like George Soros and George Clooney - remain silent, of course.

Hat tip: David Paulin