Times are tough for Europe's top earners. Past weeks, the European Union agreed to introduce a cap on bankers' bonuses in a crackdown that will affect several thousand bankers in London alone. In Switzerland voters handed shareholders a say on board and executive salaries in a bid to avoid exorbitant pay hikes.
These two decisions reflect a new mood currently sweeping the Continent. The skyrocketing pay of CEOs and boardmembers in various sectors was once seen as an inevitable byproduct of market economies, but it is no longer acceptable. Now, not even the suggestion that public disgust is rooted in envy holds sway with critics.
Across Europe, left-leaning politicians have welcomed the news from Brussels and Bern. "Long live the Swiss!" said Harlem Desir, leader of the French Socialists in an interview with broadcaster "France Info."
The referendum in Switzerland marked a step in the same direction as the new cap on bunuses, which France had long been pushing for in Brussels, he said. "It is all part of the fight against a financial world that has gone wild, and can no longer be allowed to impose its own rules on the economy."
Across Europe, from Brussels to Paris, Great Britain to Ireland, politicians share the same determination that they should further tighten the cap on bonuses approved by the EU and extend it to other sectors, arguing that new laws inspired by the Swiss referendum were needed to curb soaring executive pay.
The days when resistance to astronomical CEO salaries was frowned upon are long over. Modernizers such as former British Prime Minister Tony Blair and his German counterpart Gerhard Schröder set about lowering marginal tax rates and sought to curry favor with the captains of industry. "(We) are intensely relaxed about people getting filthy rich -- as long as they pay their taxes," said Peter Mandelson, a British Labour Party politician, who served in a number of Cabinet positions under Blair and was a key architect in the rebranding of the Labour Party as "New Labour."
Now it is suddenly acceptable again for the state to interfere in questions of salary.
France's Socialist President François Hollande has been undeterred in his fight for a super tax. His planned 75 percent tax on incomes over €1 million was ruled unconstitutional by the country's top court, but he now plans to amend the measure. Paris is said to be considering a tax of 65 percent on married couples who earn more than €2 million in combined income.
The Labour Party is caught in a quandary. The bankers' reputations may be just as bad in Britain as they are on the Continent, but the financial industry is an important economic driver and employer. Any attack on the City of London financial district is branded as unpatriotic, so the party has held back in the European debate over bonus caps.
Chancellor of the Exchequer George Osborne, the Conservative cabinet minister responsible for economic and financial matters, wants to question the new bankers' bonus cap once again. No one expects anything more than cosmetic changes -- not even the British Bankers' Association.
By Guylain Gustave Moke
Photo-Credit: AFP: UK's Chancellor of the Exchequer George Osborne