Voters in Switzerland will weigh in on a novel approach to runaway executive pay later this month as regulators, economists, and lawmakers in the United States continue to grapple with the problem.
A referendum is set for November 24 on a law called the “1:12 Initiative” that would impose a flexible cap on top employee compensation at Swiss companies. If approved, the highest-paid employee of any given Swiss firm could not earn more in a month than its lowest-paid employee makes in a year. By using a ratio rather than a dollar figure cap, the 1:12 Initiative would both shrink the salaries of top executives and raise the pay of underlings. “You shouldn’t just say a maximum salary, because what we really want is a relationship between the lowest and the highest,” said David Roth, one of the plan’s architects, in an interview with Business Insider. In March, Swiss voters overwhelmingly approved a package of CEO pay reforms, including an outright ban on so-called “golden parachute” payouts for fired executives.
The 12-to-1 ratio would be a massive shift for Swiss businesses, many of which currently pay their top people a couple hundred times what their worst-paid workers earn. Here in the United States, the prevailing ratio was 273-to-1 last year.
In Switzerland the voters have slapped high fines and jail time on managers rewarding themselves for just showing up.
Well done, Switzerland!
A shooting at a wood-processing company in central Switzerland has left three people dead and seven wounded, some of them seriously, prosecutors say.
The shooting occurred shortly after 9am on Wednesday at the premises of Kronospan, a company in the small town of Menznau, west of Lucerne.
Three people were killed, among them the suspected assailant, police in Lucerne said in a statement. A further seven were wounded, several of them seriously. Officials gave no further details.
The local Neue Luzerner Zeitung newspaper cited a witness as saying that the shooter opened fire in the company canteen. It was not immediately clear who the shooter was, what the motive might have been or whether the assailant worked for the company.
A gunman has opened fire in a village in Switzerland, killing three people and wounding two others, Swiss police say.
The attack happened on Wednesday at around 21:00 (20:00 GMT) in the village of Daillon in Valais canton, 100km (60 miles) east of Geneva.
The gunman had reportedly been drinking heavily before the shooting.
Police dispatched to the scene arrested a suspect who was shot and wounded after he threatened them.
“Three victims died at the scene,” said Valais police. “Two other people were wounded and hospitalised.”
They had rushed to the village after calls reporting that several people were lying in the street after a spate of gunfire.
Village cordoned off
Police did not name the arrested man, whom witnesses identified to local media as a 30-year-old Daillon resident.
The gunman was armed with an assault rifle and was thought to have been drinking heavily, Swiss website 20minutes reported.
More at link
Ezra Klein and Janet Rosenbaum debunk popular myths on gun ownership in Switzerland and Israel. This pretty much also backs up what I was sayin yesterday: having a gun in the house is more of a danger to you and yours than a safety.
My post “12 facts about guns and mass shootings” included a mention of Israel and Switzerland, societies where guns are reputed to be widely available, but where gun violence is rare. Janet Rosenbaum, an assistant professor of epidemiology at the School of Public Health at the State University of New York (SUNY) Downstate Medical Center School, has actually researched this question, and she wrote to tell me I had it wrong. We spoke shortly thereafter on the phone. A lightly edited transcript of our conversation follows.
Ricky Carioti — The Washington Post
Ezra Klein: Israel and Switzerland are often mentioned as countries that prove that high rates of gun ownership don’t necessarily lead to high rates of gun crime. In fact, I wrote that on Friday. But you say your research shows that’s not true.
Janet Rosenbaum: First of all, because they don’t have high levels of gun ownership. The gun ownership in Israel and Switzerland has decreased.
For instance, in Israel, they’re very limited in who is able to own a gun. There are only a few tens of thousands of legal guns in Israel, and the only people allowed to own them legally live in the settlements, do business in the settlements, or are in professions at risk of violence.
Both countries require you to have a reason to have a gun. There isn’t this idea that you have a right to a gun. You need a reason. And then you need to go back to the permitting authority every six months or so to assure them the reason is still valid.
The second thing is that there’s this widespread misunderstanding that Israel and Switzerland promote gun ownership. They don’t. Ten years ago, when Israel had the outbreak of violence, there was an expansion of gun ownership, but only to people above a certain rank in the military. There was no sense that having ordinary citizens [carry guns] would make anything safer.
Switzerland has also been moving away from having widespread guns. The laws are done canton by canton, which is like a province. Everyone in Switzerland serves in the army, and the cantons used to let you have the guns at home. They’ve been moving to keeping the guns in depots. That means they’re not in the household, which makes sense because the literature shows us that if the gun is in the household, the risk goes up for everyone in the household.
also see here
I have just arrived. I am standing in the square in the small Swiss valley town of Meiringen. On all sides, fir trees and high alpine meadows give way to cragged grey faces of rock that are veined in ice. Here and there louring clouds snag the serrated peaks.
“What’s going on?” I ask the Swiss woman next to me.
“I think they’re starting,” she replies, confidentially.
But now a brass band embarks upon some deafening mountain lament and nothing further can be heard.
I fall back upon my powers of observation and deduction. A rotund cardinal comports himself across the cobbles in full scarlet regalia to converse with a man who appears to be some kind of itinerant manure shoveller. A chubby boy in the guise of a 19th century mountain guide sits on a sedan chair with his accordion; from time to time and for no reason, he pops on a false beard, then pops it off again, the elastic cutting into his cheeks. A sly, fastidious man is half-introduced. His name is Snork, he says, or Stark or Hark or Bark or Snark—it’s impossible to hear him until the music stops; at which moment, I catch only the end of his sentence “… and sothis is where they invented meringue.’”
“My name is Peter Steiler,” shouts an elderly Swiss man in a lemon-coloured bowler hat. “I am a very intelligent man.’”
General laughter across the square. Mocking? Indulgent? It’s hard to be sure —though I feel I must join in. A man rises. He is the mayor. Another man rises. He is also the mayor. Out of the corner of my eye, I notice a number of underpowered mopeds coming very slowly towards us, the riders kitted out like Hell’s Angels—handlebar moustaches, goggles. Oddly sinister, they skirt the square.
“There are two mayors,” whispers the Swiss woman. “They are here to greet…”—she inhales slowly—”…the pilgrims.”
“Two mayors.” I nod. “What are the mopeds doing?”
“The slow race,” she says.
For years, Greece has been pledging to redouble its efforts against tax evasion. Only now, however, is Athens finally set to sign a tax deal with Switzerland in the hopes of generating billions in revenue. Critics, though, say the agreement won’t make much of a difference.
The negotiations have been going for years. And if all goes well, Greece and Switzerland will finally finalize a tax treaty this September which could bring billions of euros back to Athens. Modelled on Switzerland’s agreements with Germany, Great Britain and Austria, the deal is aimed at the billions of euros Athens estimates that wealthy Greeks have parked in the Alpine country to avoid taxes back home.
After months of delays, the three party coalition led by Greek Prime Minister Antonis Samaras now wants to implement the deal as quickly as possible in hopes that they’ll be able to find billions for Athens’ coffers. But there’s also another reason for the rush: Samaras needs to show he is serious about reform. Greece desperately needs a win in its fight against rampant tax evasion.
For one, Samaras needs to demonstrate resolve on the issue to his country’s international creditors. Indeed, the issue was a topic when the Greek prime minister paid a visit to Chancellor Angela Merkel in Berlin last Friday. For another, the Greek government is eager to show honest taxpayers that their dishonest compatriots can’t get off so easy.
The first discussions regarding a bilateral tax treaty between Greece and Switzerland took place two years ago. Last year, there were stories in the Greek press that the deal was imminent. Since then, however, not much has happened; Greeks holding Swiss bank accounts have had little to fear.
The hold up, if one believes Philippos Sachinidis, was for political reasons. Sachinidis is currently a parliamentarian with the socialist PASOK party, but this spring, he spent a few weeks as finance minister under then-Prime Minister Lucas Papademos. His term coincided with the signing of Swiss tax deals with Germany and Great Britain.
Well this guy’s a real class act.
Right-wing Swiss politician Alexander Müller is out of a party post as well as his private job after using Twitter to call for ‘Kristallnacht … this time for mosques.’
The Zurich man also faces a criminal investigation and police searched his home and confiscated his computer, according to media reports and his own blog.
The prosecutor’s office said Müller, 37, admitted tweeting in response to the May acquittal on hate-speech charges of a Muslim man who said it was “Sharia-compliant’ for a man to beat his wife if she refused to have sex with him, the newspaper Tages Anzeiger (Daily News) and others said. Otherwise, Aziz Osmanoglu had said, the man might be unfaithful.
Müller tweeted from his @dailytalk account, ‘Maybe we need a new Kristallnacht … this time against the mosques.’
The tweet was erased, but newspapers, including 20 Minuten, recovered it and other posts.
Müller also had tweeted that ‘we should take this pack out of the country. I do not want to live with such people’ and ‘I would like to stand certain people up against the wall and shoot them. Less dirt on the earth would be good.’
Müller’s tweets now are open only to confirmed followers, according to his Twitter profile page.
On Wednesday, Müller held a news conference in which he apologized and resigned from the Swiss People’s Party executive committee for Zurich districts 7 and 8 and from his seat on the local school board.
Roger Liebi, the party’s Zurich leader, said the comments were ‘unacceptable.’
Müller said in his blog that he was fired from his job at a credit insurance firm after his employers learned of his tweets through the media.
Abdel Azziz Qaasem Illi, spokesman for Islamic Central Switzerland, was quoted in Islamaphobia Today as saying that Müller’s party is no friend to religious Muslims. In 2009, the party had supported a constitutional ban against the construction of minarets in Switzerland.
Islamaphobia Today reported that Illi said statements against Jews are avoided in Switzerland, but “it is more common to hear anti-Muslim hate speech.’
Swiss arrest warrants issued over the weekend for German tax inspectors have sparked heated debate in Berlin over the ongoing tax evasion conflict with Bern. German commentators on Monday discuss how renewed tensions could endanger a preventative deal between the two nations.
Tensions over tax evasion have flared up between Germany and Switzerland once again with the weekend announcement of Swiss arrest warrants for German tax inspectors accused of industrial espionage. The spying charges have opposition politicians so riled up that a tax evasion prevention deal currently under negotiation between the neighboring countries may now be at risk.
While both countries have signalled their willingness to sign the deal, they still need parliamentary approval — which is now at risk after Swiss prosecutors on Saturday issued arrest warrants for three German tax inspectors from the state of North Rhine-Westphalia. The officials had federal approval to buy stolen bank information leaked from Credit Suisse in 2010, a move that triggered a wave of tax declarations by Germans seeking to avoid tax evasion charges.
The pending deal would require Switzerland to impose taxes on accounts held by Germans, in addition to handing out fines for undeclared assets, but would spare the country from having to reveal the identities of its valuable wealthy banking customers. With this, Berlin hopes to collect unpaid taxes on an estimated €130 billion to €180 billion socked away in the Alpine haven by its citizens.
But on Sunday, talks on the agreement reportedly broke down. The negotiations were aimed at concerns voiced by German states governed by the center-left Social Democrats. The party is in a position to block any deal in the Bundesrat, Germany’s upper legislative chamber.
The arrest warrants seem to have further complicated the delicate issue. North Rhine-Westphalia governor Hannelore Kraft, an SPD member who is among those who could ultimately torpedo the deal in the Bundesrat, called the move by Swiss authorities an outrage on Sunday. “The NRW tax investigators were simply doing their job tracking down German tax dodgers who stashed undeclared money in Swiss banks,” she said. Her party and the environmentalist Greens have both resisted the agreement, saying it doesn’t go far enough despite concessions from the Swiss.
SPD member and North Rhine-Westphalia Finance Minister Norbert Walter-Borjans told daily Berliner Zeitung that the arrest warrants were a “massive intimidation attempt,” adding that his state would not give up its efforts to fight tax evasion.
Opposition Demands Action from Schäuble
On Monday, the opposition in Berlin demanded a clear position on the issue from Finance Minister Wolfgang Schäuble, who is a member of Chancellor Angela Merkel’s conservative Christian Democrats.
“Schäuble must make it unmistakeably clear that he will stand up for the enforcement of our tax law,” deputy parliamentary leader for the SPD, Joachim Poss, told Die Welt on Monday, adding that Switzerland must give up its “business model” of protecting tax evaders.
Meanwhile, senior SPD parliamentarian Thomas Oppermann told mass-circulation daily Bild that the tax inspectors accused of espionage by Switzerland should get Germany’s federal order of merit. The trio “deserves it for their fight against money laundering and tax evasion for the nation,” he said.
But members of Chancellor Angela Merkel’s center-right governing coalition have encouraged the opposition to approve the deal. “The federal government is convinced that it has negotiated a good agreement that will finally clarify open questions between Germany and Switzerland,” Merkel’s spokesman Steffen Seibert told Die Welt.
German commentators on Monday weigh in on the conflict:
Switzerland’s oldest private bank, Wegelin & Co., had survived three centuries of upheaval on the continent, including Napoleon’s invasion of the country and two World Wars. But its illustrious history was brought to an end last month by an unlikely source: a U.S. government desperate to track down tax evaders.
In early February, in a move that rattled Switzerland’s financial industry, the U.S. Department of Justice indicted Wegelin on charges of helping wealthy Americans hide $1.2 billion from U.S. tax authorities. As the first foreign bank in history to be indicted by the U.S. government, the ruined Wegelin was quickly sold to a former rival, Raiffeisen Group. But the Obama Administration was just getting started — it also ramped up the pressure on 11 more Swiss financial institutions to hand over their American clients’ names. Now it looks like U.S. authorities might get their wish.
On March 4, the Swiss parliament approved an amendment to the country’s existing tax accord with the U.S., which, when ratified by the U.S. Senate, will give the American government unprecedented access to accounts held by its citizens in Switzerland. While the existing agreement has long allowed the release of tax information in cases of proven wrongdoing, various stumbling blocks, like different interpretations of tax evasion under Swiss and American laws, often slowed or even halted the process. (Evasion is a civil, not a criminal, offense in Switzerland.)
The amended treaty will now allow U.S. authorities to identify American tax evaders who exhibit certain “behavioral patterns” more easily. That includes stashing undeclared money in banks, “dummy” corporations, trusts and foundations created specifically to hide these assets. The new treaty will also allow U.S. authorities to request information from foreign banks that don’t do business on American soil but have U.S. clients. Banks and account holders who are found to be hiding undeclared U.S. assets will be forced to pay a substantial fine to the American government.
“This is a strike at the heart of the Swiss banking sector and a major breakthrough for the U.S.,” says Teodoro Cocca, an adjunct professor at the Swiss Finance Institute, a private foundation created by Switzerland’s banking and finance community in cooperation with leading Swiss universities. Cocca warns that the pressure on Switzerland, which has long prided itself on its banking-secrecy rules, will now increase dramatically if other countries “also demand the same exchange of information rights.”
The U.S. Department of Justice has been tightening its grip on Switzerland since 2008, when an investigation revealed that the country’s biggest bank, UBS, helped rich Americans hide billions in undisclosed offshore accounts. To avoid criminal charges, UBS paid a $780 million fine and released the names of 250 clients suspected of tax evasion.