Germany backs fresh curbs on executive pay despite protest.

This article appeared in the May 30 financial times. Angela Merkel, German Chancellor proposed new legislation to increase transparency and control exorbitant salary hikes of executives of German companies in the private sector. This legislation was met with resistance by a letter stating “Corporate decisions such as shaping of board members’ contracts should not be set by law in the tiniest detail”. Parliament supports Merkel’s proposal fully stating “not only did we make no concessions to these people, but the letter was in fact a great example of the mentality we want to eradicate”.

This article epitomizes much of the discussion that occurred in class Saturday. What is represented in this article is another shift in the paradigm of public administration. The government has taken a clear position in an effort to respond to the economic needs of the country and the citizenry by establishing policies that regulate private industry for the public good. It further demonstrates the motivation of government to establish some measures that promote a higher sense of economic security for its citizens through transparency as well as remedies for abuses.

This response appears to provide some indicators of the confidence level of citizens as it relates to the private sector and the increase sense of urgency to respond to the economic crisis that has encompassed global proportions through government regulations.

While this policy is too late for our market economy, one may speculate that had we initiated similar policies of oversight and transparency (particularly salary levels of executives) would this have limited the greed in the private sector that has created the downward economic spiral? Diana P