One rule for them

What makes it worse, is that the newly minted governor of the Bank of England, Canadian Mark Carney, should tell the Treasury select committee that he objected to proposals by Brussels to put a cap on bankers’ bonuses.

Even more, the chancellor of the Exchequer, in also opposing the Brussels measures, should use as evidence the bogus claim that the City of London would be at risk of losing its status as the financial centre of Europe.

Of course, this is silly since the popularity of the City is based on more than the size of individual’s bonuses.

Most of us will like to think it is based on governance, transparency, ethical behaviour, the rule of law and the professionalism of our regulators and those working in the district.

If the chancellor cannot put a more powerful case for the City, apart from massive bonuses, then quite clearly something is drastically wrong. The City has a better story to tell and it is not that told by the chancellor.

Implicit in this pro bonus argument is that we should ignore the jigsaw mess of off-balance sheet investments, mortgage securitisation, Lehman Brothers and its counterparty risks, sub-prime lending and the other outcomes of the sophisticated financial engineering that got us in to this mess.

Further, they are also implying that the financial sector cannot function fairly without the allegations surrounding the Libor scandal, foreign exchange scams, payment protection insurance, and so on.

Hopefully this is wrong. If not it confirms that there is a moral void in our public life, an inability to even perceive why the vast majority of people should support Brussels and object to massive bonuses, on top of huge salaries.

Fortunately, some people do have greater confidence in the ethical transparency of our financial services and its ability to recover from the present turmoil by providing a first-class service and high grade products to ordinary households.