Taxpayer pays in, bankers take out

We have to put a stop to this madness. While the taxpayer are injecting money into failing banks, the bankers are simultaneously extracting this cash in bonus payments.

THE board of Lloyds Banking Group, which is 43%-owned by the government, is prepared to inflame the growing row over City bonuses. It is ready to accept share-based rewards for the last financial year, a period which has seen its share price fall by 75% and just weeks after the bank received a £5.5 billion cash injection.

The size of the Lloyds bonuses will be determined by Wolfgang Berndt, chairman of the bank’s remuneration committee. Daniels is entitled to a maximum bonus of 225% of his basic salary of £960,000. His other 11 directors are entitled to 200% of their salaries.

Although we rarely acknowledge it, our political system is based on some implicit understandings about fairness and equity. We look after each other when we get sick through the NHS. When times are tough, we make sure no one actually starves because we have a comprehensive system of welfare payments. Everyone gets educated, inoculated, and pensioned off when they reach 65.

This system does not guarantee a fair and equal society, but it does ensure a reasonably civilized way of life. While many people take advantage of society's generosity, those abuses have always been limited and tolerable.

Certainly, we deeply dislike paying for this system through taxes. Nevertheless, virtually all of us agree that we prefer what we have to a less compassionate system, where everyone fends for themselves. To put it more bluntly, we Brits don't do "dog eat dog". We do "dog reluctantly helps dog".

However, this system can not survive when ordinary people watch helplessly as rich greedy bankers ransack our government's treasury. We will ask the entirely reasonable question, why should we pay for these bonuses to the same people who wrecked our economy?

These government financed bonuses undermine the legitimacy of our tax and benefits system. Why should we continue to pay taxes when these resources are so wantonly misused. Why should we support our political system when it has been so comprehensively captured by a narrow clique of financiers. Why should we bail out Lloyds, preventing it from going bankrupt, only to see our money disappear into the pockets of wealthy bankers.

New Labour should not misjudge the mood of the British people on this issue. If it fails to act, and prevent these abuses, it will face a furious wrath at the next election.