Strong support in Britain for banker salary caps and bonus tax

Source: Financial Times

A new Financial Times/Harris Poll in Britain finds very strong support for a new tax on bankers' bonuses (78%) and for capping their salaries (74%). However, they are not alone. The poll also found large majorities in favor of capping the salaries and bonuses of other high-earning occupations, not just bankers. Majorities of those surveyed support caps on the salaries of corporate executives, lawyers, and even on private doctors (i.e., those not in the National Health Service) and civil servants.

These are some of the findings of a Financial Times/Harris Poll conducted online by Harris Interactive among 1,347 adults aged 16-64 in Great Britain between January 6 and 11, 2010.

Half of those surveyed (50%) favor breaking banks up so that they could not be both traditional and commercial banks and investment banks (as was the case in the United States before the repeal of the Glass-Seagal Act). Only 6% disagree.

This poll also asked the public who they thought was "primarily responsible for the financial crisis." There is no consensus but many more people (38%) blame the banking industry than blamed anyone else.

The survey also found that 35% of those surveyed believe that the U.K. has not recovered at all from the financial crisis. A plurality believe they have recovered "somewhat" (43%). Only a few people believe the UK has recovered "a fair amount" (11%), "quite a lot" (3%) or a "great deal" (1%).

Notwithstanding the British public's hostility, and criticism of the banks, only 12% of those surveyed say they would be unhappy if they had a child who wanted to be a banker.

Some banks are more unpopular than others

Those surveyed were asked to say how much they trust nine large banks that do business in Britain. Majorities, or large pluralities were unsure or indifferent but those who trust these banks varies from 31% who trust Barclays Bank and HSBC, to only 6% who trust the German Commerzbank, and only 9% and 10% who trust the American banks Goldman Sachs and Citigroup, respectively.

Only three of the nine banks on the list have more people saying they trust them than do not:

* HSBC: by 31% to 24%
* Barclays Bank: by 31% to 26%
* Santander: by 28% to 22%

Santander, a Spanish bank, avoided many of the risky investments, such as securitized subprime mortgages that brought many other banks to their knees.

So what?

The financial and economic crisis, the failures of the banking system and the City, and the payment of huge bonge ge bonuses have reinforced the hostility of most of the British public not just to bank executives but also to highly paid executives and professionals generally. The idea of capping their earnings may be unrealistic but the anger is real.

However, many people are able to discriminate between different banks, some of which are now trusted much less than others.

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