ONE YEAR ON

IT is one year since the long-established and greatly-respected American investment bank Lehman Brothers was declared bankrupt. It was the worst and the most symbolic event of a week that brought the global financial system to the edge of the precipice of destruction. It might be supposed, therefore, that in the year of partial recovery that has followed we would have seen a major overhaul of the systems of international banking and also of the way in which national banks order their affairs. But this has not happened. All the signs are that having been rescued by government action the banks are adopting a “business as usual” approach. There have been proposals for tighter regulation -- President Obama set out his thoughts on the subject this week -- but the urgency seems to have gone out of the issue and in respect of such matters as short-term bonus payments there appears to be a reluctance -- by Britain and the United States particularly -- to undertake any tough action. President Sarkozy takes a different line and has said that he will walk out of the coming G20 meeting in the United States if there is no agreement on some form of “cap” on bonuses and other forms of remuneration. The general feeling seems to be to give the bankers the benefit of the doubt over the almost catastrophic events of one year ago. But they should not get away with it so easily.