FSA: Not a dirty word

Bonuses are bad, right? So it’s better to pay bankers fatter base salaries. That is the thinking behind the latest proposed reforms from the UK’s Financial Services Authority. It also seems to be influencing UBS, which is pushing up base salaries after slashing bonuses. The bonus culture in the City of London and on Wall Street has certainly been abused. But the idea that the financial services industry would therefore be better off with higher base salaries doesn’t seem right. Bonus should no...