Lambert warned that issuing fat bonuses at the start of next year, just as the public sector job cuts started to bite, would be 'toxic in the extreme'. The situation needs 'exceptionally sensitive handling', he argues - ideally by banks 'acting collectively when it comes to compensation matters and resisting the temptation to poach disaffected mega stars'. This is one of the main reasons for bonus inflation, of course - banks pay more because they're worried about their top performers going elsewhere if their pay cheque will only cover five new Maseratis.
Of course this won't be easy, as Lambert accepts (we imagine it might even be illegal, though lawyers with expertise in cartels, feel free to tell us otherwise). But he reckons the political costs of not doing so 'are likely to be substantial... Carrying on with business as normal would seem arrogant and out of touch, and further erode public trust, making it harder to defend against clumsy and counter-productive political intervention.'
Speaking of which, Lambert also had a few harsh words for the politicians. All their banker-bashing has admittedly done a good job of distracting us from their own culpability for the financial crisis, he says (in terms of lax regulation, badly-designed policy frameworks, macro-economic mismanagement and so on). But the 'overheated rhetoric' being spouted by Vince Cable et al about casino banking was 'irresponsible' and 'not constructive'.
What’s more, he reckons, it will almost certainly back-fire: it will put off new market entrants from overseas and lead to the wrong policy responses (like the bankers' levy, the impact of which he thinks will largely be felt by the bank's customers). Rather than just putting the boot in - the 'Vince Cable vs Lombard St' approach as he puts it – ministers should be talking more about what they want the City to look like in five years' time.
It's all eminently sensible stuff, as you'd expect from Lambert - his contributions to this debate never fail to be intelligent, thoughtful and considered. But while we'd love the City and Westminster to sit up and take notice, we won't hold our breath. After all, what's less likely: that banks put their self-interest aside to make common cause, or that politicians stop putting the boot into a soft target?