How Toyota is Doing Fat-Cat Bankers a Favor

The recall scandal is knocking bankers, and their bonuses, out of the news.

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Notice who's not getting grilled these days? 

Federal Reserve Chairman Ben Bernanke has managed to testify before Congress without generating any headlines at all about giving billions to AIG. Treasury Secretary Tim Geithner is doing soft-news photo ops and appearing in Vogue without drawing criticism for neglecting a troubled economy. Most surprising, there's barely a tremor over Wall Street bonuses that totaled $20 billion in 2009, a 17 percent rise over 2008 bonuses. Apparently everybody else in America got a 17 percent raise last year, so out on Main Street they're not begrudging Wall Streeters a modest bump-up. 

[See what Detroit can teach Toyota.] 

Why are some of America's most enduring villains suddenly getting off so easy? One word: Toyota. Scandals come and go, and by the usual standards, the fat-cat bankers were in the doghouse longer than most. But now there's a new hound in town. The Toyota storyline is captivating first of all on account of its irony: The standard-setter for quality suddenly seems to be hiding safety problems and jeopardizing its customers. Ooh-la-la. 

There's also comeuppance for the big institution that dissed the little guy, represented by one articulate witness who told Congress and the world how her Lexus sped out of control—and the automaker dismissed her like a crazy aunt. Then there's the jingoistic spectacle of a Japanese CEO bowing before the U.S. Congress, which vaguely satisfies our sense of importance at a time when America seems to matter less and less in the world economy. 

But there's deeper irony that reflects back on us, the spectators and pitchfork-bearers. Toyota is very likely to fix its problems in short order, by repairing faulty vehicles, troubleshooting its internal shortcomings, and settling with any actual victims of unsafe vehicles. Toyota remains a talent-rich company with deep pockets, and within six months it will be well on its way to a comeback. 

The banks, by contrast, will continue to let their customers dangle. New data shows that bank lending is plummeting, threatening the economy anew, thanks to the collateral damage of the 2008 financial meltdown. Consumers are now losing confidence they gained gradually over the last six months, largely because jobs seem to be as scarce as ever. A teeny-weeny housing recovery is now looking like a mirage, for many of the same reasons. But at least the bankers are being paid well once again. 

[See 6 myths about car recalls.] 

Unless there are nasty new revelations, the Toyota scandal is entering its denouement. If a different scandal suddenly emerges, Toyota will be old news tomorrow. If not, it will peter out over the next several weeks. The more interesting question is whether the bankers will reclaim their spot at the center of the bull's-eye. Their deeds probably warrant that, but maybe they've finally outlasted America's attention span. Which was probably their strategy all along.