Carrots are out, sticks are in. France, Germany and the UK at least agree on one thing: the need to clamp down on bankers' pay. France's president Nicolas Sarkozy wants to cap payments and has signed up French banks to a bonus code, along similar lines to the UK regulator's proposals. Germany's chancellor Angela Merkel wants to control banks' size. British prime minister Gordon Brown, meanwhile, says bonuses should reward only long-term performance. Ahead of this month's G20 summit, it is hard to ignore the ironies.

To be clear, bonuses are easy political cannon fodder – but only up to a point. After all, banks in the financial centres of Frankfurt, Paris and London provide an attractive tax take. Government involvement invokes strong emotions. Banks that have received state aid, such as Bank of America and Lloyds Banking Group, now seem intent on repaying it, reducing the scope for intervention. Yet the latter has not been without benefits: for all the hoopla about Wall Street bonuses, the US government is said to have bagged a $4bn profit from repaid bail-outs. There is mismatch too in what the UK government says on bonuses and what it condones at state-controlled Royal Bank of Scotland, where it has let the bank award rainmakers bonuses to improve its chances of a profitable exit. Another irony is that bonus pools are filling again thanks to often state-encouraged consolidation, which has reduced competition.

If the multilateral clampdown on tax havens is a yardstick, the bonus bandwagon could gain further momentum. Yet the bonus carrot may not be as endangered as it seems. That is partly because one stick – higher capital requirements on banks that do not toe the line – is not as menacing as it looks. After all, capital as a crisis cure is already in short supply. Capital as a punishment promises to be scarcer still.