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Bankers arouse public anger. But will they change?

Bankers from Lehman Brothers to Ireland and beyond are increasingly unpopular, but that hasn't impacted their salaries much.

"Billions for the Banks - the Debts for us - we say thanks!" reads the banner at a small protest outside the general shareholders meeting of the Deutsche Bank AG in Frankfurt am Main on May 27. Protests against bankers have become a common sight in 2010. What does that mean for the future of banking?

Mario Vedder / AP / File

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It's not easy being a banker these days.

In some European countries, they're the target of street demonstrators who blame them for the financial crisis and resulting government austerity plans. Britain raised its terror alert in September after Irish Republican Army dissidents threatened British bankers because of Ireland's woes. Now, British bankers worry their bonuses will stoke local public anger.

The mood's not much better on this side of the Atlantic, where commentators wonder how useful some banking really is. "What good is Wall Street?" asked a New Yorker magazine article, the second most-read story on its November website. Much is "socially worthless," concludes author John Cassidy, who has been making the rounds on radio talk shows.

Banking practices have also come under stinging attack from prominent economists and political scientists in the latest issue of Daedalus, a quarterly magazine of the American Academy of Arts and Sciences. The financial system can quietly distort the direction of the real economy, write Benjamin Friedman of Harvard University and Robert Solow of the Massachusetts Institute of Technology, both in Cambridge, Mass. "It can induce the real economy to spend human and material resources on activities that can lead to immense private profits for some of those engaged while nonetheless making little or no contribution to general well-being."

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