On December 1st the German bank announced huge job cuts and said it would receive about euro30 billion of state support, partly because of its losses in Iceland.

In America, where insurers are supervised on a state-by-state basis, regulators' smoothed assessments of capital have been dwarfed by losses.

State employers could carry on in this spirit after that, pointing out that the more pay can be kept down, the fewer the job losses.