TWICE during the 1970s, a stroppy decade, leftish British politicians tried to turn the monarchy into a nationalised industry. There were plans to place Queen Elizabeth II and a few close relatives on state salaries and sack the rest of her family, and—a few years later—for a Department for Royal Affairs, bringing the crown under Whitehall's management. Both attempts were resisted. Since then, royal aides have cannily worked to secure autonomy and arms-length financing from government. Just now, the mood behind palace walls must be giddy relief.

The queen has rarely been as popular as she is now, in her Diamond Jubilee year. The contrast with other arms of the establishment is striking, and revealing. For most people at the top of the public sector, this is a perilous time.

For months there has been angry scrutiny of the sums paid to the bosses of public or publicly controlled bodies, from the BBC to the railways and the bailed out Royal Bank of Scotland (RBS). The BBC says that its next director-general will take a big pay cut. Network Rail directors this week bowed to ministerial nagging and promised to donate any annual bonuses they receive to a fund for improving safety at level crossings.

Stephen Hester, the RBS chief executive recruited on a commercial contract by the previous Labour government to salvage the stricken bank, found himself pilloried on tabloid front pages (photographs of him riding to hounds saw heavy use). He was threatened with a vote in the House of Commons, organised by the now-opposition Labour Party, on whether he should take his annual bonus. When Conservative ministers offered tepid support, Mr Hester buckled and gave up the bonus.

In a BBC interview on February 8th, Mr Hester mounted a valiant defence of high pay in his bank and elsewhere. RBS was a “time-bomb” saddled with £45 billion ($71 billion) in losses, he said. He had scoured the world for the best people to defuse it, and if they did a good job they deserved recognition. He warned Britain not to seek fairness by “cutting down success”. Yet Mr Hester's arguments will not end the storm.

Ed Miliband, the Labour leader, presents today's voter anger as a yearning for “fairness in tough times”. The Conservative chancellor of the exchequer, George Osborne, vows to fight unnamed foes trying to create an “anti-business culture in Britain”.

On the streets, another explanation can be heard. Interview voters almost anywhere, and they couch their anger in terms of natural justice. The bankers caused this mess but are doing fine while ordinary folk suffer, is the invariable charge. Ask them about bonuses in particular, and they wonder why well-paid bosses need extra for doing their jobs properly.

None of these explanations is wholly wrong. But none really explains the depth of national outrage. Start with Mr Miliband. His talk of “fairness” is, in part, a coded call for redistribution. Higher taxes on millionaires are strongly backed in opinion polls, but—unluckily for the left—voters also overwhelmingly back a government plan to cap payments to those on welfare. Britons are only partly in Robin Hood mode: they want to take from the rich, but also to kick the poor to look for work.

Nor are Mr Osborne's warnings about anti-business forces convincing. Although Britons are cross about high pay, few seek capitalism's overthrow: they dislike corporate fat cats for being fat, not for being cats. As for voters' stated desire to see bankers suffer just retribution, they need to explain their dislike of well-paid BBC or railway bosses who did not cause the credit crunch.

Other explanations are needed for the public mood. Perhaps surprisingly, one clue may lie in the popularity gap between the queen and bankers such as Mr Hester. The Diamond Jubilee has prompted a slew of new royal biographies, making familiar points about how the monarchy has shrewdly adapted to modern mores. A new biography by Andrew Marr, a writer and broadcaster (and former Bagehot) makes a less familiar point. It quotes palace advisers who believe the queen has the “humility of the hereditary principle”, meaning a sense of duty rooted in knowing she did nothing to earn her extraordinary position.

Listen carefully to Mr Hester, and he stands for an opposing principle: the idea that the unusually talented may deserve extraordinary rewards. Yes, people are paid unequal amounts, but don't forget how wealth is created and the successful motivated, he says. In essence, he is making the case for meritocracy.

Merit is a fine principle. But the most painful revelation of the debate on high pay may be this: many Britons are not convinced that they live in a functioning meritocracy.

Are the bosses bluffing?

Assuming that voters are not suicidally casual about who holds Britain's biggest jobs, their desire to slash bosses' pay leads to one conclusion: the public does not believe that executives are as exceptional as today's pay levels would suggest. Some voters may be ready for a gamble, believing that bosses are not as globally mobile as they claim to be and would stick around if their pay was cut. Others may be more cynical, suspecting that bosses are not as unusually talented as they claim, so that others could do as good (or as mediocre) a job for less.

This is a dangerous mood, transcending labels of left and right. Indeed, it sometimes feels as if all political parties are following, not leading, public opinion. Even the queen's popularity, though mostly rooted in 60 years' service, is a warning sign: she is also admired because she does not claim to deserve her status.

Britain, an unusually free-market minded place, likes to think it is organised around such principles as open competition and rewards for merit. Cut through the noise about bankers and their bonuses, and it turns out that many voters think the fix is in.

Economist.com/blogs/bagehot