Obama has taken a play out of the VC handbook. Executive pay limits for company's receiving TARP funds is absolutely justified. It is standard for VCs to set cash compensation limits for executives. Incentives are provided through stock options to align interests with shareholders. Increase in equity value is makes lots of money for executives as well as shareholders. With stock prices of major banks less than a hat size, the same opportunity is available. Plenty of upside for stock options, but limit the cash compensation.