Kenneth Feinberg, the man who slashed the pay and compensation of executives at the seven financial firms that received the most federal bailout money (don't call him pay czar, he despises the term) made the media rounds Thursday to explain his actions.

He told NPR's Melissa Block, a host of All Things Considered that, overall, he felt he had gotten the balance right between setting pay at a level that recognized the public's outrage at hefty bonuses at at these companies while making sure the companies could pay the right executives enough so the firms make the sort of profits that lets them repay taxpayers.

Melissa asked Feinberg how that squared with the $7 million in pay Robert Benmosche, American Insurance General, is scheduled to make in 2009.

FEINBERG: You explain that by looking at the statute and balancing exactly the competing considerations. On the one hand we must get somebody on board who had nothing to do with AIG's problems. We have to find a CEO who can come in laterally and right the ship so that the taxpayer can get her and his money back.

And we looked at the data, we looked at all of the empirical information about what a CEO should be compensated, at what levels. And we concluded that getting Robert Benmosche, a nationally recognized expert in insurance to come in laterally and right the ship is something very, very important.

 

Feinberg, the special master for compensation at the federally bailed out firms, officially unveiled the Obama Administration's new pay rules for those firms on Thursday.

As the Associated Press reported:

Kenneth Feinberg, the Treasury official leading the pay review, told reporters that average salaries for the top 25 executives are being cut 90 percent starting next month.

The action will apply to the top executives at Bank of America Corp., American International Group Inc., Citigroup Inc., General Motors, GMAC, Chrysler and Chrysler Financial.

Melissa asked Feinberg why Americans shouldn't view his actions as business as usual. Her implication was that the current pay restraints could be seen by some as a relative slap on the wrist that would eventually see the companies return to their prior pay practices.

FEINBERG: I hope they won't see it as business as usual. I am very sensitive, sympathetic to that public outrage. It's real. It's legitimate. My only reaction is to say is that I think what I've tried to do is to balance that outrage with the absolute priority to find a way to get these companies back on their feet so that they repay what they owe the taxpayer. And that is clearly my number one priority.