White House To Appoint "Pay Czar"

As part of an effort to better monitor the use of TARP funds, the White House plans to appoint a "Special Master of Compensation" to make certain that guidelines that restrict executive pay at companies that received government bailouts are being followed, the Wall Street Journal reports.

The administration is expected to name Kenneth Feinberg, who supervised government compensation to 9/11 victims, to the post. He is expected to oversee pay restrictions in relation to bailout funds and help companies clearly interpret TARP guidelines.

"The law is confusing and a bit ambiguous, and so we're looking for certainty as to how to structure pay incentives," Scott Talbott of the Financial Services Roundtable, a trade association, told the Journal.

Limits on executive pay at bailed out companies were set at $500,000 in February following national outrage that some bailout money had been used to fund executive bonuses.

"This is America," the president said at the time. "We don't disparage wealth. We don't begrudge anybody for achieving success. And we believe success should be rewarded. But what gets people upset -- and rightfully so -- are executives being rewarded for failure, especially when those rewards are subsidized by U.S. taxpayers."

Although the $700 billion the government pumped into banks was supposed to spur increased lending, CNN.com reports that bailed out banks are lending less. Banks insist that they are lending and say the numbers reflect decreased demand for loans.