Legislation is prompted by $165 million bonuses to AIG employees at the unit that gutted the company and forced a massive government intervention.

Well, we will try again. We thought we had legislation that limited executive compensation, but it got changed, something that Sen. Dodd is in hot water for as noted in next post.

From The Washington Post:

"We're all going to lose on this thing," said an executive at a large bank that took federal aid. He and other bankers expressed shock at the rapid progress of legislation that could impose large pay cuts on thousands of workers, and dismay that the industry is at the mercy of an angry Congress.

A wave of public fury, which is driving the bills before the House and Senate, was unleashed over the weekend by reports that American International Group had paid $165 million in retention bonuses to employees at the unit that gutted the company and forced a massive government intervention.

The legislative action could trigger the unraveling of the broader federal bailout of troubled banks, which has grown increasingly unpopular on Capitol Hill and across the country.

The average bonus for a Wall Street employee in 2007 was more than $180,000, but top employees make much more. Lloyd Blankfein, the chief executive of Goldman Sachs, topped the charts, collecting a salary of $600,000 -- and a bonus of $68 million.