Ford Motor Company is alone among its Detroit peers in not having accepted bail-out funds. Even so, let's be clear: the company is not doing well, with the need for government assistance not out of the question and its stock down more than 50% over the past year.

The question is then, why did Ford CEO Alan Mulally get compensation valued in a company filing at $13.7 million last year? Sure, his compensation dropped by 37% from 2007 (a year in which Ford shares also lost money), but it is still unjustifiably high.

Treasury Secretary Timothy Geithner testified before the House Financial Services Committee today, primarily a public scolding where Brad Sherman (D.- California) criticized his handling of AIG and its bonuses.

On the topic of executive compensation broadly, Geithner said:

"I do think it is appropriate to put in place strong standards that govern compensation" broadly, but cautioned that the government "should not be setting precise, detailed amounts of compensation and distribution."

Part of the strong standards for compensation could be encouraging better bonus incentives for risk-managers and auditors in order to attract the best talent to those departments of the company, Geithner added.

According to The New York Times, the Obama administration will offer a proposal this week that will "seek a broad new role for the Federal Reserve to oversee large companies, including major hedge funds, whose problems could pose risks to the entire financial system."

A part of this plan will supposedly require executive compensation to be more closely tied to the company's performance and financial interests, but no details have been announced.

If government officials comments so far are to be believed, this pay reform plan would not just apply to firms receiving bailout funds but all "large companies, including hedge funds, whose problems could pose risks to the entire financial system" - though once again there are no details yet on how this group would be defined.

Despite most headlines correctly noting that Bank of America CEO Ken Lewis had his pay cut in half in 2008 compared to the year before, the 58% drop in his compensation was less severe than the drop in the company's stock price last year. Worse, Lewis still made $10 million in 2008 according to company filings (though the stock option awards are probably worthless right now).

Lewis' pay included:

• $1.5 million in base salary
• $4.3 million in stock awards
• $3.1 million in stock option awards
• $854,256 for the change in pension value and deferred compensation
• "other expenses" of $275,125 - primarily the use of company aircraft and home security services

Blackstone Group LP CEO Stephen Schwarzman, co-founder and chair of the company, did not receive any compensation last year other than his $350,000 base salary.

Schwarzman basically worked for free relative to the whopping $180 million he was paid in 2007 in addition to the $684 million he received when the company went public.

Blackstone shares lost 70% of their value last year, performing far worse than the major indexes.

Fifth Third Bancorp CEO Kevin Kabat had his 2008 pay cut in half compared to 2007.

Though he still received $3.1 million in pay last year, he saw his compensation drop significantly from the $6.2 million he received in 2007.

Unfortunately for investors, the company's shares lost more of their value than his pay last. Fifth Third shares plummeted 67% in 2008. Also, Kabat's salary actually went up 4% in 2008.

From the Dayton Business Journal:

Kabat still received a salary of $900,000, up 4 percent from $867,000 in 2007. He also received $815,000 in stock awards and $1.2 million in stock options. His pay also included $26,589 in perks, including country club dues, parking fees and trust and estate planning services.

MBIA Inc., primarily a bond insurer, announced earlier this week that its board adopted a new shareholder voting policy for senior executive pay decisions.

From Forbes.com:

Shareholders will be able to vote on whether they approve of the compensation for the company's CEO - currently Jay Brown. The vote will be considered by the board's compensation committee in determining the CEO's compensation for subsequent periods.

Shareholders will also take an advisory vote on annual compensation awarded to senior executives as a whole.

Shareholders will be afforded the right to a third vote for any one-time compensation awards given to the CEO or other senior executive offices. Those votes on one-time awards will be binding.

From the USA Today:

The profit at SunTrust Banks last year was half of what it was in 2007. The stock price was also cut in half, but the company's board of directors approved a 75% increase in the 2008 total compensation of CEO James Wells to $8.1 million, according to the SunTrust proxy filed late Monday with the Securities and Exchange Commission.

Even better, though SunTrust is in much better shape than many other banks, it has also received some bailout money.

A company spokesperson responded by saying that the company's proxy statement overstates the value of Wells' compensation because of the vast drop since then in SunTrust's stock price - which is true but doesn't explain the 7.7% increase in Wells' cash salary in 2008.

Whether you love or hate the structure of America's tax code, the simple fact is it often benefits already handsomely paid executives relative to normal 9-to-5 employees.

As the Christian Science Monitor reports:

The current top tax rate on "ordinary" work income sits at 35 percent. But dividends and capital gains from the buying and selling of most assets face only a 15 percent top rate. That's why in 2006, America's top 400 paid just 17.2 percent of their $263 million average incomes in federal tax.

Millions of middle-class American families, once you tally income and payroll taxes, pay far more of their incomes in tax. One particularly striking example from billionaire investor Warren Buffett: In 2006, he paid 17.7 percent of his income in total taxes. His secretary, who made $60,000, paid 30 percent of hers.

When an executive receives outrageous, undeserved stock compensation, they not only take advantage of their shareholders but often times they also take advantage of every normal taxpayer too.

(It is important to note that not all stock options, for instance, skirt normal income tax rates. Nonqualified stock options require the exerciser to claim the difference between the strike price and the market price as income.)