In what world does it make sense to mandate greater risk (Congress forced a lot of the subprime lending to happen - both directly, through legislation, and indirectly, through artificially low interest rates) and then excoriate the people who were at the helm?
Anyone who thinks banker pay caused this crisis has absolutely no idea how this crisis happened. It's popular to reduce banker pay, because, as De Tocqueville put it (paraphrased), Americans [and people in general] would rather slave in equality than prosper in inequality.
There are financial regulation reforms that make sense - proxy voting, flash trading, dark pools, high-frequency trading, separating taxpayer-backed portions of the business (like commercial deposits) and riskier/more speculative portions with no federal backstop (like prop trading).
But I'm pretty sure the US government has never stepped in and tried to regulate the pay of private companies before.
The Feinberg component I understand. I don't necessarily agree with it, because the 7 companies he's looking at need about as much talent as they can get right now, and driving away high paid employees is a good way to lose the executives other companies would be interested in. The Federal government, however, does own a large percentage of these firms and giving the Federal government say in how these companies are run isn't ridiculous.
The idea that the government can regulate the entire INDUSTRY'S pay is ridiculous, however.