The White House plans to set a maximum wage for many U.S. executives.

U.S. President Barack Obama says the lavish bonuses some Wall Street executives get are shameful.

"This is America. We don’t disparage wealth," said Obama. "But what gets people upset and rightfully so is executives being awarded for failure. Especially when those rewards are subsidized by U.S. taxpayers, many of whom are having a tough time themselves."

The move comes amid public outcry over $18.4 billion US in bonuses paid out in 2008 at a time when taxpayer money was shoring up the financial system.

"For top executives to award themselves these kinds of compensation packages in the midst of this economic crisis isn’t just bad taste; it’s bad strategy, and I will not tolerate it as president," he said.

'There is a deep sense across this country that those who are not responsible for this crisis are bearing a greater burden than those who were.'—U.S. Treasury Secretary Timothy Geithner

Under Obama’s plan, top executives at firms receiving extraordinary help from U.S. taxpayers will have their compensation capped at $500,000 US. If they receive any additional compensation in the form of stock, it can’t be cashed in until taxpayers are paid back.

"Companies receiving federal aid are going to have to disclose publicly all the perks and luxuries bestowed upon senior executives and provide an explanation to the taxpayers and to shareholders as to why these expenses are justified," said Obama.

"We’re putting a stop to these kinds of massive severance packages we’ve all read about with disgust. We’re taking the air out of golden parachutes."

There will also be more transparency for costs such as aviation services, big parties, office renovations and conferences.

The chill may already be settling in.

On Tuesday, Wells Fargo abruptly scrapped an upcoming sales retreat to Las Vegas.

The company received $25 billion in taxpayer bailout money and recently announced a $2.3-billion loss for the last quarter of 2008.

It had booked 12 nights at two of the most expensive hotels in Las Vegas, but after lawmakers and investigators admonished the company, Wells Fargo cancelled the event.

Companies that have previously received bailout money — such as financial giant Citigroup and insurer AIG — would have to agree to stricter oversight and prove they have followed already established limits on executive compensation, which are widely seen as being too lax.

"There is a deep sense across this country that those who are not responsible for this crisis are bearing a greater burden than those who were," said U.S. Treasury Secretary Timothy Geithner. "The executive compensation polices we’re announcing today are designed to strengthen the public trust and get credit flowing again."

Critics said the move could prompt talented executives to flee companies that fall under the guidelines.

"One size fits all has never worked. It is an understandable effort but it is a dangerous one," said Mark Poerio, partner at law firm Paul Hastings.

"If you have someone who was making well over $1 million, and now they are capped at $500,000, it is very conceivable that they are going to look to go to a company that is not subject to those limitations."

Obama and senior congressional Democrats are also seeking to push through an economic stimulus package of almost $900 billion US despite Republican criticism that it focuses too much on government spending and not enough on tax cuts.

The cap on executive pay would not apply to banks in good financial shape that receive federal assistance.