One reason that many Americans have resisted the bank bailouts is fear that the top brass would help themselves to large pay packages at taxpayers’ expense. Thus it was something of a help recently when the executives of Goldman Sachs said that this year, they would forgo their usual hefty bonuses. Goldman Sachs was one of the initial nine companies to get capital infusions from the Treasury Department. The gesture by its leaders should pressure others to follow suit.

Even before the current financial crisis though, the issue of ballooning CEO pay had drawn increasing scrutiny. New Englanders were revolted to learn this month that David J. Sargent, the president of no-frills Suffolk University, was granted a $2.8 million compensation package last year. Though it included one-time payments meant to make up for leaner years, it made Mr. Sargent the nation’s highest-paid university president. This seems to be part of a “winner-take-all” pathology that has infected the U.S. economy for some years now,

The spoils in higher education are modest next to the notoriously high remuneration for Wall Street chieftains. Last year, between cash and stock, Goldman Chief Executive Officer Lloyd Blankfein pocketed a record $68.5 million. Though forgoing a bonus this year, he still should be able to get by on his base pay of $600,000, a salary that most American workers can only dream of.

No wonder taxpayers worry that their bailout dollars may not be well spent. It did not inspire confidence when the CEOs of the troubled Big Three auto makers each took private jets to Washington Nov. 19 to appeal for help. On Nov. 20, a Wall Street Journal report noted that top executives in the financial-services and home-building sectors had cashed in billions over the past few years, leaving others to flounder once the credit crisis that the executives had helped cause hit.

In the short run, regulators must insist that any companies accepting bailout money provide detailed information on how it is being spent. The bailouts were structured to provide some oversight, but that does not seem to be happening, and the promises of the institutions’ leaders have been revealed to be about as credible as some subprime mortgages. (Besides continued rich deals for some executives, some of this taxpayer money is being spent by banks to make acquisitions of other banks.)

Current incentives for senior executives encourage the kind of short-term risk that helped fuel the crisis in the first place. While the decision on how and when to pay executives should be up to companies’ boards of directors, the tax code and other legal provisions regarding corporate actions could be adjusted to discourage what has become massive misuse of some public companies by senior executives and their pals on the board.

For instance, banks that pay astronomical executive salaries could be required to set aside more capital. Or executive pay could be spread over longer periods, say four years, and “claw-back” provisions imposed under which CEOs would return some of their gains if profits tumbled –– instead of the current “heads I win, tails you loose” system that now applies for many executives.

What Americans should not tolerate is the current safety-net system, which favors those at the top, including with taxpayer funds, while it leaves others to face devastation.