Oct. 23--The government moved in a sweeping and unprecedented way Thursday to curb the pay of executives at banks and Wall Street firms that contributed to last year's global economic crisis.

In simultaneous announcements, the Federal Reserve and the Treasury Department prescribed the pay limits to quiet public anger over the regulators' failure to restrain multimillion-dollar bonuses and other exotic pay schemes on Wall Street. The moves stirred a debate between people who saw the actions as long overdue and others who viewed the intervention as excessive.

Supporters said the effort would go a long way toward ending the incentives for short-term profits and bonuses that helped cause last year's financial meltdown and left taxpayers footing the bill. Opponents worried that the new regulations go too far, exceed the government's authority and attempt to dictate what for centuries in the United States have been the private decisions of executives and boards of directors.

The cuts ordered by Treasury pay czar Kenneth Feinberg target three of the largest culprits in the crisis -- Citigroup, Bank of America and American International Group -- as long as they continue to rely on government bailout funds. But the Fed took on a much broader group in announcing that it would regulate pay at the 28 largest banks as well as thousands of community banks. Its rules potentially will have a more lasting effect in limiting pay throughout the financial sector.

The Fed's targeting of the largest bank holding companies ensures that unsound pay practices of executives and traders at all the major Wall Street players in the crisis are reviewed, including Goldman Sachs Group Inc., JPMorgan Chase and Co. and Morgan Stanley -- companies that have already announced generous bonuses for employees this year after paying off their obligations to the government to free themselves from the Treasury's restrictions.

Fed Chairman Ben S. Bernanke, who has been nominated for a second term and faces strong criticism from some quarters in Congress, has been under the gun for not using the Fed's sweeping powers over banks and Wall Street firms to curb risky practices in the past. The Fed and Treasury also were compelled to act to comply with international agreements to curb excessive pay adopted at recent meetings of the Group of 20 economic powers.

After conducting a comprehensive review of major banks and directing changes in their pay practices, the Fed said it intends to use its regular supervisory reviews to track and curb potentially risky practices that could lead either to the collapse of the bank or create instability in the broader financial system.