As his administration shapes its approach to the next phase of the financial bailout,

President Barack Obama

has sent strong signals that he doesn't look kindly on big bonuses being awarded to executives at companies receiving government aid.

This would seem to me to be a no-brainer. As taxpayers foot the bill for $700 billion -- and counting -- in bailout money, one would think Wall Street would be tightening its own belt. And it is -- thousands of jobs have been lost in the bankruptcy of

Lehman Brothers

and layoffs at virtually every major bank, including

Citigroup

(C) - Get Report

,

JPMorgan Chase

(JPM) - Get Report

and others.

But when the subject of bonuses comes up, all logic seems to be lost for Wall Street's apologists.

Bonuses were down last year. New York Comptroller Thomas DiNapoli last week reported Wall Street bonuses totaled $18.4 billion in 2008, down from almost $33 billion in 2007. And many top executives, including

Goldman Sachs

(GS) - Get Report

CEO Lloyd Blankfein and

Morgan Stanley

(MS) - Get Report

CEO John Mack, have declined bonuses last year for themselves and top lieutenants.

The smaller bonus pool will undoubtedly hurt the state and the country in some respect. Well-paid Wall Streeters are prolific spenders, so with less cash in their pocket, that means less expensive dinners, cars and vacations, among other things. It will cost New York State $275 million in tax revenue alone, DiNapoli said.

That said, by agreeing to accept tens of billions of dollars in aid from the government through the Troubled Asset Relief Program, or TARP, banks really don't have a strong argument for turning around and paying that money out to employees in the form of a bonus.

One justification bandied about by the likes of

John Thain

is that banking is a people business and these companies need to retain their best people. That may well be true, but where are they going to go? We already noted the massive layoffs. Hedge funds, once a choice destination, are struggling, too.

Banks have also insinuated that they didn't need to accept government capital -- that they only did so for the good of the overall banking system at the behest of the federal government, so as to remove the possible stigma for other banks that needed it more.

Bank of America

(BAC) - Get Report

CEO

Ken Lewis

in October told

60 Minutes

that the company didn't need the money and was simply fulfilling a "patriotic duty" by accepting it.

Less than three months later, BofA accepted another $20 billion from the government, which also agreed to backstop $118 billion in risky assets to help BofA absorb Merrill Lynch.

When banks were making money hand over fist, there was plenty of griping about Wall Street bonuses and compensation. Chalk that up to sour grapes -- if investors have a problem with how a company spends its money, they shouldn't invest in the stock.

The difference now is the federal government's massive investment in the banking sector has been billed as not so much a choice as it was a necessity to stave off Armageddon. Banks understandably are

treading carefully

back into lending, which is what the government was hoping to stimulate when it made the investments. It stands to reason, then, that these companies do not have the right to be as generous with available capital as they once were.

That might not be palatable to Wall Street employees, who enjoyed an average bonus of $112,000 in 2008, according to DiNapoli. But perhaps they should set their sights lower for the time being and be thankful they still have a job.

Like the rest of us.

Copyright 2009 TheStreet.com Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed. AP contributed to this report.