????By Colin Barr

????For top executives, 'tis the season to get paid in company stock - unless you happen to work at Fannie Mae or Freddie Mac.

????The taxpayer-backed mortgage giants disclosed Thursday that they could pay out as much as $40 million to their top 10 executives for work in 2009.

????The CEOs - Fannie's (FNM, Fortune 500) Michael Williams and Freddie's (FRE, Fortune 500) Charles Haldeman - are in line to receive as much as $6 million apiece, on an annualized basis (though both will get less this year because they took their jobs midway through the year).

????That's a nice chunk of change for running two companies that together lost $72 billion in the first nine months of 2009 and have received $112 billion in Treasury aid.

????But what's remarkable is that every penny Fannie and Freddie will pay out will be in cash - at a time when the White House is pressuring companies to pay more in stock, in the name of suppressing the bet-the-ranch mentality that helped pave the way for Wall Street's 2008 collapse.

????The government's pay czar, Kenneth Feinberg, has cut cash payouts at taxpayer-backed companies like AIG (AIG, Fortune 500), Chrysler Financial and GMAC.

????But his message has been heard everywhere, notably on Wall Street, where some big banks that have repaid Treasury loans have set plans to offer more compensation in stock.

????"It's amazing that the government is pushing companies with which it has no contractual standing to pay executives in stock, but isn't doing the same with companies that it actually controls," said Len Blum, a managing director at investment bank Westwood Capital in New York.

????For its part, the government agency that oversees Fannie and Freddie notes that this year's payouts are 40% below the levels that obtained before the government takeover. Much of the money will be deferred over several years and some will be paid only if the companies hit certain targets.

????Fannie adds that Treasury, which approved the payouts, prohibits it "from issuing common stock in connection with any new compensation arrangements without Treasury's prior consent."

????That stands in contrast to two of Fannie and Freddie's big peers in the government-backed stable: insurer AIG and carmaker GM, which are now paying their executives mostly in stock.

????AIG chief Robert Benmosche agreed in August to receive an annual salary of $7 million - $3 million in cash and $4 million in common stock. He won't be able to sell the shares for five years. Benmosche also gets up to $3.5 million annually in stock-based incentive pay.

????At GM, new finance chief Chris Liddell agreed this month to receive $750,000 annually in cash salary, $3.45 million in stock salary and $2 million in stock incentive pay.

????Even at firms that have repaid their Troubled Asset Relief Program loans, the pay-in-stock message has sunk in.

????Goldman Sachs (GS, Fortune 500) said this month it will pay its top executives' bonuses in stock in 2009, a year in which the big trading firm is expected to set aside some $21 billion for employee pay.

????"We believe our compensation policies are the strongest in our industry and ... incentivize behavior that is in the public's and our shareholders' best interests," CEO Lloyd Blankfein said in a statement Dec. 10.

????Of course, there are big differences between these companies and Fannie and Freddie.

????Since September 2008, the government has been propping up Fannie and Freddie in the name of stabilizing the financial markets and ensuring that home mortgages remained available for Americans.

????With their emphasis focusing from investor profits to supporting home prices, the firms' financial results have collapsed. Fannie lost $58 billion in the first nine months of 2009 and Freddie $14 billion, as their share of the U.S. mortgage market soared near 90%.

????The availability of Fannie-Freddie financing allows loans that "no one would normally make" to be extended, said Blum.

????Shares of Fannie traded as high as $70 in August 2007, as the global credit bubble was getting ready to collapse. But in the past year, they have closed above $2 just once.

????Even that is probably too high, Blum said, given the companies' giant debt to taxpayers and the prospect of additional losses should this year's recovery peter out.

????Indeed, the giant paychecks also show little progress has been made in resolving the key conflict at the heart of these firms.

????Given their obvious public policy function and their ballooning losses, it makes sense to simply take over Fannie and Freddie and make them into full-fledged government agencies, Blum said.

????But in doing so, the government would have to wipe out the shareholders, foreclosing a possible sale of the firms back to the public. And it would have to start paying the firms' workers on the federal pay scale - which would mean no more $6 million paydays for CEOs.

????So as officials in Washington posture about the need to end too-big-to-fail and put the financial system on a sounder footing, action remains in short supply.

????"These companies are never going to turn a profit again, but the government hasn't come clean and wiped out the stock," said Blum. "After the crisis we have had, I don't understand why we're still allowing conflicts like this in our financial system."