In a time when a rotten business environment is forcing America's c-suite elite to renounce bonuses, it's impossible to think that any CEO could be so audacious to demand one.

Merrill Lynch CEO John Thain asked for a $10 million bonus for fiscal year 2008. But he isn't getting it. And that's the trend. The ball started rolling in the U.S. this year with Goldman Sachs executives, including oft-praised CEO Lloyd Blankfein, forfeiting their bonuses. John Mack, CEO of Morgan Stanley, has declined his bonus for the second straight year. Meanwhile in Switzerland, UBS' UBS top executives have also said they'll forgo the big check.

Like a row of dominoes falling, other top bosses across the globe are expected to follow suit, thus ending the days of the $10-, $20- and even $30-million CEO Christmas gift. Some argue that CEO payouts may return to those levels, but when? The last recession might be telling.

CEO's base salaries may remain stable, but with stock prices tumbling and bonuses going, their compensation will continue to decline dramatically. If the recession of 2001 is any indication, paydays will shrink for some time to come.

According to Forbes CEO compensation data, after the tech bubble burst in 2000, which marked the start of an 18-month recession, CEOs at the largest 500 companies took pay cuts for three years. The greatest decline came in 2003, when their total pay fell an average 36% in 12 months, to $6.2 million a year. CEO pay rebounded 8.3% in 2004 and then a huge 54% in 2005. Dramatic stock gains drove that spike. Last year was the first time since 2003 that CEO compensation went down.

In 2007, long before anybody acknowledged the beginning of a recession, massive corporate financial losses forced CEO pay down by 15.2% at the 500 biggest firms, to an average $12.8 million earned a year. That was probably only the beginning of a multi-year decline, though it's still double what those executives raked in just five years ago.

Salary and bonuses add up to far less than what companies dole out in equities, so the bulk of CEO pay gains and losses are in company stock. But bonuses are traditionally the first pay component to get nixed, because they're a direct measure of success.

CEO's bonuses declined 11% last year $2.3 million. In the wake of the 2001 recession, they fell 21% in 2002 to an average $1.34 million, then 2% in 2003 to $1.31 million.

"Bonuses tend to be a lagging indicator of the state of the economy," says David Wise, senior consultant at Hay Group, a global management consulting firm. "Expect a full economic rebound before we see bonuses like last year's."

Goldman Sachs CEO Blankfein was the eighth highest-paid CEO in America in 2007. (Lawrence Ellison, founder and CEO of Oracle, was ranked No. 1, earning $192.2 million.) Blankfein's bonus alone was nearly $27 million. The boss of the vaunted Wall Street firm renounced his bonus this year because, like its peers, Goldman has fallen on tough times.

Top business leaders from around the world are feeling the pinch, too. UBS, the Zurich-based bank, has said that its top 12 executives, including Chairman Peter Kurer and CEO Marcel Rohner, will forgo 2008 bonuses. UBS said it is even its whole compensation structure for management.

In the U.K., Barclays, the firm that bought the investment banking and trading divisions of a bankrupt and crippled Lehman Brothers, said its CEO John Varley won't get a bonus this year. Barclay executives Frits Seegers, Chris Lucas and Robert Diamond are in the same boat. According to some reports, Diamond could have received roughly $22 million.

Marc Hodak, a compensation consultant for the New York City-based Hodak Value Advisors, adds that CEO pay levels could drop 30% to 40% this year.

"We will get back to where they were before," he says. But the financial services industry may have to say goodbye forever to the giant bonuses it enjoyed in 2007, the last year of a now-deceased Wall Street business model.

"They no longer are going to be able to take the risks associated with getting those rewards," Hodak said. Financial sector CEOs will just have to come up with new ways to get themselves handed tens of millions of dollars in year-end gratuities. And most likely, nobody's bonus will go up again for at least two years.

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