Fast forward nearly 30 years, and several lawmakers have put the Iacocca challenge to the CEOs of Detroit’s Big Three, who are in Washington this week pleading with Congress for a $25 billion bailout to buoy the sinking industry.

During a Senate Banking Committee hearing with those executives yesterday, Sen. John Tester (D-Mont.) asked point-blank if the well-compensated executives would be willing to make the same sacrifice that Iacocca did. Only one, Chrysler head Robert Nardelli, answered non-evasively. ” I’d be willing to accept that,” he said.

The other two — Ford CEO Alan Mulally and General Motors executive Rick Wagoner — showed no such alacrity for a $1 paycheck. Wagoner boasted of cutting his salary “unilaterally 50 percent” a few years back, but had little response when Tester pointed out that half of an enormous salary is still enormous, relatively speaking.

Mulally rejected the challenger even more bluntly. “I absolutely respect the intent of your question as a symbolic gesture,” he said, “but it is a symbolic gesture.”

Such remarks may not play well with Congress. Even supporters of the auto bailout are warning that huge pay packages for executives of bailed-out companies leave a bad taste with an American public that’s also struggling in the economic downturn.

“I can’t begin to tell you,” Sen. Chris Dodd (D-Conn.) told the CEOs yesterday, “what sort of reaction there’d be from the public if you on your own would be willing to take some steps that would reassure the American public that their dollars, if they’re going to be forthcoming, are not going to be used in any way to provide exorbitant salaries and fees to people.”

Judging from the behavior of banks after they got their $700 billion bailout, lawmakers might do better simply to write such restrictions into the legislation.