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Top 10 most responsible for AIG debacle

Okay, after all the hearings and posturing, we get it. Public outrage is palpable over AIG again snubbing U.S. taxpayers' 80 percent stake in the company and paying out $165 million in bonuses.

Politicians are channeling the wave of citizen disgust and doing their best to out-outrage one another in scorning AIG's behavior and bad business decisions.

When demonic Enron starts to look smart and responsible, AIG's got serious problems.

Let's just not get too hung up on this bonus controversy. AIG last week handed out $165 million while U.S. taxpayers have tossed in some $170 billion to save AIG. That's like saying we bailed out a company with $100 and got hot and bothered by handing out 10 cents in bonuses.

If you want to rage, scream about sinking $170 billion — and counting — into one firm.

Let's spread the wrath around. Here's a Top Ten list of those who stuck us with this loser stake:

10. Former Treasury Secretary Hank Paulson: Last fall he said he "never once" considered it appropriate to put taxpayer money at risk to save Lehman Brothers. But for AIG? Sky's the limit.

9. Federal Reserve Chairman Ben Bernanke: Last fall, he defended the first $85 billion into AIG, saying a disorderly failure could hurt the already "delicate financial markets." At $170 billion, what about "delicate" taxpayers?

8. Harvard University economics professor Martin Feldstein: If he's such a brainiac and public policy veteran, why didn't he stand up all those years as an AIG director and condemn those screwy deals?

7. Obama administration special envoy to Middle East Richard Holbrooke: See No. 8 above. If he didn't see trouble at AIG as a director, can he fix Pakistan?

6. President Barack Obama: He just "instructed" Treasury Secretary Tim Geithner to "explore every avenue" to get back that AIG bonus money. Hey, he's the President. It could happen in a snap — if he really meant it.

5. The financial press: With few exceptions, the watchdog business media lacked the horsepower to properly warn of the AIG debacle in the making.

4. SEC Chairman Charles Cox: From Madoff to market meltdown, he missed it all, including AIG.

3. Ed Liddy, government-appointed CEO of AIG: He could have stopped the bonuses, even if it meant being sued. He handed them out anyway.

2. Ex AIG CEO Martin J. Sullivan: He got $14 million in 2007 before being ousted just before a fed takeover. Nice work if you can get it.

1. Former AIG CEO Hank Greenberg: He was at the helm when AIG began jumping into credit default swaps, a key reason the company became a ward of the state.

Robert Trigaux can be reached at trigaux@sptimes.com

Top 10 most responsible for AIG debacle 03/18/09 [Last modified: Wednesday, March 18, 2009 11:23pm]
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