AIG debacle: The players and who knew what when

As the AIG bonuses debacle grows ever larger and the angry voices grow ever louder, the question for some may be: Who created this mess, anyway?

To make a long, long story short: The U.S. government bailed out the ailing insurance giant AIG with $170 billion. Unbeknownst (allegedly) to anyone (until now), AIG is using $220 million of taxpayers' hard-earned dollars for "retention bonuses" for its financial products division, the section arguably to blame for the company's downfall. Today, the House passed a bill, 328-93, that would slap huge taxes on employee bonuses from bailed-out firms.

Here is a list of the players in the tangled financial web now gripping the nation's attention:

Edward Liddy: Six months ago, Liddy was named AIG chairman and CEO as part of the bailout package under then-Treasury Secretary Henry Paulson. Liddy's current salary: $1. He is not among those at AIG getting a bonus. Testifying before the House Financial Services subcommittee probing the AIG bonuses, Liddy said that bonuses were a legal commitment: "When you owe someone money, you pay that money back."

Liddy told the panel that he's asked employees to return at least half of the bonus money and that some workers have already volunteered to give money back.

Sen. Christopher Dodd (D-Conn.): Billed by Gawker.com as "the senator from AIG," Dodd inserted language into the stimulus package that allowed for the AIG bonuses, weakening an earlier provision by Sen. Olympia Snowe (R-Maine) and Sen. Ron Wyden (D-Ore) that limited bailout recipients' ability to dole out bonuses. His provision included this line: "There is an exception for contractually obligated bonuses agreed on before Feb. 11, 2009."

Dodd's spokeswoman told dcexaminer.com that the senator was "completely unaware" of the AIG bonuses at the time his amendment was added to the $787 billion stimulus bill.

Those Who Knew About Dodd's Provision: Apparently, no one. According to dcexaminer.com:

Sen. Ben Nelson (D-Neb.): "That's the first I've heard of it."

Rep. John Fleming (R-La.): "That's one little line item I never got to read."

The White House said Tuesday for the first time that Treasury Secretary Timothy Geithner found out about the bonuses a week ago Tuesday; he informed the White House last Thursday.

The Investigator: New York Attorney General Andrew Cuomo uncovered the details of who (no names, fortunately for them) got what and how much. From The HuffingtonPost:

- A single beneficiary received more than $6.4 million

- Seven individuals received more than $4 million apiece

- Twenty-two individuals received more than $2 million or more

The New York Post is reporting the names of three of the alleged bonus recipients. An AIG spokesman told the Post: "I honestly don't know who got what."

The Angry Mob: The average Joe on Main Street hasn't been very vocal about this bonus mess, but it could be because he's being drowned out by lawmakers from both sides of the aisle who are demanding to be heard. Sen. Charles Grassley (R-Iowa) raised some eyebrows by suggesting AIG executives should resign or kill themselves. From a March 16 radio interview:

"But I would suggest the first thing that would make me feel a little bit better toward them (is) if they'd follow the Japanese example and come before the American people and take that deep bow and say: 'I'm sorry,' and then either do one of two things: resign or go commit suicide."

Federal Reserve Chairman Ben Bernanke told "60 Minutes" that he "slammed the phone more than a few times on discussing AIG."

Senate GOP leader Sen. Mitch McConnell (R-Ky) went after the White House, saying "It's shocking that they would — the administration would come to us now and act surprised about these contracts ... This administration could have and should have ... prevented this from happening. They had a lot of leverage two weeks ago."

The political fallout from the bonus scandal remains to be seen, but so far President Obama has managed to shift the burden of fixing the mess squarely on the shoulders of Treasury Secretary Timothy Geithner. White House spokesman Robert Gibbs told the press corps that "the president has complete confidence" in Geithner.

- Lili Ladaga

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