[MORTARDUDE]

Courant.com
Dodd Admits Role In AIG Bonus Controversy
By CHRISTOPHER KEATING
The Hartford Courant
March 19, 2009



U.S. Sen. Christopher Dodd, already reeling in public opinion polls, suffered another political blow Wednesday with the admission that he had been involved in key legislative changes that helped pave the way for AIG to pay controversial bonuses to its employees.

In a retreat from earlier statements, Dodd said Wednesday that U.S. Treasury Department officials had approached him last month, urging him to modify an amendment to the federal stimulus bill that capped bonuses for executives at companies receiving aid.

On Tuesday, Dodd said that he was not a member of the conference committee that crafted the final compromise bill and said that the exception had not been in the bill as he drafted it.

But late Wednesday, Dodd admitted in an interview with CNN that he had been involved in the change.

"I agreed reluctantly," Dodd said. "I was changing the amendment because others were insistent."

The admission was another in a series of issues that have brought negative attention to the state's senior senator.

"It's apparent that Sen. Dodd — on a whole host of issues — has a lot of explaining to do," state House Republican leader Lawrence Cafero said. "People are having a credibility problem here. ... For a long time, there was an impression that Chris Dodd was an institution and could be there [in the U.S. Senate] as long as he wanted to. Once you believe that, that's when the wheels come off."

Dodd said he agreed to the Treasury Department's request, which made the limits apply only to future bonuses. Dodd's provision, as originally proposed, operated retroactively, meaning that it would have applied to any firm, such as AIG, that benefited from the first wave of federal assistance.

The senator said he agreed to the change to protect the compensation restrictions he was seeking. He refused to name the U.S. Treasury officials who asked him to add the language that paved the way for the bonuses, saying that much of the detailed work on the bill was done on the staff level.

"The alternative was losing the amendment entirely," Dodd said.

The political firestorm that had been simmering around the issue all day exploded with Dodd's admission. Dodd is already vulnerable when it comes to matters relating to AIG. Employees and PACs related to the financial services company have donated thousands to the senator's campaign coffers through the years.

Amber Wilkerson, a spokeswoman for the National Republican Senatorial Committee, said: "Sen. Dodd's reversal on this issue is both astonishing and alarming."

"Contrary to his statements and denials over the last 24 hours, Sen. Dodd has now admitted that he and his staff did in fact change the language in the stimulus bill to include a loophole for AIG executive bonuses."

Dodd said his comments were not a reversal, although when asked by CNN what had changed in his understanding between Tuesday and Wednesday, the senator replied, "Going back and reviewing it. … I apologize if we had some confusion."

Still, he said in a statement: "Reports that I changed my position on this issue are simply untrue. I answered a question by CNN last night regarding whether or not a specific date was aimed at protecting AIG. When I saw that my comments had been misconstrued, I felt it was important to set the record straight — that this had nothing to do with AIG."

The firestorm around Dodd is the most intense ever for the veteran politician who is known as one of the most savvy political players nationally. In Connecticut, his name recognition is as close to 100 percent as possible, and he normally wins re-election in a blowout.

But this year is different.

In a telephone interview with The Courant on Wednesday night, Dodd said he knows he has been enmeshed in multiple controversies recently, including the refinancing of his two mortgages with Countrywide Financial, his purchase of a 10-acre cottage in Ireland and the latest firestorm over the AIG bonuses.

"I've been getting whacked around the head for the last eight or nine months — part of it my own fault for not stepping up earlier," Dodd said.

Concerning the poll ratings that show he is in a statistical dead heat with Republican Rob Simmons in a potential matchup in 2010, Dodd cited the national and state economies as being a major problem for an incumbent politician.

"The backdrop doesn't help," Dodd said. "Jobs being lost. Homes being lost. There are obviously exceptions to this, and we know it."

When asked about speculation concerning his possible retirement by 2010, Dodd said, "I'm running. I haven't announced anything yet. ... I want to win. What I want more than winning is to do what I'm supposed to be doing."

Dodd said several times that it was ironic that he was being criticized regarding the amendment, saying that he had no co-sponsors and was the only person who spoke in favor of it originally. He flatly tried to block companies receiving federal bailout money from paying bonuses in the original bill.

"It's somewhat ironic that the people who thought I had gone too far," Dodd said, "are now saying I didn't go far enough."