So Chris Dodd admitted he misled CNN, telling them on Tuesday he had nothing to do with the loophole that mysteriously found its way into legislation and paved the way for AIG's bonuses to be paid.  The following day, Dodd confessed to CNN's Dana Bash that he in fact wrote the loophole, though he said he did it at the behest of the administration and with the knowledge that he would lose the amendment altogether if he did not comply.

But even Dodd's mea culpa doesn't ring totally true. He refused to say who at the Treasury Department requested the modifications to the amendment, downplaying it as a negotiation that took place at the "staff level." And at the very end of the CNN interview, Dodd says he "didn't know the exact details" of the modifications that made their way into the bill, a notion that strikes me as very hard to believe.

Dodd released a statement last night further clarifying his statement that 1) he made modifications at the behest of the Obama administration and 2) he was unaware of the AIG bonuses at the time and had no idea the modification would effectively create a loophole for them. (Read the full statement after the jump)

Stepping back for a second, Chris Dodd is already in a bit of trouble in his reelection bid, based on recent polling. Obviously, this further complicates matters.  Dodd is now directly associated with two of the most distasteful aspects of the current financial meltdown: getting a sweetheart mortgage from the CEO of a company that was a major player in the subprime mess, and now authoring the loophole that allowed AIG to pay $165 million in bonuses after already taking scores of billions of bailout dollars , all at taxpayer expense.

March 18, 2009

Senator Dodd, Chairman of the Senate Committee on Banking, Housing and Urban Affairs, today issued the following statement on his executive compensation amendment:

“I'm the one who has led the fight against excessive executive compensation, often over the objections of many.  I did not want to make any changes to my original Senate-passed amendment but I did so at the request of Administration officials, who gave us no indication that this was in any way related to AIG.  Let me be clear – I was completely unaware of these AIG bonuses until I learned of them last week.

“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.

“Fortunately, we wrote this amendment in a way that allows the Treasury Department to go back and review these bonus contracts and seek to recover the money for taxpayers.  Again, I have led the fight to curb excessive executive compensation, and will continue to do so.”