Houghton Responds to Buce on Mau-rice

Good, he followed through: Ken  Houghton is up with his promised post undertaking to show how and why I was too kind to Maurice (don't call him "Mo") Greenberg in my (re)telling the story of the debacle that is AIG.  Houghton's is a fascinating post and is worth your time and effort whether or not you read my original (which is here).    I can be magnanimous not least because I really don't have a dog in the fight: I was retailing what I read in Roddy Boyd's absorbing account of the debacle, and my account possibly be any more accurate than Doyle's.  As to Greenberg himself, it's clear that Houghton entertains, as the late Speaker John McCormack said about a political foe "a minimum high regard for the man."  Yet here is the oddity: on the issue of Greenberg's role in the crisis, I'm really not sure there is all that much real estate between us.   Houghton and I agree that AIG probably would have hit the skids whether or not Eliot Spitzer had attacked.  It might be that I was too credulous in falling for the line about Greenberg's management skills.  Yet the fact is, as Boyd makes clear, the bolts were loose and the wheels were beginning to wobble long before Spitzer made his move--and indeed it was precisely because he scented weakness that Spitzer figured he could move in for a cost-effective kill.

I don't think there can be any doubt that Boyd was impressed by Greenberg's apparent skill at his job.  One thing I guess everybody agrees on is that Greenberg was an obsessive detail oriented workaholic.  I'd have to concede that if he was successful in his detail-oriented workaholism, he was as kind of an outlier: detail obsession is the one thing you are not supposed to do as a top manager:  you are supposed to know how to identify people you can trust, and farm things out.  Obsession about detail also leaves the obsessive and his company vulnerable to one phenomenon that clearly did overtake AIG on Greenberg's departure: a gaping, yawning, black hole, with nobody who can fill it ("what is the combination to the paper clip vault?"--"I don't know, Maurice had it memorized").   And indeed if there is one important charge on which Greenberg seems clearly culpable, it is in allowing AIG to wind up with the man they chose as Greenberg's successor--a glorified insurance salesman who seems to have been utterly out of his depth in the management suite.  Dogged loyalty may be a promising route to the front office but it makes for a black mark against anybody that lets it happen.

Anyway, at the end of the day we are still at wouldacouldashoulda, but at the end of the day there is one point on which Houghton and I seem to agree: Spitzer or no, it probably would have happened anyway.