Photo: A.P WorldWide

When you have thirteen executioners, it’s tough to say whose bullet inflicted the coup de grâce. There will, however, be no forensic autopsy of the Dick Grasso case. Nobody on the board of the New York Stock Exchange wants to talk publicly about why Grasso went from underpaid hero to overpaid villain in less than a year.

Nobody has to. The board members are powerful people, cloistered from the rest of us—answerable, basically, to no one. But when someone gets $187 million to do a job that any of us might do for $1.87 million—or, in these tough times, maybe $187,000—things leak out and otherwise become evident.

First, a few things that the 13-to-7-vote firing was not. Dick Grasso was not mau-maued out of the job by a group of liberal politicians and the left-wing press. In fact, the most influential media involved in the crushing publicity against Grasso were the New York Post, the Wall Street Journal, and CNBC—hardly a troika of liberalism. The most influential politician, the one who repeatedly aimed for Grasso’s jugular these past few weeks, was Bill Donaldson, the Republican SEC chairman.

Second, this was not a case of everyone on the board knowing how much Grasso made and everyone approving it and thinking he deserved it. My sources tell me that only a handful of people knew how much this man was being paid when he was being paid it. (But it wasn’t Grasso’s fault that board members didn’t know. All board members were shown everything. It’s just that many of these board members were hopelessly out of the loop or couldn’t even figure the deal out. Others, such as the executives from Goldman, Morgan, and Credit Suisse, aren’t necessarily good friends of the exchange. In fact, they are competitors!)

So, how did it all come to pass? How did Grasso get this package, and why, at any time, was he thought to be worth it?

“The boys on the floor hadn’t liked Grasso since he’d become a guilty-until-proven-innocent regulator.”

Perhaps you should blame Home Depot. That’s right, Home Depot, because the two people most instrumental in giving Grasso more than he should have gotten were Bernie Marcus and Ken Langone, the founders—and geniuses—behind the big orange home-improvement giant. Both sat on the NYSE board, both ran the compensation committee during the period in question, and, get this, both are great guys who like other people to get rich along with them. It’s their mantra, always has been. (Grasso served on the Home Depot board, in classic back-scratch fashion.)

Langone and Marcus crafted the pay package for Grasso in 1999 when Grasso was in great demand and every other phone call to his office was a headhunter trying to lure him with a stock-and-cash package to head a dot-com. Why not? If you got Grasso, your stock could double—he was that respected.

“The man was worth every effin’ penny of it,” one of the board members told me. “In 1999, this place was under attack from everyone, and people thought it was going the way of the dinosaur. Dick saved it. Now some of these two-faced bastards who were begging him to stay are telling you he wasn’t worth it.”

The board’s largesse, of course, turned truly grotesque in the Enron-WorldCom era when the “regulator” portion of Grasso’s job seemed to merit civil-service, not rock-star, pay. None of this would have mattered if “transparency,” that newfangled disinfectant, hadn’t spread to the floor of the exchange. As long as no one but Grasso’s friends on the board and a couple of smart executives from other businesses actually understood what he made, Grasso could have continued to take giant pay packages. But when everyone found out the real number, both friends and the dignitaries appointed to gloss up the joint felt the heat—and the temperature was more like that of hot- jellied napalm than sunlight.

The boys on the floor instigated the insurrection. They hadn’t liked Grasso much since he’d become a guilty-until-proven-innocent regulator, and an imperious one at that.

Given all of the jealousy and the anger, you might be wondering why Grasso wasn’t fired immediately when his package came to light. You might be wondering, for example, why the latest compensation-committee chairman, Carl McCall (who suddenly resigned last week), became the Brutus of the gang, first praising Grasso on my CNBC show, Kudlow & Cramer, and then leaking (through an aide) to the New York Times that everything he said on my show was phony and that he’s no backer of Grasso’s. That switch was a naked betrayal that nobody counted on. Wasn’t McCall down here to make money and shut up? Wasn’t that the bargain?

You might also be thinking, Why didn’t the heads of Morgan Stanley, Goldman Sachs, and Credit Suisse First Boston just say, “Let’s get rid of him now,” rather than hide behind the giant, sucking chest wound of a “no comment” that they issued daily to those of us seeking interviews? For that, again, you have to understand the economics, not the politics, of the exchange. You have to recognize that there simply is no innate reason for the exchange to exist, because there are more efficient ways of trading through machines. But the hard-won monopoly of the place, kept up in large part by the endless fêting and lobbying of Congress by Grasso himself, made too much money for too many people on the board to throw Grasso out.

Of course, loyalty mattered, too. Grasso did everybody’s dirty work, and he was up from nothing and one of “the guys.” That cultural affinity made people like me, for example, who admired Grasso’s rags-to-riches yarn, stick by him.

You hate to turn your back on a guy who was overpaid on Wall Street, because everyone on Wall Street is overpaid. After all, the numbers Grasso got, despite the Times’s insistence, didn’t put him among the richest of the Big Board’s directors. Not by a long shot.

In the end, what mattered is that few people liked the imperial Grasso—the money, by all counts, changed the man—and he became a liability to everyone involved. (Heck, I even saw my show’s Nielsens drop for defending the guy, but I can’t pile on when the only thing he did wrong was negotiate one hell of a pay package—something I’ve been trying to do all my life!)

Is it right that Grasso gets lumped in with Ebbers and Lay and Kozlowski, that tawdry trio that turned the face of capitalism from a perpetual smile to a face-lift gone Wildenstein? Is it right that the man’s legacy after 36 years of service is that of an overpaid rip-off artist with a Napoleon complex and an ugly Waterloo?

No. But then again, he did get to keep the money. As they say, if the rich are unhappy, it’s their own damned fault.