Hank Paulson, Ben Bernanke, and Tim Geithner have probably been criticized and critiqued more than any other trio in the history of business for the Wall Street bailouts they designed in 2008 -- as they should be.

But criticizing is one thing; saying, "Here's what I would have done differently, and here's why it would have been better," is quite another, and something that happens far less often. 

Last week, I sat down with former AIG (NYSE:AIG) chairman and CEO Hank Greenberg (who left AIG in 2005, before the company's downfall and bailout). I asked him what Paulson, Bernanke, and Geithner should have done differently in 2008. Here's what he had to say (transcript follows):

Morgan Housel: How should Paulson, Bernanke, and Tim Geithner have responded in September 2008?

Hank Greenberg: They had their mind made up. They wanted to use AIG as a back-door bailout. You had Goldman Sachs, you had Morgan Stanley, you had many institutions who were using AIG to get them funds, and they did.

Now, they could have had access to the window, and they ultimately got access to the window, but they would have gotten a lot more access to the window. Their debt would have been much greater. This eliminated a lot of debt that they otherwise would have had to come up with.

Morgan Housel: What did you think about the terms and the validity of the other bailouts that were given to companies like Citigroup, Bank of America, Goldman Sachs?

Hank Greenberg: The Fed guaranteed -- Citi and a number of others -- guaranteed a lot of their assets at a fraction of the cost. If the Fed, as an example, had guaranteed AIG FB for whatever; 100 or 200 basis points...

Morgan Housel That was the Financial Products division of AIG that was running the derivatives?

Hank Greenberg: Yeah. It all would have been over. AIG would have regained its AAA rating, and there would have been no collateral calls necessary, and a lot of those assets came back. In fact, AIG was buying some of them last year. Buying them out of the Fed, so clearly if they hadn't lost their nerve and they'd done it the right way, it all would have been over. 

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Morgan Housel has no position in any stocks mentioned. The Motley Fool recommends American International Group. The Motley Fool owns shares of American International Group and has the following options: Long Jan 2014 $25 Calls on American International Group. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.