Later On

A blog written for those whose interests more or less match mine.

Bailout oversight: MIA

with one comment

This reminds me very much of Jerry Bremer’s tenure in Baghdad, when he lost literally skids of money: bundled billions lost forever, gone who knows where? Those Republicans just don’t care about money. And the Democratic Congress is ineffectual and quivering with cowardice. And now this:

Remember back in September when Congress blocked the Bush administration’s initial effort to ram through a bailout bill that would have given Treasury Secretary Hank Paulson virtually unlimited authority to spend $700 billion however he saw fit?

Among the measures that Congressional Democrats successfully held out for — against the wishes of the White House — were meaningful oversight mechanisms that would allow Congress and others to track what the Treasury Department is doing with all that money.

That seemed like a victory for taxpayers at the time. But now, over two months later, we’ve learned a bit about what those oversight mechanisms have been able to provide. And there’s real reason to question whether in fact they were designed adequately for the task in the first place.

“It’s a mess,” Eric M. Thorson, the Treasury Department’s inspector general, told the Washington Post last month. “I don’t think anyone understands right now how we’re going to do proper oversight of this thing.”

Perhaps the single biggest obstacle to adequate oversight of Treasury is how little oversight Treasury itself is exercising over the bailout funds, whether through indifference or an inability to hire qualified staff. In the first report issued by the Congressional Oversight Panel (COP) — the main oversight mechanism that Congress fought to include in the bailout bill, over Paulson’s objections — the authors made clear that they were concerned about Treasury’s lack of tracking mechanisms: “Treasury cannot simply trust that the financial institutions will act in the desired ways; it must verify.” But COP also suggested that it was prevented from going further by the fact that Treasury wasn’t keeping extensive enough records of its allocation of funds to be able to provide much more information.

A different overseer, the Government Accountability Office — which functions as the investigative arm of Congress — drew similar, albeit somewhat firmer, conclusions about Treasury’s handling of the bailout money. Its preliminary report last week found a litany of problems, perhaps most fundamentally that there were no procedures to ensure that bailout funds are used as intended.

Just as important, the system of oversight doesn’t appear to …

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Written by LeisureGuy

12 December 2008 at 9:47 am

One Response

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  1. DO THE PEOLPE WHO ARE BEING BAILED OUT HAVE TO GET CRIMINAL BACKGROUND CHECKS, LIKE ORDINARY AMERICANS WHO ASK FOR LOANS OR HELP FROM THE GOVERMENT WHO ARE DENIED. I WAS DENIED HOUSING AND JOBS FOR A FELONY AND AM DISABLED . SOME OF THEM MIGHT HAVE, WHICH WOULD MEAN THAT THERE ARE DOUBLE STANDARDS NOW THAT’S NOT RIGHT .WHO DO I ADDRESS ABOUT THIS MATTER ? ALL OF US OR NONE OF US ?

    AREWESTILLPREDJUDICE

    18 December 2008 at 7:30 pm


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