This WaPo article gives me a lot to comment about.

Congressional investigators are criticizing the Obama administration for failing to police deals in which banks participating in the $700 billion federal bailout lent billions of dollars overseas, highlighting the growing political tension over the extent of government involvement in firms receiving taxpayer funds.

This might be a legitimate gripe. But in the context of everything I've said about the weakening of Congressional oversight over the past -- I don't know... decade, now? -- it seems more than a little ridiculous for Congress to be griping about a lack of oversight by the executive.

This part, too, bugs me:

Under the bailout's largest program, only the 20 largest recipients of money are required to file reports with the program's overseers, the report said, while the other 297 are not. The investigators also said that Treasury has not deployed personnel to any of the largest participants, other than a minimal presence at two. Even the filings required of the 20 largest recipients provide general monitoring of the bailout money's impact on lending activities, not the overall use of the taxpayer dollars, the subcommittee concluded.

"As a result, Treasury has limited ability to detect or prevent waste and abuse," the report concludes.

Again, I understand the frustration in general, but the fact that there's so little in the way of on the ground oversight brings me back to this bold assertion from Max Baucus (D-MT) during the TARP debate:

For the taxpayers' sake, I also wrote a provision creating a special watchdog to track and protect taxpayers' dollars. I have said that American resources must be used wisely and efficiently. This bill includes my proposal to create an independent Inspector General to oversee this effort. This effort and nothing else. Solely designed [sic] on this problem. I designed the office of this Inspector General to be truly independent, with the necessary resources to fight for every taxpayer dollar. I designed this Inspector General to be accountable only to the Congress and to the American taxpayer. It will be my personal ambition to make sure that this watchdog does his or her job. I want this Inspector General on the ground, in New York, inside the firms that facilitate Treasury auctions, watching every dollar that comes and goes. This investigator will hear from the Finance Committee as we work to protect the American people's interest in this effort.

Well? Where are your IGs on the ground, inside the firms, Senator?

"I wrote."

"My proposal."

"I designed."

"My personal ambition."

"I want."

That's a whole lotta you in there, Senator. So what are you gonna do about it? Word is, the president's looking for another $750 billion, too. That's putting a lot of the onus on Max Baucus, of course, when there are dozens of Members of Congress who are equally responsible for this lack of oversight and enforcement, not to mention the dozens of other areas in which there has been an equal lack. But boy, was that speech ever full of personal assurances that we were in good hands. And it turns out... not so much. Where should I turn?

Second thing that's bugging me:

The report underscores the political strain between some lawmakers, who are pressing for much more government involvement in banks that receive federal assistance, and officials at the Treasury Department and the Federal Reserve, who say it is impractical and counterproductive to approve every aspect of a bank's operation.

The overseas deals by the banks were not illegal, the report concluded, and it is impossible to know whether they were funded with bailout dollars.

It probably is impractical (and maybe counterproductive) for the government to be approving every aspect (or even a great deal) of a bank's operations. And yes, because money is fungible (and we knew this going in, because it's axiomatic) it's impossible to know exactly what happens to TARP dollars. But that's why a gigantic, carte blanche bailout was such a trainwreck waiting to happen. You can't honestly sell a $700 billion, hands-off bailout as being specifically targeted at anything in particular, so to have sold it first as something designed to vacuum up all the "toxic assets" out there, then later as something designed to loosen credit markets (presumably here in the United States, it should have gone without saying), was an obvious lie and we all should have recognized it as such. Is there a sector more ideologically resistant to government scrutiny/interference than high finance?  Their entire operational philosophy is that it's impossible for outsiders to pin down where they'll put their capital from day to day or hour to hour. And not just that it's impossible, but that even if it were possible, it'd be detrimental to their operations to tell anyone what they were doing before they did it, because it would lessen their relative advantage in being a first mover.

So yes, it's arguably impractical and counterproductive to approve bank operations at the level necessary to effectively oversee the use of TARP funds. Pretty much by definition. Which means your two choices are either to admit that and live with it, or not bail the banks out.

Well, the third option is actually to bail them out and lie to yourself about oversight, I guess. And we went with that one, and will likely do it again.