When Treasury Secretary Hank Paulson first submitted his proposal for a Wall Street bailout to Congress, he provided a vague, three-page proposal that could boiled down to two words: “trust me.” Congress wasn’t having it. While the bailout bill ultimately signed into law is deeply flawed, it did require some monitoring and oversight – basic accountability measures Paulson initially refused.
This week the first results of the congressionally-mandated monitoring are in, and while just about everything about Paulson’s Troubled Asset Relief Program has changed the resistance to being held accountable for hundreds of billions of taxpayer dollars remains unaltered.
Barney Frank says it best:
“Treasury has no way to measure whether taxpayer funds invested in banks are being used in accordance with the purpose of the law – to increase lending. The much worse news is Treasury's response that it does not even have the intention of doing so… By rejecting the GAO’s recommendation that measurement is needed and substituting a vague promise to ‘evaluate the overall success of the program,’ Treasury is coming very close to telling the institutions that they will be free to use the funds as they wish.”
Frank says it's a betrayal of trust. I think it's sadly predictable.