Bob Higgs has some great commentary on how not even a penny from the bailout has gone where Paulson said it was so desperately needed:
UPDATE: Dr. Higgs has an expanded article here.
Think back. Think far, far back into the past. Think all the way back to the last week of September 2008. Historians tell us that at that time many Americans took leave of their senses. Despite all the evidence of their own eyes, ears, and noses, they became persuaded that the world as they had always known it stood on the verge of utter destruction. Hysterical “journalists” and “experts” on radio and television told them so. What else could they do? Because life without a flush 401(k) lay beyond their wildest imagination, they concluded that “something must be done.”
That realization became the signal for hundreds of devoted public servants to leap into action to save civilization. Understanding full well that the people expected them to “do something,” they enacted the Emergency Economic Stabilization Act of 2008, known in some quarters as the Bailout of Abominations.
The core of this statute consists of the Troubled Asset Relief Progam (TARP), in which the Secretary of the Treasury would expend as much as $700 billion to purchase rotten paper, such as mortgage-backed derivatives, from banks and other financial institutions. It was a bold stroke, to be sure. An unnecessary and foolish stoke, too, yet, withal, bold in the fashion of fearing nothing but fear itself, which was precisely the kind of boldness the crisis seemed to demand.
Read the entire blog post