The Senate voted to release the remaining $350 billion TARP funds earlier this evening.  So now the ball is in the House's court, and that's been the tougher hurdle with both Democrats and Republicans in Congress poised to put more conditions on the funds. 

Martin Neil Baily, Chair of the Council of Economics Advisers under Clinton, and Charles L. Schultze, chair of the CEA under Carter, made a case for TARP today in the Washington Post.  They say that, despite a growing perception among many that the first $350 billion of TARP funds were spent without enough oversight and accomplished little. 

Much of the criticism of TARP reflects a fundamental misunderstanding of the basic financial problem that the program was intended to address. The first goal was to ameliorate the large and long-lasting contraction in lending that was the inevitable consequence of the mortgage-related losses by U.S. banks. This credit squeeze has already depressed bank lending and, if unabated, threatens to radically deepen and prolong the recession. It is unrealistic to expect troubled banks to make a lot of new loans. Only when the banks are stabilized can we expect them to raise new private capital to expand lending and fuel an economic recovery.

Read Let the Bank Bailout Work here.