Terry Chia, we meet again xD. Simple put, although technologies to track hackers are present, there are a number of constraints on governments that prevent them from doing so. That said, a private individual working as a blackhat will probably have better chances to track a particular hacker.
To begin with, the main reason law enforcement agencies arrest hackers in the first place is their connection to their (generally some crappy free) VPN breaks down without their realization. The reason IP Spoofing is so devastating is if a US individual spoofs a Russian and then Chinese IP, it is almost certain that the two governments would never help US law enforcement. So you ask how it can be done?
For example, Google has been known to be able to track users even under spoofed IPs and disabled geo location instantly. They do this, by capturing all wifi points in range every time you connect to them, by matching this to their existing database of wifi points they could easily locate you. The technique essential works by invading user privacy. If the "law enforcement" could access such a database, they could use it against you. Additionally if they can somehow sniff such traffic they could obtain the same info.
Here's a video demonstration that: http://www.youtube.com/watch?v=McF50tjuFEs
Ultimately, it's not viable for law enforcement to accurately track or arrest any individual, because laws in most country believe that a person is not guilty unless convicted. What I mean is that, even if they get your "true IP" and come to your house, hackers have been known to have security measures to erase disks several times over beyond capabilities of cyber forensics or use Deep Freeze/TrueCrypt to hide and lock that data with multiple unbreakable layers of encryption.
If you do it right, there's no "evidence" on your PC. In fact, people can got away in many cases because they claimed their computer was used as a zombie or their wifi was hacked. In many cases it is true.