TARP rescued a crashing economy on the verge of Depression. Propping up the banks prevented an economic panic that would have destroyed the worldwide economy.
I commend both Bush and Obama for recognizing how critical it was to prevent massive bank failures
No, TARP did that sort of. Yes, it rescued the banks from freezing up. But it also got extended, under first Bush and now Obama, to virtually everything that looked like a financial institution.
So AIG got bailed out. Some of the brokerages got bailed out. GMAC got bailed out, three times now. Auto makers. You name it.
The intervention by the gov't has been massive and unprecedented. There is an article by James Grant in his newsletter on this.
The down side of all that is that it has prolonged the recession and will make recovery difficult and the expansion phase less robust.