You cannot solve a crisis brought on by borrowing too much, by borrowing even more. You have to work your way through the debts, repaying some, and increasing your income relative to the interest costs.
You cannot magic away a load of bad debts and poor investments by transferring them all from the private sector to the public sector. That just undermines the credit standing of the government, and leaves the taxpayer lumbered with loads of losses they do not deserve. Most of the so called recovery plans the UK and US governments are looking at are just different ways to land the poor investments on the taxpayer.
I am amused to hear President Obama saying he is going to announce a halving of the running government deficit over his first term. How can he do that, when his government is busily taking on more and more obligations from banks and insurance companies, and when he is just beginning a big expansion of public spending financed by borrowing?
Controlling debt and cutting deficits has to start today if he wants to do that, not at some unspecified date in the future. Curing the banks entails working through all the investments and debts and saving as many as possible through intelligent banking – not shoving them off to someone else to pay the losses.