Not doing the bailouts would have been a catastrophe that made Greece 2008 look relatively mild, across the entire Western world. Ordinary retail banking, cheque clearing etc would have been locked out for months while the bankruptcy was untangled.
Should the UK have said "sorry, if your bank account was with RBS, you don't have a bank account any more and you'll have to see what is left after the recievers have sold off the office furniture to see if you get any money back at all"? Including all businesses which bank with RBS? Many of whom themselves would be bankrupt as a result?
That said, there was a lot of choice in how the bailout was done, and in many cases it was done badly. Things like the robosigning fraud in the US should have been prosecuted more aggressively.
Should the UK have said "sorry, if your bank account was with RBS, you don't have a bank account any more and you'll have to see what is left after the recievers have sold off the office furniture to see if you get any money back at all"? Including all businesses which bank with RBS? Many of whom themselves would be bankrupt as a result?
That said, there was a lot of choice in how the bailout was done, and in many cases it was done badly. Things like the robosigning fraud in the US should have been prosecuted more aggressively.