What are some potential agency problems associated with the government bank bailout?

If the government buys up the banks' bad debt in an attempt to unfreeze credit, do those banks have incentive to lend money? Or is there an agency problem. I'm trying to understand the situation. Thanks!

The situation is as simple as it can be Bush passed 800 billion dollar bail out which was the biggest robbery in man kind history. Right now Obama is trying to pass a bail out that would actually HELP the middle class americans but NO the republicans dont give 2 craps about the middle class. The rich wont make money off this new bail out that Obama wants. Situation we are stuck in corruption