Former Deputy Treasury Secretary Roger Altman says the much-criticized $700 billion bailout, known as the Treasury Assets Recovery Program (TARP), has generally been effective.

Obama and Bush aides are lobbying Congress now to release the second half of the bailout even as Obama presses elected officials to quickly approve up to $775 billion more in direct stimulus spending.

While the rescue package hasn’t been perfect, “I don’t think taxpayers are getting a raw deal,” Altman, now chief executive of private equity firm Evercore Partners, told Bloomberg TV.

Treasury Secretary Henry Paulson has been criticized for using the first half of the money to buy stock directly in banks.

Paulson’s approach had the effect of injecting cash directly into the banks and offers the potential of a return on the investment — but did not achieve the stated goal of the program, which was to buy up mortgage-backed securities in order to stabilize home lending.

Lawmakers now want to shift the focus back to housing and away from Wall Street, which has sucked up billions in taxpayer cash but lent back out only a small fraction of the total.

What’s more, many of the investments made by Paulson have so far lost money, even though Treasury bought a raft of bank stocks at historic lows.

Altman says it’s unfair to compare TARP, for instance, with Warren Buffett’s $5 billion investment in Goldman Sachs, which yields 10 percent.

“The goal the Treasury had in TARP and investing in a wide range of financial institutions is very different than what Buffet had in his investment,” Altman explains.

“Buffett’s goal was solely a good return from an investment point of view. The government’s goal was to stabilize the financial system.”

The more return the Treasury had demanded out of major banks in return for the government’s money, “the more difficult it would have been to,” achieve that goal, Altman says.

“Did the Treasury get the last dime of dividend or warrant return? Probably not.”

But the bailout did accomplish its aim of avoiding a systemic meltdown, he points out.

Going forward, Altman says TARP might be used purchase banks’ toxic mortgage-related securities as originally planned and could directly help homeowners with troubled mortgages.

House Financial Services Committee Chairman Barney Frank proposed Friday that TARP rules be tightened in just that way, and demanded information on how money given to banks is deployed.

“We are Reaganites. We intend to trust but verify,” the Massachusetts Democrat told reporters.