Taking over banks: A debate in motion

WASHINGTON, Feb. 20 (UPI) -- Nationalizing some of the weaker U.S. banks may be a politically difficult, but necessary step, some financial experts and politicians say.

The move may play into the viewpoint expressed by Republican Alaska Gov. Sarah Palin during last year's presidential election campaign that Democrat Barack Obama wanted to "experiment with socialism," The Hill newspaper reported Friday.

Scott Talbott, vice president of the Financial Services Roundtable said nationalizing U.S. banks would "destroy the private sector," The Hill said. But, others believe the step is looming as a possibility, if not a necessity.

"This idea of nationalizing banks is not comfortable," said Sen. Lindsey Graham. R-S.C. "But I think we have gotten so many toxic assets spread throughout the banking and financial community throughout the world that we're going to have to do something that no one ever envisioned a year ago."

"Basically, nationalization is the only option left in my view," Axel Merk of Merk Investments told the Washington political publication.

"It's the fastest way to secure the system," he said.