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February 18th, 2009
05:58 PM ET

Should U.S. banks be nationalized?

From CNN's Jack Cafferty

The idea of nationalizing struggling U.S. banks is starting to pick up steam, even among some Republicans.

Should U.S. banks be nationalized?

Some in Congress favor nationalizing the banking system.

Senator Lindsey Graham tells the Financial Times that many of his colleagues, including Senator John McCain, agree that nationalization of some banks should be "on the table." He says many people think it just doesn't make sense to keep throwing good money after bad when it comes to institutions like Citibank and Bank of America. Graham says people shouldn't get caught up on the word "nationalization" that we can't keep funding what he calls "zombie" banks without the public taking control.

Several people, including President Obama himself, have pointed out that's what the Japanese did, and they never really got credit flowing. The president has said he's leaning more toward the "Swedish model" – where they nationalized the banks and then auctioned them off once they were cleaned up.

The administration is opposed to nationalization in principle. Treasury Secretary Geithner has said "governments are terrible managers of bad assets", but the way things are going there may be no choice.

In fact, we are already on the road to nationalization when you consider how much money the government has already dumped into this nation's banks. According to the Treasury Department - about 400 banks in 47 states have gotten government aid since the program started in October.

And when the banks begin to report first quarter earnings in a few weeks, the decision may be made for us.

Here’s my question to you: Should the U.S. to nationalize its banks?

Interested to know which ones made it on air?

Leroy in Jersey City writes:
Jack, You can’t use the “N-word.” If we N-word (Nationalize) the banks, then comes Socialism and Marx. We might as well lay down our arms and fly the Russian flag. Never, never should we “Nationalize” the banks. Now, maybe we should “Re-structure” the banks—that is, take over the insolvent financial institutions that fail the “stress test.” We fire the management that created the mess, then sell off the positive assets in an orderly fashion, trash the toxic assets, send the shareholders packing. Then eventually, resell the healthy bank back to the private sector. That is a far better solution than trying to prop up the private zombie banks that do not have the nation’s interest at heart.

Cali from Chattanooga, Tennessee writes:
Jack, Let the banks go belly up and the car companies. We will learn to live without our credit culture only if this is done.

Bob from Morristown, New Jersey writes:
It would only take one nationalized bank as a warehouse for the toxic assets and a conduit for putting taxpayer provided funds into the credit market to break the logjam, and get the private banks lending again.

Robin writes:
The banks should have been nationalized immediately. All assets of CEOs and higher ups should have been frozen. All monies received from illusionary profits be returned. Why are taxpayers bailing out these banks when the proceeds from this disaster are sitting in the perpetrators' bank accounts?

Jim from North Carolina writes:
Jack, If CNN's ratings drop below sea level, I promise you that you and Wolf would be looking for another Situation Room. You guys would not be bailed out. The same goes for every facet of our society. If the truth could be told, the American people do not believe in rewarding failure. Unfortunately, that is what we are seeing every day.


Filed under: US Economy
soundoff (132 Responses)
  1. CJ in Roanoke, VA

    It's only a matter of time before there is no choice to nationalize certain banks. The stocks of Citibank and Bank of America are trading like they are going to be nationalized. If they mark to market the assets on their books, they are essentially insolvent. I personally wouldn't mind if they did go under and someone buys up what remains. That is how capitalism is supposed to work, but it would really shock the financial system and that's why it will not happen.

    February 18, 2009 at 1:06 pm |
  2. Russ in PA

    Of course they shouldn't be nationalized; let them go through either Chapter 11 or 7 as they should, then the bad debt will be liquidated, and those that mis-manage will pay the price they so dearly need to pay. Trying to bail them all out with borrowed or tax payer money will just feed the monster even further.

    Let them go through the process! To do otherwise is nonsensical.

    February 18, 2009 at 1:06 pm |
  3. Kevin in Dallas, TX

    Absolutely not. The only people more irresponsible with our money than our banks is our government. What the government should do is pass legislation to help create entirely new banks, and let the banks that are not strong enough to survive die off.

    February 18, 2009 at 1:07 pm |
  4. Dave, Brooklyn, NY

    I’m a conservative and do not like the idea of socialism, but when a bank operates in such a completely irresponsible way as they have, perhaps this is the time to take over control of them until we figure out something better. Either that of toss the jerk CEOs out on their ears sans golden parachutes and replace them with conservative executives.

    February 18, 2009 at 1:17 pm |
  5. Conor in Chicago

    I have heard convincing arguments in favor of this. I have also heard economists essentially say that this is the only realistic option left so we might as well do it now instead of giving insolvent entities more money to pay for their summer vacations since that is the ONLY thing more money to them is going to do.

    February 18, 2009 at 1:21 pm |
  6. Jeanette Zinke

    Interesting concept. We know the banks cannot be trusted to do what is right on behalf of the people they serve. Thus, putting the control of the banks into the hands of the government is an oxymoron.
    If our government wanted to help the people, they would just put the cold hard cash into the hands of the people and let them pay their mortgages, car payments and basics like food and clothing. By-pass the greedy banks, car companies and lenders and let the people save themselves which will just happen to stimulate the economy through spending. It's really not that complicated. I'm so disappointed that Obama just doesn't understand the obvious.

    February 18, 2009 at 1:22 pm |
  7. David in Granville, Ohio

    Coming from Europe, nationalization is not a four letter word for me. Many will say government cannot run institutions effectively, but can it really be any worse than the bums who are causing this world-wide meltdown right now?

    Nationalize the banks, remove the toxic asets, replace the current bunch of non-executive executives, and then re-privatize once the economy is turned around again.

    February 18, 2009 at 1:28 pm |
  8. Frank Canada

    Canadian financial institutions are regulated with a 1500 legislated document with rules and regulations and penalties for those who fail to comply. Canada ranks #1 the world wide banking rankings and still needs a lot of fine tuning to stem their greed.

    These regulations in both Canada and the U.S. should limit the amount of interest charged on credit cards to 5% above bank prime.

    This will put an end to loan sharking and giving out credit cards to people who can't afford them and/or keeping credit limits on these cards in accordance with their ability to pay.

    Doing this properly would eliminate the need to nationalize the banks.

    February 18, 2009 at 1:43 pm |
  9. Rob of Brooklyn

    well if that means people are watching them. Yes. They can't seem to manage themselves .And why should we have to keep bailing out people that are idiots - they don't seem to know how to run a business. But they do know how to misuse our money for themselves

    February 18, 2009 at 1:54 pm |
  10. Paulette,Dallas,PA

    Seems like they need to be temporarily.

    February 18, 2009 at 1:54 pm |
  11. Stacy from Leesburg, VA

    This is a tough one Jack. The thought if nationalization of any business is a scary one for Americans. But with the banks’ collective inability to function, what other choices are there? We handed them a blank check with no restrictions and they turned around and blew through that. Now they want more? That makes me more nervous than a long tail cat in a room full of rocking chairs.

    February 18, 2009 at 1:55 pm |
  12. sean brizendine

    unfortunately we might not have any choice but too nationalize them but it needs to be temporary because the free market will be affected and that means everyone will loose in the long run.
    "sean in santa rosa"

    February 18, 2009 at 1:56 pm |
  13. John in Santa Barbara, CA

    With the bailout, we are nationalizing the banks de facto, de jure is all about just doing the paper work.

    February 18, 2009 at 1:57 pm |
  14. Jack in DC

    Jack, if the major banks will not survive without government takeover, then by all means, NATIONALIZE them. Of course, the ideologically blind and the republicans on 'automatic' will cry socialism, but its something worth looking at. It's not ideal but if it will save the country from going back to the stone age, then I'm all for it.

    February 18, 2009 at 2:04 pm |
  15. Tom, Avon, Me, The Heart of Democracy

    Absolutely. The tail has wagged the dog into this predicament. The power of banking and finance was checkmating all the safeguards that had out of necessity been put into place.

    Only if banking is subordinate to our federal government will we have a democracy. People like Graham, and all the Republican foolishness of deregulation, free-market, and the invisible hand should be laughed off the stage.

    February 18, 2009 at 2:05 pm |
  16. Tom in Desoto Texas

    If worst comes to worst yes. What are the alternatives?

    February 18, 2009 at 2:24 pm |
  17. Ken in Seattle

    Nationalizing them is a huge step, which should only be taken as an absolute last resort. However, the banking industry apparently is incapable of effectively managing itself, even with hundreds of billions of taxpayer dollars to help them. The banking industry is like someone's good for nothing brother in law. They will misuse the money you give them and then will be back for more, again and again. If you feel you have to give them money you have to take charge of their checkbook.

    February 18, 2009 at 2:28 pm |
  18. Ron in Ohio

    If they don't reveal where tax money is spent and/or if abuse become evident, then nationalize each independentally depending on those results. Bonuses are abuse when your company lost billions. Retreats and such are abuse. Meet in the company conference rooms for crying out loud. If the bank holds onto funds and won't lend, then nationalize. If nationalized, heal the bank and resell it in a few years for a profit to reduce the deficit.

    February 18, 2009 at 2:32 pm |
  19. Agnes from Scottsdale, AZ

    Jack, I don't like it, but if nationization is the only way to make this work, so be it. The arrogance and lack of performance on the part of the large financial institutions are what helped us get into this mess. If they can show that they can act responsibly, then let them show it and be exempt from nationalization. Otherwise, their chopped liver!

    February 18, 2009 at 2:32 pm |
  20. Mack in Traverse city Michigan

    Hmmm get the loans from the government to the consumer and skip the middle man? BRILLIANT!!!!! Now lets talk about the insurance industry and maybe we the people should build a couple gasoline refineries too while we're at it. Capitalism as we know it is great but how do we know it couldn't be better. We cannot afford to be stuck in a mindset that this democracy and this system has evolved as far as it can.

    February 18, 2009 at 2:40 pm |
  21. Mike, Albuquerque, NM

    The banks that recieved TARP should be taken over by the state. Then reorganized. Then resold in IPO's. This is the action that Sweden took when their Banks failed. It worked.
    As for the Federal Reserve, the fed should never have been independent. The constitution specifies that our money is to created and controlled by the government. Let's heed our founding fathers wisdom.

    February 18, 2009 at 2:46 pm |
  22. V.K. Raman, Sparks

    I like U.S to study how Mrs.Indira Gandhi, the then Prime Minister of India went about to nationalize major 14 Indian private banks and how those banks are being managed by professional managers now. May be we can learn a few lessons. The service with all the nationalized banks in India is pathetic and none of them show concern for customer satisfaction.

    February 18, 2009 at 2:50 pm |
  23. JW in Atlanta

    I would say yes...but temporarily. We're funding them anyway. Time to wipe out the hyper-bonused layer of banking and get back to what that industry is all about in the first place. This is not an industry to make little well-born Faunleroys rich. This is a service industry that intermediates, maximizes and facilitates the use of money. Right now it's not doing that. So let's just take it over, make the system safe, reinstill confidence, stabilize the monetary system, then slowly re privatize to a wiser and more moderately compensated bunch of overseers.

    February 18, 2009 at 2:54 pm |
  24. WilliamTell

    Here you go, another change for America, Swedish banking service by way of Nationalization. What is next, Nationzation of oil and Gas, Supermarkets, Hollywood... When will it end...The power at be (President Obama) is striking fast and hard to make our country more and more socialistic. Change we can count on. Yep...

    WT
    Buffalo, New York

    February 18, 2009 at 3:24 pm |
  25. Ron Kepics

    Hi Jack:

    I doubt the government has the appropriate talent to run the banks. First they have to get rid of half the law makers in this country and replace them with responsible, credible, and dedicated public servants. Only then would I trust the government to run the banks. Of course we can't trust the bank the way they are currently. So I guess it's a toss up. Got a quarter??

    Ron San Diego

    February 18, 2009 at 3:30 pm |
  26. Lynn, Columbia, Mo..

    Geithner's Republican ideas helped get us in this mess. They need to go back to Teddy Roosevelt's antitrust laws. "If they're too big to fail, they're too big to exist". Nationalize them, break them up into smaller companies and then sell them off with new regulations. I think that's the only way it will work. If not, then Sweden had the right idea. As for nationalizing, the gov. can't do any worse than what has already been done, although I don't have much confidence in them either.

    February 18, 2009 at 3:31 pm |
  27. Mark, Warwick RI

    I cannot, for the life of me, understand why we have become convinced that failing businesses – which is what banks are – need to be saved. They will all eventually fail, and replacements will always emerge. The vulnerability of any and all businesses is a tenet of capitalism, and as such we will be forfeiting our economic system if we make any business enterprise immortal. Do not do this, to any industry, ever.

    February 18, 2009 at 3:35 pm |
  28. Patricia

    What a scary question Jack. We know the CEO's of these banks couldn't stop themselves from causing great hardship on their customers nor their shareholders. Yet, our government is sadly lacking in people with the knowledge to run banks properly. We can't trust the CEO's because they've proven to us we can't, & maybe we can't trust some of the government agencies who allowed the banking industry to become the cesspool it is,(Chris Cox deserves alot of blame for this). But, I'm willing to give this a chance.
    Patricia
    Palmdale, Ca.

    February 18, 2009 at 3:57 pm |
  29. Stacy, Fairfax, VA

    Whether we nationalization the banks or not, we need to fix the underlying causes for the collapse in the first place.
    First, we need to establish rock solid SEC oversight on financial institutions and security rating agencies. We also need an overhaul mortgage lending practices, so that people aren't offered and enter into unrealistic mortgages.
    If we don't fix the causes, we will only end up here again in the future.

    February 18, 2009 at 3:58 pm |
  30. gail Centre, Al.

    I would tell Obama that we are not the japanese. The banks didn't do what they were supposed to do the first time, Why in heavens name would you give them more money. Nothing has made any sense congress has done, and their still wasting our money, giving them more and more. Somebody grow a brain.

    February 18, 2009 at 3:59 pm |
  31. AndyZ Lynn, MA

    Nationalizing banks is only treating a symptom and treating symptoms is the way modern medicine works so we are very comfortable with the process. We need an in depth root cause analysis of the way America conducts business. Remember the Michael Douglas character in the movie, "Wall Street?" "Greed is good." We believed him and look where we are today. Maybe greed isn't all that good. We are at a cross roads. America needs to determine if it has a conscience and heart or are we just about the money? Business has made their answer clear.

    February 18, 2009 at 4:20 pm |
  32. Karen - Missouri

    Well, it's obvious that the big banks know nothing about accounting...ok, they know CREATIVE accounting. If the big institutions don't know how to run a bank successfully when they're supposed to have "top notch" people...well, fire them all so they have time to go back to school, they certainly need to. The party is OVER!

    I don't care if banks are nationalized if it means someone can take care of our money without the GREED and over-salaried employees and CEOs taking it all. No wonder all our products and services cost so much! While you're at it, take some of the healthcare industry's CEOs!

    February 18, 2009 at 4:20 pm |
  33. bill in PA

    Jack,
    Yes, we should nationalize the banks. We would save money.
    We the U.S. taxpayer would then get something of value for the hundreds of billions of dollars we are giving the banks. Just nationalize them as was done in Sweden and in a few years we can sell them to the highest bidders at a profit. In the mean time we can save billions in CEO costs and restart the lending necessary to get our economy started again. What we are now getting for our tax dollars is very hard to see. While the follies and crimes of the current financial leaders grows daily.

    February 18, 2009 at 4:37 pm |
  34. Bob

    Jack,

    We might as well. In our country's short history we have proof positive that un-regulated capitalism does not work.

    New lenox

    February 18, 2009 at 4:50 pm |
  35. Hubert Bertrand

    I think we need to keep an iron hand on the banks.Any time we give them slack they take advanage and cheat.

    February 18, 2009 at 4:52 pm |
  36. C. Farrell, Houston, Tx

    I wouldn't bank on anything Senator John McCain or is buddy Lindsey Graham say regarding finance. Both seem to be hell bent on failure of the Obama administration.

    February 18, 2009 at 4:53 pm |
  37. Esther Princess of the great state of Ohio

    good idea take away the profit and greed and give it to the citizens of this country instead the money is legal tender of the united states not of bank of america or us bank or key bank. its property of the united states of america and we should have the rewards for it not share holders but the citizens of this nation which spend and spend to make this country what it is

    February 18, 2009 at 4:54 pm |
  38. Keith

    Yes a "nationalized" bank. I should be able to have the option to bank with the government. That way I can get the greatest interest rate on the planet, The longest term mortgage on the planet and the most secure banking on the planet and have one less thing to worry about. This way, if the government fails, I fail with them and not with some banker that lives on park avenue.

    February 18, 2009 at 5:03 pm |
  39. rpb Viburnum Mo

    Lets see the Federal Reserve already dumped two trillion into the banks and the bailout was seven hundered billion and they still need more I would say they are already nationalized.

    February 18, 2009 at 5:09 pm |
  40. Gwen Bell

    Heck no, don't give them any more they will never stop asking. Use the money to back up their retirements and create green jobs to put the laid off workers back to work.

    February 18, 2009 at 5:13 pm |
  41. NY Jett

    Don't the people run them now? F.D.I.C. + Bailout = Government

    February 18, 2009 at 5:17 pm |
  42. Richie in South Dakota

    In actuality the banks are already nationalized, same as the auto companies along with the agriculture industry and military contractors. The only difference is that the control is done through back doors with subsidies and tax breaks that allow the US government to push companies in any direction they feel is neccesary.

    The only change we would see if we "Officially" nationalized our banks would be that the government would take a more direct approach under the judgement of the public view. For this reason I back the decision to nationalize our banking system for the time being, so that any decisions made to control them would have the potential to be made in clear view of public criticism, instead of controlling the banks behind closed doors.

    February 18, 2009 at 5:54 pm |
  43. Mellie

    Why stop at nationalizing the banks? Why not nationalize the airlines, the car companies, phone companies and cable (I'd love to have free cable)? Let's nationalize the hospitals and pharmaceutical companies too! Let's just do away with that silly notion of expecting companies to turn a profit. After all, turning a profit and acting responsibly are just so old-fashioned these days.

    Mellie, Phoenix, Arizona

    February 18, 2009 at 5:57 pm |
  44. Gary - Woodhaven, Michigan

    Sure.

    There is no greed, deception, bureaucracy, mismanagement in government.

    Wait , that is government.

    On second thought, no, let the failing banks be taken over by the stronger banks as it should be.

    February 18, 2009 at 6:02 pm |
  45. Scott in Canada

    The Swedish system seems way too logical for me to say no.

    February 18, 2009 at 6:02 pm |
  46. john stroudsburg pa

    No The banks need to be put through bankruptcy. Then this country should go to the credit system as outlined in a little known document THE CONSTITUTION! That is the answer to our problems and no one sees it. Someone needs to address this option because all these bailouts have not and will not work.The worst is yet to come

    February 18, 2009 at 6:02 pm |
  47. Purnell Kankakee lL.

    What are you talking about we bought them already didn't we, they are already nationalize because we own them!

    The old system is completely broken so stop trying to save it, build a new that has real rules and guidelines. The leaders of these companies that have failed, and only care about filling their pockets with the people’s money, cut them off and start over before we lose everything! It does not make sense to keep doing the same procedure over and over and then expect a different result to occur!

    It’s that also the definition of insanity?

    February 18, 2009 at 6:05 pm |
  48. LeRoy in Jersey City

    Jack,

    You can’t use the “N-word.” If we N-word (Nationalize) the banks, then comes Socialism and Marx. We might as well lay down our arms and fly the Russian flag. Never, never should we “Nationalize” the banks.

    Now, maybe we should “Re-structure” the banks—that is, take over the insolvent financial institutions that fail the “stress test.” We fire the management that created the mess, then sell off the positive assets in an orderly fashion, trash the toxic assets, send the shareholders packing, then eventually, resell the healthy bank back to the private sector. That is a far better solution than trying to prop up the private zombie banks that do not have the nations interest at heart.

    February 18, 2009 at 6:05 pm |
  49. Matt

    Jack,

    Geithner is only partly right. governments are usually terrible managers of even good assets. I think we can find a way to invest the funds they need, attach some restictions, and make sure that taxpayers get a payoff when / if they begin to turn a profit.

    Matt,

    Sheboygan, WI

    February 18, 2009 at 6:08 pm |
  50. cheryl

    we should not nationalize the banks or anything else. Let them fail. Why prop up institutions that made bad loans and didnt manage their businesses. Why do we continue to applaude failure? We promote those who cannot read and make those who cheat on their wifes and dont pay their taxes top government officials.

    February 18, 2009 at 6:10 pm |
  51. Brian - Detroit

    Nationalize banks? Nationalize health care and we'll talk.

    February 18, 2009 at 6:10 pm |
  52. Helen in Texas

    Yes, the U.S. should nationalize the banks!

    February 18, 2009 at 6:11 pm |
  53. Moira

    Oh, sure. The banks are in trouble, so put them in the hands of the people that brought you FEMA.
    I wonder if the federal government can handle yet another administrative nightmare – their hands are pretty much full as it stands.

    Moira from Worcester, MA

    February 18, 2009 at 6:11 pm |
  54. Liz, Windsor, Ontario, Canada

    Like you said, the decision may be already made for the U.S. – it may ne necessary to nationalize the banks at least for now.

    February 18, 2009 at 6:11 pm |
  55. Nate Hill

    No, we should not nationalize the banks like Sweden. Let's not forget that Sweden is a socialist country. We should avoid the impulse to migrate away from a pure democracy. Lawrence, KS.

    February 18, 2009 at 6:11 pm |
  56. Tara

    In lieu of nationalizing banks, perhaps we can have a nationalized fixed mortgage interest rate of, say, four percentage points (4%). This would allow ALL homeowners who hold conventional loans on their homes to re-finance to a fair and stable fixed interest rate. Not all homeowners are "under-water" with their mortgages, but most are paying rates higher than 6 percentage points, while the prime is currently at zero (0%). A statutory federal interest rate is what this country needs now. Such a proposal would be similar to statutory post-judgment interest rates and would be fair to all across the board.

    February 18, 2009 at 6:11 pm |
  57. Eric

    Definitely not. Banks should never be nationalised, it's not the role of the Federal government to interfere with private businesses. Moral hazard is a problem, it says you can screw up but we'll take care of it. Let them fail as an object lesson to the rest, and get the Federal government out of the economy.

    February 18, 2009 at 6:11 pm |
  58. Andrew

    Theodore Roosevelt provides the answer to this question:

    "The things that will destroy America are prosperity-at-any-price, peace-at-any-price, safety-first instead of duty-first, the love of soft living, and the get-rich-quick theory of life."

    This recession is a prime example of the People abdicating their responsibility to pull themselves out of a mess and throwing themselves upon the mercy of the Government.

    There are winners, there are losers, and not everyone gets to be an astronaut. America needs to wake up and remember that.

    February 18, 2009 at 6:11 pm |
  59. Aaron in St. Louis

    These banks are out of control, and have been taking advantage of people for years. They need to be reigned-in. So if that what it's gonna take Jack, so be it.

    February 18, 2009 at 6:12 pm |
  60. Cali

    Only if they quit giving out credit to everyone. Only then can we learn to live within our mens

    February 18, 2009 at 6:12 pm |
  61. Phil

    Nope, let them fail. Taxes should not be used to bail out any failing business.

    When did the USA become so afraid of capitalism anyway?

    February 18, 2009 at 6:12 pm |
  62. Bill Brush

    Its time for Senators Lindsey Graham and John McCain to wake up–nationalization already occurred for our major banks when Secretary Paulson purchased ownership stakes last December to infuse cash to free up credit markets. You have to wonder if Congress really gets it–they clearly don't.

    February 18, 2009 at 6:12 pm |
  63. Chuck Butler

    Yeah Jack, let's nationalize the banks. Let's also tear down the Jefferson memorial and build one for Karl Marx. Let's pretend that Capitalism and Socialism are really the same thing, and that we're just as "free" under either system. And let's pretend that Ayn Rand never wrote "Atlas Shrugged" to warn us about what would happen if we went down this path . . .

    February 18, 2009 at 6:13 pm |
  64. V. Korenke

    Yes, they should be nationalized. If the wealthy want to call this socialism, they can go get their money out of the Swiss Banks and leave.

    February 18, 2009 at 6:13 pm |
  65. Don - from New Jersey

    No Nationalizaton please. Enough of the bailouts already. Let the banks and the auto companies fail. There will always be someone to buy up the good assets. Isn't that what capitalization is?

    February 18, 2009 at 6:15 pm |
  66. Ann

    I worked for both Ctibank and Bank of America years ago. I was sick to my stomach when I saw the CEO's in congress trying to defend themselves. I wanted to slap them. They have fleeced American, these banks have finally been exposed and caught with their hand in the till. Americans don't feel safe with banks. Take care watch them these executives are not what they pretend to be. Please America hold bank CEO's accountable they are a greedy unscrupulous bunch.

    February 18, 2009 at 6:15 pm |
  67. Wesley M. Campbell

    Maybe now disabled veterans can get a home at no more than 3.25% over a 30 year fixed mortgage so they won't be technically homeless and disabled compliments of the U.S. government! This ought to be their piece of the action in the stimulus, if not , what would be?

    Wesley Campbell
    Rockford, IL

    February 18, 2009 at 6:15 pm |
  68. Matt

    Nationalize the Banks? You bet!

    What with all the Perks, Golden Parachutes given to themselves, these so-called CEO'S of the Banking Business are a joke. Get rid of them.

    Greed has become very BAD!!

    Over and out.

    Matt

    February 18, 2009 at 6:18 pm |
  69. Chuck from Charleston, SC

    You think we have bad service at banks now? Wait until they are nationalized, then try to get credit or make a secure transaction. Let's get real here, have you been to the Post Office lately, been in line to get a Driver's License, how about a building permit , or try to get a live voice to answer if you call the IRS or any other gov't office? I've been a gov't worker for over 20 years, the gov't could care less about you or your money, so let's give them more of it and more control over it! Wow! What a fantastic idea that would be!

    February 18, 2009 at 6:18 pm |
  70. Matt in Stafford, VA

    I had great faith in the free market system until the post-bailout era. The bank heads had an opportunity to fix the system and get money moving. Instead, we found ourselves paying for CEO bonuses, private jets, and thousand dollar commodes. The bankers have proven that they cannot handle receiving large sums of money. Nationalizing the banks is the last option remaining, so long as it is a temporary measure.

    February 18, 2009 at 6:18 pm |
  71. Franklin Lay

    The current collapse of our economy is evidence of the failure of the private capitalistic system. Not only should the banks be nationalized, but the auto industry, drug and oil companies. It is interesting to note that during the time when we were paying $4.00+ for gasoline you could go across the border to Mexico and pay $2.50 per gasoline. You can also buy drugs in Canada at about half the price.

    February 18, 2009 at 6:18 pm |
  72. Spastica Rex

    Maybe nationalizing the banks won't help. Maybe nothing will help. Maybe people borrowed too much and spent too much and now we have to pay for it. Maybe, since we don't have the money to pay for it, we'll all just have to learn to live with MUCH less. Maybe the American Dream is done. Maybe capitalism is a failed economic religion, just like communism was a failed economic religion. Probably makes the true believers angry to even consider it.

    February 18, 2009 at 6:18 pm |
  73. john

    The problem with nationalizing banks is we have no experts that the US should trust to run it including our own government. Perhaps we should outsource our needs to Canada with the strongest banking system in the world. I would think stronger controls and oversight over our banking industry is better than nationalizing.

    February 18, 2009 at 6:18 pm |
  74. Jeff from Texas

    Once they become nationalized they will never be privatized again.

    February 18, 2009 at 6:18 pm |
  75. Norman

    The large banks should definitely not be nationalized. We need the traders and others who are shorting the share price and ruining market capitalization of the banks because this is preventing lending to be stopped. And we also need the doom saying commentators who seem to be acting on some aganda to nationalize Citi and Bank of America to stop their chatter. Do they have inside information? All this is counter productive to solving the economic situation. .

    February 18, 2009 at 6:19 pm |
  76. horton jennings

    Good question, Jack. But who do you trust to answer that question?
    Lindsey Graham? John McCain? Wolf Blitzer? Jack Cafferty?

    Can we trust Greenspan's judgement? Get real!

    How about the CEOs of Citi, Wells, Chase, Goldman Sachs?

    The problem with nationalization is who is going to run those banks. RIchard Shelby. Schumer. Barney Frank. Nancy Pelosi. Eric Cantor? Just Who?

    I have to say for the moment the Obama team of Summers, Bernanke, Geitner and Obama are are a better team than any of the above in my view. So I've answered the question for you.

    Horton Jennings

    February 18, 2009 at 6:19 pm |
  77. Nick - Great Falls, VA

    Depends on what you mean by "nationalized". Is it by the nation monopolizing the banks or just an effort to buy up toxic mortgage loans? What I happen to be concerned about is whether FDIC can guarantee the money in my checking, savings, and IRA should something go wrong with my bank. I also agree with Bill Maher when he says in "New Rules" on an episode of "Real Time" that banks shouldn't solicit ID protection because that should be the bank's job. It's bad enough I have been solicited ID protection and credit cards I don't need. Banks should only give me what I ask for, and nothing solicited to me that I don't need. I have already told my bank to mark my accounts for no soliciting, however, they seem to find loopholes around that by mailing and e-mailing spam. Indeed, banks should be more responsible for my money than I usually am, but that's not always the case since I get solicitations and the loopholes thereof, as well as the toxic mortgages issued for those naive enough to think they could buy a home or car with any credit. If people were more fiscally responsible like me among many other reasonable and average citizens, there wouldn't be such fiscal wrecklessness in spending $10 billion a month in Iraq and offer faulty mortgage loans. Why can't the government and banks be more like the rest of us?

    February 18, 2009 at 6:19 pm |
  78. Jean

    I definatly feel the banks should be nationalized. They need to be monitored or babysat for a while. I think they got so many people in mess, that they should'nt be trusted. The banks recieved money and wouldn't start lending to those who really needed it ! What are they proving now. Those bad loans are there because of them. They need a reality check! President Obama had to show his authority on the subject already. Now wasn't the time for them to get greedy and hold on to the cash, for themselves. I think the rules pertaining to morgages, need to be restructured so this never happens to Americans again.

    February 18, 2009 at 6:19 pm |
  79. Francois

    Jack,

    When an individual invest in a venture, s/he has a piece of this business. It's a business principle largely teached in College.
    I do not think it is proper for the tax payer to dump billions of dollars in banks, industries and other big business, but get nothing from that. Nationalization would help solve this contradiction. If not Nationalization, we should see coming at least a fair coperation between tax payers who mandate the government and the private sector that should include the workers and the public. That would be called the democratization of the assets. The name itself would define the endeavor as democracy at its utmost.

    February 18, 2009 at 6:19 pm |
  80. Danni

    Let’s say that we do nationalize, who’s gunna run the show. Im sick and tired of hearing about Sweden nationalizing there banks, Sweden is smaller than the state of Georgia, and how can we even imagine nationalizing our banks across 50 states. The only thing I believe that would save our banks is if we can save the real estate market and the solve job situation.

    Danni
    Upland Ca

    February 18, 2009 at 6:20 pm |
  81. Kyle- DuPont, WA

    Jack, it’s probably not a bad idea. It seems to me that the major cause of our current economic crisis has been greed and over inflated executive salaries. Why not create a cabinet level position, perhaps the Department of Banking and Finance, and limit salaries to the same GS/SES schedule that all government employees follow. This would make the banking system’s bottomline the health of the economy and not its profit margin. Additionally, we could nationalize the debt and pay ourselves off.

    February 18, 2009 at 6:20 pm |
  82. stephen mial

    In light of the multi faceted dilemma of the financial component of our economy it seems apparent that we should at least nationalize one single US Bank with a mandated sunset which would shut it down or sale it to a private firm/entity at the end of this current economic crisis.

    Steve M
    Clifton, VA

    February 18, 2009 at 6:20 pm |
  83. Frank

    why are we even wasting time on these small banks like Bank of America or Citygroup? We need to nationalize the FEDERAL RESERVE (If you thought the federal reserve was a gov't controlled entity, you are VERY wrong). The Federal Reserve is the MAIN reason we are in this situation. Please watch Money Masters and Zeitgeist. We are being clouded by a smoke screen.

    February 18, 2009 at 6:20 pm |
  84. Ben Campbell

    Mr. Cafferty,

    Yes I believe we should follow the Swedish model of nationalization. Or perhaps our government and the banks themselves can look to our very own American credit union system. Similar it is to the banking industry but it is a financial system that is owned by it's members. Which ever model is sought I believe time is of the essence. On the note of nationalization I must also through this idea out. Why do we not nationalize the things that Americans need to survive? Gas, electric, Natural gas. Would it not benefit the American people in the end? Just food for thought.

    Thank you,
    Ben Campbell
    Clintonville Ohio

    February 18, 2009 at 6:20 pm |
  85. Julius - Canada

    Nationalize the 800 pound gorilla in the room.
    Her name is Federal Reserve Corporation.
    It would be a good start.

    February 18, 2009 at 6:20 pm |
  86. Will Rodgers

    The banking industry is like a bad dog running amuck and pooping on the carpets of the American taxpayers. When you say No! they just look at you blankly and keep doing it. If nationalization is needed to train this dog, then for now so be it. Ironically, a real dog would get it before the banking industry ever would. Bad banks! Bad bad banks!

    February 18, 2009 at 6:20 pm |
  87. AP

    If they do nationalize the banks, what happens to the rank and file employees? Do they become federal employees?

    February 18, 2009 at 6:21 pm |
  88. Brent

    A private banking system is essential to the free market system. But since Obama and the Democrats are hell-bent on socializing our economy in the name of "saving it" (anyone remember "we have to destroy the villages to save them"?), private banks won't be needed.

    February 18, 2009 at 6:21 pm |
  89. Christian-André Schultz

    Obama said that he doesn't want "big" or "small", but "smart government". Nationalizing banks sounds like "rash government" that clearly gets over its head.

    February 18, 2009 at 6:21 pm |
  90. Spencer, Chicago Illinois

    Nancy Pelosi running our banks. That should get it straightened out!

    February 18, 2009 at 6:21 pm |
  91. Micaiah2004

    Bank's nationalized? No. Let the zombies DIE. Stop propping up all these dead, half-dead, weak, insolvent, incompetent banks, corps, individuals. Clean out the DEADWOOD. And we will recover faster.

    Imprison the crooked and corrupt politicians. That is a REAL Solution,

    February 18, 2009 at 6:21 pm |
  92. Allan Barstow

    In this case Steve Forbes is right! Nationalization is not necessary. But going away from wild-west, risky mark-to-market accounting is key. Banks can't loan when they immediately have to write off huge amounts because of mark-to-spun out of control-market valuations. Stop mark-to-market; bring back traditional comprehensive bank regulation!!

    February 18, 2009 at 6:21 pm |
  93. Mark

    Jack,
    Yes, we should nationalize some banks. Up and to this point nationalization has been a bad word. Investors would be the losers on this but they are also the ones that reaped the rewards during the good times. They should have jumped ship before it began to sink. Since the bad times rolled in, investors have been demanding taxpayer bailouts. The bailouts need to end.

    February 18, 2009 at 6:22 pm |
  94. Aaron

    Nationalize the banks? Are you kidding me? Everyone wants to look at the banks' books and see how they're doing. Anyone care to take a look at the government's books and see how they're doing?

    February 18, 2009 at 6:22 pm |
  95. Dave

    Nationalize the banks!? if we wouldn't have bailed them out in the first place, they would have gone under and new banks would be standing in their place right NOW. There would be no credit crisis. Same with the big three. What happens when you don't bail somone out? sure, they go under, but this is AMERICA, somone will scoop up the capital and give all those people their jobs back.

    February 18, 2009 at 6:22 pm |
  96. Chris

    Andrew Jackson would come back and haunt us all.

    February 18, 2009 at 6:22 pm |
  97. Kraig Archer

    Jack, rather than nationalization, we need a national bank. A national bank would ensure that credit would flow. This should be a temporary bank, until the financial system recovers. Alexander Hamilton created a national bank at a time when we had a lot of debt from the Revolutionary War. He wished to create a strong national currency. Why not make use of a meaningful lesson from our history.

    Kraig from Saint Clair, Michigan

    February 18, 2009 at 6:23 pm |
  98. greenguy

    Nationalizing banks is not a good idea, sounds like socialism talk which is one step from communism. When government controls too much we are not free. force them to restructure, bring back reluation and have more oversight. this will cost us more money by nationalizing bank, higher taxes will come. I prefer to keep more of money so I can decide how I want to spend it. I don't need the government to do it for me.

    February 18, 2009 at 6:24 pm |
  99. joe smith

    absolutely not; but look, the way the government has the banks tied up in regulation, one could say they already are..let the survivor of the fittest mentality fullfil itself..

    February 18, 2009 at 6:25 pm |
  100. Scott

    Do NOT give failing banks any funds. If the USA is to remain a capitalist society then the Darwinism assocaited with capitalism must be allowed ot run it's course. Adapt or die. Stronger, better run institutions will take their place. Provided thatthe Gov't has learned it's lesson and regulates (rather than runs) them, it will eventually be for the better.

    Take this same prinicple and apply it ot the auto industry.

    Sure there will increadible pain and suffering and restructuring that will take place as a result of this but better it be quick than prolonged through life support by funding.

    February 18, 2009 at 6:26 pm |
  101. Tony Hamelin

    Jack,

    The banks should be nationalized. It's the only way to free up the credit markets and ensure we the taxpayers get our bailout money back since the banks now are taking our money and hording it.

    "Capitalism is ok, but the capitalists are too damn greedy." President Taft.

    February 18, 2009 at 6:26 pm |
  102. FFG

    Ask the question, do you like the efficiency of the Post office, IRS and TSA?

    If the answer is yes, you will love nationalized banks…

    For the rest of us normal folks, we see this as a stupid idea that only self-absorbed narcissistic Washington- Insiders would like.

    February 18, 2009 at 6:28 pm |
  103. skeptic

    What about first establishing at who's at fault, and then prosecuting these people to the fullest extent of the law. Why are these people always getting away with this without penalty. Nationize if you must, but trusting the government to take care of it, is also dangerous. If the politicians hadn't been in bed with the bankers and big oil this wouldn't have happened in the first place. It may be time for all citizens to go back in time and not use the banking industry the way they have been used too.

    February 18, 2009 at 6:28 pm |
  104. Tara

    Yes! Let's nationalize the banks. And while we're at it the car companies too. Then maybe we can guarrantee useful, efficient, eco-friendly cars that average Americans can buy (and most importantly WANT to buy) and we'll have banks that are accountable to the working people of America and not the personal checking accounts of rich swindlers that we have now.

    Tara W. – San Francisco, CA

    February 18, 2009 at 6:32 pm |
  105. John Fortune

    Let's just do it and get it over with. We are never going to get out of this mess until that happens and the housing delima is fixed!

    February 18, 2009 at 6:32 pm |
  106. Terese

    I would say YES due to the corrupt banking currently affecting Americans. Chase Cardmember services has recently imposed a added fee of 10.00 (120.00 a year) to, what their associate said; 4.5 to 5 billion account holders like myself. This account payment has never been late and no default on my part. They call it a;
    SERVICE CHARGE* FINANCE CHARGE* . My fixed rate is not fixed any longer, it has doubled. This is wrong!

    February 18, 2009 at 6:33 pm |
  107. Peter

    Yes, our banks should be nationalized, but only temporarily!

    February 18, 2009 at 6:33 pm |
  108. Andrew - Derry NH

    We don't need to nationalize banks. A drastic overhaul of regulations and the ability to enforce such regulations is what we need. This is a small list of changes that must be done immediately.

    1) Complete elimination of ARM, Alt-A, interest only, and any other creatively financed loans. Fixed rate mortgages should be the only option for buying a home.

    2) More rigorous standards for who can qualify for a home mortgage including income verification over a multiple year time span and complete examination of ALL other debts.

    3) Credit card interest rates 3% over prime rate maximum

    4) Income verification and credit report examination should be done annually by credit card companies for all cardholders. Limits should be reduced or credit lines withdrawn for anyone no longer meeting standards.

    5) New standards for maximum amount a credit card company can charge you for fees pertaining to late payments.

    February 18, 2009 at 6:34 pm |
  109. Greg Taylor

    Jack,

    No need to nationalize the banks. Our free market system is designed to weed out poorly managed companies by forcing them into bankruptcy. We just need politicial leaders with the guts to let the process run its course. Already they have spent over
    $2 Trillion dollars baiing out the banks. But they'll only public acknowledge $750 billion.

    February 18, 2009 at 6:34 pm |
  110. David

    Look at what happened in Japan in the 90's. Something needs to be done and what we are doing is NOT enough. Nationalize some banks, remove the poor leadership, force serious rules on lending. No more handouts. If a bank or any company wants help they should be required to make sacrifices. All of the people are currently making them they should too!

    February 18, 2009 at 6:34 pm |
  111. Duck

    First, we should have let the big banks fail. Our capitalist friends would have taken their favorable actions. Secondly, there are many regional and local banks that are in great shape. Thirdly, let lending go global, there is no reason to have gate keepers on wall street. They have been protecting their asses as if it is a franchise. The government has been in the banking business before and it does not take skill or intelligence. Lastly, the bankers and investment bankers are simply in another world, slopping up the flow of cash without any value added or service. A dollar is simply a dollar.

    February 18, 2009 at 6:36 pm |
  112. Ives Russo

    I do support nationalizing all US banks. Also, I support our government controlling the money supply. It does not make
    sense to have civilians provide the money supply to America
    just to have us tax payers get stucked paying exorbitant interests on it. I am sure if put to vote, Americans will choose to have the Federal Reserve Bank abolished. No one is asking how we are going to pay for all the stimulus packages being approved which seems to be a never ending situation. We need to fix the real problem rather than
    try to temporarily cure its symptoms.

    February 18, 2009 at 6:36 pm |
  113. Suzy

    Unlike the auto makers, the banks need to be allowed to fall flat on their behinds if they can't run their business successfully. Why would I want to open a line of credit, take out a loan, or invest money with a bank that had to be bailed out? Let the strong survive!

    February 18, 2009 at 6:36 pm |
  114. Henry

    That's a ridiculous idea...Just imagine the anarchy if the government had been held to the same financial standard as these banks. Besides, the government (through creation of Fannie/Freddie and certain housing legislation) was partially to blame for the housing crisis and credit crunch...and now we want to give them total control.

    February 18, 2009 at 6:36 pm |
  115. Tom Insko

    If the government is going to force the banks to make more bad loans without the ability to securitize them, then they have to nationalize them. Welcome to Socialism, isn't this fun?

    February 18, 2009 at 6:36 pm |
  116. George in Texas

    let some successful banks buy the failing bank's assets at a bargain basement price and we all could be done with it.

    February 18, 2009 at 6:36 pm |
  117. Georgia Lockwood

    I am puzzled by the knee-jerk response to words like socialism. We don't care if it works in Sweden or anywhere else. We just hate those words. To me "socialism" has the connotation of banding together to help everyone in the society, but what do I know? I'd rather help pay for others' educations rather than whine for a tax cut. There is no civilization without taxes, a readily available public education, and an honest financial system, nationalized or not. How did large numbers of us start believing we could have everything and pay for nothing, while people poorer than us go without healthcare, food, and schools? We are angry that the banks took our money, but we have been worshiping excessive wealth for years, and the consequences are finally adding up. Why are we so surprised?

    February 18, 2009 at 6:37 pm |
  118. Robert

    If the Republican's hadn't deregulated the banks back in the 1990's, nationalization would not be required now! Have we learned nothing from the Great Depression?!

    February 18, 2009 at 6:38 pm |
  119. Steve, Houston, Texas

    People, people people – wake up! I can't believe anyone is even considering this idea. We shouldn't even bail them out, much less nationalize them. This is called SOCIALISM. This country is a democratic republic, with a free market economy. It's worked pretty well for a long time, and will keep working for a long time to come. I beg the government not to do this – don't ruin our may

    February 18, 2009 at 6:38 pm |
  120. Purnell Kankakee lL.

    Politicians have been whoring around with these Banks and Businesses for years now you want the John to take control of the bank, how funny!

    February 18, 2009 at 6:39 pm |
  121. Mr. Canada

    Socialist banks in America? What's next? Health care?

    February 18, 2009 at 6:39 pm |
  122. John, cumming, ga

    Do not nationalize. The govt is the reason Freddie and Fannie Mae are in the shape they are in! Let the banks collapse. They've got $200k in FDIC insurance now until the end of 2009. See if they can make it on their own. Not every bank in America has these problems. That's where capitalism prevails! Very similar to nature, the strong always prevail over the week. Nobody likes BOA anyway, so who really cares if they falter. I just wish these goons in Washington would let things play out and quit trying fix things that they created.

    February 18, 2009 at 6:40 pm |
  123. scott

    Coming from someone who works for a bank that has not needed 1 dime of stimulus money or engaged in any risky or predatory lending I say the answer is NO. Financial institutions that were not run properly will pay the price in a free market and those institutions that were responsible will reap the benefits. Nationalizing the banks will only provide our government another opportunity to prove their ineptitude (which has happened time and time again, see social security for starters). Nationalizing banks will send this country down a dangerous path. Socialism is not the answer. The blame can be spread far and wide but this country as a whole needs to take its lumps and realize it is always darkest before the dawn. Our great country will come out of this mess just as we have in the past and in much darker times.

    February 18, 2009 at 6:41 pm |
  124. Purnell Kankakee lL.

    The time has come for the government to control it's own money and let the FED. go away, before we lose every thing!

    February 18, 2009 at 6:41 pm |
  125. Michael, Chicago

    Having spent most of my professional life working with (not for) the Social Security Administration, I can attest to the fact that you don't want the people who work for the federal government running our banking system, or much else for that matter. On the other hand, the banks have blown it big time. Something needs to be done and the idea of taking the banks over temporarily and auctioning them off later may be the only solution at this point. Let's not worry about lables and ideology and do what works.

    February 18, 2009 at 6:41 pm |
  126. Philip Pilgrim

    Suggestion:
    Why not put 100% of the stimulus into a brand new bank and into a brand new stock market that is regulated and let everyone migrate to it and let the others suffer the consequence of their actions through "natural selection".

    Real World Analogy:
    Rather than throwing money into restoring a crashed and badly damaged car, you have to write it off and buy a new one ASAP to continue commuting to your job or you spend a lot more time and money to revive the wreck and be stuck with a patched up beater AND not go to your job as you have to wait for the car to be revived.

    Philosophical explanation of what just happened:
    Man has evolved from hunters and gatherers to a regulated commerce based society, however; in the past 15 years the regulations were thrown out the door and unregulated greed, chaos and self-destruction took their predictable course. Remember what happened in school when the teacher left the classroom?

    February 18, 2009 at 6:42 pm |
  127. steven

    Jack,

    I live in canada, and we have "nationalized" banks, but in essence the government only dictates the risks the banks are allowed to take, and also limits the amount of debt they are allowed to incure that cannot be replaced with liquid assets. Even though the government controls the regulations the banks themselves are run by CEO's and boards, and are allowed to remain that way as long as they dont endanger the economic future of the country.. I cannot see why my American nieghbors couldnt adopt this system and finally control the rampant greed of the few that has destroyed so many lives of the many.

    February 18, 2009 at 6:43 pm |
  128. Dee in Florida

    I'd say that, after the huge bailouts, we (the people) pretty well already own the banks.

    Maybe if they were nationalized we could FIRE those CEOs and other money grubbers who put us in this horrible financial situation.

    And maybe we would NOT give them a golden parachute! Maybe we'd just let them fall where they fall!

    Sure would be about time.

    February 18, 2009 at 6:43 pm |
  129. Karen in CA

    I think the greedy corporations that run this country have continually proven that they cannot be trusted to make the right choices and do the right thing. It's human nature – when it comes to the almighty dollar and doing the right thing, most of them take the $$$ and run. If nationalization is what it takes to fix the problem and shove them all out on their behinds, then let it be. Some of these banks just need to fail, they have proven they can't and or won't not do the job as it should be done. The real crime is that the government sat back over the last few years and did nothing to stop this crises from happening. People saw this coming, anyone with half a brain knew that a sub-prime mortgage was a disaster waiting to happen.....but no one listened, there was just too much money to be made!

    February 18, 2009 at 6:43 pm |
  130. Paul B.

    Let's nationalize GM and Chrysler while we're at it.

    February 18, 2009 at 6:43 pm |
  131. Eriq

    Jack

    We need to Nationalize the banks befire they destroy themselves and the government and the taxpayers would make out better if the government bought the auto companies heck for what they're asking for in aid is moreless an inflated purchase price!!

    February 18, 2009 at 6:50 pm |
  132. John Meyer

    The US government has bought the banks so why shouldn't it own them outright?

    Make it official and take full control and then sell them back to the private sector when you find some honest people to run them.

    There is also the small matter of the $300 or $500 billion in excess management compensation to be recovered. Easier to do if you have full control of the books as opposed to asking the guilty parties for "full disclosure".

    John in Midland

    February 18, 2009 at 6:51 pm |