Can we have a reasonable conversation about nationalization?

There's talk of short-term bank nationalization to get us out of our economic crisis.  Essentially, the governments would step in and take over the banks for some period of time, in order to break the current vicious circle of banks refusing to write-off their bad debts because they want the capital cushion in place to do so, capital they can't get because of the bad debts on their books.

Unfortunately, the discussion of nationalization, a process that has worked elsewhere (Sweden being the most bandied about example) is rife with ideological hyperbole that threatens to maintain our grossly unequal status quo.  From the above NY Times article, my emphases:

Moreover, Mr. Obama’s advisers say they are acutely aware that if the government is perceived as running the banks, the administration would come under enormous political pressure to halt foreclosures or lend money to ailing projects in cities or states with powerful constituencies, which could imperil the effort to steer the banks away from the cliff.

“The nightmare scenarios are endless,” one of the administration’s senior officials said.

I'm sorry - halting foreclosures is a "nightmare"?  Aide to states too?  Have you seen the budget cuts that states are proposing?

The proposed cuts [in California] would mean that money for the state's university systems would decrease. Transportation and schools would take a hit. Funds for regional centers that help treat developmental disabilities in babies and toddlers would decline. Cash to help the elderly, blind and disabled keep up with rising food costs would be slashed.

God forbid we reverse these current economic trends!  Who needs good schooling, functioning buses and roads, treatment for developmental disabilities or money for groceries?  Toughen up people!

Seriously, I'm so tired of this "Americans don't do that" kind of thinking - it's what got us all that nonsensical "Eww!  Socialism!" mouth-breathing during the election.  I'm trying to believe the hype that Obama represents a shift in our political approach (though a baseline of "making government work" is a bit weak for me), but that involves taking bold action.  Action such as - gasp! - taking a cue from those chilly social democracies overseas, those utopias of women's representation, extended family leave, and an expansive social safety net overall.

I know, it's crazy talk - apparently we Americans just luv our frayed and shredded safety net just fine!