WASHINGTON – Former Federal Reserve Chairman Alan Greenspan thinks it’s necessary. His successor, Ben Bernanke, doesn’t rule it out. From editorial pages to the blogosphere to boardrooms, this is the question on many minds: Should the United States nationalize some banks?

“It may be necessary to temporarily nationalize some banks in order to facilitate a swift and orderly restructuring,” Greenspan, the long-revered sage of free-market theory, told London’s Financial Times in an interview published Wednesday. “I understand that once in a hundred years this is what you do.”

Banks are sitting on trillions of dollars worth of complex securities, backed by U.S. mortgages that are going into default as more and more homes are now worth less than the mortgages on them. If banks were forced to put present-day values on these securities instead of hold-to-maturity values, their liabilities would far exceed their assets. They would be insolvent.

Seize, clean up, sell

What’s needed, nationalization advocates argue, is for the government to seize Bank of America, Wells Fargo, Citigroup and other large banks, carve out their bad assets, then break them into smaller pieces for quick sale to the private sector.

“Nationalization is the only option that would permit us to solve the problem of toxic assets in an orderly fashion and finally allow lending to resume,” Nouriel Roubini, a prominent New York University economist, wrote in an opinion piece Feb. 15 in The Washington Post. “Of course, the economy would still stink, but the death spiral we are in would end.”

Other analysts think that nationalization is all but inevitable.

“It’s very hard when you get to this point not to do that,” said Adam Posen, the deputy director of the Peterson Institute for International Economics, a free-market research center. Posen thinks that nationalization is losing its stigma, and he envisions scenarios in which the government could seize the nation’s 50 largest banks.

Most depositors would be safe, since their deposits are insured up to $250,000. Stockholders probably would be wiped out, and bondholders eventually would get shares of any new company. The government could even make money on some seizures.

Roubini and Posen think that a bold, drastic step is inescapable, and that a failure to take it now would only make it costlier and more difficult later. Today’s problem is the $1.2 trillion in assets whose underlying collateral is shoddy subprime mortgages, which have eroded faith in the broader U.S. housing market.

For now, the Obama administration is mum on nationalization, other than a statement Friday from White House press secretary Robert Gibbs that “a privately held banking system is the correct way to go, ensuring that they are regulated sufficiently by this government.”

That stated a preference but didn’t rule out nationalization.

Senate Banking Committee Chairman Christopher Dodd, D-Conn., said in an interview Friday with Bloomberg that temporary nationalization might be necessary.

Nationalization was tried successfully on a smaller scale in Sweden in 1992 and Japan in 2001-2002, but it’s never been attempted in the United States in contemporary times.

The Obama administration began new “stress tests” last week, with regulators visiting major banks to gauge how they’d hold up if today’s recession became a full-blown depression. Nationalization advocates such as Posen think that this exercise is simply the Treasury Department laying the groundwork for bolder action such as seizing banks in the months ahead.

“Unless you put in government money and take control of management, the problem will get worse,” he said.