The most stunning comment of the weekend came from none other than Sen. Lindsey Graham (R., South Carolina), the hyperbolic, baby-faced, conservative “best friend” of John McCain and Joe Lieberman.

Sunday he told the world we must keep nationalization of the banks on the table as a potential solution to the banking and credit crisis.

Contrast it to President Barack Obama’s comment that nationalizing the banks as Sweden did is alien to our culture and traditions (but even he never quite said “never”).

The fact is, nationalizing the banks, at least temporarily, may turn out to be the most conservative way to save the entire banking system. The process will involve the federal government shutting down and taking over insolvent banks that cannot capitalize themselves on the private capital market—those that require federal bailouts to survive.

The government already has the power to shut down bad banks, but is loath to do so, especially because the bankers make a great mystery of their actual financial condition. Regulation is lax as security at Pakistan’s borders.

Instead of just handing over bailout funds—even with stringent strictures on the use of the money—the people of the United States shut down the bad banks, take them over and get an equity stake. This comes at the expense of the bank’s investors, but they were fundamentally losers anyway because their banks were insolvent shells. That’s why they weren’t lending in the first place.

If we simply hand the banks more bailout money, it’s the taxpayer, not the investor, who loses. Investors take a gamble buying stocks and bonds—and like any other gamblers they have to understand once in a while their horses will lose.

It’s the taxpayer who loses when bailout money is gobbled up by the banks, hoarded, and not used to get the wheels of credit turning. That was the tragic waste of Bush’s first bank bailout.

Why shouldn’t the taxpayer have the opportunity to share in the profits if and when the bank actually comes back?

As the Nobel Laureate economist Joseph Stiglitz points out, a further advantage of federal ownership comes because many of these troubled banks owe each other tons of money due to complicated derivatives—the kind that helped create the problem. With federal ownership of a slew of banks, they can sort through all those obligations and net them out much easier than under private ownership.

If and when the economy recovers, the banks are functioning and making enough money to go private again, they can do so—having paid back the taxpayers, perhaps with a bit of profit as well.

Now, I don’t know whether a plan along these lines is really part of the proposed $1.5 trillion plan of the Obama administration. Maybe it’s secreted back there somewhere and they have to move slowly in telling us about it. Maybe they have an alternative plan that perhaps could work as well—but I doubt it.

What I do know is that it was just plain idiotic to send Treasury Secretary Tim Geithner into the congressional lions den with only a vague outline of a plan as they did last week—especially with Obama’s promise that the plan would be set forth in full.

There would be nothing wrong if they had said simply “We are still working out the details and fine points of this massive banking rescue bill—give us another few days or maybe even a couple of weeks.” The public would understand completely.

Obama won a huge victory with his $787 billion stimulus bill, insufficient as it may be. As noted last week, it is way short on infrastructure spending and funding for the states—and way too high on tax cuts, which in most cases are not structured to create jobs or jump-start the economy.

Frankly, I don’t see why Republicans aren’t overjoyed with one of the largest tax-cut packages in history.

But it’s clear the GOP has locked into a strategy of solid opposition because, though they won’t say it out loud, they agree with Rush Limbaugh’s battle cry, “I want Obama to fail.”

They have nothing to lose by opposing him. Their ranks are diminishing and there will be nothing to gain if his program works. Their only hope of coming back will be if Obama fails.

Never mind that the country might fail with him.

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Don Rose is a regular contributor to the Chicago Daily Observer