Why does it have to be an extreme form of socialism? Why not do what most of Europe has done and have socialism in some areas and capitalism in others? Granted some states have failed to do proper calculations and haven't balanced their income with the benefits they give their citizens, but most have done a fairly good job.
The fact that the banks also failed in their responsibilities and lent money to overspending states is a major concern right now, but that's not a failure of socialism, that's capitalism failing.