The debate in Washington over the $700 billion bail-out plan for the US financial system is starting to resemble a plot from the television show 24.

Hank Paulson, the Treasury Secretary, yesterday stepped up his efforts to persuade an increasingly reluctant Congress to pass the legislation needed for the scheme. But members of Congress from both parties are angry at what they regard as moral blackmail by the Administration and the banks that will benefit from the plan.

“Wall Street’s like a suicide bomber in a movie theatre,” said one adviser involved in the deliberations.

“They’re standing there with 200lb of explosives stuck to their chest and saying ‘If you don’t do exactly as we say, we’re going to pull the cord’.”

After the initial relief that greeted news of the proposal last week, there is rising uncertainty; not only about whether it is right to funnel all that taxpayers’ money into Wall Street but about whether the plan is even going to be effective in stopping the rot. But there’s an understanding, too, that a failure to produce legislation within days could have violent financial consequences.

Last night the stakes were raised a little higher as John McCain, the Republican presidential nominee, dramatically suspended his election campaign to return to Washington to try to craft a compromise.

Republicans are hostile to the idea of a huge increase in government intervention in the economy. Democrats are worried that bailing out Wall Street will eat up all the money they had been planning for tax cuts and spending increases in the first months of a Barack Obama Administration.

Tom Daschle, the national co-chair of Senator Obama’s presidential campaign, told me yesterday that the scale of the bailout means the Democrats will have to “rethink the timing” of their planned fiscal measures to help America’s hard-pressed workers.

That translates roughly as: those tax cuts we promised are going to have to wait till we have finished handing money over to Wall Street firms. But the bigger, nagging question is whether the plan, even in modified form, will work at all.

Mr Paulson and his colleagues insist that passage of the plan would mark the beginning of the end of the global financial crisis.

If banks — not just in the US but around the world, including Britain — can dump their bad assets into the welcoming arms of the US Treasury, the fear and uncertainty that has stalked markets in the past year will pass.

Banks can stop worrying that loans to other banks will not be repaid. The engines of the global credit system can start to turn smoothly again and that should mean lower interest rates and less stringent borrowing terms for customers everywhere.

But critics worry that the plan won’t in fact tackle the real problem — a lack of capital at the world’s big banks. If banks can’t rebuild their capital base they will still not be able to increase lending and the world economy will still not get the financial support it needs.

Yet with Wall Street’s clock ticking, the plan’s critics probably don’t have enough time to fashion a much better alternative. And even those critics acknowledge that failure to pass a bailout could have apocalyptic results.

In short, there may be only one thing worse than the Paulson Plan: No Paulson Plan.

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