Political leaders on Capitol Hill hope to take a second high-stakes gamble on the Bush administration's stricken $700 billion financial rescue package by seeking a final make-or-break vote in the US House of Representatives on Friday.

The critical first stage of the battle to resurrect the Bill, after its stunning defeat in the House on Monday, begins with a vote due to be held in the Senate tonight. The White House and leaders from both parties, scrambling to pass the legislation before more banks fail, hope a revised version of the plan will be passed in the upper chamber, giving it momentum and increasing pressure on the House to quickly follow suit. It reconvenes at noon tomorrow after the Jewish New Year.

Yet despite cautious optimism among Congressional leaders that the $700 billion package can be salvaged from the wreckage of Monday's 228-206 defeat, its fate is still deeply uncertain. Failure by the Senate to pass the revised version, which contains "sweeteners" to make it more palatable in the House, would deal the legislation a devastating - and possibly mortal - blow.

John McCain, Barack Obama and Joe Biden - the Democratic vice-presidential nominee - were all returning to Washington tonight to vote in favour of the modified Bill. But even it passes the first Senate hurdle, the Republican and Democratic leadership in the House - all of whom back the plan - are still deeply wary. None is yet claiming to have won over enough waverers to pass the legislation and there are risks that the Senate modifications - aimed more at Republicans - could push House Democrats away.

James Clyburn, the democratic whip in the House, said: "That's a great possibility. To pick up 12 votes on the Republican side you could well lose 20 votes on the Democratic side. That's a concern we have."

Tonight's vote and the plan to then reintroduce the Bill to the House, came along with a sense that the Dow's record one-day points drop after Monday's calamitous defeat has led to a significant shift in the public mood and a growing realisation among voters that the plan is not just a Wall Street bailout but a critical rescue package for the entire US economy.

The angry calls from constituents railing against the Bill shifted abruptly after the turmoil that followed Monday's House vote. "It's completely in the other direction now," a spokesman for John Boehner, the Republican House Minority Leader, said.

Both Mr McCain and Mr Obama, on the campaign trail yesterday, stressed how critical the Bill was for the whole economy.

Chris Dodd, the Democratic chairman of the Senate Banking Committee, said that he believed Monday's vote had sobered up some House members, adding: "I'm told a number of people who voted 'no' yesterday are having serious second thoughts about it."

The Senate version - aimed at winning over just 12 extra House Republicans and Democrats needed to reverse Monday's defeat - contains more than $100 billion of tax breaks, including relief for businesses - popular with Republicans - and help for more than 20 million middle class taxpayers to avoid higher levies under what is called the Alternative Minimum Tax.

To calm voter fears of bank collapses, the Senate plan would also increase federal insurance for deposit accounts, from $100,000 to $250,000. That element was backed by both Mr McCain and Mr Obama on Tuesday.

At its heart the Bill remains the same - a plan to allow the US government to spend $700 billion to buy up the financial sector's toxic, mortgage related assets - which 133 Republicans and 95 Democrats could not vote for on Monday despite furious lobbying by the leaders of both parties and President Bush.

While the new provisions might make the Bill more attractive to some Republicans, it also risks losing critical Democratic "yes" votes from Monday. Aides in both parties warned that the Democratic "Blue Dog" caucus in the House - many of whom backed the plan on Monday - might now oppose it because of the tax breaks included in the Senate proposal.

The "Blue Dogs", a bloc of 47 fiscally conservative Democrats, have always strongly opposed the tax breaks included in the new Senate version, unless they are paid for by tax increases in other areas. Such "pay as you go" measures are not included.

In a sign of dysfunction between the Senate and House Democratic leadership, Nancy Pelosi, the House Speaker, appeared to have been taken by surprise by the Senate plan, which was introduced by Harry Reid, the party leader in the upper chamber. She released a lukewarm response. "The Senate will vote... and the Congress will work its will."

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