(updated below)

My guest today on Salon Radio is Digby, and we discuss various political aspects of the Paulson bailout, beginning with her widely cited post from Monday warning of the political dangers to Democrats from joining with George Bush in approving the bailout. The discussion is roughly 35 minutes and can be heard by clicking PLAY on the recorder below. A transcript is posted here.

We recorded this yesterday and it has become increasingly clear even since then that some permutation of the Paulson bailout is basically a fait accompli. The Hill reports that House Democrats have declared their willingness to approve the bailout provided a majority of Republicans join them. ABC News reported today that Democrats are ready to support it provided that McCain supports it as well, and the NYT summarized Obama's position as supportive of the Paulson plan with some oversight provisions and other protections added on (though without the requirement that the Government obtain an equity stake in these companies rather than ownership of their toxic assets -- the provision that Paul Krugman has identified as being an absolute prerequisite for any deal to be remotely fair or tolerable: "No equity stake, no deal").

In sum, it seems as though Democrats and Republicans -- and both presidential campaigns -- are preparing to jointly endorse some mildly improved version of the Paulson plan, on the premise that if they both do it, neither side will pay politically. As David Sirota notes, bank lobbyists have already decided they don't need to take Chris Dodd or any other intransigent members seriously because their winning is inevitable. Wall Street and corporate America can't lose in Congress -- they never do -- for one very simple reason: they own Congress and the "leaders" of it. Just listen to Rep. Marcy Kaptur; she's been in Congress for 26 years and she knows how it works:

To Wall St. insiders . . . you have perpetrated the greatest financial crimes ever on this American Republic. You think you can get by with it because you are extraordinarily wealthy and are the largest contributors to both presidential and Congressional campaigns in both major parties.

It looks like that belief on their part was well-founded and about to be vindicated.

UPDATE: In comments, Kovie notes two separate reports that suggest that part of the Democratic proposal continues to be a provision to allow taxpayers to have some equity stake in whatever companies are bailed-out. In the very well-executed press conference he just gave, Obama -- in listing the bailout points on which he insisted -- didn't use the word "equity," but said that taxpayers should be treated "like investors" for any money they give, which is roughly the same thing. It's still unclear, then, whether the ultimate package which Democrats approve will contain such a provision.

My discussion with Digby is about the reasons why all of this is happening, the political considerations driving it, and whether there is any prospect for stopping it: