Bailout or sinking fund?

I know all this talk about a bailout can be confusing for non-financial types, so I'd like to try to put it in layman's terms. Last night, President Bush said that under the proposed bailout plan, "...the federal government would put up to $700 billion taxpayer dollars on the line to purchase troubled assets that are clogging the financial system. In the short term, this will free up banks to resume the flow of credit to American families and businesses, and this will help our economy grow."

All this can be quite confusing, I know. So, here it is in terms we can all understand:

The US Government (which doesn't have any money, which is why we're nearly $10 trillion in debt) is going to borrow more money so it can lend it to banks (who don't have any money, which is why so many are going bankrupt) so that they can loan it to consumers (who don't have any money, which is why mortgage forclosures are at an all-time high). That way, consumers (still no money) can go deeper into debt to the banks (who've now loaned all the money out again) and the government is caught holding the bag. Actually, not, because the government doesn't have any money... it all comes from us. And our kids.

So, to simplify further: Our kids are loaning money to the government to loan it to the banks to loan it to us so we can buy flat screens and Volvos.

Hopefully, this makes the matter simpler to understand.