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Last night's speech and today's performance by Secretary Rice seem to indicate that even though the words the administration is saying don't admit defeat, they have largely accepted it. Bush had no swagger and Rice appeared simply baffled trying to explain the administration's plan.
With Republican Senators seeming to jump from the ship as well, we're looking at perhaps the weakest president since Ford. Bush has the support of maybe 1/3 of the Senate now, it would seem (we've heard less from House members so far, but I can't imagine he has much more support there). For a president intent on radically expanding the power of the presidency, it's looking like he's about to become nearly impotent to do much of anything. He lost the Democrats long ago, and he's losing his party now.
The man who wished to strengthen the presidency may well end up being the man who significantly weakens it.