With the election four weeks away, here is what I predict you'll see if you watch a major network or read the NYT.

• Foley and Hastert headlines
• Republicans who might have gay pages (believe it or not, this is about to hit the presses - as if that's somehow wrong)
• Coverage of Bob Woodward's book
• Stale stories about Delay or Cunningham
• Daily bad news from Iraq - and any number milestone they can find
• Individuals who have suffered under Bush (a janitor who lost his job in Milwaukee, etc.)
• Comparisons of Iraq to Vietnam - mostly with polls and general hopelessness
• Dan Rather's revenge (he's got to re-establish credibility as an effective blaster of the right)

Stories you won't see:

• Seniors now strongly approve of the Medicare drug bill
• The deficit continues to fall as the economy continues to boom
• Democratic organization held Foley info - putting youth at risk - until it was best for them to reveal it
• American majority does not want to withdraw from Iraq
• American majority believes we will be successful in the end in Iraq
• Stale story about Barney Frank's pages running a gay prostitution ring from his apartment
• Story about Demcratic Representative William Jefferson's $100k in bribery funds in his freezer
• Lack of true comparability between Iraq and Vietnam
• Democrats who've had sex with their pages

All I can say is, thank goodness for blogs.

sharp

North Korea wants direct talks with the U.S. That's all they ever wanted. Well, they also wanted an ocean full of U.S. cash.

That's why Bush wouldn't hold direct talks.  He pushed for mulit-nation talks - just like in Iran.  In both cases you have blatant attempts at extortion.  And Bush wouldn't bite.

I'd be surprised if he bites this time, either.  We won't be paying ransom money to keep them from launching a nuclear weapon.  We'll keep international pressure on them and keep those most likely to be hurt by it involved. 

N. Korea and Iran are in an economic disaster.  For North Korea it's nothing new.  But for Iran, this was a country that was prosperous under the Shah in the 70's that is now riddled with unemployment and hopelessness.  And as the price of oil falls, Iran's mess gets messier. 

If oil falls below $50 a barrel, look for Iran to make concessions for U.N. cash.  If they don't, their own people will begin to revolt.

Look for North Korea to settle for "some" international support.  Since Bush removed food aid to the country (rather than assisting their government in staying focused on nuclear weapons) they have fallen near a breaking point and there will be trouble from within.

sharp

The CBO reported today the federal budget deficit was $250 billion this year. Down from $318 billion last year. It totaled only 1.9% of GDP.

What's the big deal, right?  It's still a huge deficit, right?

Yep.

But the CBO had originally estimated a deficit of more than $110 billion more for this year.  They kept shaving it back because tax growth came in at 12% this year.  That was second only to last years 14.5% growth as the two highest years since 1981.

Taxes on wages and salaries grew by 7% this fiscal year.  That is the single best gauge of wage and salary growth - far better than the tepid survey number.

Taxes paid grew by 1/4 of a trillion dollars this year. 

Factors making the deficit what it is:

• $50 billion related directly to Hurricane Katrina
• $45 billion from higher interest on the national debt
• $42 billion from increased Medicare spending - basically the new drug benefit
• $26 billion in increased military spending (now to $500 billion)

Just those items - forget highway bills and farm bills and brides to nowhere - contributed $163 billion of the $250 billion deficit. Some of them should go away in coming years even as receipts continue to spiral upward. All other spending rose by about 6%.

Those tax cuts have stimulated growth, investment and income for the 3rd time (Kennedy, Reagan and Bush).  That makes them 3 for 3.

sharp

Only 51k jobs added this month against an expectation of over 100k.

That's terrible news.  Right?

Well, ordinarily.  Except that they raised last months new jobs number to 188k from about 120k. 

And the really big news...buried deep in the article...is that the Labor department said that they now realized there were 810k more jobs created in the last 12 months than they recorded.

810,000!!!!!

That's pretty close to a million jobs they somehow didn't count.  Maybe their model is bad.  But it explains why the unemployment rate has been falling.  And it gives more creedence to the Household survey, which I much prefer, because it captures more than just large businesses.

The economy is booming.  It won't be enough to help Republicans this year, but it's good news for America.

sharp

I don't see much way now for Republicans to hold onto either house of Congress.  They had a period of momentum around Labor Day, but it's been a perfect storm of messes since then and I can't imagine they won't lose every close race - maybe as many as 50 seats in the House.

Welcome to 1994.

For Republicans who were hoping Democrats would retake the House so that the country would see the extreme liberalism of that party's leadership, they may be surprised to find that there is inertia in House voting until something upsets the apple cart.  Last time it took 40 years for Republicans to regain a majority.  It will have been 12 years for Democrats this time.

But how could Republicans overcome this wave of troubles?  The Iraq war is the big unsettling factor for all voters.  But it could be overcome by:

• strong economic stewardship - our economy is in fantastic shape
• strong leadership with direction on terror - Democrats still have a big vulnerability here - particularly the "we killed the Patriot Act" scene.
• values leadership - each side has an opportunity to lead here; Republicans on Christian mores and Democrats specifically with the poor and otherwise disadvantaged (ironic that the two are separate, isn't it?)
• the power of incumbency - voters tend to be reluctant to bring in unknown leaders unless they are very unhappy
• the money of incumbency - you can get your message out better and define your opponent with a serious money advantage as the majority party

However, the Foley incident was the end of any momentum the Republicans had - and will probably cost some good Congressmen their jobs.  It might not, if not on the heels of Ney in Ohio, DeLay in Texas and Cunningham in California.  And all against the backdrop of majority frustration and even deep resentment over Iraq.  Throw in a huge Hastert problem, a expose' to explain, ratcheted up violence in Iraq and a few leaked reports and targeted televised testimony on Capitol Hill and you have the makings of one huge landslide.

Enjoy the nice offices for the next three months Republican leaders.  It may be the next generation before Republicans are there again.

But maybe, just maybe, they and the country will be the better for it.

sharp