Monday, July 17, 2006 | 3:00 p.m. ET
From Alex Isenstadt

  1. Other political news of note
    1. Animated Boehner: 'There's nothing complex about the Keystone Pipeline!'

      House Speaker John Boehner became animated Tuesday over the proposed Keystone Pipeline, castigating the Obama administration for not having approved the project yet.

    2. Budget deficits shrinking but set to grow after 2015
    3. Senate readies another volley on unemployment aid
    4. Obama faces Syria standstill
    5. Fluke files to run in California

Bayh’s middle class campaign
Even though the Iowa caucuses are still 18 months away, potential Democratic candidates are already trying to carve their own niches in the emerging field. The latest example: Indiana Sen. Evan Bayh, who today delivered a speech at the National Press Club that focused on helping the middle class. His remarks, which came nearly three weeks after former vice presidential nominee John Edwards spoke about eliminating poverty, seemed intended to stake out his own territory on pocketbook issues. "Working to eliminate poverty, which my friend John Edwards speaks so eloquently about, is a moral imperative. But if we don't directly strengthen the middle class, we will never achieve our potential as a nation." Bayh's platform is based on making college more affordable, cutting insurance premiums, strengthening Social Security, and providing tax credits for energy-efficient vehicles.

After his speech, Bayh was scheduled to head to Iowa, where he will continue to talk about the middle class. When a reporter asked about his 2% showing in a recent Des Moines Register poll of likely Iowa caucus-goers, Bayh said that, "Iowans take their time," pointing out that at this time in the 2004 race, eventual second-place finisher John Edwards was far behind. Besides, he said, "there is something liberating about being an underdog."

Monday, July 17, 2006 | 11:50 a.m. ET
From Mark Murray

Stem cell battle begins anew
Firing the first volley in today's congressional battle over embryonic stem-cell research, a group of the science's supporters -- including Rep. Diana DeGette (D), former NIH director Harold Varmus, former NARAL president Kate Michelman, and Rev. James Forbes of New York City's Riverside Church -- urged President Bush not to veto legislation expanding the research if the Senate passes it. In a conference call, Varmus insisted that embryonic stem cells hold much more promise than the adult stem cells opponents are touting; Forbes said the science could "lift the quality of life for all of us"; Michelman, who noted that her daughter is paralyzed and her husband has Parkinson's disease, argued that Bush "may not understand what a defining moment this is for his presidency"; and DeGette recounted that the president had declined to talk to her about the legislation, saying he didn't have time -- but noted that Bush apparently has the time to travel to her state of Colorado on Friday to raise money for Republican candidates.

DeGette added that she's holding out hope that Bush won't veto the legislation -- even though most expect he will -- but said that it will one day become law. "The longer it takes, the more lives will be lost," she said. DeGette's opponents will have their chance to return the fire when Sen. Sam Brownback (R) holds a press conference at noon to discuss the promise of adult stem cells and his opposition to embryonic ones. 

Monday, July 17, 2006 | 9:20 a.m. ET
From Elizabeth Wilner, Mark Murray, Huma Zaidi andAlexIsenstadt

In today's issue:
One or two Bush firsts this week: first veto, possibly first NAACP speech
The Senate tackles stem-cell research funding
Democrats see political fodder in the "donut hole"
Primary turnout is down; Arizona may offer some lucky voter $1 million

First glance
President Bush will arrive back at the White House from Russia at 3:30 pm ET.  He has no other public events scheduled for today, and his current itinerary for the rest of the week looks unremarkable, featuring a couple of photo ops and a road trip to Colorado.  Yet there's much afoot to distinguish this week from all the others of the Bush presidency, as he's expected to cast his first-ever veto.  The bill in question is not a spending measure, but a bill opposed by social conservatives and supported, polls have suggested, by a majority of the public.

The Senate is scheduled to devote 12 hours of debate today to three measures that would impact stem cell research in the United States, with votes scheduled for tomorrow starting at 3:45 pm.  As NBC's Ken Strickland points out, most of the debate will focus on one controversial bill, passed by the House a year ago, which would extend federal funding to research on stem cell lines taken from unused embryos at fertility clinics.  That bill is expected to pass with at least 60 votes, the required minimum per a deal cut by Senate Democrats with Senate Majority Leader Bill Frist; the deal also prohibits any amendments.

Bush has pledged to veto the measure which, if it were to become law, would basically nullify his August 2001 executive order allowing federal funding of embryonic stem cell research, but limiting it to research on stem cell lines already in existence at that time.  (When the issue boiled up during the 2004 campaign, the Bush campaign emphasized the former while the Kerry camp focused on the latter.)  House supporters of the bill, who passed their identical version by 238-194, don't believe they have the votes to override a veto, an attempt which could happen as early as this week.  Polls have shown that a majority of the public supports expanded federal funding, but social conservatives who make up the GOP base oppose it.

The other two measures also are expected to pass, providing Bush with something to sign into law as he vetoes the other measure.  One would require the National Institutes of Health (NIH) to research and develop ways to acquire stem cells without destroying human embryos.  (As Strickland notes, the current method for getting stem cells destroys the embryos in the process, which conservatives equate to abortion.)  The other would prohibit "fetal farming," or the development of embryos in non-humans or from human pregnancies for the sole purpose of research.

In another possible first for Bush this week, he might address the NAACP convention.  The convention is taking place in Washington and wraps up on Wednesday; Bush's schedule for that day is officially TBD.  (Scheduled to speak that day, per the convention program: Sens. Barack Obama, Ted Kennedy, and Hillary Clinton.)  Now that the House has reauthorized the Voting Rights Act for another 25 years, with the Senate expected to follow suit eventually, Bush has a peace offering for an organization with whom he has been at odds since the 2000 presidential campaign, despite his overarching goal of winning over more African-Americans to the GOP.  A speech would come on the heels of an impromptu visit to the National Civil Rights Museum during his recent trip to Memphis.

Also this week, one of the President's few signature pieces of legislation will come under renewed assault as critics of his Medicare prescription-drug law tout "Donut Hole Week," in reference to the fact that seniors have begun falling into the gap in coverage that begins when their prescription drug costs exceed $2,250 in a year.  At that point, as NBC's Chip Reid reminds us, coverage under the law stops and starts up only when costs hit $5,100.  Critics say many beneficiaries are unaware of the gap and will be stunned when they fall into it.  Today at 1:30 pm, Senate Democrats will hold an unofficial hearing with witnesses who have fallen into the hole and are unable to afford their medications.  Tomorrow, Democrats and the liberal Campaign for America's Future will release a report declaring September 22 "Donut Hole Day" -- the day when they say the average senior will fall into the hole.

And also today, Vice President Cheney heads to Iowa for two fundraisers for Republican House candidates and remarks at a rally for the Iowa Air and Army National Guard.  At 1:30 pm ET in Des Moines, Cheney headlines a fundraiser for Jeff Lamberti, who's challenging Rep. Leonard Boswell.  He hits the Guard rally in Johnston at 2:35 pm ET.  Then at 6:30 pm ET, he headlines a closed-press fundraiser for Mike Whalen in Davenport.

Have you checked your favorite political calendar lately?

Stem cells
Among the various related press conferences and events on this issue today, Democratic Rep. Diana DeGette, former NIH director Harold Varmus, former NARAL president Kate Michelman and others hold a conference call today at 10:00 am to call on Bush to sign the bill into law, if it passes.  The liberal group has an ad in today's New York Times saying, "Bush Threatens to Veto the Stem Cell Bill, Choosing Religious Extremists over American Lives."  And conservative GOP Sen. Sam Brownback, a potential presidential contender in 2008, holds a press conference at 12 noon.

"The issue... is forcing Republicans to make a dicey choice between two potent political constituencies: social conservatives who believe the research is immoral, and advocates for patients with debilitating diseases, who have won the support of prominent Republicans as well as Democrats," says the Los Angeles Times, which also looks at how the issue in playing out in some key races around the country.

"It also gives Senate Majority Leader Bill Frist, who supports expanded funding, an opportunity to raise his standing with moderates and the medical and scientific communities as he considers a 2008 White House run.  Yet the Tennessee Republican is eager to dispatch the matter before the midterm elections, to minimize damage to Sen. Jim Talent of Missouri and other antiabortion Republicans in tight races," says the Wall Street Journal, which also reports that Karl Rove has been making calls urging GOP lawmakers to vote against the bill.

"Sen. Charles E. Schumer, New York Democrat and chairman of the Democratic Senatorial Campaign Committee, said a veto will particularly anger moderate Republicans and independents...  But some Senate Republicans said the fight will blow over." – Washington Times

Security politics
Bloomberg sums up the current Administration position toward the Middle East conflict -- that "Israel largely has a free hand in attacking the militant group Hezbollah in Lebanon.  They have declined to set limits on Israeli action, and [Secretary of State Condoleezza] Rice says she won't engage in personal diplomacy until there is a clear path toward ending the extremist threat...  The conflict marks the first time that U.S. and Israeli military forces are engaged in fighting some of the same enemies in the region at the same time since President Ronald Reagan's administration, when U.S. Marines were part of a multi-national force in Lebanon."

The Houston Chronicle reports on Bush's open-mic issue: "President Bush inadvertently dropped the facade of carefully scripted summit diplomacy today when his lunchtime conversation with other world leaders was picked up by Russian television.  'The irony is what they need to do is get Syria to get Hezbollah to stop doing this (expletive) and it's over,' Bush told British Prime Minister Tony Blair during lunch today, unaware their microphones were on."  The incident put "an awkward postscript on a summit that had gone fairly well for Bush."

NBC's Kelly O'Donnell reports that White House officials, when asked to comment, said that although the President's remarks might have been more blunt, what he said privately is the same as what he expresses in public.

It's the economy...
Fed chief Ben Bernanke is scheduled to appear before Senate and House committees later this week and report, to the dismay of edgy Republicans, that the "economy is slowing and inflation remains a risk," Bloomberg says.  The story also notes that some Republican lawmakers are wondering whether Bernanke is up to the job (criticism we can expect to hear more of, should his report be as gloomy as expected).

The Wall Street Journal looks at how increased tax revenues may have shrunk the budget deficit, as the Administration has touted, but aren't necessarily indicative of how fast the economy is growing.  White House budget director Rob "Portman acknowledged in an interview last week with The Wall Street Journal that the economy hasn't expanded much more than anticipated.  However, he said, the administration 'didn't necessarily understand as much in February about how that growth would affect revenue.  Income tax is coming in more from higher-income earners,' he said."

More on the Bush/GOP agenda
NAACP chairman Julian Bond's invitation to Bush to address their convention this week came with some criticism of Bush's Iraq policy. – Washington Post

In time for the so-called "Donut Hole Week," the New York Times notes that the Administration is planning sweeping changes in Medicare payments to hospitals, which could cut payments by 20% to 30% for complex treatments and technologies.  "The changes... are meant to improve the accuracy of payment rates.  But doctors, hospitals and patient groups say the effects could be devastating."

"Undeterred by a decisive defeat in the Senate, House Republicans are moving ahead with a vote on a constitutional amendment to ban gay marriage, forcing lawmakers to take a stand just months before the election," the AP says.  "The vote, scheduled for Tuesday, will occur in a week devoted to several priorities of social conservatives - what House GOP leaders call their 'American values agenda.'"

Pegged to another GOP priority this week, "Pledge protection," the Wall Street Journal questions whether the whole "values agenda" will work for Republicans in 2006 the way it worked for them in 2004, and "whether 'values' issues represent the party's principal gambit with voters souring on the Iraq war and the economy."  ("The answer: probably not.")

The Washington Times reports that troubled judicial nominee William Haynes II, a former Pentagon counsel, is seeking to clarify the record on some aspects of his position on detainee policy, which currently has enough Senate Republicans skeptical of his nomination that his prospects are in serious doubt.

The Democrats
Senate Minority Leader Harry Reid addresses the NAACP convention at 9:30 am.

Potential presidential candidate and Sen. Evan Bayh (D) gives twin speeches on the future of the middle class at the National Press Club and in Des Moines this afternoon.  Per advance excerpts of the speech, Bayh is seeking to position himself as the presidential candidate of the middle class, and will revive the concept of an "opportunity society."  "If this President will not speak for our Middle Class, I will," Bayh will say.  "And if Democrats want to lead this nation, we must."

The San Francisco Chronicle offers its take on Democrats' push for a minimum wage hike.  Democrats have "seized on the issue... as a building block in their effort to retake both houses of Congress in November.  Their effort in Washington is moving forward as organizers in several states push ballot initiatives for the fall election to adopt or increase state minimum wages, measures that the Democrats hope could boost turnout of voters likely to lean their way."

In a lengthy article, US News & World Report examines the Democratic debate over DNC chair Howard Dean's 50-state strategy.

The Washington Post examines how a new network of Democratic donors has directed $50 million to party think-tanks and other organizations as "the first installment of a long-term campaign to compete more aggressively against conservatives...  The alliance has required organizations that receive its endorsement to sign agreements shielding the identity of donors."  Also: "some Washington political activists" are "concerned about what they perceive as a distinctly liberal tilt to the group's funding decisions."

The Los Angeles Times looks at how House Government Reform ranking member Henry Waxman (D) effectively uses his oversight role to cause problems for Republicans on his pet issues.  "The research Waxman's staff generates is so strong and so pointed it gives his GOP colleagues heartburn...  Investigative reporters in Washington agree that - partisan as Waxman is - his staff research is highly reliable."

Disaster politics
The recent Big Dig fatality has created new opportunities and new risks not only for Massachusetts Gov. Mitt Romney (R) as he prepares for his presidential bid, and for some of the candidates seeking to replace Romney as governor, including his lieutenant governor and the Democratic state attorney general.

More on the midterms
A USA Today study indicates a drop in primary turnout since the midterm elections in 2002.  Also: "Turnout hasn't cracked 40% in any state.  In most, primary participation was in the 20%-30% range.  Idaho, Illinois, North Carolina, Oregon, Virginia and West Virginia posted their lowest primary turnouts in at least eight years.  So far, the year's rock-bottom has come in Virginia," where fewer than 4% turned out.

The New York Times front-pages that a measure has qualified for the ballot in ARIZONA that would award $1 million in each general election to one lucky individual who simply voted -- as a way to boost turnout.  But some question whether such a lottery is legal.

The Sacramento Bee examines Democrat Phil Angelides' uphill fight against Gov. Arnold Schwarzenegger (R). in California.  "'People inside politics are looking at Arnold racing downfield with the ball and they're asking, "How is Angelides going to tackle him before he gets to the end zone?"' said Democratic political consultant Darry Sragow.  'There is no question Angelides has to get some tracking and find some way to build some momentum.'"

As the Democratic Senate primary in Connecticut draws closer, we're seeing a stream of op-eds both supporting and criticizing Sen. Joe Lieberman's prospective run for re-election as an independent should he lose the primary.  A recent one by a former Lieberman aide took after the liberal bloggers who have targeted the lawmaker.  The latest in the New York Times, taking the opposite view, argues that "if Mr. Lieberman, with all the benefits of major-party incumbency, can't persuade Democratic primary voters to nominate him over Mr. Lamont, he should have the decency to accept that verdict."

Florida GOP Senate candidate and Rep. Katherine Harris undergoes preventive surgery today at Walter Reed to remove an ovarian mass.

Tomorrow is primary day in Georgia, and one of us wrote last week on MSNBC.com about how former Bush campaign advisor Ralph Reed, running for the GOP nomination for lieutenant governor, might become the first casualty of the Abramoff scandal.

Per the Quad City Times, Cheney's two fundraisers for GOP House candidates in IOWA today "are expected to raise a combined total of $200,000."

The Minnesota Senate race, which has been viewed as Republicans' best shot at picking up a Democratic Senate seat, apparently isn't as close as the GOP would like to think, though that could change.  A new poll for the Minneapolis Star-Tribune shows Democrat Amy Klobuchar leading Republican Mark Kennedy by 19 points.  "Klobuchar in midsummer has more support than Kennedy in nearly every demographic category...  Kennedy is most popular with younger Minnesotans... and with Republicans."

And, the GOP Senate campaign committee has a history of ultimately pulling its financial support from its New Jersey Senate nominees, despite the apparent closeness of the races there, to direct those resources to states where they might do more good.  In what may be a warning shot to 2006 nominee Tom Kean, Jr., Roll Call reports today that national Republicans are "disappointed" with Kean's campaign thus far.

“First Read” is an analysis of the day’s political news, from the NBC News political unit. Please let us know what you think.  Drop us a note at FirstRead@MSNBC.com.  To bookmark First Read, click here.

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