“First Read” is a daily memo prepared by NBC News’ political unit, for NBC News, analyzing the morning’s political news. Please let us know what you think. Drop us a note at FirstRead@MSNBC.com.

Thursday, April 14, 2005 | 9:20 a.m. ET
From Elizabeth Wilner, Mark Murray, Huma Zaidi and Kasie Hunt

First glance
Back to the economy -- and foreign policy. As President Bush struggles with his Social Security effort and the GOP's death tax talk reminds us of Bush's hoped-for changes to the tax code, we wonder whether the White House is going to have to revert to foreign policy before too long.

  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

The general rule of thumb for two-term presidents lately has been to tackle domestic priorities during their first four years, which gives them accomplishments on which to run for re-election. Then in their second terms, after building up international relationships, they tackle legacy-building stuff like foreign policy. Reagan in his second term had, for example, the missile treaty with Russia and the chain of events that led to the fall of the Berlin Wall. Clinton in his second term, once he got past impeachment, had Yugoslavia, Bosnia, his visit to Vietnam and the Good Friday accord.

But September 11 turned this equation on its head for Bush, who got his tax cuts and No Child Left Behind prior to the terrorist attacks, but can claim just one major domestic initiative afterward: his Medicare prescription-drug law. Post-September 11, Bush spent the bulk of the remainder of his first term, and certainly the duration of his re-election campaign, focused on homeland and national security, Afghanistan and Iraq.

Now he's looking to enact major domestic initiatives like Social Security and tax reform. But even with a GOP-run Congress, including 55 seats in the Senate, he may get no further than relatively minor reforms like tort and bankruptcy. At base, the economy isn't doing too well. Will he and his Administration have to renew their heavy emphasis on national security in order to build up a successful Bush legacy? This issue may also provide Republicans with their best chance to keep Democrats off-kilter, since beyond a small burst of activity around the release of the WMD report, Democrats essentially have given up on talking about Iraq, and are still debating how to take on Bush on this front. More on this below.

We wonder how divergent the average concerns are inside and outside the Beltway, or how much the public is following the debates over the nuclear option and Tom DeLay versus how much they're following, like, gas prices.

Yes, we keep coming back to gas prices. Two weeks ago, in the NBC/Wall Street Journal poll, gas prices ranked second behind Terri Schiavo and just ahead of the Pope and Social Security in terms of stories the public was following. Now the Schiavo and Pope stories have faded. But even Social Security has been relegated to a back burner in DC this week. Not that DeLay and the nuclear option don't raise some serious governmental issues, or that momentum heading into 2006 isn't at stake. But the fights seem to be devolving into tunnel-visioned "our war room can beat your war room."

At the same time, the drip-drip on DeLay just might be slowing. Check the papers today and you'll find, yes, lots of coverage of DeLay's apology yesterday for his remark about retribution against judges over Schiavo. But you'll also read about Trent Lott's political rehabilitation, and about how lots of members of Congress put family members on their payroll. And besides, Democrats want DeLay on that wall. They need DeLay on that wall. Because somewhere deep down in places they like to talk about at fundraisers, he's one of the best base-motivators they have. Do they really want him gone?

The Senate meets at 9:30 am; the House meets at 10:00 am. President Bush addresses the American Society of Newspaper Editors at 1:15 pm, then throws out the first pitch at the Washington Nationals opening game at RFK.

Lastly, a question: Where will you be Saturday night? Will you be in Houston listening to DeLay's keynote at the NRA annual meeting? Or will you be in Los Angeles at Howard Dean's address to the California Democratic Party convention? Both gatherings kick off tomorrow.

It's the economy
The Wall Street Journal leads, "The U.S. economy may be hitting a soft patch, as once-indefatigable consumers strain under higher energy prices and climbing interest rates. Disappointing March retail sales, reported yesterday, along with slowing job growth and a drop in consumer confidence, add to evidence that the U.S. expansion lost steam as the first quarter drew to a close." The story notes, "U.S. consumers have defied past predictions of retrenchment. Higher oil prices slowed economic growth last summer, but the effect was brief. Economists don't expect the latest setback to push the economy into recession. But they are shaving estimates for economic growth this year."

Edwards gives a speech at the New School in New York at 6:00 pm today in an effort to "frame the tax reform debate" and show the Democratic party how this can be a "winning issue," per an Edwards aide. Excerpts of the speech suggest that at least some of the ideas Edwards will tout are things he has mentioned before, but the rhetoric is tougher. Edwards will say that Republicans "want to shift the tax burden from unearned income straight onto the backs of working people," and he'll blame the Administration for the AMT issue.

USA Today covers the largely party-line House vote on an estate tax repeal yesterday, and the continuing unlikelihood that it will pass the Senate, where they may be more Republicans to vote in favor now, but concerns exist about the deficit.

That said, the Senate has begun "negotiations... on a deep and permanent estate tax cut that can pass this year, even if it falls short of full repeal," says the Washington Post.

The New York Times links an estate tax repeal to Social Security: “With President Bush barnstorming the country in an effort to convince Americans that the Social Security system is on the verge of insolvency, Democrats are now arguing that the tax revenue saved by retaining the estate tax on just the largest three-tenths of 1 percent of estates would offset at least a quarter and possibly as much as half of the Social Security shortfall over the next 75 years.”

The House Resources Committee yesterday "backed drilling for oil in Alaska's Arctic National Wildlife Refuge, advancing a key element of the Bush administration's energy plan." - Washington Post

We were recently alerted to a video available on an "online news video service," which is offering a "news report" done by AARP and the Alliance to Save Energy about gas prices. The package features reporter "Mary Norton" talking to a contractor frustrated with rising gas prices. Norton also interviews a representative for the Alliance to Save Energy about how to save "gas and energy." The tag line encourages viewers to purchase a hybrid-electric car, not only to save money on gas, but says you can get a tax deduction.

California, Florida, and New York "are looking to counter soaring gas prices and reduce air pollution by becoming leaders in the effort to build affordable hydrogen-powered cars." - USA Today

Whither the GOP: DeLay
DeLay gave an interview to the Washington Times yesterday, in which he "accused Democrats of shutting down the chamber's ethics committee to prevent him from being exonerated of the ethics accusations against him. 'The only way I can be cleared is through the ethics committee, so they don't want one,' Mr. DeLay said... He also offered a second reason why Democrats want the ethics committee to be hobbled. 'One of their best friends, [Rep.] Jim McDermott, is being investigated, and they don't want him to be kicked out of Congress,' Mr. DeLay said." The Times reminds us, "McDermott was the top Democrat on the ethics committee in 1997 when he leaked to the New York Times an illegally recorded tape of a Republican congressman's cell-phone conversation." DeLay also "said he has offered to provide the ethics committee complete documents related to recent accusations against him, but he suggested that the ranking Democrat on the committee... was ignoring his offer."

Beyond the Washington Times, DeLay coverage generally leads with his apology for his heated remarks about retribution against judges. The Washington Post notes, "People who are working in support of DeLay's position said the next several days would be critical, as leaders wait to see whether any other House Republicans call for his resignation" after Chris Shays did.

The New York Times has new comments from Newt Gingrich, following his CBS interview from earlier this week. “Mr. Gingrich, who in a television interview Tuesday said Mr. DeLay seemed to be blaming a left-wing conspiracy, told a meeting of the American Society of Newspaper Editors on Wednesday that the majority leader must ultimately ‘brief the country in a public way.’”

The Chicago Tribune quotes a senior aide to Speaker Hastert, who says that DeLay might have to make some public explanations for the charges that are surrounding him. “‘I'm not sure why he doesn't lay it out, regardless of whether the ethics committee ever meets or not,’ said the Hastert official, who spoke on condition of not being identified.”

The Washington Post reminds us on its front page that "[a]ll Washington thought" Trent Lott "was finished" after he commented at Strom Thurmond's 100th birthday party that "we wouldn't have had all these problems over all these years" had Thurmond won the presidency. And Lott's clearly still kicking.

The Los Angeles Times leads its website with: "At least 39 members of Congress have engaged in the controversial practice of paying their spouses, children or other relatives out of campaign funds, or have hired companies in which a family member had a financial interest, records and interviews show."

And the AP covers the same.

Whither the GOP: the judiciary
Former RNC chairman and GOP message strategist Ed Gillespie has signed up to help Bill Frist sell the nuclear option, Roll Call reports. But we can't tell whether Gillespie's purpose is to help sell the maneuver to the public -- or to the crucial number of Senate Republicans who don't seem inclined to vote for it.

The Hill says Senate Republicans fear Harry Reid and his war room are beating Frist and his.

Despite the conservative outcry over Democrats allegedly obstructing Bush judicial nominees, USA Today points out that "Bush is already well on his way to recasting the nation's federal appeals courts in a more conservative mold. Republican appointees now constitute a majority of judges on 10 of the nation's 13 federal appeals courts."

Immigration
The politically pernicious issue continues to hang up the war supplemental. "A vote Wednesday evening on a nonbinding resolution revealed that a majority of the Senate does not believe immigration issues should be debated during consideration of" the bill. "But as of press time, Sens. Larry Craig (R-Idaho) and Barbara Mikulski (D-Md.) were undaunted and actively moving forward with debate on their amendments to make it easier for undocumented immigrants to work legally in the United States."

"The divisive issues of immigration and the budget have caught up with Congress," the Wall Street Journal says. On immigration, "the focus is on providing a more-structured system for workers with a record of having been employed by U.S. companies over the past several years. And at the heart of the debate is the question of how far the government should go to accept workers who have often entered the country illegally but are otherwise law-abiding employees whose jobs are important to the economy."

"The House opened the door to revising immigration policy last month by attaching tougher rules for states in issuing driver's licenses to illegal immigrants to its version of the spending bill," the Washington Post reminds us. "The sudden focus on immigration underscores the mounting pressure lawmakers face to address the swelling illegal workforce, a mainstay of numerous industries but a serious voter concern."

The Washington Times gives separate coverage to DeLay's comments about immigration during his interview with the paper: "the Texas Republican said the House will produce a broad immigration bill this Congress... Mr. DeLay also disagreed with President Bush's recent characterization of the Minutemen currently aiding the U.S. Border Patrol's apprehension efforts in Arizona as 'vigilantes.'"

The values debate
The Connecticut House passed the civil union bill yesterday, along with an amendment defining marriage as between a man and a woman, and the state's GOP governor has said she'll sign the bill. – Hartford Courant

Per the Portland Oregonian, "Gov. Ted Kulongoski and a bipartisan coalition of state senators introduced legislation Wednesday allowing civil unions for same-sex couples and outlawing discrimination against gays and lesbians." The bill "was unveiled a day ahead of an expected ruling from the Oregon Supreme Court on nearly 3,000 same-sex marriage licenses issued by Multnomah County and whether the Oregon Constitution requires the state to make equal benefits and protections available to same-sex couples... A court decision today... could provide instant momentum for civil unions legislation." The bill also defines marriage as between a man and a woman.

Whither the Democrats
At the Center for American Progress rollout of a new security and peace initiative yesterday, CAP senior VP Morton Halperin repeated over and over that Democrats and progressives need to be tough and strong on national security -- but also demonstrate that they can do it smarter, more effectively, and with more international cooperation. So First Read asked him, "In 2004, John Kerry spent every day saying he was strong on national defense; that he could do it more effectively; and that he could do it with more cooperation from allies. He lost. How do you communicate that message better?"

Halperin paused for a few moments, looked at the other panelists, and said kiddingly (we think), "Anyone want to try and take a stab at that?" And then replied that there's always a rallying around the President when it comes to security and national defense, and since there won't be an incumbent or heir-apparent running for president in 2008, Democrats will "have a clean slate and a more even platform." He also explained that the Democrats' failure to communicate that message can be attribute to personality -- "how the person projects himself." And he said there needs to be more unity on security among the progressive side of the party.

After becoming DNC chair two months ago, Dean has (mostly) stayed out of the national press. He takes a baby step into the spotlight today when he addresses the steelworkers' convention in Las Vegas at 3:00 pm ET. And he'll take even a bigger step on Saturday when he keynotes the California Democratic party convention. First Read tomorrow will take a longer look into Dean's first two months as chair and his decision (so far) to dodge the national press.

The Wall Street Journal covers Edwards with the headline, "Edwards Strives to Stay In the Public Eye." The story notes (as First Read did not long ago) how it can be tough for candidates without the platform of public office to stay public -- and that "there are advantages to not holding a public job."

Newt Gingrich told the ASNE yesterday that Hillary Clinton will likely be the Democratic nominee in 2008 and could win the White House. “‘Senator Clinton is very competent, very professional, very intelligently moving toward the center, very shrewdly and effectively serving on the Armed Services Committee - the first New Yorker to serve on the modern Armed Services Committee since it was created in 1948,’ he said.” - New York Times

The Hill is starting its weekly series looking at the 2008 campaign (hmm) with a long story about "party insiders" questioning Senator Clinton's electability.

The UK elections
Tony Blair yesterday appealed to "voters to elect him for one last time," then "went as close as he could to anointing Gordon Brown as his successor... By being bound into what some were calling a 'treaty of succession', Mr Brown is an even stronger favourite to replace Mr Blair than he was only a fortnight ago." - Times Online

Meanwhile, "Conservatives blunted their attack on what they said were Labour’s unaffordable spending plans yesterday when they refused to rule out raising taxes themselves if they win the election." Times Online

Tory leader Michael Howard yesterday also "sought to bring immigration and asylum issues to the fore in the election campaign" by "blaming failures in government policy for allowing Algerian ricin plotter Kamel Bourgass into Britain... Mr Howard said the prime minister had failed to deliver the 'firm but fair' immigration policies he had promised before being elected in 1997, and that the Bourgass case underlined" problems with "the government's asylum policy." - The Guardian

But a new poll shows that Howard's own "immigration strategy is encouraging more reluctant Labour voters to return to their party than recruiting new Tory voters... The survey shows that the first phase of the election campaign has left Labour in a stronger position - up two points on 39% of the vote and the Conservatives down a point on 33%." - The Guardian

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