Final debate moves closer to home

The first two presidential debates focused on Iraq and the war against terror. Wednesday night, domestic issues take center stage.

Wednesday night's presidential debate will offer candidates a final opportunity to reach a mass audience, and possibly reset the dynamics of the race heading into its last three weeks.

It will also be totally different from the past two debates - and, indeed, from much of the campaign so far - for one simple reason: It will not be about Iraq.

On the surface, the domestic-policy focus of this third encounter would seem to favor Sen. John Kerry, who polls show retains an edge over President Bush on a number of domestic issues. For days, Senator Kerry has been attempting to push the campaign's focus toward the domestic side, giving speeches on energy independence and stem-cell research, and attacking Mr. Bush's record on the economy and jobs.

But Bush has been ramping up his own attacks on Kerry's domestic record, casting Kerry as a liberal who favors government-controlled healthcare and who will raise taxes.

Moreover, the absence of Iraq as a main topic could actually work to Bush's favor - removing the most contentious topic of the past two debates, on which Kerry has found growing room to attack, and allowing Bush to showcase the "compassionate conservative" side he presented in 2000.

Supporters note that although 9/11 transformed Bush into a war president, his background up to that point was centered almost entirely on domestic issues.

"This is a president who, as a Republican, was one of the first to really run as a domestic-policy oriented candidate," says Republican pollster David Winston. "Now 9/11 obviously changed that dynamic significantly," he adds. But Bush also has a number of significant, if sometimes controversial, domestic achievements under his belt - from the No Child Left Behind bill to the Medicare prescription drug bill, to the largest tax cuts in decades.

How well Bush defends this domestic record - and whether he can erode Kerry's advantage on jobs and the economy - could prove every bit as important as his stance on terrorism and Iraq.

Both campaigns are already trying to frame the domestic debate to their advantage. Kerry has been zeroing in on the plight of the middle class, telling voters he's "got [their] back," while portraying Bush as favoring the wealthy and special interests.

Bush is presenting Kerry as an out-of-the-mainstream liberal who would hurt the economy - and the middle class - by raising taxes, increasing government spending, and opposing tort reform.

Of course, this doesn't mean Iraq won't come up at all in Wednesday night's debate. Domestic issues remain inextricably linked to foreign policy - often as an example of priorities, measured in dollars. Kerry is likely to make the point, as he often has on the trail, that Bush's failure to bring in more support from other countries in Iraq has cost the US money that could have gone toward schools or healthcare or other priorities. The Bush administration has been building firehouses in Baghdad and shutting them at home, he often says. Kerry also argues that Bush's tax cuts for the wealthiest Americans have taken money away from homeland security.

Bush is less likely to bring up Iraq - but is almost certain to find ways to reference 9/11 and the larger war on terror. He often cites the terrorist attacks on New York and Washington as context for the recession the economy went into under his watch, and how decent the recovery has been, given the circumstances the nation is facing. He also cites the expense of fighting the war on terror to explain the deficit.

Terrorism remains Bush's strongest suit, according to polls, and he continues to look for ways to play up that advantage - this week attacking Kerry for stating in a New York Times Magazine interview that he hoped to reduce the terrorist threat to the point where it becomes a "nuisance."

Indeed, Democrats argue that Bush decided to frame the race around terrorism because his domestic record was so weak. But, they say, that may prove to be a big mistake if voters' concerns over domestic issues grow stronger than their concerns on national security.

"[The Bush campaign] made a calculated risk they could not sell the domestic issues - so they had to go to terror and security," says Democratic pollster Paul Maslin. But as domestic issues come into sharper focus in this debate and the next few weeks, "that is a very, very damaging place for Bush to be."

Yet Republicans believe some domestic issues could actually play to the president's advantage - or at least wind up a draw. Bush has been hammering Kerry on medical liability and tort reform, arguing that Kerry has shown where he stands on the issue by putting a trial lawyer on the ticket (though Kerry has advanced a Nixon-goes-to-China argument, saying he and Sen. John Edwards would be ideally suited to get tort reform through the Senate).

Republicans also say Bush can score points on education - an issue many were sorry did not come up in previous debate. Although Kerry attacks Bush for not fully funding No Child Left Behind, the bill was one of the biggest education reforms in decades, and is an issue on which supporters say Bush is unusually fluent.

Healthcare is likely to be more problematic for Bush, as the number of Americans without health insurance continues to rise. His Medicare reform bill was hailed by many as a significant achievement, but has proved unpopular with many seniors. In a new ad, Bush calls Kerry's healthcare plan "a big government takeover" that would put decisions in the hands of "Washington bureaucrats" instead of doctors. But analysts say that's a distortion: Kerry's plan - though far more ambitious, and expensive, than Bush's - would in fact leave the employer-based system intact.

Bush's most conspicuous problem has been the economy. Last week's disapointing jobs report gave Kerry new ammunition to argue that jobs are not being created as fast as they should be, and ensured Bush will be the first president since Herbert Hoover to preside over a net loss of jobs. Kerry has gotten particular mileage out of the outsourcing issue, arguing that he would close a tax loophole that encourages companies to send jobs overseas.

Still, Bush has touted the overall unemployment rate as lower than the median rate of the 1990s. And the picture varies from state to state: Some key swing states, like Ohio, have seen significant job losses, but many others, like Florida, have unemployment rates below the nation's average.

Bush has also argued that Kerry would hurt the economy by raising taxes. Democrats say Kerry helped himself on this front in the last debate with his into-the-camera pledge not to raise taxes on those making under $200,000 a year. But some Republicans are suggesting that Kerry's promise actually contradicts other statements he has made suggesting he would return to the tax rates of the Clinton years, which would require raising taxes on those making more than $75,000 a year. If Kerry were somehow forced to amend his pledge, they say, it could prove as damaging as when Bush's father went back on his "no new taxes" promise.

"What he did in terms of looking into the camera could be a Bush Sr. moment - and that could come back to haunt him," says one Republican strategist.

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