The Washington Postand Los Angeles Timeslead, while the Wall Street Journal tops its worldwide newsbox, with President Bush's end-of-year news conference, where he called 2006 a "difficult year," gave a harsh assessment of the situation in Iraq, and insisted he is still considering several options on how to proceed.

The New York Timesleads with another story in its energy series that looks at how a United Nations-backed program to limit global warming is inefficient and enriches a select few. USA Todayleads with the heavy snowstorm that hit Colorado and has delayed thousands in the middle of a record-breaking travel season. Denver International Airport closed down, and more than 1,000 flights were canceled through Thursday. Some highways and roads were also closed. The airport set up cots as they predict some could be stuck for several days.

The Post's lead story focuses on reading between the lines and gives big play to Bush declaring that he won't necessarily listen to military officers on the question of whether more troops should be sent to Iraq. In the past, the president had emphasized that any decision on troop levels would have to be made by the generals on the ground. Yesterday, however, Bush insisted that while "the opinion of my commanders is very important" he hinted that ultimately he would be the one who will be making the decision on troop levels. The WSJ mentions how Bush acknowledged Iraq hasn't gone exactly as planned and stated that "additional sacrifices" will have to be made. He also said the military would have to expand in order to carry out these sacrifices.

The LAT focuses on Bush's harsh assessment of the Iraq situation but the president also emphasized the mission to create a "free and democratic Iraq that can govern itself, sustain itself and defend itself, and is an ally in this war on terror" hasn't changed. Bush said he would not make any changes to Iraq policy without first talking to Defense Secretary Robert M. Gates, who is currently in Baghdad. Democratic leaders said the president's news conference shows he doesn't understand the need for more urgent change in Iraq.

The Post's Dana Milbank sees symbolism in the fact that the news conference was held in the Indian Treaty Room. The room was once used as a reception room for the Navy and "it had stars on the ceiling for navigation, a compass in the center of the floor and other devices used by those who have lost their way."

After he met with Gates, Army Gen. George W. Casey Jr., the commander of U.S. forces in Iraq, declared he's not "necessarily opposed to the idea" of raising troop levels. Retiring Gen. John P. Abizaid, commander of U.S. forces in the Middle East, has frequently spoken out against sending more troops to Iraq but yesterday said "all options are on the table." Abizaid also insisted his retirement "has nothing to do with dissatisfaction."

The United Nations-backed program allows businesses in rich countries to pay to reduce greenhouse gasses from poorer nations, in order to stay within the limits of how much pollution they can create themselves. These deals usually end up being more expensive than merely cleaning up the original offender. For example, a factory in China could buy an incinerator that costs $5 million to clean up one particularly harmful gas. Instead, foreign companies will end up paying approximately $500 million for the incinerator, with much of the money going to lawyers and factory owners. The companies go ahead with these costly propositions because it is still cheaper than cleaning up their own act.

The LAT uses President Bush's signing of the last major piece of legislation passed by the 109^th Congress to highlight some of the most outrageous earmarks that were added in middle-of-the-night meetings. The bill was merely supposed to be an extension of existing tax cuts and credits, but in the end some industries won big. Although the paper is quick to emphasize "there have been more outrageous end-of-session bills," it does note this one came soon after an election that emphasized ethics and corruption issues.   

The NYT fronts news that the United States and Britain will move more warships into the Persian Gulf, in order to display military prowess toward Iran. Although U.S. officials acknowledge the move might be seen as a provocation, they want to send a sign they can still keep an eye on Iran, despite the growing problems in Iraq.

The LAT goes inside with a grim landmark: The bodies of 76 unidentified people were recovered in Baghdad yesterday, which is a one-day record. Additionally, 26 Iraqis were killed around the country yesterday. Two U.S. soldiers were also killed by roadside bombings.