Investors fear the worst isn't over; Bush says Democrats aren't being fair to Mukasey.

Investors fear the worst isn't over; Bush says Democrats aren't being fair to Mukasey.

Investors fear the worst isn't over; Bush says Democrats aren't being fair to Mukasey.

A summary of what's in the major U.S. newspapers.
Nov. 2 2007 6:17 AM

Bad News Bears

The Washington Postleads with yesterday's drop in the stock market, as some bad news from the financial sector prompted renewed fears that the credit woes are far from over. The decrease more than erased Wednesday's gains that came after the Federal Reserve announced a cut in interest rates. The New York Timesleads with President Bush "upping the ante," as one Republican put it, by going to bat for attorney general nominee Michael Mukasey. In an Oval Office interview and a speech at a conservative think tank, Bush said Democrats are being unfair and should move to confirm him or risk leaving the Justice Department without much-needed leadership.

The Los Angeles Timesleads with a look at how the Democratic Party is "on the verge of a major political gamble" as several lawmakers, and all the presidential hopefuls, are advocating increasing taxes on rich Americans. Some say the move isn't politically risky but Republicans are thanking their lucky stars that they have been handed an easy campaign sound bite and several Democrats are increasingly nervous that their party might be ignoring basic conventional wisdom. The Wall Street Journal leads its world-wide newsbox with violence in Iraq, which claimed the lives of at least 21 people around Baghdad yesterday, and the U.S. military announced the deaths of three soldiers. A top U.S. commander also said there's been a decrease in the number of explosively formed penetrators in Iraq, which are thought to originate in Iran. USA Todayleads with a plan brokered by the Bush administration that would bolster Atlanta's water supply as a drought continues to affect the region.

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The Dow Jones Industrial Average fell 2.6 percent yesterday as "many investors appeared to have second thoughts about their initial reaction to the Fed's move," says the NYT. Financial firms were particularly affected after analysts downgraded Citigroup stock noting that the world's largest bank will have to take some painful steps to counter the effects of weak credit markets. Although investors (and the media) liked to act like the markets were back on track after the summer turmoil, since last week "a drumbeat of bad news began to send a different message," says the WSJ. The fact that Exxon Mobil reported lower-than-expected profits (no matter that it was still a humongous $9.41 billion) and that Chrysler announced it would cut 11,000 more jobs certainly didn't help matters. The NYT notes there are also simmering fears that credit problems coupled with increasing oil prices could lead to a decrease in spending this holiday season.

The NYT says the president's new campaign "demonstrates just how much the White House has been caught off guard" by the controversy surrounding Mukasey's nomination. As usual, the administration hopes it can turn the situation around by warning that the country's ability to fight terrorism will be affected if Mukasey isn't confirmed. The LAT notes that although some think Bush might go for a recess appointment, there's speculation that Senate Majority Leader Harry Reid would keep some lawmakers in Washington over the holiday to prevent such a move.

Meanwhile, Sen. Edward Kennedy became the fourth Democrat on the judiciary committee to announce that he will vote against Mukasey. Both the NYT and WP dedicate separate stories to the speculation surrounding Sen. Charles Schumer's vote. Schumer was a strong supporter of Mukasey but now says he's undecided, which the NYT says amounts to "a hard lesson on the risks of taking credit."

The WP off-leads word that, according to internal documents, the head of the Consumer Product Safety Commission received lots of free travel courtesy of key industries the agency regulates. The current acting chairman and her predecessor took almost 30 trips that were paid for by the companies. According to government regulations, free travel should not be accepted if it could cause "a reasonable person … to question the integrity of agency programs or operations." Even though agency officials say the trips are essential to their work, the Post notes that the chairman during Bill Clinton's administration traveled only "at the expense of the agency or of media organizations."

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The NYT fronts an interview with Sen. Barack Obama where he emphasized that, if elected, he would not put forward preconditions before sitting down to talk with the highest levels of the Iranian government. Obama said Iran's support for militant groups in Iraq comes from concerns about the Bush administration's policies. He noted he could be willing to promise not to seek "regime change" in exchange for cooperation and emphasized he would consider offering incentives, including economic aid and entrance into the World Trade Organization. He also said that after combat troops are removed from Iraq, the American forces that will remain in the area to fight terrorism might be based outside Iraq.

The LAT fronts an above-the-fold picture relating to the late-breaking news that Hollywood's writers are inching closer to a strike. Leaders of the writers' union announced the strike is happening and pledged to inform members today when they should stop tapping their keyboards. There's still a chance that an agreement will be reached but most think a strike would probably start on Monday. "This feels like Armageddon," an entertainment attorney tells the LAT.

The LAT fronts, and everyone mentions, the death of Paul Tibbets, the pilot of the plane that dropped the atomic bomb on Hiroshima. Tibbets had declared he had no regrets over his actions because of his conviction that the bomb actually ended up saving lives, as it prevented an invasion of Japan. "I never lost a night's sleep over it," he said.

As Americans get ready to turn the clocks back this weekend, the WSJ's Carl Bialik notes there are no reliable statistics that show switching the clocks back and forth actually saves any energy.

TP has tried to avoid writing about Stephen Colbert's publicity stunt but makes an exception today to note that leaders of South Carolina's Democratic Party rejected his bid to be included in the primary ballot. One of the Democrats that voted against Colbert said the comedian "might be trying to use us … to achieve some kind of status he doesn't really deserve." He will get his $2,500 filing fee back.

Daniel Politi has been contributing to Slate since 2004 and wrote the Today’s Papers column from 2006 to 2009. Follow him on Twitter.