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American pessimism about the direction of the country is growing, largely because of rising energy prices and a sluggish economy, according to a new survey by pollster John Zogby ... 53 percent of Americans believe the country is on the "right track," down 7 points from January ... 38 percent believe the country is on the "wrong track," up 6 points from January ... President Bush's personal approval is up to 60 percent from 54 percent in January, and those who think he's doing a good job in office are now up to 51 percent from 42 percent ... But Democratic attacks are also taking their toll ... those who disapprove of Bush's job performance are up 11 points, to 48 percent from 37 percent in January ... Of growing concern to GOP leaders: Democrats now lead Republicans 38 percent to 28 percent in a generic question of who should run Congress. Senior economic advisers to President Bush say he is serious about more rounds of tax cuts and fundamental tax reform and simplification ... Larry Lindsey, chief economic guru to the president, has long supported a 17 percent flat tax, and even wrote favorably about it when he was at the American Enterprise Institute ... Other administration figures are supportive, including Labor Secretary Elaine Chao, a former Heritage Foundation fellow ... Treasury Secretary Paul O'Neill has been talking about bold tax reform in recent interviews, including scrapping the corporate income tax ... During the GOP presidential primaries Bush was cool to Steve Forbes's flat tax plan, but after his meetings with Russian President Vladimir Putin in Slovenia, Bush had surprising and unprompted kind words for the new Russian flat tax that passed last year ... "I was so impressed that he [Putin] was able to simplify his tax code in Russia, with a flat tax. I'm not so sure I'll have the same success with our Congress." Russia hasn't been a top foreign-policy priority of the Bush administration ... Early on, Bush focused his personal and diplomatic energies on Mexico, Canada, Latin America, and Europe ... But now, Bush is seeking to develop a close personal relationship with Russia's Putin and is trying to persuade him to accept changes to the 1972 Anti-Ballistic Missile agreement and accept the development of ballistic-missile defense systems that Bush believes must be a top U.S. priority ... The meetings between Bush and Putin at the Brdo Castle in Brdo Pri Kranju, Slovenia, went extremely well, reports author and former speechwriter Peggy Noonan, who spoke with the president in the Oval Office after his return ... Bush does remain a bit wary of the former KGB chief, but has decided to publicly announce his "trust" in Putin until there is any reason not to believe otherwise. U.S. officials are growing increasingly concerned about Iran as a financial supporter of global terrorism and a destabilizing force in the Persian Gulf ... That's one reason President Bush specifically raised the issue of Iran with Putin ... Bush is worried that Iran is buying Russian weapons, including submarines and nuclear reactor components ... No sooner did Bush return from his meetings with Putin than Attorney General John Ashcroft announced indictments of 14 people-13 Saudis and one Lebanese-for conspiring and carrying out the bombing of Khobar Towers, a Saudi Arabian apartment complex ... FBI and CIA officials believe Iran was behind the June 25, 1996, truck bombing that killed 19 American servicemen and injured 372 other Americans and Saudis, but can't yet prove it in court. Just when you'd heard enough about Democrats, interns, and scandals, a story is brewing in Washington that gets stranger every week and is increasingly hard to dismiss as simple rumor-mongering ... The media spotlight is now focused on Rep. Gary Condit (D-Calif.) and what he may know about the mysterious disappearance in early May of Chandra Levy, 24, a constituent of Condit's who was a Washington intern at the Bureau of Prisons ... The case has mushroomed from a local missing persons story to an explosive national political story as Levy remains unaccounted for. Condit, 53 and married, denies any romantic involvement with the young girl, but says the two were "good friends" ... Condit insists he knows nothing about Levy's disappearance, but D.C. police searched his Washington apartment and interviewed the congressman twice at length.

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