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1 which way did they go? The recycled flap over Bush administration intelligence gathering has a way of obscuring real threats coming out of Iraq. Weapons inspectors just returned from their first postwar tour admitted to the UN Security Council last week that 22 pounds of uranium compounds are missing from the largest nuclear power facility in Iraq. Inspectors from the International Atomic Energy Agency tried to downplay the seriousness of the quantity and type of stolen radioactive material, while at the same time insisting that prewar weapons inspections successfully dismantled Saddam Hussein's plans to enrich uranium for bombs. The French inspections chief, nuclear physicist Jacques Baute, ridiculed recent U.S. findings of uranium-enrichment parts in Iraq, part of the international community's lingering resentment over Operation Iraqi Freedom and a renewed attempt to show it lacked basis. But at the same time some Democrats are finding evidence to support U.S intervention. Federal appeals court judge Gilbert Merritt, a longtime Gore family friend serving in Iraq at the behest of the Justice Department, one of 13 legal experts called to rebuild Iraq's judicial system, is a recent convert. Baghdad lawyers gave Judge Merritt, once a candidate for Supreme Court nomination, a document containing names and positions of 600 people closest to Saddam. Saddam Hussein tried to suppress the document, according to the lawyers, but Saddam's son Uday signed it. The list includes Abid Al-Karim Muhamed Aswod, who was assigned to the Iraqi embassy in Pakistan and was-according to the list-"responsible for the coordination of activities with the Osama bin Laden group." Secretary of State Colin Powell told UN Security Council members in February, "From the late 1990s until 2001, the Iraqi embassy in Pakistan played the role of liaison to the al-Qaeda organization." Judge Merritt said, "Up until this time, I have been skeptical about these claims. Now I have changed my mind." 2 red all over If the Bush administration hoped that new budget projections out last week might distract from the mounting body count in Iraq, they got their wish. But if they thought that might be a good thing, they were surely disappointed. The White House admitted July 15 that the $5 trillion surplus envisioned three years ago has disappeared. Instead, the federal government has dived deeper into the red ink than ever before in history. This year, the government will spend $455 billion more than it takes in, and next year's shortfall is expected to swell to $475 billion. Deficit levels should shrink a bit after that, but no one in the White House expects to see another surplus before Mr. Bush completes his second term in 2008. Democrats hope the budget mess may preclude a second term entirely. They blame GOP tax cuts for the sudden record deficits. But the White House insists those cuts have successfully laid the groundwork for faster growth once the economy begins to recover, probably later this year. The real culprits behind the budget numbers, according to the president's economic advisers, are the continuing recession, the stock market collapse, and the high cost of the war on terror. In such an environment, "manageable," short-term deficits are to be expected, insisted White House budget chief Josh Bolten. Fed Chairman Alan Greenspan agreed that the deficits posed no near-term economic problems, but he warned they must be brought quickly under control. That would be doubly bad news for the administration, which already has watched the unemployment rate creep up to 6.4 percent, its highest level in almost a decade. Unless those numbers turn around soon, Mr. Bush may find the "battle for hearts and minds" in America almost as difficult as the one in the Middle East. 3 un backs regime change UN officials want the United States out of Iraq but into Liberia. Secretary-General Kofi Annan pressed West African leaders to speed deployment of their own peacekeepers before the end of July. President Bush has said he will not consider sending U.S. troops until regional forces take up posts inside Liberia and President Charles Taylor steps down and leaves the country. The Bush administration is proceeding cautiously toward intervention, even as the international community doesn't mind asking the United States to throw its weight around on this one. UN diplomats would like American soldiers first to quell the violence-which includes amputations and other brutalities-before a more permanent UN peacekeeping force takes over. Peacekeepers have a poor track record solving Africa's wars. Since 1999, forces loyal to Mr. Taylor have been fighting a rebel group, Liberians United for Reconciliation and Democracy. Abuses abound on both sides, and as fighting began to spread from the north to the entire country last year, UN workers and private humanitarian agencies found they could no longer manage the crisis. 4 a matter of when California Gov. Gray Davis has already conceded that he'll likely face a recall vote-the first in California history. Now his strategists are concentrating on timing. As of last week, groups gathering voter signatures said they've collected about 50 percent more than are needed to bring the matter to a vote. But whether a vote happens in November or in March hinges on two things: how quickly Democratic Secretary of State Kevin Shelley orders county registrars to validate collected signatures as legal-a pending lawsuit accuses him of illegal footdragging-and whether the Davis camp can successfully tangle the timeline in court. Should recall proponents deliver enough valid signatures by Sept. 2, the law requires Mr. Shelley to call a special election in November. Backers of the governor, whose approval ratings are in the tank, want to push any recall vote back to March, during a presidential primary, when more Democratic voters would show up at the polls. Mr. Davis's handlers have admitted that they were examining legal options that would slow down the recall effort. Last week, they filed a lawsuit alleging that one recall group, U.S. Rep. Darrell Issa's "Rescue California," knowingly hired a pair of convicted felons to circulate recall petitions in violation of state law. But Rescue California's Dave Gilliard notes that the two worked only briefly for Mr. Issa's group, then switched to Mr. Davis's side, where they were also paid for their work. Now the two are key witnesses in the Davis lawsuit. 5 roller coaster on a roll Is tech back? Investors have turned back to the Nasdaq market, after it spent three years in the doghouse. Some analysts even say the bull market is back. Tech stocks boomed, crashed, and now some see them as a bargain. A rally started in mid-March, after the Iraq invasion started. Since then, the Nasdaq index-home to Microsoft, Cisco, Oracle, and many others-rose over one-third. A hint of happier times comes from Juniper Systems, a networking company that competes with giant Cisco. This month it reported quarterly income of $13.6 million, which was more than double the same period last year. CEO Scott Kriens said high-speed Internet access is growing around the world-and that's good for his business. Intel's second-quarter profits also doubled. Long-term optimism can be found in a new report from the Rand Corp. The United States will continue to dominate high-tech, Rand concluded, although China could eventually pose a threat.