WASHINGTON -- Well, 2007 was the year when people predicted the economy would be in a recession, the Iraq war was lost and Democrats would be dictating policy to a weak, lame-duck president.

But the U.S. economy is still expanding, racking up nearly 5 percent growth in the third quarter, violence has plummeted in Iraq as a result of President Bush's military surge, the first of American troops are coming home and the Democrats lost all of the major legislative fights of the year. So much for those predictions.

Let's take these one at a time, because rarely has a minority party shown so much unity or beaten an incoming majority so soundly, or a lame-duck president shown more resilience on so many big showdown battles.

Iraq: The Democrats tried repeatedly to tack a troop-withdrawal deadline onto military-spending measures, but could not muster the votes needed to override Bush's veto. Despite the doom-and-gloom forecasts that Iraq was plunging into the abyss, the surge strategy has been a spectacular success.

Last month, the Democratic majority made one more attempt to restrict or even to deny war funding, only to cave in to Bush's demands for a full $70 billion more for Iraq and Afghanistan.

The economy: The naysayers repeatedly predicted throughout the year that we were heading into a recession if we were not in one already. But the economy grew in each quarter, turning in a solid 4.9 percent spurt in July, August and September. The people who saw recession just around the corner never told us how the county could be in a near-recession with the nation at full employment.

We've produced 8.3 million jobs since August 2003 as a result of a record 51 consecutive months of net new-job creation.

The deficit: The people who said if you cut income-tax rates, you reduce tax revenue and enlarge the deficit were wrong again. The Bush tax cuts have stimulated the economy, put more people to work and boosted revenues.

The result is a deficit that plunged $250 billion in the past three years. It fell further last year as a result of $161 billion in unexpectedly higher tax revenues. The American people are not undertaxed as Democrats keep telling us, but that didn't stop them from trying to raise taxes last year.

Tax battles: House and Senate Democrats came up with an energy bill that would have slapped significantly higher taxes on energy companies, driving up energy costs beyond what they are now. After Bush threatened to veto any legislation that raised taxes, Democrats dropped the idea, and the result was a compromise measure the president signed into law.

But Democrats tried to raise taxes again in a bill to keep millions of taxpayers from being hit by the alternative-minimum tax that also included a higher tax on investors. They abandoned that tax, too, in the face of a certain presidential veto, and the bill sailed through. Continued...