Robert Novak

WASHINGTON -- The Bush administration has been alerted that Chairman Alan Greenspan will guide the Federal Reserve Board to a small interest rate boost before the presidential election, and President Bush is reported to be satisfied.
According to these sources, the central bank this fall will raise the federal funds (interbank lending) rate from the current historic low of 1 percent up to 1.25 percent. The Fed is expected to push the rate to 1.5 percent later this year after the election and up to 2 percent early next year.

 Typically, Greenspan's public statements have been so difficult to interpret that Fed-watchers have disagreed in their predictions of future action. But the administration has been assured that interest rate increases will not affect the election outcome.


 Well-placed New York Republicans concede that there will be no chance to keep the state's governorship for a fourth straight term in 2006 unless Rudy Giuliani returns to politics to run.

 These Republican leaders have no idea what the former New York City mayor will do. But they see nobody else who could beat State Attorney General Eliot Spitzer, the likely Democratic candidate. Three-term Republican Gov. George Pataki is expected either to return to private law practice or, if President Bush is re-elected, get a federal appointment.

 A footnote: Giuliani is the most popular Republican presidential prospect for 2008. His support of gay rights and abortion rights makes him unacceptable to the party's rank-and-file unless they are desperate following a defeat for president this year.


 If Rep. Tom DeLay is indicted in a politicized Texas legal proceeding, he may be replaced temporarily as House majority leader by 80-year-old Rep. Henry Hyde of Illinois.

 Ronnie Earle, the Democratic district attorney in Austin, could bring an indictment against DeLay for alleged illegal cash payments in pushing congressional redistricting through the Texas legislature. In secret discussions, Republican leaders discussed naming a seat-warmer to replace DeLay temporarily rather than a competitor for the leadership.

 Hyde, a 15-term House member from the Chicago suburbs, formerly has been chairman of the House GOP Policy Committee and the House Judiciary Committee and is currently chairman of the House International Relations Committee.


 Conservatives are upset with Republican Rep. Pete Sessions for signing a mutual disarmament pact with Democratic Rep. Martin Frost, forgoing "outside" support in their race against each other in Texas this year.

Robert Novak

Robert Novak (1931-2009) was a syndicated columnist and editor of the Evans-Novak Political Report.

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