George W. Bush has always been suspicious, even contemptuous, of
introspection. "I don't spend a lot of time looking in the mirror,"
he once bragged, "except when I comb my hair." Last week, though, he
suddenly yielded to reporters' endless, and hitherto fruitless,
efforts to plumb his moods. Days after aides had taken pains to tell
reporters the President had not expressed frustration in a meeting
about Iraq, Kelly O'Donnell of nbc pressed, "But are you frustrated,
sir?"

"Frustrated?" he replied. "Sometimes I'm frustrated. Rarely
surprised. Sometimes I'm happy ... But war is not a time of joy.
These aren't joyous times. These are challenging times, and they're
difficult times, and they're straining the psyche of our country."
He might as well have busted out some French or broken into song.
George Bush was putting the country on the couch. Republicans and
Democrats alike flashed back to Jimmy Carter's assertion in July 1979
that the country was suffering "a crisis of confidence." Only
political junkies know that Carter never actually used the word
malaise. And only the most astute historian remembers that he got an
initial bounce in the polls. In the long run, though, the speech was
judged a disaster and set the stage for Ronald Reagan to use sunny
optimism to run Carter out of town. George H.W. Bush, accepting the
vice-presidential nomination in 1984, promised that the country would
not return to the "malaise days" of his Democratic predecessors.

One other President, also a Democrat, regretted venturing into
psychobabble. Bill Clinton, squatting in jeans in the press cabin of
Air Force One, said as he geared up for his re-election run that he
was "trying to get people to get out of their funk," provoking
mocking headlines like dr. clinton, national therapist.

Some of Bush's friends were mystified by his remark last week and
concluded that it must be a phrase he picked up in a briefing. "It's
pollster talk," said one person who speaks often to the President. A
senior Administration official said the President was simply saying
he recognizes that the protracted war on terrorism inevitably takes a
toll on the public. "He wasn't saying there's some kind of crisis of
confidence," the official said. "Just the opposite: he believes
Americans have the ability to sustain a long struggle." But Bush's
comment reflected the increased pessimism about Iraq that is seeping
through the Administration. "It's a little hard for us to keep saying
there'll be good days and bad days when they're all bad days," an
aide said, moping.

The President himself is unchanged, say people who spend private
hours with him, even as he gears up for the stretch run of the
midterm-election campaign, which has Republicans more worried than
they have been in a dozen years. His traditional summer sojourn at
his ranch was cut from a month to nine days, but he dived into the
gritty, sweaty labor that he loves. Each week aides put a new photo
album on a credenza outside the door to the Oval Office for the
President and visitors to savor; the current edition features Bush in
T shirt, ball cap and goggles, using power tools to cut a bike path
through Texas scrub.

Bush's aides maintain that they're in no funk either. Previewing the
final quarter of Bush's presidency, officials disclosed to Time that
the Administration is formulating a huge energy initiative designed
to "change the whole nature of the discussion" and challenge the
g.o.p., Democrats, the oil and electricity industries, and
environmentalists. An adviser said Bush's views about global warming
have evolved. "Only Nixon could go to China, and only Bush and
Cheney--two oilmen--can bring all these parties kicking and screaming
to the table," the adviser said.

Whatever the coming months hold, Bush advisers said they could safely
predict there would be no more Dr. Phil-speak. The President doesn't
fret in private, they say, so he won't in public. A friend said Bush
hopes his ultimate legacy will be that he engaged the war on
terrorism and started a multigenerational process of winning it, the
way Harry Truman began winning the cold war. No one remembers Harry
Truman ruminating about the nation's temperament.

Former Deputy Secretary of State Robert B. Zoellick is planning to join the presidential campaign of Sen. John McCain next year, overseeing development of domestic and foreign policy, Republican officials tell TIME.

Zoellick, who will be working in New York and around the world for Goldman Sachs starting Sept. 11, told TIME that McCain contacted him as he was leaving the State Department this summer, and said he is delighted to advise the prospective campaign. "I have great respect for John McCain's character, sense of honor and record and have worked with him on a host of foreign policy and economic issues, and think he would make a great President who would fit the times and challenges," Zoellick said.

[Update: An earlier version of this posting incorrectly said Zoellick would work full-time for the campaign.]

The Arizona Senator has said he will not make a firm decision about whether to pursue the Republican presidential nomination until after November's midterm elections. But his advisers are already doing heavy outreach to key early states in the nominating process like New Hampshire and South Carolina, and the Senator is traveling like a candidate. Now, the GOP officials disclosed, McCain's advisers are making plans to launch a formal campaign in the first quarter of 2007 if he decides to go ahead.

Zoellick, who was U.S. Trade Ambassador in President Bush's first term and is headed for Wall Street until he joins McCain, will be one of the top members of the prospective campaign's senior staff. The officials say the arrangement was worked out about three months ago and came about because of mutual admiration between the Senator and Ambassador Zoellick, and through the involvement of Gov. Jon Huntsman Jr. (R) of Utah, who's an active McCain supporter and is close friends with Zoellick. McCain already has strong views and a large stable of advisers on foreign policy, so Zoellick will manage that process. The domestic side will involve more policy development.

The rapid pace envisioned by McCain's advisers, and the firm commitments he is securing from top political, governing and fund-raising talent, reflect McCain's determination to "have the full complement of what a frontrunner's campaign should look like," according to a GOP official familiar with his plans.

Although much attention has been given to the fund-raising and campaign machine McCain is assembling, his advisers also are deep into planning a large policy and issue apparatus. McCain sources said it's too early to describe the theme of his policy, but said it will be "bedrock conservatism, Main Street Republican, what we got used to in the Reagan administration and with former President Bush." Among his star recruits:

--Phil Handy of Florida, who handles Gov. Jeb Bush's financial trusts and was named by the governor to chair the Florida State Department of Education, will be an education adviser, political adviser and fund-raiser for McCain's campaign, the officials said. That strengthens McCain's growing ties with Gov. Bush.

--Phil Gramm, the former U.S. Senator from Texas, will have a broad economic-policy portfolio, from trade and budget policy to private property rights. Another leader of the economic team will be Gerald Parsky, President Bush's California chairman and a former Assistant Secretary of the Treasury. Also working on fiscal policy will be two former directors of the Congressional Budget Office: Dan Crippen, a budget and domestic policy adviser to President Ronald Reagan who chaired a panel advising NASA on changes after the space shuttle Columbia disaster, and Douglas Holtz-Eakin, who also was chief economist of President Bush's Council of Economic Advisers. Crippen will be staff director of issue development.

--Former Sen. Dan Coats (R-Ind.) will help with defense policy, and is a key link to evangelical Christians.

Zoellick, a Harvard Law graduate who later was an executive vice president at Fannie Mae, has held senior positions under the last three Republican Presidents.

"It's a big get," the GOP official said. Zoellick was Deputy Secretary of State under Secretary of State Condoleezza Rice from February 2005 until July. In September, he joins Goldman Sachs as a managing director and vice chairman. He left government after he was not selected to succeed John Snow as Treasury Secretary. During the administration of President George H.W. Bush, Zoellick was Under Secretary of State for Economic and Agricultural Affairs and later White House Deputy Chief of Staff, and he held several Treasury Department positions under Reagan. -- With reporting by Michael Duffy/Washington