Little New Hampshire Could Hold Big Significance for Both Parties

But like Penn's Saturday memo, that may be more wish than reality. By Wednesday, it may be too late. By then, Obama's campaign may have inflicted enough damage on the woman-who-was-once-inevitable that no amount of readjusting, recalibrating and rearranging will give her the wherewithal to overcome two big losses in the first contests of the 2008 nomination battle.

The New York Post headline on Monday morning read "Panic." When Smith asked "Is your campaign in panic?" Clinton replied: "Well, I'm not."

People close to the senator from New York said she has been clear-eyed about the challenge since arriving here early Friday -- and determined to turn things around. But her team is far less confident. Loyalists describe a campaign that failed to provide Clinton with a new core message or focus after Iowa.

She spent Friday in one mode: reiterating in slightly sharper language her Iowa theme that the key issue is who is ready to be president. By Saturday she began to toughen that message. By Sunday she was making even stronger arguments against Obama, and by Monday morning she was in all-out contrast mode.

"Where's the beef?" she asked of Obama, invoking the words of former vice president Walter F. Mondale during his ultimately successful comeback against then-Sen. Gary Hart in 1984. The Clinton team hopes that with more time, it can shift the focus to Obama in a way that will force voters in later states to take a closer look at him. But the comeback is built on a series of assumptions, some of which could prove as faulty as the "Where is the bounce?" memo.

Clinton's advisers believe their first lifeline is Nevada, where pre-Iowa and pre-New Hampshire polls showed her with a big lead. But if Obama wins in New Hampshire, he will have the inside track on an endorsement from the Culinary Workers Union, which could play a significant role in a caucus process that is brand new to voters in the state.

The next stop will be South Carolina. That state's Jan. 26 primary will be the first on the Democratic calendar in which African Americans will play a significant role. Clinton and her husband have a long and strong relationship with black voters, but she will have a struggle against the first viable black presidential candidate.

The Republican contest will not end in New Hampshire by any means. The candidates will next move to Michigan for its Jan. 15 primary. McCain will be favored there if he wins New Hampshire, but a Romney victory would send the confused race to South Carolina on Jan. 19 with three different winners in the first three contests.

Research editor Alice Crites in Washington contributed to this report.