Power Outage

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DeLay may not have seen the worst of it yet. Sources tell TIME that while Earle was closing in on DeLay from Austin, Texas, a federal investigation into the spreading scandal around disgraced lobbyist Jack Abramoff, accused with Michael Scanlon (a former press secretary of DeLay's) of bilking their Indian-tribe clients out of $66 million, has begun lapping at the edges of the former majority leader's operation. A former Abramoff associate who was questioned by the FBI in August says, "They had a lot of e-mails, a lot of traffic between our office and DeLay's office." Many of those exchanges involved lavish travel by DeLay arranged by the lobbyist but requested, the e-mails suggest, by aides in DeLay's office. (House members are allowed to accept gifts under limited circumstances but not to solicit them.) Says the source: "There was nothing I saw that hit DeLay personally, but there was a lot of questionable stuff that was going on with his staff. 'Tom wants this. Tom wants that.' Was it really him or just the staff that was being aggressive?" DeLay's office wouldn't comment on the Justice Department investigation, and neither would the FBI.

Republicans had plenty of problems even before the latest blow to DeLay. Voters are angry about gas prices, the war in Iraq and the botched response to Hurricane Katrina. Polls show President George W. Bush at or near the lowest public-approval ratings of his presidency. On the other side of the Capitol, Senate majority leader Bill Frist faces an investigation by the Securities and Exchange Commission into the circumstances surrounding his decision to sell all of his stock in the hospital chain founded by his family, Hospital Corporation of America, in June, just before the share price dropped following a bad earnings report.

So dispirited are Republicans that some worry about losing control of the House--a danger that once seemed remote. "We're looking in the crystal ball. We're moving into an area where we don't know what will happen," says deputy whip Tom Cole, a conservative from Oklahoma. With a switch of only 15 seats required to end their majority, Cole is anxious that the party may have to contest as many as 100 tight races if the winds arraying against it turn into a national backlash like the one that ended the Democrats' 40-year reign in 1994.

Having seen how the Democrats failed to galvanize their voters in that campaign, Republicans say the chief goal in rewriting their strategy for the fall will be to re-energize their base. The plan taking shape calls for a robust conservative agenda through next spring, including a tax-reform package. That move would allow Republicans to pivot back to issues like education tax credits that would appeal more to moderates as the elections approach.

As for DeLay, his struggles appear likely to consume him for many months. He has launched what amounts to a major political campaign to convince supporters that the indictment is flimsy and he is a victim of a political smear. DeLay pointed to Democrats' vow to use G.O.P. ethics as a campaign issue, and supporters noted criticism of Earle in Texas for speaking in May to a $100,000 fund raiser for a Democratic political action committee (PAC). But DeLay has produced no evidence Earle conspired with Democrats in Washington.