In an interview with Carol Joynt at the Q&A Cafe at Nathan’s restaurant yesterday, Howard Fineman characterized immigration and Iran as the two big issues ahead in the 2008 presidential race. The notion of a nuclear-armed Iran and the potential for another conflict in the Middle East elicited an anxious response from the audience.

It was a bleak, if necessary, closing to an otherwise lighthearted session during which Newsweek’s chief political correspondent discussed the Democratic and Republican presidential candidates.

His first thought at the mention of Hillary Clinton? “Great mom. She doesn’t get enough credit for that.” Giuliani? “Bald” but a “tough cookie.” Romney? “Intent on touching every button at the risk of coming off as phony.” On Fred Thompson’s slow start at the GOP debate: “He looked like a guy who missed the first month of class.”

Fineman—armed with the latest poll results—discussed what he thinks is shaping up as a unique election race. Citing the Iraq war as “the driving force,” he argued that Americans are paying attention earlier in the race than they normally do: “October polls usually don’t mean squat.” He speculated that the overwhelming sense that the country is heading in the wrong direction has changed the playing field for the election.

“The attitude is corrosively bad,” Fineman said of public response to the war, adding that many baby-boomers fear that their children won’t have better lives—suggesting to him that there are cracks at the core of the optimistic American spirit.

What chances, then, does a Republican candidate have? Plenty, in Fineman’s view: Because the Electoral College is “closely divided” and the public trusts the GOP in terms of the general question of terrorism, Republicans still have some cards to play. Whether they use the right ones is another matter: “They think Hillary Clinton is their card.”

Describing the media as “wrestling promoters,” Fineman named the public’s appetite for contention and controversy as a reason not to discard a strong Republican contender. “We want a contest,” he said. “We need a contest.”