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U.S. lawmakers returned Wednesday for the second and final year of the 107th Congress with the Enron scandal, the recession and their upcoming November elections all crowding center stage.

Though election-year politics are certain to make it tough for Democrats and Republicans to find much common ground, both sides vowed to try - even as they debated who was to blame for a return to federal deficits.

"There will be differences, clearly. But as we confront those differences, hopefully, we can overcome them," Senate Majority Leader Tom Daschle, a South Dakota Democrat, said after he and fellow congressional leaders met President Bush at the White House shortly before their chambers convened at midday.

House Speaker Dennis Hastert, an Illinois Republican, added: "We've made a commitment to at least start to discuss and try to work things out."

Congress will begin by taking another crack at crafting a bipartisan economic-stimulus package, which bitterly divided the Democratic-led Senate and Republican-led House last year.

Daschle got the ball rolling Tuesday by offering a scaled-back package of employment and tax provisions, which Senate Minority Leader Trent Lott, a Mississippi Republican, called an "encouraging development," but insisted does not go far enough.

The collapse of Enron Corp., the energy trading company, has spawned a cottage industry in committee investigations. The first of what will be many hearings into Enron's collapse is set for Thursday.

The Senate Governmental Affairs Committee wants to know whether federal regulators did all they could to protect investors and businesses hurt by the largest bankruptcy ever in American history.

Over at the Senate Finance Committee, they're looking into whether Enron used tax shelters to mask its financial condition. And a subcommittee of the House Energy and Commerce Committee also has scheduled a hearing for Thursday.

To the relief of lawmakers, officials reopened the Hart Senate Office Building for occupancy on Tuesday. The building, which provides space for 50 of the 100 senators, had been shut since an anthrax-tainted letter was opened in Majority Leader Tom Daschle's suite in October.

If the Hart building weren't reminder enough of a terrorism-filled fall, security has been visibly enhanced around the Capitol grounds in the weeks since lawmakers left for the holidays.

President Bush travels to the Capitol on Jan. 29 to present his annual State of the Union address, then follows up several days later with his budget proposals, including a call for economic stimulus legislation and additional funds for the war against terrorism.

Political skirmishing is well under way on both issues, even though Democrats routinely praise Mr. Bush's leadership of the war effort and pledge all the support necessary for success.

The two parties maneuvered for position on the anti-terrorism effort last fall, with Democrats trying to accelerate spending at a tim when the president wanted to wait.

More recently, Democrats sharply criticized comments made last week by Karl Rove, the president's political adviser, who said the administration's handling of terrorism could boost the party in the November elections.

As for the recession, a White House-backed bill to stimulate the economy died in the Democratic-controlled Senate on the last day of the session in 2001. Daschle blocked a vote, saying the bill was laden with tax cuts that would worsen the deficit without helping the economy.

More broadly, the two parties seem poised for a debate over taxes and spending, as the country's three-year experience with surplus budgets come to an end.

"Obviously, our first big business of the year is to get budget discipline back on track," House Majority Leader Dick Armey said. "In the aftermath of the 9-11 attack, we lost the language 'how are you going to pay for it?'

"If we can't cut spending, as least (we need to) hold the line on spending," Armey added.

Apart from the economy and terrorism, lawmakers left the Capitol in December with several matters unfinished. These include a farm bill, energy legislation and a measure to enhance presidential bargaining authority in trade talks, all of which were passed by the House and are awaiting Senate action.

Supporters of an overhaul of campaign finance legislation are seeking a vote in the House. They are only four signatures short of the number needed to push the measure to the floor over the objections of the GOP leadership.

Both houses passed legislation last year to overhaul the nation's bankruptcy laws, but compromise talks failed to materialize after the Democrats gained control of the Senate at midyear.

Patients' rights legislation has cleared both the House and Senate, but there was no visible progress on a compromise before lawmakers adjourned last year. Sen. Edward M. Kennedy, a leading Senate supporter of the bill, has been in contact with the White House in recent weeks, and aides have been trying to find areas of agreement.

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