If New Hampshire is a proxy for the nation, John E. Sununu's Senate race may be the most important contest to watch this fall. It could tell us not only which way the balance of power in Congress will tilt, but something about the outcome of the presidential contest as well.

On the face of it, that could sound a little ominous for Republicans: Mr. Sununu is supposed to be the most endangered man in the U.S. Senate. In March, he was polling below 40% against his opponent, former New Hampshire governor Jeanne Shaheen. He's been behind in every poll taken over the past 18 months, including one released Monday by the National Republican Senatorial Committee, which hailed the fact that the first-term senator had pulled within two points.

But Mr. Sununu seems remarkably sanguine, both on the stump in New Hampshire and during a recent interview in New York. Not only does he think that the conventional wisdom underrates his chances, but he sees upside for a lot of Republicans as voters, at last, start to tune in to the 2008 campaign.

In the minds of the press and the political class, this political season has already been going on forever. But the average voter, Mr. Sununu argues, has only just started paying attention. "Over the last four or five weeks," he says, "voters have finally begun to turn from their summer vacations and their children heading back to school to thinking about the election."

Mr. Sununu ought to know something about electoral dynamics. He won election to the House three times -- the first time in 1996, a year in which Bill Clinton carried his state in the presidential race. He was an underdog in his first Senate matchup with Mrs. Shaheen in 2002. But he ended up winning in what turned out to be a surprisingly good year for Republicans in New Hampshire. His father, moreover, was a three-term governor of New Hampshire, and later chief of staff to President George H.W. Bush.

So he's been around politics most of his life, even though he stresses on the stump that he worked as director of operations in a small manufacturing firm in Manchester, N.H., before entering politics -- experience he touts as proof that he understands the concerns of small businesses and the 60% or so of his constituents that work for one. It also gives him, he argues, an analytic framework that is all too rare in Washington. "I am not a lawyer" has been an applause line for him.

Two years ago, says Mr. Sununu, "There's no question things were not progressing in Iraq the way anyone in America would have liked, there was a sentiment that the Republican-controlled Congress didn't do enough to control spending, and people were reading about scandals in the weeks leading up to the 2006 elections. And it's taken some time to stop looking back and start looking ahead."

That, Mr. Sununu argues, is exactly what is happening now, and it explains why his own race is tightening, and at least some of the bounce John McCain has enjoyed the past two weeks.

Needless to say, any candidate that's running behind has to have some story to tell about how they're going to pull it out. But Mr. Sununu first made this argument to your correspondent while campaigning in New Hampshire before the Republican Convention and the most recent round of polling. And there are signs elsewhere in the country, including the equally contentious Senate race in Colorado, that events are starting to move in the Republicans' direction. A Gallup poll released Friday showed that Republicans had jumped ahead of Democrats among likely voters in a generic ballot.

His opponent's strategy to date suggests a certain backward-looking bias. Mrs. Shaheen's most recent ad features a man, who could pass for Mr. Sununu, in a hole -- literally. He looks like he could be digging his own grave. The first name mentioned in the ad is George Bush, which is a major theme of Mrs. Shaheen's rematch: "John Sununu voted with George Bush 90% of the time" is a mantra of sorts for the Democrat.

Fortunately for Mr. Sununu, George W. Bush won't be on the ballot in November. And the way he sees it, his opponent's approach, also in evidence in the presidential contest, will only lose power as voters look away from the era now ending and focus on the choices going forward.

This isn't to say that Mr. Sununu is sitting back and waiting for history to come his way. "The issues that come up most often on the campaign trail today," Mr. Sununu says, "are the economy, energy and probably health care." And Mr. Sununu believes he's on the right side of all of them.

At a recent campaign event in Newbury, New Hampshire, Mr. Sununu hit each of these issues. While his opponent speaks of government investment in "emerging industries" to spur job creation, Mr. Sununu takes a different approach. "Jobs in America," he tells an audience assembled in a spacious home above Lake Sunapee, "are not created 200,000 at a time. They're created two at a time, five at a time, one at a time in those small businesses that drive our economy." You help those businesses not with government spending programs, but by "hold[ing] taxes steady," because "you cannot raise taxes without hurting millions of people in this country."

On health care, Mr. Sununu acknowledges that voters would like to see "change." But he's skeptical that this translates into broad support for much bigger government. Voters, he says, "understand that a government takeover of the health-care system is highly unlikely to improve efficiency." He argues that "we need to make sure everyone in the country has access to affordable health insurance. We do that by first looking carefully at who goes without insurance. And a very large number of them work for small businesses."

Given that, Mr. Sununu says we should focus first on dismantling government-erected barriers to affordable, accessible health-care. This includes "allowing small businesses to pool together in large numbers on a national basis to negotiate better prices," and "allowing an individual or a business to purchase a health-care policy from anywhere in the country," which Americans can't do right now.

When it comes to the current credit crunch and concomitant slowdown, he notes that he has fought to reform Fannie Mae and Freddie Mac since almost the moment he arrived in the Senate, co-sponsoring legislation that might just have prevented what happened to them last week, if Democrats hadn't consistently blocked any attempts to rein in the two mortgage giants.

As for energy, he pays homage to the idea of a "balanced energy policy," but adds that "there's no reason not to lift the ban on offshore oil exploration. I say that with confidence because I know that there's no country in the world that does more or spends more to protect the environment" when it drills for oil.

Mr. Sununu's speaking style, both on the stump and one-on-one, is thoughtful and engaged. True to his New England roots, he eschews grand pronouncements in favor of pragmatic language. His outlook is unmistakably conservative without sounding ideological. Conversing with him, it is easy to see why John McCain and others have called him "the smartest man in the Senate."

He is certainly smart enough to know that a little distance from the Bush administration can't hurt, which is why he pointed out in Newbury, "I took a stand -- a tough stand at the time -- to stop the Patriot Act because I didn't think it did enough to protect civil liberties." He notes that the version that passed into law when the act was reauthorized in 2006 adopted most of the changes he had called for.

A stand like that may indeed be important to voters in a state whose license plate reads "Live Free or Die." But even more importantly, it's hard to square the Democratic caricature of a Bush crony with the down-to-earth, easy-going persona that Mr. Sununu projects face-to-face.

New Hampshire small business owners I spoke to still shudder at the thought that Mrs. Shaheen wanted to impose a sales tax on a state long renowned for keeping government small and taxes low. All those Vermont cars that they see stream over the Connecticut River to shop in New Hampshire would have stayed home if that had happened, one shop owner in Claremont, NH said.

Then again, that is also in the past, and Mrs. Shaheen is not running for governor this time. What's more, unlike their last contest in 2002, this is a presidential year. The latest polls show a statistical dead heat in New Hampshire in the presidential race, with Barack Obama, if anything, slightly ahead. Even so, Mr. Sununu predicts that Mr. McCain could be "the strongest Republican presidential candidate [in New Hampshire] since George Bush against Mike Dukakis in 1988," when George H.W. Bush won by 26 points in the state.

"It's a different environment than conventional wisdom thought it was 12 months ago," Mr. Sununu says. "It's a different environment than most pundits thought it was going to be six months ago or three months ago." For the "most endangered man in the Senate," that's good news.