WHILE AMERICA WAS SLEEPING I fixed a 'news breakfast' for you -- ready each weekday morning at 6am Eastern to satisfy your media craving [feature permalink here]. These must-reads will kick start your day!

U.S.

Liberal Discontent With Tax Deal Spurs Murmurs of Primary Challenge: "The idea seems to have little momentum for now, not least because there isn’t an obvious candidate, and because such a challenge would seem to have about as much chance of success as, say, a reality show about David Hasselhoff. That a primary is being openly discussed, though, reflects how fully Mr. Obama’s relationship with his party’s liberal activists has ruptured and the considerable confusion on the left over what to do about it. " (NY Times)

Soaking the Rich A Washout for Obama: "President Barack Obama lost on Capitol Hill but he claims he won the public argument about how much the rich should pay in taxes." (Politico)

MN Gov. Race -- Dayton to Concede? "Removing all but a smattering of ballot challenges, a lead attorney for Republican gubernatorial candidate Tom Emmer acknowledged Tuesday that it is no longer possible for Emmer to win the statewide recount against DFLer Mark Dayton. 'We're almost done now,' Emmer attorney Eric Magnuson said of the recount process. A GOP source with knowledge of Emmer's plans said he would concede at 10:30 a.m. Wednesday at his Delano home." (Star Tribune)

Judge Tosses CIA Hit-List Lawsuit: "A federal judge tossed out a lawsuit Tuesday that challenged the Obama administration's placement of a Yemeni cleric, who is also a U.S. citizen, on a kill-or-capture list of terrorists linked to al-Qaeda. U.S. District Judge John D. Bates of the District ruled that the Yemeni father of the cleric, al-Qaeda propagandist and plotter Anwar al-Aulaqi, lacked the standing to bring the challenge in federal court. Bates's 83-page opinion handed a victory to the White House and a setback to civil liberties groups." (WaPo)

Elizabeth Edwards, 1949-2010: "Elizabeth Edwards has passed away after a long battle with cancer. The 61-year-old wife of former presidential candidate John Edwards died at home Tuesday morning with her family around her. The news came after the Edwards family announced Monday that cancer had spread to her liver and doctors were recommending against further treatment." (WTVD/ABC)

Money

States Face Budget Gaps in Billions: "States are reporting billions in midyear budget shortfalls, and the crunch is likely to continue for at least several more years, a new report says." (WSJ)

U.S. fiscal health worse than Europe's -- China adviser: "The U.S. dollar will be a safe investment for the next six to 12 months because global markets are focused on the euro zone's troubles but America's fiscal health is worse than Europe's, an adviser to the Chinese central bank said on Wednesday." (Reuters)

College Grads' Unemployment Worst Since 1970: "Last month's increase in unemployment was especially discouraging for the well-educated. The jobless rate for Americans with at least a bachelor's degree rose to 5.1 percent, the highest since 1970 when records were first kept, reports the Bureau of Labor Statistics. October's 4.7 percent rate was up from 4.4 percent in September." (ABC)

Ireland's Drastic Budget Cuts Fail to Soothe Eurozone Worries: "The harsh budget has failed settle fears over the eurozone debt crisis with the single currency weakening again and borrowing cost rising across the board, as markets look beyond action by individual states to the lack of unity in the EU about how to stop the contagion spreading." (Daily Telegraph)

World

U.S. to Blame for Cablegate -- Australia: "Australia's foreign minister has said the US is to blame for the release of thousands of diplomatic cables on Wikileaks, not its Australian founder, Julian Assange. Kevin Rudd said the release raised questions about US security." (BBC)

DoJ Studying WikiLeaks Prosecution: "The Justice Department, in considering whether and how it might indict Julian Assange, is looking beyond the Espionage Act of 1917 to other possible offenses, including conspiracy or trafficking in stolen property, according to officials familiar with the investigation." (NY Times)

Assange Arrest in UK Complicates Extradition: "to bring Assange to trial on American soil could be increasingly messy. Not only would the United States need to come up with creative charges that may be difficult to prove, it would also have to launch a laborious extradition request with Sweden, a country known for protecting asylum seekers. In addition, if British authorities grant the Swedish request, Assange would be flown to a country that shares a significantly stricter extradition treaty with the United States. Swedish authorities said Tuesday that they would seriously weigh any request but noted that their treaty with the United States does not cover crimes that are political or military in nature." (WaPo)

'Chaos': "The arrest without bail of WikiLeaks founder Julian Assange on Tuesday has left the organization in a state of uncertainty, despite transition plans laid out prior to his surrender to British police, according to one dispirited WikiLeaks activist who spoke to Threat Level on condition of anonymity." (Wired's Threat Level)

What's That 'Sex By Surprise' that Sweden's Accusing Assange Of? (Slate)

STD Fears Sparked Case: "The two Swedish women who accuse WikiLeaks founder Julian Assange of sexual misconduct were at first not seeking to bring charges against him. They just wanted to track him down and persuade him to be tested for sexually transmitted diseases, according to several people in contact with his entourage at the time." (Reuters)

U.S. Gives Up On Israeli Settlement Freeze: "'After consultations, a moratorium extension will not provide the best basis for resuming negotiations,' a senior administration official said. He added that, in coming weeks, the U.S. would 'engage with both sides on substantive, core issues.'" (WSJ)

U.S. Committed to Defending S. Korea -- Adm. Mullen: "The top U.S. military officer on Wednesday warned North Korea that the U.S. commitment to helping South Korea defend itself is 'unquestioned,' even as he pressed China to use its influence to push its ally Pyongyang to change." (AP)

Haiti Election Goes to Runoff: "Election officials in Haiti say governing party candidate Jude Celestin will be in a presidential run-off with former first lady Mirlande Manigat. Ms Manigat won 31% of the vote and Mr Celestin 22%. Pop star Michel Martelly polled just over 21% but, as things stand, misses out on the run-off. Violent protests broke out in the capital Port-au-Prince after the results were announced." (BBC)

Tech, Science

Doubts Brew About NASA’s New Arsenic Life: "An arsenic-loving microbe found in a salty lake, which was touted last week as a potentially new form of life, is under heavy fire from the scientific community." (Wired)

Media, Entertainment

John Lennon's Last Days: The final interview, plus more. (Rolling Stone)