WASHINGTON (AP) — Barack Obama will inherit two wars and the worst economic conditions in three generations when he takes the oath of office on Jan. 20. Ironically, that challenge might be a blessing for the president-elect — unemployment is so high and consumer confidence so low that even modest improvements will let him claim progress.

Obama also brings extraordinary assets to the task.

The president-elect enjoys high approval ratings, well-regarded Cabinet appointees and a smooth running transition operation that grew almost seamlessly from his successful campaign team. Fellow Democrats will hold solid House and Senate majorities to help move his agenda through Congress.

CHICAGO (AP) — Barack Obama's fellow Chicagoan Rahm Emanuel, the hard-charging No. 3 Democrat in the House, has accepted the job of White House chief of staff, Democratic officials said Thursday.

One of Obama's first decisions as president-elect was to ask the Illinois congressman to run his White House staff. The selection of the fiery Democrat marked a shift in tone for Obama, who chose more low-key leadership for his presidential campaign.

Emanuel, who served as a political and policy aide in the Clinton White House before running for Congress, weighed the family and political considerations before accepting. He will have to resign his seat, relinquish his position in the House Democratic leadership and put aside hopes of becoming House speaker.

WASHINGTON (AP) — President Bush and Barack Obama will hold their first substantive talks Monday as the transition to a new Democratic administration accelerates.

Bush, who will return to Texas soon after completion of his two terms in office, publicly directed employees Thursday to ensure a peaceful and cooperative transfer of power. The transition is a delicate dance, in which the White House keeps the president-elect in the loop, and even solicits his input, but the decisions remain solely the president's.

On Monday's discussion list: the financial crisis, the war in Iraq and the future of the country.