* With House in Republican hands, roadblocks remain
* Opportunity to build on healthcare success
* First order of business – the fiscal cliff
By Andy Sullivan
WASHINGTON, Nov 7 (Reuters) – Barack Obama swept into the
White House four years ago as an agent of change. The nation’s
first black president won re-election on Tuesday as a
steady-as-she-goes defender of a new status quo.
With a second term, Obama also wins a second chance.
Obama may never become the unifying figure he promised to be
in the 2008 race, but he will have four more years to try to
enact sweeping changes that could affect the United States for
decades.
It won’t be easy. Obama has been blocked in Congress ever
since the 2010 elections, when Republicans took control of the
House of Representatives, and that’s not likely to change.
Breaking through the gridlock will be just as difficult.
Obama’s modest second-term agenda so far illustrates his
diminished clout in Washington. Republicans retained their hold
on the House of Representatives and they have a large enough
presence in the Senate to tie that chamber in knots. His narrow
victory is likely to leave them unimpressed.
Right off the bat, he faces a potential crisis known as the
“fiscal cliff” – tax increases and automatic spending cuts that
threaten to throw the country into another recession.
While he brought U.S. combat in Iraq to a close and is
drawing down in Afghanistan, he will have to rein in Iran’s
nuclear ambitions, along with the chance of an Israeli
counterstrike.
Inevitably, the president may bring to his second term the
hard lessons of his first.
“He was a figure who promised to transform the way politics
worked,” said Julian Zelizer, a presidential historian at
Princeton University. “I don’t think people think that anymore.
It’s not just less faith in him, it’s less faith in what the
political system can do.”
If Obama did not change Washington the way many hoped, he
can build on many notable successes.
He won a historic expansion of healthcare that had eluded
Democratic presidents since the 1940s. Though voters like many
of its components, they have been less enamored of “Obamacare”
as a whole. He now will have the opportunity to prove its worth.
The same may be said for the Dodd-Frank financial reforms,
which aim to rein in some of Wall Street’s worst excesses.
Obama’s legislative attempt to curb global-warming emissions
died in the Senate, but he can continue the effort through
regulation. He can also continue an effort to create millions of
“green” jobs, which has so far fallen far short of its goals.
He came nowhere near his goal of cutting trillion-dollar
budget deficits. He will rejoin that battle as soon as this
week.
But for many voters, these issues were pushed aside by the
economy, which plunged into a deep recession in the final months
of 2008.
Here, too, Obama can point to success: his 2009 stimulus
created millions of jobs and blunted the impact of the worst
recession since the 1930s. The domestic auto industry, on the
verge of collapse in 2009, has been restored to health.
The country avoided economic catastrophe but robust growth
remains elusive. As Obama won re-election, 23 million Americans
were either unemployed, underemployed, or too discouraged to
look for work.
Obama’s cautious approach to the housing crisis did little
to stem an epidemic of foreclosures or help those left deep in
debt by plunging real-estate values. A follow-up stimulus
stalled in Congress as the administration focused on its
healthcare and Wall Street reforms.
NOT A BACKSLAPPER
Though Obama was the first sitting member of Congress to win
the presidency since President John F. Kennedy in 1960, his
relations with Capitol Hill were problematic at best.
A private person by nature, Obama shied from the
backslapping and arm-twisting that is often needed to advance an
agenda in Washington. Democratic lawmakers grumbled privately
that he cared little for their political concerns.
Republicans opposed his initiatives in an unprecedented
manner, providing few, if any, votes for his major initiatives.
In the Senate, action slowed to a crawl as Republicans threw up
a record number of procedural hurdles.
The dysfunction came to a climax during the debt-ceiling
battle of 2011, which brought the country to the brink of
default. Consumer confidence plummeted and credit-rating
agencies issued a historic downgrade of the country’s debt.
It’s unclear whether Obama could have done much to break the
logjam on his own.
Congressional scholars Norm Ornstein and Thomas Mann, who
have studied Washington for 40 years, argued in their book “It’s
Worse Than It Looks” that the Republican Party has become an
ideologically extreme “insurgent outlier” with little interest
in the compromises needed to run a vast and diverse country.
But Republicans would have been willing to work with Obama
when he took office had he shown some independence from his own
party, said former Bush aide Tony Fratto.
“That was a missed opportunity – I thought this particular
president, at this particular time, had a real, unique
opportunity to turn the tables on Congress,” Fratto said.
Obama’s relationship with the business community has been
rocky as well. Corporate leaders complained that their White
House meetings seemed more like photo opportunities than policy
sessions.
Wall Street turned against the administration in the wake of
the 2010 financial reforms and even prominent Democratic figures
like J.P. Morgan Chase CEO Jamie Dimon accused Obama of
demonizing the financial industry.
The “grand bargain” that would set U.S. finances on a
sustainable path will remain as elusive as ever, as investors
continue to snap up U.S. debt at rock-bottom interest rates and
lawmakers face little pressure from their constituents to make
the sorts of painful concessions that will be needed to reach a
deal.
Republicans might determine that it is in their best
interest to cooperate on an immigration overhaul, but they will
want to negotiate on their terms.
The economy could give Obama a much-needed tailwind in his
second term as employment, consumer confidence and a range of
other measures indicate that the recovery may finally be taking
hold.
An improved economy could solve some of Obama’s problems by
narrowing budget deficits, putting more Americans back to work
and vindicating many of the decisions he made in his first year
in office.
For a president who has seen much of his first term hijacked
by the sluggish economy, that would be an ironic turn of events.
“The 2008 presidential election had the effect of raising
expectations to a level that would have been very difficult to
satisfy even in the best of circumstances. And the circumstances
have not been the best,” said William Galston, a Brookings
Institution scholar and former policy adviser to President Bill
Clinton.
