Barack Obama won the presidency Tuesday by persuading voters to embrace a seeming paradox: Leadership based on contradictory principles of change and reassurance.
The Illinois senator combined ambitious goals and a cautious temperament. He promised tax cuts, improved health care, new energy programs and fiscal discipline — all without the bitterness and stalemate that arose when those issues have been tackled in the past.
Now, as Obama moves through his transition to the White House, this effort to square the political circle becomes the defining challenge in the months ahead. Will one Barack Obama or the other emerge as he begins to govern? Too much of the ambitious liberal, and he rekindles partisan squabbles he was supposed to transcend. Too much the cautious mediator who reaches across the aisle to compromise with Republicans, and he risks losing the energy and idealism that attracted millions of hopeful voters to his candidacy. The president-elect will have little undisturbed time as he works to strike the promised balance. The nation is in dire economic straits. His Democratic Party has been waiting since early in President Bill Clinton’s administration for a chance to work its will. And the conservative Republican opposition, though deeply wounded, is unlikely to roll over. In some ways, the economic crisis may work to Obama’s advantage.
The seriousness of the problem and the lengths to which President George W. Bush went as he responded — $700 billion to bail out banks and other financial institutions alone — may give Obama some fiscal elbow room. Complaints about a rising deficit may not stir much concern if housing, the auto industry and the rest of the economy continue to slide.
Also, Obama advisers and other senior Democrats say, as the new president focuses on stabilizing the economy, he will have to seek some early victories with bipartisan support — and defer many of his biggest, potentially most divisive, goals until later. “First you’ve got to deal with the economy,” said Leon Panetta, a former chief of staff to Clinton who will consult Obama’s transition team. “If you don’t get that back on track, it undermines every other priority you want to achieve.”
The current Congress is likely to pass an economic stimulus package by the end of the year. If it doesn’t, that will almost certainly be Obama’s first order of business. Even if Congress does pass a stimulus, Obama will probably ask for more — including some version of the middle class tax cut he made a centerpiece of his campaign — plus energy and infrastructure projects that would create jobs in a time of rising unemployment.
“We’ll create 2 million new jobs by rebuilding our crumbling roads and bridges and schools,” Obama said in his “closing argument” campaign speech last week. “And I will invest $15 billion a year in renewable sources of energy to create 5 million new energy jobs over the next decade — jobs that pay well and can’t be outsourced.” All that spending will create a budget problem for a president who has promised to reduce the ballooning federal deficit — and a debate in Congress between big spenders and deficit hawks.
But if the economy sinks into a recession that some are already comparing to the Depression of the 1930s, that debate may be less paralyzing than in the past.
Up to a point, anyway. “Are there limits to the spending he can do in his first term?” asked William A. Galston, another aide to the Clinton White House. “Some people say no — that we’re already spending so much, another $150 billion won’t hurt. But Obama has to decide how much deficit spending the political market will bear. If the budget hits a trillion dollars, the nation will go into sticker shock.”
What priorities are likely to be downsized or delayed? A prime candidate is Obama’s plan for near-universal health care, which his aides acknowledge would cost hundreds of billions of dollars to implement, especially in its early years. Instead of moving forward with a comprehensive plan, an approach that led Clinton into a major setback in his first term, Obama may try to take smaller bites.
As early as last summer, former Sen. Tom Daschle, an Obama adviser often mentioned as a potential White House chief of staff, said health-care reform would be easier to pass “if we take it a piece at a time,” instead of as a single, giant-size reform.
And some Democrats are already debating whether Obama’s promised middle-class tax cut should be scaled back to lessen the hit to the budget.
