Why Obama Has Shifted to the Positive on the Economy

President Obama issued another dire warning about the economy when he delivered his prime-time speech to a joint session of Congress Tuesday night. It was essentially the same negative assessment he has been giving for weeks—but with a difference. Now that his economic stimulus package has become law, Obama realizes it's time to boost consumer confidence as much as possible. So, he tried the Big Pivot—shifting from an emphasis on gloom and doom and, finally, taking a more upbeat view of the future. "We will rebuild. We will recover. And the United States of America will emerge stronger than before," he declared, echoing the optimism of Ronald Reagan and Franklin Roosevelt.

In that shift, Obama showed an important ingredient of presidential leadership that will hold him in good stead—the willingness to listen and learn and to adjust to changing circumstances. One of the best pieces of unsolicited advice he has received recently was from the last Democrat to occupy the Oval Office. Bill Clinton said Obama needed to talk up the economy rather than be too negative. "It's worth reminding the American people that for more than 230 years everyone who bet against America lost money," Clinton told ABC's Good Morning America. "I just want him to embody that and to share that."

White House advisers say Clinton wasn't the only person offering such advice. In any case, Obama came to the conclusion that perhaps he had tilted a bit too much toward the negative and was adding to the sour public mood that has been restraining consumer spending and perhaps discouraging lenders from loosening up on credit. So he emphasized that America would weather the storm and declared that "the answers to our problems don't lie beyond our reach."

Senior White House advisers were dispatched to a variety of television shows to spin the president's message and reinforce the idea that Obama is trying to balance realism with optimism. The White House message is clear: Obama believes that American workers are the most productive in the world and that the United States has the greatest technology—and that we will need every weapon in our arsenal, in addition to a new aggressiveness by the government, to get past the current crisis.

Obama also did his share of finger-pointing at the administration of his Republican predecessor, George W. Bush. Some Democrats had argued that he has been letting Bush off too easy. That didn't happen Tuesday night, as Obama pointed out that he had inherited both the current economic mess and a deficit exceeding $1 trillion. Under Bush, he noted, "A surplus became an excuse to transfer wealth to the wealthy instead of an opportunity to invest in our future. Regulations were gutted for the sake of a quick profit at the expense of a healthy market. People bought homes they knew they couldn't afford from banks and lenders who pushed those bad loans anyway. And all the while, critical debates and difficult decisions were put off for some other time on some other day."

Obama has a long way to go to reassure the country that the economy will improve in a timely way. He may be pushing Congress to do more than it can handle so quickly, including providing universal health insurance and enacting carbon cap-and-trade legislation to reduce climate change and limit reliance on fossil fuels. And he has yet to give Americans what Richard Nixon once called "the lift of a driving dream."

Obama is staking his presidency on turning the economy around, and so far he hasn't much to show for his efforts. Wall Street investors haven't bought into Obamanomics, as illustrated by the continuing declines in the stock market. Congressional Republicans intend to confront him as a tax-and-spend liberal. At the grass roots, some Americans are angry at Obama's massive bailout of the banks and resentful of his plans to aid homeowners who have overextended themselves.

But pollsters say most voters realize that solving the nation's economic problems will take time, and they appear to be more patient than many media pundits think. Obama has been in office, after all, for less than six weeks. And he says the stimulus will start to be felt shortly, with more money showing up in Americans' paychecks. The main insight into Obama from this week is that he has shown, once again, a willingness to be flexible. And that's proved to be an essential trait for presidents facing fast-moving, trying times.

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