State of the Union is Obama's Chance to Reset His Presidency

When President Obama strides into the House of Representatives to address a joint session of Congress on Wednesday night, he will command the nation's attention for one of the most important speeches of his career. His State of the Union address will provide the opportunity to set his priorities for 2010, offer insights into whether he will adopt a fight or flight strategy in dealing with his adversaries, and, overall, provide an opportunity to lift himself out of a political trough.

"The State of the Union is a chance for him to reset the conversation," says Democratic pollster Geoff Garin. "It's the platform where he can tell the average American worker and taxpayer it's all about them. That's the message people want to hear. People are really hurting, and he needs to address the needs of people who feel they are living on the edge."

Healthcare will be a major theme, although it's unclear what kind of legislation can pass now that the Democrats have lost their 60-vote, filibuster-proof majority in the Senate. That happened last week when Republican Scott Brown won a special election in Massachusetts to fill the seat of the late Sen. Edward Kennedy. With Brown in office, the GOP has 41 votes, the minimum needed to block Obama's agenda using parliamentary maneuvers. So Obama's options will be much more limited than they were a year ago, when he took office amid great jubilation among Democrats and considerable optimism that he could end Washington's long era of partisanship and polarization. Those hopes have dramatically faded amid relentless GOP opposition and intensifying public concern that he is spending too much money and injecting the federal government into too many areas of national life.

For months, White House officials have privately admitted that healthcare legislation, Obama's top domestic priority, was pulling attention and energy away from other priorities, including job creation, which has become of utmost importance to everyday Americans affected by the 10 percent unemployment rate. "We need to finalize healthcare," says a senior White House official. "It hangs over everything and tends to overshadow everything."

It's unclear how that resolution might happen, but Obama will use his State of the Union speech to attempt to clarify a broader agenda that will include creating jobs, strengthening the overall economy, cutting the deficit, and preserving national security, according to White House aides.

Meanwhile, Republicans argue that Obama and Democrats in Congress have dug themselves into a deep pit as big-spending liberals who have bailed out banks and auto companies but failed to give the middle class enough help.

"The most troubling story line for him is his constantly overpromising and under­delivering," says a prominent GOP strategist who advised a major GOP presidential candidate in 2008. "The electorate has a lot of anxiety about spending in Washington and deficits and the Democrats' healthcare bill." The strategist adds that Americans are fed up. "People are done with the talk. They want results. People feel that the stimulus has been a waste and that there's always another bill that the Democrats are trying to pass. Obama and the Democrats are marinating in excess. . . . He doesn't challenge the status quo. And there is no bipartisanship." Obama's job approval has dropped 15 to 20 points to about 50 percent since his inauguration, with independent voters increasingly disenchanted with him.

And Brown's underdog victory in Massachusetts has given the GOP a huge boost. "This is rocket fuel for the party in terms of candidate recruitment and fundraising," says Frank Donatelli, chairman of the conservative GOPAC political action committee and President Ronald Reagan's former White House political director.

Now, there are signs that Obama will change his approach, at least rhetorically, as he shifts to more of a populist message of siding with everyday Americans against big banks, insurance companies, and Wall Street. One of his latest proposals is to tax banks that received federal bailout money but are now giving huge compensation packages to their top executives.

On a personal level, White House aides are weary from the seemingly endless crises of the past year, including the near collapse of the financial industry, the recession, unemployment, the wars in Afghanistan and Iraq, threats from terrorists that crystallized in the attempted bombing of a U.S. airliner on Christmas Day, and, most recently, the earthquake in Haiti. But White House aides say Obama seems less fazed than nearly anyone around him. When the president and his advisers walked out of an hourlong meeting on Haiti in the Situation Room one evening recently and headed to more deliberations on healthcare and the economy, an aide said the velocity of events seemed very high, requiring nearly constant decision making under crisis conditions. Obama smiled but was stoical. "That's just how we do it," he said matter-of-factly. "That's how we roll."