No other American president in modern memory has faced a learning curve as steep as the one Barack Obama has encountered. Three years ago in April, 2006, the Dow Jones Industrial Average traded between 11,017 and 11,468. It wasn't until 18 months later in October, 2007 that the Dow Jones averages peaked at 14,269 and began the downward spiral with a 55% drop to 6,443 on March 6, 2009. By the time he took office, America's financial industry was in chaos, credit markets were frozen, housing values were plummeting and the economy was in its worst contraction since the Great Depression. Add to that Afghanistan, Pakistan, Iraq, Iran and North Korea, and you get an extraordinary set of challenges.
And yet, by most measures, President Obama's first 100 days have been successful. The economy remains weak, of course, but he has put forward a series of initiatives to stabilize the capital and housing markets, proposed longer-term programs to create sustained growth, adjusted America's military priorities in Afghanistan and Iraq, and begun a process of reaching out to the world and changing America's image. These are only overtures, and naturally much will depend on how things turn out—in the economy, in Pakistan, in Iraq. But so far, any president would be envious of Obama's accomplishments.
The real question is, why has Obama been so successful? Many commentators have focused on his calm leadership style, his deliberative methods and his tight teamwork. That's all true, but there is a larger explanation for the success so far. Obama has read the country and the political moment correctly. He understands that America in 2009 is in a very different place now. Polls say the country is more liberal than it was two decades ago.
Conservative commentators have made much of a recent Pew survey showing that public reaction to Obama has been more polarized than to any previous president: Democrats really like him, and Republicans really dislike him. But the poll's most striking statistic was how few Americans now self-identify as Republicans. For the past year it has hovered around 24 percent, the lowest in three decades. It's not so much that the Republican base has shrunk, as Emory University political scientist Alan Abramowitz points out in a recent essay: the Democratic base has expanded. When Bill Clinton was elected in 1992, the Democratic base was 30 percent of the electorate; swing voters were 43 percent and Republicans 27 percent. Last year Democrats made up 41 percent; swing voters dropped to 32 percent and Republicans stayed put at 27 percent. Because party loyalties tend not to shift quickly, an 11-point rise for the Democrats is astonishing. Abramowitz argues that since these changes are largely rooted in demography—particularly the growing nonwhite population—they are likely to persist for a while.
It's not only that Obama has inherited a more liberal country. He has figured out how to utilize the moment. Rahm Emmanuel's aphorism "Never let a crisis go to waste" has in fact proved a brilliant political strategy. By combining short-term stimulus spending with long-term progressive projects, Obama has confounded the opposition. Sen. Judd Gregg was on CNBC last week trying to explain that while he fully supported government spending for 2009 and 2010 to jump-start the economy, his concerns were about 2011 and 2012. That's a pretty complicated case to make to the electorate.
Just as important, Obama has not overinterpreted the moment. He has steered a careful middle course on the bank bailouts. The most spirited critiques of his policies have come not from the right but from the left—in the clamor for nationalization. He may or may not have the policy right, but he certainly has the politics right. The country remains generally suspicious of big government and comfortable with free markets and private enterprise. And the old Democratic hostility to big business doesn't resonate so strongly anymore, since the new Democratic majority has fewer working-class whites and more college graduates. Obama has handled the public's anger well, giving voice to outrage but not enacting populist policies. He quietly announced last week that he will not reopen negotiations on the North American Free Trade Agreement to impose new labor and environmental standards.
On the torture memos, Obama has made clear (after some hesitation) that he does not want to criminalize a policy disagreement. On Iraq, he has hewed to a centrist course, but still one that draws down America's military presence there. On Cuba, Iran and Syria, his overtures have been modest and preliminary. In almost every arena, he has pushed the envelope to change policy, not worrying about the inevitable opposition from the right, yet always in a sober and calculating manner.
Globalization, immigration, more working women and college graduates—all these have changed America over the past two decades. In a detailed study for the liberal think tank the Center for American Progress, Ruy Teixeira and John Halpin point out that 67 percent of Americans now think favorably of the term "progressive," a 25 point increase in five years. This doesn't make us a European country—67 percent also think favorably of the term "conservative"—but it does suggest that things are changing. And Barack Obama's success derives from his understanding of this shift—and his readiness to act on it.