Now it’s idealism versus realism

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, better healthcare, new energy programs and fiscal discipline all at the same time, and all without the bitterness and stalemate that arose when those issues were 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. Which Barack Obama will dominate 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 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 Clinton’s administration for a chance to work its will. And the conservative Republican opposition, though deeply wounded, is unlikely to roll over.

The new president will focus first on stabilizing the economy, Obama advisors and other senior Democrats say. He will seek early, high-profile legislative victories with bipartisan support. And he will probably defer some of his biggest, most controversial goals until later -- a decision that may send some of his liberal supporters into postelection depression.

In his victory speech in Chicago, Obama warned his supporters: “Our climb will be steep. We may not get there in one year or even in one term. . . . There will be setbacks and false starts. There will be many who won’t agree with every decision or policy I make.”

The biggest cause for caution, advisors said, was the slumping economy, which has become the federal government’s overriding priority, trumping all other concerns.

“First you’ve got to deal with the economy,” said Leon Panetta, a former chief of staff to Clinton who has been consulted by 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 may pass a new economic stimulus package by the end of the year. If it doesn’t, that will almost certainly be Obama’s first order of business.

And if it does, Obama will probably ask for more -- including some version of the middle-class tax cut he made a centerpiece of his campaign -- as well as 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 it will mean a debate in Congress between big spenders and deficit hawks, including among Democrats.

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. 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 healthcare, which his aides acknowledge would cost at least $50 billion a year to implement, with independent estimates much higher. 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 advisor often mentioned as a potential White House chief of staff, said healthcare reform would be easier to pass “if we take it a piece at a time,” instead of as a single, giant-size reform.

Rep. Rahm Emanuel (D-Ill.), another Obama advisor, said healthcare remained a top priority -- but added that he’d be satisfied with passing “a down payment” in Obama’s first term.

The president-elect’s ambitious energy proposals may also be tackled piecemeal, advisors said. Some elements, such as the job-creating investments in alternative energy that Obama emphasized last week, are broadly popular.

But proposals for tough limits on greenhouse gas emissions from energy-generating plants and other facilities, a program known as “cap and trade,” will be harder to pass because they impose new costs on energy producers.

“This is going to be a tremendously heavy lift to get passed,” acknowledged Heather Higginbottom, Obama’s chief domestic policy advisor in the campaign.

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. “He should be able to persuade the country that some promises are going to have to be put on hold,” said Will Marshall of the centrist Democratic Leadership Council.

So instead of focusing on President-elect Obama’s big-ticket goals, his transition aides and Democratic congressional leaders have been drawing up a list of easy-to-pass items with broad bipartisan support.

The best way to get an Obama administration off on the right foot, they argue, is through early, eye-catching successes. And, where possible, they will try to find common ground with Republicans.

“To start on the right foot, you’ve got to tee a few things up and make damn sure that you win,” Panetta said. “That sends a signal to Congress and the public that you’re serious about governing.”

A prime candidate for early action is an expansion of the State Children’s Health Insurance Program to make healthcare available to more children in low-income families, funded by an increase in tobacco taxes.

A victory on the children’s health program, Emanuel said, would give Obama a quick, clear accomplishment on an issue that most voters approve -- much like the popular family leave bill that Clinton passed in his first year in office.

A second early priority, aides said, would be federal funding for embryonic stem cell research. In 2007, President Bush vetoed bills funding stem cell research and expanded health insurance for children.

Emanuel isn’t the only Obama advisor who has been contemplating the lessons of Clinton’s unhappy first year in office, when Democratic congressional leaders pushed a new president to the left -- leading to the party’s loss of both houses in the midterm elections of 1994.

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doyle.mcmanus@latimes.com