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At Obama's midpoint, an altered State of the Union

By Nancy Benac

Associated Press

Published: Sunday, Jan. 23 2011 9:09 p.m. MST

WASHINGTON — Nearly two years ago on a cold February day, President Barack Obama stood for the first time before a joint session of Congress and spoke of a national day of reckoning.

It was time not just to stabilize the shaken economy, he declared, but to reach for lasting prosperity.

His goals were expansive: overhauling health care, cutting the deficit, improving schools, finding a way out of Iraq and a way ahead in Afghanistan. Most of all, creating jobs. Jobs by the millions.

He had big plans and a Democratic majority in Congress to help him carry them out.

"We will rebuild, we will recover, and the United States of America will emerge stronger than before," Obama said to rousing applause.

Grim as the economic news was at the time, the nation — and Obama — didn't know how bad it was going to get before things started to turn around. The economy hemorrhaged nearly 4 million jobs in 2009, Obama's first year as president.

Two years in to his term, as Obama prepares to stand before Congress once again on Tuesday, he will size up an altered State of the Union.

The economy undisputedly is on stronger footing, though far from robust. There's a new health care law. U.S. troops have come out of Iraq and gone into Afghanistan.

"The most productive two years that we've had in generations," the president pronounces it.

Yet he will speak to a radically reshaped Congress. His party's ranks have been thinned by voters who delivered a harsh verdict in November on two years of collaboration between Obama and the Democratic-controlled House and Senate.

He faces Republicans who are sworn to slash spending by as much as $100 billion as the government comes off an economic rescue effort that has put the country on track for a third consecutive year of $1 trillion-plus deficits.

Ask people whether Obama has delivered on his broad-brush promise of change, and 42 percent — the biggest share — say it's still too soon to tell, according to an AP-GfK poll. One-third say he's failed to deliver; one-quarter think he's kept his promise.

The public is divided, too, on whether Obama is attempting to change things at the right pace, according to the poll. About one-third think he's moving too fast, and almost equal shares think his pace is just right or too slow.

Where do we stand? "I think I'd use the word transitional," says Rutgers political scientist Ross Baker. "There's a sense of expectation on the part of the public. I think it's tinged with hopefulness."

The nation may have weathered its economic crisis, but the same cannot be said for many people.

The unemployment rate was 8.2 percent in February 2009, when Obama first addressed Congress. It hit double digits by that October and was 9.4 percent at last report. While the administration is quick to point out that 1.1 million jobs were created last year, there are 2.8 million fewer jobs now than when Obama took office.

Housing is a particular sore spot. Foreclosures hit a record 1 million in 2010, and this year's figures are likely to be worse.

"I don't think they ever fully got their arms around the factors that were contributing to such an appalling rate of foreclosures and I don't think they've done it yet," says the Brookings Institution's Bill Galston, a former Clinton administration official who gives the president good marks overall for stabilizing the economy.

In Obama's first address to Congress, the president spoke passionately about the inequities and "crushing costs" of the health care system, of families denied treatment or forced into bankruptcy because of medical bills.

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