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Americans now seem to believe that the worst is behind them. A slim majority of Americans, 52 percent, believe the U.S. economy has stabilized. Last month hardly more than a third said the same. Pessimism has also dwindled. Only 36 percent of the public believe the worst is yet to come today. Last month, 57 percent said the same, according to Ipsos/McClatchy polls.

A CBS News/New York Times poll reported last week that only 39 percent of Americans "feel things in this country are generally going in the right direction." While still low, that's the highest "right direction" result since February 2005. Rasmussen polling records a similar trend, finding that more Americans believe that the nation is heading in the right direction than any time since 2004. Consumer confidence has also reached its highest point in the past year, according to Gallup.

The upward momentum bodes well for President Obama. His popularity has remained relatively stable in recent weeks. But the marked turnaround, while likely rooted in the stabilizing stock market, signals a shift in the public outlook that usually tracks the approval or disapproval of a president.

Not every indicator has turned upward however. The jobs outlook, as far as the public is concerned, remains bleak. But gains in the employment rate usually follow the first stages of an economic recovery. This may explain why Americans are not more sanguine about their employment even as they are at least less pessimistic about the economy overall.

The American mood has proven resilient in the past. In September 1971, with the United States suffering from a recession, concern over the economy had reached its highest level since 1936 according to Gallup. By June 1973, amid inflation, the cover of Time magazine showed men chipping away at a dollar sign. The headline read "Nixon's other crisis." In August 1974, as Gerald Ford took over the presidency, the recession languished on. Only 13 percent of Americans believed economic conditions would get "better" in six months, while 68 percent said they'd get worse. By March of 1975, 35 percent believed conditions would get better and 50 percent said worse. A month later, for the first time since the public's economic outlook tumbled, more said economic conditions would get better than worse.

Public confidence generally takes years to rebound. Today, not surprisingly, Democrats are primarily responsible for the recovery so far. Democratic satisfaction with the nation's direction has doubled, from 21 percent in mid-February to 40 percent today. Yet Republicans and independents' views have also improved 6 to 9 percentage points, respectively.

Obama cannot take too much solace in the turnaround however. Gains in the public mood can quickly stagnate. Ronald Reagan is praised historically for reviving American optimism. In August 1979, only 12 percent of Americans were satisfied with the direction of the country. By November, that portion rose to 19 percent. Come June 1981, under Reagan, a third of the public was satisfied with the direction of the United States. Yet six months later satisfaction was again receding, ebbing to a quarter from spring to winter 1982. It was not until 1984 that as many people were satisfied as dissatisfied with the direction of the country.

The question for Obama is whether his momentum will continue as it has or stall as Reagan's did. Should the rate of recovery in the public outlook continue as it has in recent months, satisfaction could overtake dissatisfaction far sooner for Obama than Reagan.

At the peak of the financial crisis, in October, the gap between the near majority who thought the nation was on the wrong track and the few who believed it was on the right track was roughly 75 points. Today, about half dozen polls show, the same gap has narrowed to between 10 and 15 points. That outlook remains more negative than positive. But in the context of the abysmal national mood only a half-year ago, the tepid pessimism of today feels almost like optimism.

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It was the New York Times that captured the G-20 as heralding a super power at sunset. "Gone are the days, from Pax Britannica to Pax Americana, when Britain and the United States made the rules that others followed." Obama's own words partly inspired this declaration.

"If there's just Roosevelt and Churchill sitting in a room with a brandy, that's an easier negotiation," Obama said before the international press core in London. "But that's not the world we live in, and it shouldn't be the world that we live in. And so, you know, that's not a loss for America."

So it was that the president discussed American post-war power in the past tense, not at the G-7 but at the G-20. The term "world powers," as opposed to "world power," was revived in this most precarious of American moments.

Later that week at the NATO summit in Strasbourg, France, the president was asked if he subscribed to American exceptionalism.

"I believe in American exceptionalism, just as I suspect that the Brits believe in British exceptionalism and the Greeks believe in Greek exceptionalism," Obama replied.

Of course, if all are exceptional then none are exceptional.

American exceptionalism was taken too far in recent years. "If we're an arrogant nation they'll view us that way, but if we're a humble nation they'll respect us," George W. Bush said during the 2000 campaign. But humble W became "bring them on" Bush. And Obama was elected to, in so many respects, be what Bush was not.

Obama seems, however, less the redemptive president than the contrite commander, noting the passing of Pax Americana as "not a loss for America."

The end of Pax Americana surely would be a loss. It would surrender the nation's defining sense of mission, rooted in men from James Monroe to John Winthrop. It would portend the loss of our wealth and way of life. And indeed, in time, much of the world would rue that loss.

Last year, the National Intelligence Council completed a report on 2025, foretelling an era that where the "United States will remain the single most powerful country but will be less dominant. Shrinking economic and military capabilities may force the U.S. into a difficult set of tradeoffs" amid "the decay of international institutions, climate change, and the geopolitics of energy." It noted, "rather than emulating Western models of political and economic development, more countries may be attracted to China's alternative development model."

Alternative development model is a gentle euphemism for the fruitful marriage of capitalism and repression. The economic crisis has certainly exposed the weaknesses in Anglo-American economics. But if Britain's Brown is right and the Washington consensus is over, what is to replace it?

China may be emulated. But expect no Beijing consensus. As James Fallows recently wrote, "No other nation that could build roads, airports, and industrial parks as modern as China's could impose so repressive a political regime."

Arthur Schlesinger Jr. once observed, "When the Chinese students cried and died for democracy in Tiananmen Square, they brought with them not representations of Confucius or Buddha but a model of the Statue of Liberty."

Huddled masses yearning to breathe free are not traveling to China. Indeed, China seems to have a reckoning brewing with its impoverished masses. On the world stage, China sells arms to Sudan and just this past week, with Russia, stalled UN Security Council measures to press North Korea away from brinkmanship.

If this is to be the Chinese century, as some contend, the Middle Kingdom has not yet found its sense of outward mission. Only last year, the Chinese navy took part in its first operation beyond the Pacific and this was to protect Chinese vessels from pirates in the waters off Somalia. America's pledge of freedom has often been undercut by its effort to secure power. China is focused on power alone.

For all the American misuses of power in the name of liberty, ever since the Marshall Plan, American prosperity has driven world prosperity. This is the reason why the American economic crisis was so rapidly exported abroad.

Yet the upside of Pax Americana is rarely highlighted. Between 1976 and 2006, the number of "free" nations more than doubled, from 42 to 90, while nations "not free" fell from 68 to 45, according to Freedom House. There are 123 democratic countries today, compared to, give or take, 22 in 1950. One Australian government report found that between 1972 and 2006, 67 dictatorships had fallen. Half the world's population was in poverty in 1950. Today, about a fifth of the world remains impoverished.

The world's progress during Pax Americana is no accident. The United States could do more. But between 1946 and 2000, in constant year 2000 dollars, the United States gave about $1.5 trillion in foreign aid--that 50-year total, even while excluding billions in private annual aid, likely dwarfs all other nations. A success story of post-war U.S. aid, Japan, is now a top government donor.

The American motto abroad, if one can be found over the past century, could be summed up in Woodrow Wilson's pledge that "the world must be made safe for democracy." That was how an American president believed he had to frame the Great War in order to get American boys to save French and British boys. At the peak of Great Britain's power, its mission was to "make the world British."

It's the gap between American ideals and some of its actions that has long been the nation's undoing. Yet it's worth noting that the cold war never went hot.

There have been no world wars since Pax Americana's inception at the conclusion of World War II. The most ignoble and bloody modern U.S. wars, Korea and Vietnam, killed 3.2 million. That's millions less than the wars of countless empires of old, from the Mongol Conquests, to the Islamic Conquests of Timur, to the Napoleonic Wars to the tens of millions dead in World War I and the tens of millions more during the world's sequel.

The debacle in Iraq may remain fresh in the world's mind but stability, like Coca Cola, has also been a U.S. export. The very notion of American imperialism has long been ridiculous on its face. The United States only briefly flirted with imperialism around the fin de siècle, with the meager grab of Puerto Rico, the Philippines and Guam.

The American empire was most possible following World War II. The sun had set on the British empire. America was the only nuclear power. Its coffers constituted roughly half of the world's economy. But while Joseph Stalin was moving to repress much of Eastern Europe the Untied States moved to create the United Nations, which would inevitably undermine any effort at global dominance.

Today, the United States still constitutes one-quarter of the world's economy. It has the best universities, the most well funded research and development and a military budget larger than the next twenty nations combined.

Japan and South Korea do not depend upon China to pressure Kim Jong Il. Israel and many regional Arab powers, ever so quietly, are not relying on Russia or Europe to help contain Iran's nuclear program. It is not China or the European Union that developing nations look to for a dramatic increase in consumption to reboot the world's economy. It is, as it long has been, the United States.

Yet diplomatic chatter is inebriated with the idea of U.S. decline. We've seen this before. As Josef Joffe once noted, Paul Kennedy's "The Rise and Fall of the Great Powers" predicated the dusk of American power only four years before the Soviet Union fell and the United States became the world's sole super power.

That moment of singular world power has passed. But Pax Americana has not. And that, as the Frenchman recalled and the president appeared to forget, is a good thing.

This is far larger than politics. At first blush, the finding may seem to substantiate the mistaken impression of late that American religiosity is fading, notably bolstered recently by the American Religious Identification Survey 2008 (ARIS). The more accurate statement is that the rate of secularism is growing while the portion of passively or somewhat religious Americans is declining. On the other hand, the portion of religious Christians is generally unchanged.

True, as ARIS found, the number of Americans who describe themselves as Christian has fallen from 86 to 76 percent between 1990 and 2008 while the secularists have doubled, from 8 to 15 percent of the population. But the study also found no decline and some rise in those identifying as Pentecostal, evangelical or born again. It also found the most significant identification decline in mainline Protestants. It's no coincidence that mainlines are less likely to attend weekly services as well.

The portion of voters who attend church at least once a week has held remarkably stable over the past half century, bobbing around four in ten. This stability is in part due to the slender increase in Protestant weekly attendance, after declining until the mid '60s. Weekly church attenders also have a higher turnout rate than the average voter.

Gallup found that the decline in Catholic religiosity largely occurred between 1955 and 1975 and happened most precipitously among the young. These two decades of course bookended the rise and decline of the counter culture. No less, this is the period that particularly Catholics and ethnic whites ascended to the upper and middle class--only for their household incomes to stagnate by the mid '70s.

Where does this leave us today in political terms however? The God Gap is still a core divide in American politics.

Indeed, secular voters have become more Democratic in recent political cycles. Last year 67 percent of those who never attend church backed the Democratic nominee, the same as in 2006. But that marks a 7-point rise since 2004 and a 12-point rise since 2002. However in 2000, 61 percent of secular voters favored Al Gore. The secular move toward Democrats is therefore notable but not drastic. Seculars are 16 percent of voters today, a 2 point increase in eight years.

Meanwhile, while Barack Obama made gains with minority regular church attendees, likely due to issues of racial identity and/or immigration, the three in ten voters who are white weekly attenders have remained firm in their politics in recent years: only 29 percent supported the last three Democratic presidential candidates. Fifty-seven percent of born-again or evangelical Christians also backed the Republican in 2008, as they roughly did in 1980 as well.

So even amid Catholics' waning worship, in political terms American religiosity is what it was--a powerful force in U.S. politics.

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Generally however, from Harry Truman at the Potsdam Conference to John F. Kennedy and later Ronald Reagan's historic speeches in Berlin, to Nixon's trip to China and Bill Clinton's trip to Europe amid scandal at home, Americans' views of presidents are largely unfazed by news of their commander-in-chief overseas.

We know that Truman's approval remained in the 80s from the summer to autumn of 1945, vaulted by the conclusion of World War II. Kennedy came into his historic West Berlin speech on June 26, 1963, with a 61 percent approval rating, where it precisely stood a month later. Slightly less than half of Americans approved of Lyndon Johnson before he went to Vietnam in late December 1967; Americans felt the same after Johnson returned.

Like Obama, Nixon took an extended trip to Europe early in his presidency. Nixon's approval looks to have risen from 60 to 65 percent, improving his image across party lines. Nixon's later trip to China in 1972 showed no statistically significant gain.

Jimmy Carter certainly saw no bounce from images, later regretted, of him toasting the Shah in Iran at the close of 1977. Reagan saw no bounce from his 1985 meeting with Mikhail Gorbachev in Geneva. His famous Berlin Wall speech two years later may have briefly improved his image a few points to 53 percent, only for it to fizzle a week later below the 50-point mark--where Reagan began the trip.

More recently, Clinton achieved no bounce after his five-day trip from Russia to Northern Ireland in early September 1998, when still more than six in ten Americans approved of him despite scandal at home.

By mid 2006, as George W. Bush's popularity had sunk to 38 percent, Bush went abroad for two European summits that summer. Neither trip impacted his popularity. Bush's first trip abroad to Mexico, in February 2001, did likely achieve a mild 5-point bounce.

A president's inability to advance his standing at home is only one metric of his success abroad, and hardly the best one. World trips, after all, aim to improve the world's opinion of the United States (outside diplomatic substance, of course). And Americans believe Obama accomplished that aim. A recent CNN/Opinion Research Corporation poll found that nearly eight in ten Americans believe his tour abroad has improved the world's view of the United States.

But for Obama, who returns home from Baghdad to legislative battles in Congress, his political capital will likely be no more powerful than when he left for London last week.

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Kimtology--the study of North Korean leader Kim Jong Il's actions from a similar missile test in 1998 to the testing of a nuclear device in 2006--indicates that Kim believes the more powerful his military the more secure his regime. The more secure his regime, Kimtology indicates, the more able he is to get the region to meet his terms. It's less instigation for the purpose of negotiations than instigation for the purpose of power.

"Talk about how North Korea is doing this because they want U.S. attention, almost like 'let's fire off a missile to get the Americans to do negotiations,' that's not what's going on here," said Joel Wit, a longtime East Asian State Department expert who was a key actor in Bill Clinton's 1994 Agreed Framework treaty with North Korea.

"The North Koreans are building a small nuclear deterrent," Wit added.

Wit generally leans more toward the dovish side of North Korean issues. He believes as firmly as ever that Washington should, after a cooling off period, proceed with direct and aggressive talks with Pyongyang. Yet that Wit agrees with the more hawkish North Korean analysts like Henry Sokolski, a skeptic of negotiations who favors defensive precautions, indicates that few experts stateside are Pollyannaish about Pyongyang.

In its usual Orwellian fashion, North Korea said Sunday's rocket launch was only intended to send a communication satellite into orbit. The North Korean news agency, Pyongyang's propaganda machine, reported that the satellite was broadcasting "the melodies of the immortal revolutionary paeans" to Kim and his late father Kim Il-Sung.

American intelligence does not hear this alleged Kim-tune. Washington believes no satellite is orbiting and that while North Korea still likely lacks the technology to create a compact nuclear warhead, it's attempting to master nuclear delivery capability.

"This thing is a nuclear weapons capable missile, with pretty good range," Sokolski said, who directs the Nonproliferation Policy Education Center in Washington, D.C., and served from 1989 to 1993 as Defense Department deputy for nonproliferation policy under Paul Wolfowitz. "These weapons are what they have and they don't have much else," he continued.

North Korea has now presented Barack Obama with the first national security crisis of his presidency. On the same day Obama went to Prague to speak about a denuclearized world he is reminded of the nuclearized threats in that world.

The United States is forced, for the time being, to step away from any intention to rejoin North Korea at the negotiation table. The North Korean missile test, as Kim likely expected, has elicited precisely the opposite response that an "attention seeking" diplomatic measure might. Sticks are generally met with sticks in diplomacy.

For President Obama, he cannot afford to be viewed as too conciliatory to belligerents on one side of the world while spearheading a fragile attempt at thawing relations with Iran on the other side. And the two issues are not wholly unrelated. The U.S. believes Iran and North Korea were and are likely working together to realize both nations' nuclear aspirations

Sunday's launch was followed within hours by predictable calls from the United States, Japan and South Korea for tougher U.N. sanctions, during an emergency Security Council meeting. No less predictably, China and Russia scuttled that proposal.

In recent years the general cycle has been: North Korea escalates tensions; Japan and South Korea justifiably jump; the U.S. president charges "provocation" and the Russians and Chinese call for "restraint." Diplomatic paralysis ensues. North Korea continues to build a nuclear arsenal.

"I kind of feel it's "Casablanca" and we are rounding up the usual suspects," in Wit's words.

Pyongyang realizes Washington fears a second Korean War. Tokyo and Seoul view North Korea as an existential threat. Washington would prefer to contain and gradually convince Pyongyang with carrots more than sticks that peace succeeds where brinksmanship fails. Beijing only requires an absence of war, to prevent a flood of refugees along its border and bolster the communist nation it effectively defended in the Korean War against the United States.

The region therefore remains intensely fragile even as, at first blush, it appears the American public leans hawkish. A Rasmussen Reports poll over the weekend found that 57 percent of U.S. voters support a "military action to eliminate North Korea's ability to launch missiles."

Yet that is likely an exaggerated finding. Americans may prefer a more measured strategy if it was explained that a U.S. strike may lead North Korea to attack Japan, Pyongyang to fire its thousands of artillery pieces trained on Seoul and cause a second Korean War.

It's that worst-case scenario, combined with China's place as North Korea's patron, which has kept Washington closer to a policy of containment than confrontation.

Meanwhile, despite U.S. and Japanese warnings, North Korea fires another rocket and moves a step closer to a nuclear arsenal. As Wit put it, the missile test "may not have been a success, but they likely learned an awful lot."

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President Obama closes his first week abroad at the NATO summit on Friday and Saturday, marking the 60th anniversary of the alliance. But behind the celebrations are deep divisions between member-states over NATO's war in Afghanistan and the role of the alliance itself.

Last Friday, Obama pledged still more U.S. boots on the ground in Afghanistan. The president also committed thousands of U.S. civilians over the long term to Afghani infrastructure, and by consequence the U.S. to nation building.

Obama's actions come as NATO allies rebuff requests to increase their troop commitment in the region. The exception may be Britain which is reportedly considering adding 2,000 troops, still a tenth the size of the U.S. escalation. Nations like France may commit new civilian resources for police training or improving the Afghani bureaucracy. But the allies are generally present in the safer northern and western regions of the country. Germany requires its troops to be stationed in the north, effectively offering a force that will not fight. Meanwhile, U.S. troops are increasingly facing the brunt of front-line warfare.

The asymmetric allied actions have forced NATO to face a crucial question: is the military alliance soon to be little more than a diplomatic pact?

After the United States was attacked on September 11, 2001, NATO invoked Article 5, its mutual defense declaration, for the first time. But now the endurance of Article 5 is being tested and as the fulcrum of the alliance, so is NATO.

Afghanistan amounts to NATO's first war abroad, its first land war and its first trial in the post-September 11 era--an era where threats are less from states than from rogue actors.

"This attempt to reposition NATO to a robust expeditionary force, sort of the UN with guns, has been more of a detriment than help," said Max Boot, a foreign policy advisor to Republican John McCain during the 2008 campaign and a senior fellow at the Council on Foreign Relations. "It was a noble experiment but it didn't work out.

"Afghanistan is becoming a coalition of the willing by another name," Boot continued. "We've seen the crack in [NATO's] edifice exposed."

As NATO expert Elizabeth Sherwood-Randall, Obama's recently hired European affairs advisor, reportedly said before taking the post: "The glue of this alliance is gone."

The White House has avoided the same blunt declarations. The Obama administration continues to hold out for a significant escalation of European resources in the region. Yet of late, save commitments by outliers like the Netherlands, U.S. greybeards are not optimistic that Europe will stay significantly in the fight.

NATO's military alliance certainly may withstand even a full on European retreat from Afghanistan. Since its formation in 1949, NATO has been no stranger to existential crises. From the 1956 Suez Canal crisis, to the fall of the Soviet Union and most recently to the war in Iraq, the preeminent transatlantic treaty has endured.

Yet particularly after the Soviet Union imploded, what Henry Kissinger called the "core institution" of the cold war became a defensive alliance without an antagonist. The coalition formed to "keep the Russians out, the Germans down and the Americans in" wanted the Russians in, the Germans up and ever-more democracies in. The terrorist attacks of 2001 seemed however to clarify NATO's role and briefly offer the alliance renewed raison d'etre.

That glue has already faded. Europeans lack the sustained will in Afghanistan, for no reason more than the 9-11 attack was on U.S. soil.

And even amid some good news for NATO--after withdrawing from NATO's military command structure in 1966, France recently rejoined its ranks--the war's worsening terms have expended what little public support existed across Europe to risk its troops' lives.

International soldiers' deaths in the Afghan war rose by 37 percent in 2008, six-fold the rate of Afghani troops. Nearly nine of ten allied soldiers in Afghanistan remain under the command of the NATO, for now at least.

The U.S. musters slightly more than half of the roughly 70,000 international troops in Afghanistan today. But this year Obama committed some 21,000 additional soldiers, and counting. By 2010 the United States will constitute about two-thirds of NATO's commitment in Afghanistan even as the troop commitment by other allies, like Canada, expires in 2011.

NATO has then come toward its sixth decade facing an identity crisis, testing the reach of its ideals and the elasticity of its original intent.

The summit this week will, perhaps unintentionally, expose that conflict between past and future missions. The agenda is consumed with Afghanistan. But the summit is occurring at the Rhineland border cities of Kehl and Strasbourg, once the fault line of the great wars of Europe. The alliance meant to in part help keep the peace between Germany and France is now caught in a war far beyond Europe's borders.

Some U.S. foreign policy figures, like Boot, believe that NATO will remain a vital democratic alliance regardless of the outcome in Afghanistan.

The reach of that democratic alliance though is also divisive. The ambitions of Ukraine and Georgia to join NATO have wedged the alliance from Russia, a nation NATO now aims to embrace. Yet that debate as well has taken a back seat to the Afghan war, especially as the war's outcome appears increasingly opaque.

Concern is rising in U.S. diplomatic circles over whether Afghanistan could turn into Obama's Vietnam. Zbigniew Brzezinski, Jimmy Carter's national security advisor, calls Afghanistan NATO's "critical test."

But Brzezinski's chief concern is quickly shifting from joint-commitments to the potential for over-commitment. If the United States and NATO get "bogged down" in Afghanistan and Pakistan, he said in an interview, it could be "a bottomless pit."

Similar issues came to the fore during NATO's 50th anniversary as well. In 1999, the alliance celebrated its inception also rife with divisions over an ongoing war, then in Kosovo. And like Afghanistan today, the alliance was haunted by the potential for Kosovo to turn into a quagmire.

"That summit was to hold the alliance together," recalled Berger, who helped organize the 1999 conference for the Clinton White House. "There is a question again of NATO solidarity" and in Berger's words a new question as well: will Europeans offer "serious participation" in Afghanistan "lest this become an American war?"

Yet with the financial crisis still smothering the diplomatic agenda, it remains unclear how much political capital Obama will spend in the coming days to publicly pressure nations like Germany and France to significantly join in a war that remains, perhaps soon by treaty alone, Europe's war as well.

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It's this combination of tests that frames Obama's first extended trip abroad. The president leaves tomorrow for the G-20 summit in London, aiming to close the conference Thursday with a global response to a global financial crisis. On Friday, Obama attends NATO's 60th anniversary summit meeting in Strasbourg, France and in Baden-Baden and Kehl, Germany, where the commander-in-chief hopes to convince skeptical allies that they too have a stake in the U.S. war in Afghanistan. Obama then goes on to Prague, Ankara and finally Istanbul, where he hopes to convey that the election of a man named Barack and Hussein exemplifies that America is a nation of open minds.

By trip's end Obama though may have little to show for the diplomatic blitz. There is a heightened temptation abroad to scold America. Many U.S. allies and adversaries believe that the war in Iraq has undercut American national security clout and that the global recession has done the same to America's economic authority.

To much of the world, the United States is looking like the Wizard of Oz. The flash is mesmerizing but many nations question the country behind the curtain. They see an unregulated wild west with an unsustainable financial machine that depends on nations like China for endless credit.

As Columbia Professor of International Affairs Michael W. Doyle put it: "The curtain is about to be raised ... and he will walk out as the key actor."

The U.S. narrative, as Europe has long requested, though has changed. The executive order closing the Guantanamo Bay detention center within a year confirmed a willingness to heed world opinion. The staggered withdrawal of U.S. soldiers in Iraq should also help mend the tear in transatlantic relations.

Even Americans are now second-guessing "cowboy capitalism." There is a sense that hedge funds will be regulated like banks, though not to the extent that nations like France desire. The United States has also put its money where its mouth is, investing trillions in revitalizing its own economy at the moment it asks the same of the world powers.

Obama's election was the most powerful gesture of all that the United States has, in the president's words, "turned the page." European magazines covered themselves with photos of Obama during the campaign in a fashion rivaling those of David Beckham. It was just last summer that 200,000 Germans crowded Berlin's Tiergarten park to hear the candidate lecture on how to "save this planet" with an ethos of "global citizenship."

It is Europe however acting most parochial of late. On the eve of the G-20, French President Nicolas Sarkozy argues that "radical reform" of capitalism should be the top issue. German Chancellor Angela Merkel told reporters that she "will not let anyone tell" her "we must spend more money." It was a most blunt, perhaps Bushian, challenge to Obama and British Prime Minister Gordon Brown's effort to orchestrate trillions of dollars in global fiscal stimulus.

The Spanish finance minister, Pedro Solbes, said he too opposes new large-scale spending. The Czech Republic's prime minister characterized the United States' push for a global stimulus as "the road to hell." This rhetoric is hardly the statesmanship Europe has demanded of us.

The responses are also indicative of European national politics. There is less urgency to exit the recession in continental Europe. The focus instead is on long-range solutions like an international financial regulatory structure. Continental Europe's automatic stabilizers pump more money into the economy and its wider safety nets insulate its citizens from economic anxiety. Losing your job, across Europe, does not mean you lose your health insurance.

But as British Member of Parliament Denis MacShane put it, if the world's economies do not recover "who does Mrs. Merkel think is going to buy Mercedes and BMWs?"

In this sense, many continental European leaders seem unwilling to ask their constituents what they have long asked of American presidents: convince their voters that what is in the world's interest is in their national interests as well.

If continental Europe does not ante up, London will look like a G-2 meeting of China and the United States. European nations could relegate themselves to the sidelines even as they hope to prove themselves still vital world players.

It seems Europeans have not generally reconciled with the candidate they fell for. A Financial Times/Harris Poll conducted when Obama was inaugurated found that Europeans wanted the Guantanamo detention center closed but were unwilling to take in some of the captives. Europeans were also opposed to escalating the war in Afghanistan but it's precisely that escalation that is necessary to stabilize the region.

Obama will look to the NATO summit to, at least, earn a communiqué of unified support for America's renewed efforts in Afghanistan. Obama's more immediate burden is the financial crisis however. And at the G-20 Obama faces an uphill battle of perception. The American push for a global economic stimulus is viewed as the assailant asking the victim for help.

"The U.S. is blamed, with some justification, with having inflicted an absolutely disastrous recession on much of the world," said Sebastian Mallaby, the director of the Center for Geoeconomic Studies at the Council on Foreign Relations in Washington.

But the blame game can quickly turn London 2009 into London 1933. More than 50 nations sent delegates to meet at the London Monetary and Economic Conference of 1933 to revive the global economy during the Great Depression. The meeting fell apart when Franklin Roosevelt broke from his British and French allies. That failure assured that the depression turned global.

According to Columbia University's Doyle, "The failure to coordinate," sundered the 1933 conference. "That's why this London summit is so important," he added, "it is the opportunity to do it right."

Obama's desire to deal immediately with the recession, like Roosevelt in 1933, is again up against a continental European desire to return to more orthodox financial standards. But this is the candidate Europe courted. Last summer, when Obama toured the continent, no one anticipated this economic crisis. That's the way marriages go however. It's the hard times that prove their mettle.

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America is indeed flirting with populism. From CNN's Lou Dobbs to recently the halls of Congress, populism is on the upswing. In Ronald Reagan's conservative era economic populism was never able to hinge itself to the mainstream, a requirement for a movement meant to represent the masses. Some Democrats tried. Al Gore revived the slogan "people versus the powerful" in 2000. But it turned out many people aspired to be the rich and powerful.

When historian Michael Kazin published "The Populist Persuasion" in the 1990s he concluded, with a tone of regret, that "the centrist course of American politics" will likely continue as long as "the people' remain united more by what they wish to consume than by their grievances as producers." The question now facing the nation is whether the worst U.S. economic crisis in seven decades will unite Americans more by their grievance than their economic aspirations. For now, grievance has only gone so far. American populism today, however shocking for its absence in recent decades, remains mild by historical measure.

Consider one recent Rasmussen poll result. A modest 55 percent of Americans were classified as populist. Modest, that is, because populism by definition extols the common people over a small privileged elite.

"If we expect economic populism like that of the '30s we are going to be disappointed. It's not going to happen," Kazin said in an interview. "We are much more likely to see people going to stock holders meetings and demanding that CEOs get fired rather than seeing people on the streets."

American populism, it seems, is not yet exceedingly popular. By Rasmussen's measure, less Americans have a populist outlook than have the impression that President Obama is politically liberal.

It's particularly American that in this recession only a slim majority trust, to the extent it can be measured, the people more than the powerful. Rasmussen asked Americans a series of questions to differentiate the political class from the populist mainstream. For example: do you have more trust in the judgment of the people or political leaders on national issues?

It was American International Group's controversial $165 million in executive bonuses that sparked these questions and perhaps the most potent episode of populism in a generation. A Gallup Poll taken shortly after the news broke found that six out of 10 Americans were "outraged" by the bonuses. Politicians understood the sentiment and ran before klieg lights to condemn AIG.

The House of Representatives retroactively taxed most of those bonuses. The Senate, the more prudent chamber by design, stalled the proposal. By that point, much of the media was condemning the House's actions. The Washington Post turned up its nose in an editorial and wrote that the public outrage was "hardly relevant" to "what is in the public interest now" and that "AIG's demagogic critics in both parties should keep that in mind."

Looking back, the House may have been constitutionally out of line--oh that bill of attainder--but the House was not out of touch. Rasmussen found that while the public is overwhelmingly against Congress imposing retroactive taxes, a clear majority support making an exception in AIG's case. Gallup found that three in four Americans wanted the government to "block or recover the bonuses."

The public's view of Wall Street has generally crashed with the market. A January NBC/Wall Street Journal poll asked Americans to rate their confidence in 21 institutions. Wall Street and the financial industry ranked last. But Obama and most Democrats are notably not framing the whole of Wall Street as the scapegoat. One factor is that Democrats received 57 percent of the donations from securities and investment industries in 2008, some $86 million.

Still, Obama's outlook is more like progressive Teddy Roosevelt than populist William Jennings Bryan. TR's "malefactors of wealth" emphasized criminal conduct, not one class persecuting another. Bryan's "crown of thorns" and "cross of gold" evoked a sense of the common people's crucifixion.

"Core populist rhetoric tends to demonize people who have a lot of money and have concentrated power," Kazin said.

Of late, the president is going through pains to do the opposite. It's widely publicized that Obama plans to meet with about a dozen top bankers today, including the chief executives of Citigroup, Goldman Sachs and JPMorgan Chase.

Roosevelt did not have similar public summits with the giants of finance. J.P. Morgan himself is only recorded to have met with Roosevelt once during FDR's presidency, and they more likely discussed the Soviets than stocks.

Wall Street figures were so unpopular during the Great Depression that Hoover attempted to secretly have dinner with the New York Stock Exchange president and vice president. It took two days for newsmen to force the White House to confirm that the meeting took place.

Unlike Hoover's and FDR's day, the nation has not seen populist revolts. No runs on banks, thanks to reforms from Roosevelt's era. No food riots. Unemployment is at 8.1 percent, a third the unemployment rate in 1932.

The public is also married today, for better and now worse, to Wall Street. Half of Americans are directly invested in Wall Street's recovery.

"Once a society like ours passes from a society where most people don't have Marxist class consciousness but do see themselves as working class, to a society that sees itself as middle class, it's pretty hard to go back," Kazin said. "I don't see it happening. What people want is to get back to the '90s."

In other words, people want the rich times again. It is in fact Americans' optimism that helps explain why populist figures like Bryan never won the presidency. This past January, pollster John Zogby found that the portion of Americans who believe in the American dream dropped to 56 percent. What struck Zogby though, despite the recession the majority still held true to the American Dream-- however much it eludes many.

It was during Obama's first primetime press conference that he remarked, "the party now is over." Most of America missed out on that party. The 1974 median annual earnings of Americans, adjusted for inflation, was $38,102. By 2007, it was $40,320. At the turn of the century the nation's ultra-rich commanded more of the nation's income than anytime since the Roaring Twenties.

To an extent easy credit allowed the public to live with the illusion of rising prosperity. But the ultra-rich's hold over wealth has fallen since the 1920s. In 1929, the richest 1 percent owned about 40 percent of the nation's wealth. By 2000, one study found, it was cut in half. That decline mitigates grievance.

Obama is now attempting to strike the middle road between populism and the American quest for prosperity. He is forever the conciliator, as the New Yorker was early to point out.

In this week's press conference he said, "Bankers and executives on Wall Street need to realize that enriching themselves on the taxpayer's dime is inexcusable" but that "at the same time, the rest of us can't afford to demonize every investor or entrepreneur who seeks to make a profit. That drive is what has always fueled our prosperity."

The floor of this economic downturn may still be far off. The Great Depression saw it's 1929 crash followed by recovery and only another crash some eight years later. The populist sentiment today will likely rise if the recession slogs on for years or worsens. And Obama's conciliatory nature may then seem out of touch. As Kazin notes, "It's not in Obama's DNA. I think he is much more comfortable talking about unity."

By the mid-1930s, Roosevelt was being challenged from the left by Long and from the right by the ultra-rich who saw him as a "traitor to his class." FDR's rhetoric did escalate as the Depression dragged on. At the 1936 Democratic National Convention he spoke of the "privileged princes of these new economic dynasties, thirsting for power, [who] reached out for control over government," adding that "as a result the average man once more confronts the problem that faced the Minute Man."

That's class warfare. Gallup indeed found in 1936 that four out of 10 people believed "the government should limit the size of private fortunes" for all Americans. Today, solely for companies saved by tax dollars, it's controversial to merely demand executives don't get bonuses.

Thus the man initially described bullishly as "heartening news for financial markets," is now commonly depicted as a reason those markets remain bearish.

It therefore seemed remarkably normal this weekend, that barely two months on the job, Obama was asked what if Geithner tendered his resignation. The president told CBS' "60 Minutes" he would say, "Sorry buddy, you've still got the job."

Geithner's job is center stage this week. He has unveiled a plan to remove toxic assets from the books of failing banks. In his words, "we have to act." Indeed, it was in part his failure to act over the past month that brought the wrath of Wall Street.

This is the Geithner paradox. There is wide disagreement over what action Geithner must take, but nearly everyone demands he take action. Geithner is chided for being unclear about his plans, but as Federal Reserve's veteran Vincent Reinhart put it in an interview, "he can't be too clear."

"The fundamental problem is that the American people are not willing to direct resources to financial institutions to help markets," said Reinhart, a former director of the Fed's division of monetary affairs. "Because of that real anger, which A.I.G. has only intensified, Secretary Geithner has no cards to play."

The White House new public-private plan, stewarded by Geithner, will finance between $500 billion and $1 trillion in problematic loans and securities, the toxic assets at the core of the economic crisis. The U.S. government will shoulder the risk in order to persuade private investors to purchase the troubled assets, which could later prove lucrative.

The political environment has forced Geithner to use as much as $100 billion of Treasury's own coffers, as well as Federal Deposit Insurance Corp. reserves. Congress is in no mood for bailouts. Outrage over the $165 million in staff bonuses by American International Group Inc., the largest recipient of aid, has undercut what little public support remained for using tax dollars to effectively loan money to banks. And it's Geithner, more than any other, who has been held to account for those bonuses.

Geithner is now a man perpetually against the ropes. Earlier this month, the Wall Street Journal forecasting survey of 49 economists graded the Ivy League Geithner a failing 51 out of a 100. Several Republicans have asked him to resign. Democrats are not rallying to his defense. By last week, the mounting criticism forced President Obama to express his "complete confidence" in the Treasury secretary. Hardly encouraging. Expressions of presidential confidence often signify a lack thereof.

Geithner's foremost problem is not the president's confidence. "Geithner doesn't have the confidence of the markets," Reinhart said. "And in that job, having the confidence of the president ranks as number two."

So far the markets have positively received the latest plan, as well as Geithner's presentation of it. The Dow Jones Industrial Average soared nearly 500 points Monday, almost 7 percent, largely on the backs of financials. Still, it will be at least months before the plan's effectiveness can be gauged.

Geithner though remains in the hot seat. He is scheduled to testify twice this week before the House Financial Services Committee. He will face some harsh criticism in light of the bonuses backlash. But even his critics have no clear replacement in mind. And to some analysts, the rap against Geithner is fundamentally absurd.

"What do people want? A Nordic god figure?" asked Mark Blyth, a professor of comparative political economy at John Hopkins University. "Geithner is sitting there with a shit sandwich of unbelievable proportion. I don't understand any of this Geithner bashing. So yeah the guy doesn't come out and sound like Charlton Heston with two stone tablets but is that the level we are at?"

To an extent, yes. "Managing the psychology of the market is as important as managing the flow of funds," said Marc Roberts, a Harvard professor of political economy.

The role then is Geithner's to play. So Geithner carries on, understaffed, facing a crisis of almost unprecedented scope and forced to act amid disagreement on how to act. He is blamed for decisions that are not his to make. The left hits him for doing too little. The right hits him for doing too much. And middle ground seems inadequate, like a partial invasion on D-Day.

But Washington is never fair to fall guys. For a period, presidents benefit from lightning rods. But the storm can in time become too much. And there is a sense in Washington that, unless he quickly recovers, Geithner's time is nearing.

"The next two weeks are key," Roberts said. "If Geithner presents his plan clearly and forcefully and defends it forcefully, all this will be forgotten."

Reinhart described Geithner as "damaged but not dead, yet."

"He has not done anything that has irretrievably damaged his reputation," Reinhart added. "If he comes up with a plan and a sign of forceful action all this will be forgotten." But if the pitch or plan fails, "then someone will have to go and it would be him."

Geithner's future also depends on the degree Obama wishes to invest his political capital in the bad politics of bank bailouts, as well as join his image with Geithner's.

And that's the ironic rub for the Treasury secretary. Geithner is reminiscent of his boss. He and Obama are the same age. Both men are defined by their measured equanimity. Geithner too shot up the Washington food chain. Yet the shared characteristics are now condemned in Geithner and still admired in Obama.

It was the Times that once captured Geithner as a "cerebral Dr. Phil." Now Geithner's critics have to, perhaps imperfectly, choose whether they want the "cerebral" financial regulator from the trenches or Dr. Phil. Geithner was always only the former. There is no paternal FDR-like figure counseling the nation today. But really, is that Geithner's job or Obama's?

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Bush, like Obama, began March 2001 with strong support from moderates. By the close of the month Bush's independent support withered to 48 percent, slimming his majority for the first time into the low 50s. Bush again neared 60 percent public support by early April, briefly dulling divisions and earning a 37 percent approval rating from Democrats.

Obama's Bush-like divisiveness, at least when party identity is concerned, may undercut the core image he constructed for himself. Obama campaigned on the theme of ushering in a post-partisan era. By inauguration day, Obama pledged to "end" the "worn-out dogmas that for far too long have strangled our politics."

Obama is now mired in those same political dogmas. Republicans, by consequence, have won a small victory by opposing a president who promised to unite.

Gallup finds that Obama has the approval of nine in ten Democrats, matching Bush's standing with Republicans in March 2001. Only about a fifth of the opposing party backs Obama, not unlike Bush or Bill Clinton over the same period. But neither Bush nor Clinton, while campaigning as consensus builders, made transcending the two tribes of Washington the core theme of their campaign.

Washington's partisan divide had a searing impact on the Clintons in particular. No less than Obama's onetime rival Hillary Clinton, now secretary of state, mocked Obama as the kumbaya candidate during the Democratic primary.

"I could just stand up here and say 'Let's just get everybody together, let's get unified,'" Clinton told supporters little over a year ago. "Maybe I've just lived a little long, but I have no illusions at how hard this is going to be."

Obama now realizes how hard it's going to be. Yet independents' support, combined with a still united Democratic Party, currently keeps Obama from suffering Bill Clinton's fate of early partisan gridlock.

Independents' approval of Obama has held between 59 and 62 percent since he took office, according to Gallup's weekly averages. The Pew Research Center has Obama shuffling along the same narrow terrain, 63 to 57 percent, between February and mid-March. The recent CNN/Opinion Research Corporation poll shows Obama with the approval of about six in ten independents.

Americans have long offered new presidents the benefit of the doubt. Presidents tend to earn early approval ratings well exceeding their margin of the vote.

It's been clear since early February that Obama is a popular president, but not remarkably so. He is slightly more popular than the early presidencies of Bush and Clinton, though it varies by the day. He is at par with Ronald Reagan. And he is less popular than the early presidencies of Jimmy Carter, John F. Kennedy or Dwight Eisenhower.

Obama is in this sense a president indicative of his era. He campaigned on "turning the page" but has found himself unable to return to earlier bipartisan chapters.

No less than Richard Nixon, who had an approval rating similar to Obama at this point in his presidency, was initially not as divisive a figure. A majority of Democrats and six in ten independents approved of Nixon by late-March 1969.

In time Nixon, like so many presidents, would begin to lose that majority as his independent support dipped below 50 percent.

Even Eisenhower, who only twice fell below the 50 percent mark in the Gallup Poll, briefly lost the majority as partisans held steady and independents ebbed. For Carter, Reagan, and generally all presidents thereafter, the loss of the majority of independents coincided with the loss of the majority.

In broad terms, a president's mandate rises and falls with the middle of the electorate.

Obama's public support today is reminiscent of Reagan's. Six in ten Americans backed Reagan by mid March 1981. Like Obama, Reagan managed similarly strong independent support-- 61 percent. Later that month, the attempt on Reagan's life offered him a second honeymoon.

But by mid-November 1981, as the economy staggered despite Reagan's Economic Recovery Act, the center began to escape Reagan and the majority followed. For the first time, half the public did not approve of his presidency. Reagan was no longer able to blame Carter for the nation's malaise. As the recession worsened, Reagan's public support fell as low as 35 percent in late January 1983.

Obama's centrist support shows no signs of flagging. But there are signs of potential weakness. Independents represent about three in ten voters. They support many of Obama's policies but remain skeptical of his guiding principles.

Pew notes that a majority of independents prefer a smaller over larger government but favor more government regulation of the private sector. Six in ten independents believe Obama should raise taxes on Americans making at least $200,000 annually. A slim majority of independents also back a new law to "make it easier for labor unions to organize workers," according to Gallup.

Still, Pew finds a quarter of independents now disapprove of the president. A majority of the middle is "angry" over the bank bailouts. Slightly fewer than half of independents support the government spending "billions of dollars" to help homeowners.

More disconcerting for Obama, the portion of independents who say Obama is listening more to Democratic liberals than to moderates has risen from a third in January to nearly half today.

Obama will likely have to reverse that last trend to keep the middle behind him, absent a jarring event. Many of the early successes of modern presidents were aided when tragedy rapidly broadened their appeal: Bush after the September 11 attacks; Reagan, again, after the failed assassination attempt; Johnson after Kennedy's assassination.

Not since the first stock market crash has the economic crisis held similar shock and awe over the public mood. Obama is an ambitious president in the mold of Johnson and Reagan. But Obama is still governing in the divided Washington of Clinton and Bush.

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The nation's two big demographic trends, the browning of America and the educating of America, are boding badly for Republicans. That's the horizon of American politics today. But the catch about looking over the horizon is that you can't be quite sure of what you've seen until you get there.

Hispanics' support for Democrats may, in fact, have peaked. This White House is certainly in no rush to traverse the political minefield of immigration reform. Obama's historic levels of black and youth support will almost surely lessen when Obama is no longer atop Democratic ballots.

The Democratic dominance of the millennial generation may prove especially fleeting, if taken for granted. George W. Bush and the war in Iraq were strong incentives for voters under age 30 to ditch the GOP. But Bush is now gone. Americans have turned their focus from national security to the economy. And in time the millennial generation will get married, have a family and struggle to pay the bills--a generation likely poorer than their parents. The GOP will still have issues ranging from tax policy to cultural anxiety to woo millennials back. And lest Democrats forget, youth is not always a synonym for progressive politics. In 1984, Republicans won six out of 10 young voters.

Political parties also do not live in a vacuum. Andrew Jackson would not have recognized George McGovern's Democrats. The GOP majority of the early 20th century--Northeastern, Protestant and old money--never conceived of the southern orientated culturally populist GOP of the second half of the century, collecting blue-collar Catholics by the millions.

Between those two GOP majorities were men like Richard Nixon and Joe McCarthy. McCarthy's hearings on communism and Nixon's "Checkers Speech" reached the white working and middle class. FDR's coalition was cracking.

It was at the dusk of the FDR era that Nixon-man Kevin Phillips wrote that 1968 was a "repudiation visited upon the Democratic Party" for "its ambitious social programming, and its ability to handle the urban and Negro revolutions" that was "comparable in scope to that given conservative Republicanism in 1932 for its failure to cope with the economic crisis of the Depression."

Republicans seem to be reliving their Great Depression mistakes. They're offering scant government solutions at a moment when the private sector is failing, only further surrendering the near term demographic patterns that do indeed favor Democrats. It need not be this way for the GOP. It was, after all, not fated that Democrats lose millions of middle and working class voters by 1980.

Now Democrats' again control Washington. But they seem confused between their long-term ambitions, like national health care and alternative energy, and the economic crisis they inherited and must now tame. The confusion may be rooted in misinterpreting Obama's mandate. Many progressives still fail to recognize, as I detailed in a past essay, the central role of the crisis in bolstering the demographic gains liberals now celebrate.

Teixeira's nearly 50-page report ignored the economic crisis impact on the electoral map. By the Gallup Poll's tracking, Democrats were winning about 55 percent of the Hispanic vote before the first stock market crash. McCain was winning the college graduate vote. By September's close, Democrats were winning roughly 65 percent of the Hispanic vote and college graduates.

Obama won nine states Bush took in 2004. But in six of those states, including Florida and Ohio, John McCain was ahead or tied prior to the first stock market crash on September 15. Nearly to the day of the dive, Obama rose in all nine states to soon sustain a national majority for the first time.

Looking back, FDR's coalition was not fated. The Great Depression only gave Roosevelt his chance to govern. It was action-- the New Deal--that won Democrats their enduring majority. Programs from the National Recovery Administration to the Social Security Act would bond working Americans to Democrats. Photographs of FDR hung in homes, restaurants and offices. During the Great Depression, reporter Alistair Cooke recalled getting thrown out of a motor lodge by a clerk after he mocked a poor rendering of Roosevelt.

Democrats understandably hope that Obama's slated programs will deliver the same long-term loyalty.

Last week, when I asked a top Democratic strategist about the demographic tailwinds at his party's back, he shrugged. "Americans are incredibly practical people," the strategist said. "The only ideology they are going to be loyal to is what works."

A member of Roosevelt's administration, Thurmond Arnold, was once asked to explain liberalism. Arnold replied, "Liberalism is deuces wild."

Obama's gambles, favoring many legislative battles over only one, will eventually need to pay out. Democrats' hope for a sustained majority rests on it. Demographics change. But political success has always depended on practical success.

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It's certainly okay to make a buck in war. Take automobile companies in World War II. But in wartime, society generally concedes profit cannot trump patriotism. An economic crisis may not be that different.

Consider the act of short-selling during a particularly bad bear market. Short sellers aim to profit from the fall of a publicly traded company. A trader makes money by the companies decline. It's a pessimistic bet, mostly practiced by professional investors.

In normal times, manageable bears or bulls, short sellers may legitimately view a stock as overvalued. Shorts can sober overpriced securities. Shorts can make assets more liquid, easier to sell and purchase. They serve as insurance against gambling on the upturn. And certainly, speculation must allow for both ups and downs.

But a host of major Wall Street banks, from Citigroup Inc. to Morgan Stanley, argue that short-selling has not simply made money in this economic crisis but contributed to it by driving down stocks to destroy companies. Some short-sellers therefore are exacerbating the same company's decline they have gambled on.

"The shorts certainly seem to accentuate any kind of weakness" in a company, said Bob Pavlik, chief market strategist of New York 's Banyan Partners LLC. "The shorts have been acting if not like an organized group, a sort of wolf pack."

The shorting problem is only multiplied when hedge funds act as a "wolf pack" and collectively attack a company already in critical condition.

Past collapses have witnessed similar concerns. But even as bear markets go, these are not normal times. By Barron's count the stock market has lost $2.6 trillion in the past 10 weeks alone. That's nearly equal to the 2008 GDP of the United Kingdom. We have the worst unemployment rate in a quarter of a century, 8.1 percent. The world's seventh largest economy, California, has come near to complete financial collapse. Millions of Americans life savings have been decimated. In Buffet's words, it's "an economic Pearl Harbor."

Short-selling did not cause this economic crisis. But some short-sellers contribution to the crisis has evoked moral issues.

"Imagine you are a salvaging company. You make money off salving refuge on buildings that collapse," said Waheed Hussain, an assistant professor of business ethics at University of Pennsylvania 's Wharton School. "It's one thing to make money off a bridge collapsing. It's another thing to send extra trucks over the bridge to get it to collapse."

The government concluded during the Great Depression that short-selling exacerbated the market collapse. A so-called uptick rule was implemented in 1938 to regulate bearish traders to only shorting a stock on the uptick--when the price has increased. The Securities and Exchange Commission canceled the rule in 2007.

The impact of the uptick rule is debated. But no less than Wall Street giant Charles Schwab wrote in December that the uptick rule, "slowed the short selling process making it more expensive and limiting the ability of short sellers to manipulate stocks lower by piling on, driving the share price quickly down and quickly profiting from the downdraft they created." And as Schwab put it, "without this vital control mechanism, short-sellers have been having a field day."

SEC chairwoman Mary Schapiro said in January that she would look into short selling and reinstating the uptick rule. Earlier this week, the chairman of the House Financial Services Committee, Barney Frank, triggered buzz on Wall Street when he said, "I am hopeful the uptick rule will be restored within a month. Mary is moving towards the uptick rule."

Some Wall Street veterans are asking what's taking so long? Pavlik believes, like Schwab, the uptick rule would have "slowed the decline."

After all, this economic war's enemy is not only the decline itself but also a delay, impotence or inefficiency in combating the causes of the decline. Though so is governmental overreach, Wall Street analysts argue.

Shortly after the market first crashed in September, the SEC enacted a temporary ban "to prohibit short selling in financial companies" and to protect market "integrity." It noted, "unbridled short selling is contributing to the recent, sudden price declines in the securities of financial institutions unrelated to true price valuation."

The SEC ban though may have confused the market. The economic crisis had spread far beyond the financial sector. The ban likely fueled volatility. It was expected to expire from its inception and may have artificially boosted the financial sector. Sufficed to say, the ban is controversial. The return of the uptick rule is more tolerable to Wall Street.

Then there is the moral debate, never popular among traders. Ethical questions of "the common good" are "engaged" when Americans bet against the market and aggravate the crisis, Hussain said.

"We rightly limit moral free space sometimes in a crisis through law," Thomas Donaldson said, also a business ethics professor at Wharton. "There's never a justification for limiting basic freedoms, i.e., to a fair trial, or to free speech, but the right to short sell doesn't make the cut."

Donaldson conclusion, the "financial exigency argument is strong."

But traders flinch at discussions of new circuit breakers on the market. They say their job is to make money. And indeed some traders are now placing "doomsday puts," betting options on a Dow Jones below 5,000 points. Last week though analysts suggested that short-selling helped drive the Dow to its lowest close in 12 years, crossing the line between profiting off the nation's decline and helping to inflame it.

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It soon became a ubiquitous GOP refrain. "It's not a failure of the free market" that's "going on in the economy today," House GOP Leader John Boehner reportedly said at an October Republican fundraiser, but "the excesses of Fannie Mae and Freddie Mac."

Or as Nevada Republican Senator John Ensign recently said on MSNBC's "Hardball:" "Government is what caused the problem in the first place. I think the underlying probably in all of this was the housing problem," which he flatly blamed on old Fannie and Freddie.

In early September 2004, at the peak of the presidential campaign, it was Ensign again on "Hardball" proudly telling Americans "the economy is doing incredibly well." It was this optimistic view that led Ensign to go on and defend Bush's promise to restructure social security so that younger Americans could invest their retirement in Wall Street.

"Social Security just doesn't return a good enough investment," Ensign said. "Pension systems, state pension systems do. We ought to model Social Security reform on something like that."

These same pension funds have tumbled today. States like Florida regrettably invested hundreds of millions of dollars in failed Wall Street giants like Lehman Brothers.

But back during the 2004 campaign, Ensign's home city of Las Vegas was benefiting more than most from the housing boom. It was at a Las Vegas rally attended by Ensign, late in the campaign, that Bush declared, "I believe our country can and must be an ownership society."

That ownership society depended in part on a low interest rate and easy loans. It was also inextricably tied to the same Wall Street that was inflating the housing market. Banks and rating agencies got rich by disguising bad credit risks with good credit ratings. Subprime mortgages were bundled into mortgage-backed securities. Bankers then sold these snake-oil securities as an investment to willing buyers.

Fannie and Freddie were part of the problem. Both companies lowered their standards to offer home loans to Americans who traditionally could not afford them. But they were following Wall Street bankers who first loosened their lending standards. Those loose standards became a catalyst for the subprime industry.

Even Alan Greenspan told Congress in October that these bundled subprime mortgage securities were "undeniably the original source of the crisis."

This fact has put Republicans in a bad place. A GOP credo since the early 20th century has been that free markets work best when entirely free. But in the same respect that traffic lights do not curtail freedom but ensure an efficient road system, reasonable market controls ensure an efficient economy.

Last month the rant of CNBC commentator Rick Santelli against the government aiding the "losers" who could not meet their mortgage payments struck a chord for the same reason conservative criticism of welfare once did.

By the 1970s, it was perceived that welfare provided a lifestyle for the idle poor comparable to that of the working class. Naturally, those who were working resented others getting a free leg up.

Santelli's rant is in this sense a warning to Democrats. There will be widespread push back from the "silent majority" if aid to defaulting homeowners is seen as only helping the irresponsible, as it was during welfare.

Republicans are betting that defaulting homeowners may come to be seen as "welfare queens." But placing the blame on Fannie, Freddie and Joe the Spendthrift is dishonest, yes, but also strategically clumsy. It misunderstands 2009 as 1969, confusing the dusk of a conservative era with the excesses and decline of a liberal one.

More than eight in 10 Americans believe Obama "inherited" this bad economy, according to the recent Wall Street Journal/NBC News poll. The same poll finds that the public believes Democrats, by more than a two to one ratio, are able to do a "better job of getting the country out of a recession."

This public perception has contributed to Republicans' newfound powerlessness. In time, the overreach by the majority party may again offer the GOP some control in Washington. So goes the cycle of politics.

But the Democrats partially revived themselves as a party not by touting the success of their creed but by understanding some of its key failures. They moved away from the welfare state and even gun control battles, grasping how these stances wedged them from the majority.

At some point, Republicans need to face the reality of private sector hubris. If they do not, the GOP could sound like the Democrats in the mid-1980s, a party arguing for the same welfare state that the majority had long abandoned. That Democratic dogmatism contributed to Ronald Reagan's landslide in 1984.

Today, three in four Americans believe that corporate America's moral compass is "pointed in the wrong direction," according to one Marist College Institute of Public Opinion Poll. This is the same corporate America that many Republicans believe can guide us out of this market mess. Those GOP leaders forget that the public is wary of more bailouts because they are seen to benefit the same executives that led us astray.

Unlike during welfare, Americans see the personal irresponsibility that caused this crisis in boardrooms rather than living rooms.

Republicans have long said that Democrats never fail to believe in an active government that tends to fail. Now, however, that mirror extremism seems to be afoot in the GOP -- a belief in a private sector that when unregulated never fails to fail us.

Active state liberals like Woodrow Wilson, Franklin Roosevelt, Harry Truman and Lyndon Johnson all saw the pendulum of their presidencies swing from domestic to foreign affairs.

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"American history teaches us that the world has a way of unexpectedly catching a president's attention and priority," said Allan Lichtman, a presidential historian at American University.

Johnson called Vietnam "that bitch of a war" stealing him away from the "the woman I really love," which was the Great Society.

It's the unfinished agendas of domestic reformers that have lately been on the minds of presidential historians like Robert Dallek. Dallek has in recent months become a Cassandra about Obama's plans for reform, prophesying the potential undoing of Obama's domestic agenda by affairs abroad. He tends to reference the foreboding historical adage, "war kills reform." Dallek and Lichtman will recite the list: progressive reform felled by World War I, New Deal with World War II, Truman's Fair Deal by Korea and Johnson's Vietnam. Even George W. Bush's promise to turn away from nation building and enact a compassionate conservative agenda ended with the September 11 attacks.

Today there are roughly twice as many American soldiers in Afghanistan as there were in Vietnam the day Johnson became president. By May 1964, Johnson was a president wrestling with escalating the war. He, like Wilson, had campaigned on promises to keep the nation's boys out of a foreign war. Johnson privately told Senator Richard Russell, "I haven't got the nerve to do it and I don't see any other way out of it."

By the end of July 1965, Johnson declared that the land war was underway. Troop levels were raised to 125,000 from 75,000. There were promises of more soldiers if needed. Two days later Johnson traveled to Independence, Missouri, to sign Medicare into law. With an elderly Truman at his side, Johnson had accomplished the reform Truman could not. He would have his Great Society and his war, or so he thought.

It was at the next year's state of the union address that Johnson, true to character, told America, "I believe that we can continue the Great Society while we fight in Vietnam." Critics immediately derided Johnson for quixotically pledging both "guns and butter." Johnson would not raise taxes. The bill came due. The cost was Johnson's domestic agenda and eventually his presidency.

Obama has long promised to deescalate the wrong war and escalate the right one. The same week Obama told Congress about his domestic ambitions--universal college education and health care, a green economy and even curing cancer--he announced the draw down of troops in Iraq. He appeared to be heading in the opposite direction of Johnson.

Obama has pledged to reduce U.S. forces in Iraq to less than 50,000 from 145,000 by the end of summer in 2010. A few weeks earlier, Obama upped the American troop deployment in Afghanistan to 55,000 from 38,000. There are hints from the Pentagon that some 30,000 additional troops could still be deployed to Afghanistan.

"If Obama gets drawn too deeply into Afghanistan it can be very destructive to his reform agenda," Dallek said.

Obama believes Afghanistan is the war America must win. Like the "wise men" of Johnson's day, Obama's circle--Defense Secretary Robert Gates, to Vice President Joe Biden to Secretary of State Hillary Clinton-- seemingly agree. But then there is the nation at hand. It would be difficult to select a more difficult country to stabilize than Afghanistan. It is the world's largest producer of opium. The country has a life expectancy rate of 44 years. Four in ten of its citizens are unemployed. Hardly more than a quarter of the population is literate.

These statistics are not unfamiliar to the Obama administration. Gates said in a recent Senate hearing that, "If we set ourselves the objective of creating some sort of central Asian Valhalla over there, we will lose, because nobody in the world has that kind of time, patience and money."

So it may be that Obama will follow the conservative war of George H.W. Bush, who has now been redeemed by history for pushing troops out of Kuwait but not pushing on to Baghdad.

The danger Obama faces, however, is the temptation of presidential power. The most clearly enumerated power of the presidency, both constitutionally and by precedent, is to shape foreign affairs.

The nation has been focused on what Obama will do about the worst economic crisis since the Great Depression. Meanwhile, there has been little discussion of the limited ability of the president to shape that economy.

Congress has always been more apt to assert itself on the economy than issues abroad. Truman, for example, was still able to enact his foreign agenda, from the Marshall plan to the Truman doctrine overall, despite a Republican Congress. Historians also generally agree that a president is more often a bystander of the economy rather than its steward.

"Not only do presidents have limited power to control the economy but limited power to predict the economy," Lichtman said.

It was on the eve of Dwight Eisenhower's inauguration in 1952, that Truman is said to have remarked that Ike "will say, 'Do this! Do that!' and nothing will happen. Poor Ike--it won't be a bit like the army." Foreign affairs, especially the waging of war, are generally the exception to Truman's warning.

For Obama, the blessing and problem of the wars on his horizon are that they won't require the great industrial mobilization that was World War II, but therefore cannot economically lift the nation as Roosevelt's war did.

Obama's supporters take some comfort in his deliberative intelligence, so unlike Johnson's bullish street smarts. Though even Wilson, who served as president of Princeton University, was forced to learn the limits of a president's capacity to focus exclusively on domestic reform.

Wilson famously remarked, as he left Princeton for his inauguration, that "it would be an irony of fate if my administration had to deal chiefly with foreign affairs, for all my preparation has been in domestic matters."

It would be no less ironic for Obama.

In Depth: How Do Americans Think Obama Is Doing?

In Pictures: 10 Memorable Moments From Obama's Inauguration

In Depth: Analyzing Obama's First 100 Days

Reagan's line struck a chord a quarter of a century ago because Americans' view of government had changed. Gallup asked in 1937 and 1981: "Which theory of government do you favor -- concentration of power in the federal government or concentration of power in the state government?" In Reagan's day, a majority of Americans favored power being concentrated in the states. During FDR's presidency, 1937, just a third of Americans held the same view. Even then only a plurality of Americans, 46 percent, favored concentrating power in Washington.

A majority of Americans have, in fact, favored a smaller federal government, rather than larger, from the outset of Bill Clinton's presidency to the outset of Obama's, according to ABC News/Washington Post polling.

Obama does represent a different kind of Democrat. It was Clinton who pledged that the era of big government was over. Obama signifies its return. He, unlike Clinton, is not constrained by a conservative era as he faces down a far worse economy than Clinton knew. This explains why Americans, on some crucial policies, are with him.

Multiple polls show that a large majority of Americans now support national health insurance. But historical data suggests that even as the public backs one measure, Obama may eventually face blow back against the broad sweep of his agenda.

By autumn 1966 Gallup found that more Americans had an unfavorable opinion of the Great Society than favorable, by a margin of 44 to 32 percent.

In fact, since 1965 Gallup has asked Americans whether big business, big labor or big government is the "biggest threat to the country in the future." Americans have picked big government as the answer every year, including as recently as early December.

Historian Henry Steele Commager called this skepticism of the federal government an American "notion," rooted in a basic belief that there is a conflict between man and state. Commager thought the New Deal ended that conflict. But even today, this conflict haunts Obama. The nation, in broad philosophical terms, has more often than not sided with Jefferson over Hamilton.

In spite of our Jeffersonian tendency, there is daylight for Democrats. In 2005 and 2006, like in the mid 1990s, Americans were even more likely to name big government as a "threat" to the nation's future.

This week's Wall Street Journal/NBC News poll found that a slim majority of Americans believe the "government should do more to solve problems and help meet the needs of people." But the public had the same view in the summer of 2007 and 2008; it's one more indication Americans view of government has not shifted nearly as rapidly as their household net worth.

Meanwhile, the same poll found that about six out of 10 Americans are more concerned about the federal government spending "too much money" to boost the economy rather than "too little." Less than a third of Americans are more concerned Washington will spend "too little money" to revive the economy.

No less, however, Republicans risk misunderstanding this public angst. Americans say they want Obama to take action. A large majority of Americans were behind Obama's stimulus package. Post/ABC polling found more support for Obama's stimulus plan than Reagan enjoyed for a similar measure early in his presidency.

Obama's problem is though that even his public support carries a caveat. Americans only want measures that seem to reach Main Street, not Wall Street.

More than eight out of 10 Americans support "new government programs to help create jobs" while roughly two-thirds of the public supports aid to state governments in "serious financial trouble" and "giving aid" to Americans in danger of losing their home, Gallup finds. Meanwhile, only about four out of 10 Americans support U.S. aid to automakers in "danger of going bankrupt" or aid to U.S. banks or financial institutions in danger of "failing."

So Americans might agree with Reagan's stated-though-unrealized belief in small government, but today they are not believers in Reagan's trickledown economics or conservative economic policy.

In early January, the Journal/NBC poll found that by a two to one margin the public saw "government spending that will help create jobs" as more important to stimulating the economy than "tax cuts that will allow people to spend more."

Still, distrust in Washington remains a yellow light for Democrats. The recent ABC/Post poll found that a slim majority of Americans do not believe Washington "will put in place adequate controls to oversee the stimulus spending."

Obama's burden ahead is now twofold. One, despite the limitations of the president to shape the economy, eight out of 10 Americans believe that if leaders in Washington "make the right decisions" they can "improve" the economy a "great deal" or at least a "fair amount," by Gallup's measure. As the president himself has said, his political future is now tied to the economy.

Obama's second problem is with his flank. Liberals want big government measures. It is only liberals today who strongly reject Reagan's view of government as the problem, by a two to one margin. On the other hand, moderates today agree with Reagan's statement by a 47 to 32 percent margin.

A president's currency is his popularity. That means Obama's risk is in the middle. Only 37 percent of independents were "generally positive" about Obama's recent budget proposal, according to Gallup. The Pew Research Center also recently found that nearly three-quarters of Democrats believe the nation is now on the "right track." Only 41 percent of independents agree.

Obama does not need to convert the public to liberalism. But it's clear that while Americans want Washington to take rare steps to improve the economy, the public remains skeptical of the guiding philosophy behind those steps.

The era of cries for small government is likely over, for now. But Americans have not yet converted to big government either.

Obama once bothered his base by stating that, "Ronald Reagan changed the trajectory of America." Obama added that Reagan "just tapped into what people were already feeling."

The public is not where Reagan was in the early 1980s. But it's also not yet philosophically where Obama is going. The president's capacity to hold the middle and maintain his mandate will depend on him not getting too far afield of his public.