THE BLOG
11/07/2012 03:48 pm ET Updated Jan 07, 2013

So... Um... What's Different Now?

OK, you can be forgiven for waking up today wondering: did we really go through all of that just to be stuck exactly where we were?

I've already been on TV this AM with some who were arguing that there's no reason for yesterday's gridlock to suddenly evaporate. And you've got the predictable obstructionists making the predictable noise:

"If he [Obama] wins, he wins -- but at the same time, voters will clearly vote for a Republican House," said Representative Joe Wilson, a South Carolina Republican who shouted "You lie!" at Mr. Obama during a speech to Congress. "The consequence of that is our voters really anticipate and count on us holding firm."

Well, I know I'm running on no sleep and too much caffeine, but I disagree. Here's a sketch of the reasoning that says some important differences were established by dint of last night's clear, though narrow re the popular vote, victory:

- New presidents, including newly reelected ones, get some props. What seemed impossible before an election can become doable after one. Outside of die-hards like the guy quoted above, and he's of course not alone, I know that there are Republicans who are ready to deal on, e.g., the fiscal cliff. More on that in a moment.

- Losers last night included supply-side economics and the Tea Party. Yes, some tea partiers won, but not only were their positions rejected by their candidate in the general election, but R's lost a bunch of races they could have won because of positions that stick in the primary and stink in the general.

And Romney/Ryan's big centerpiece supply-side, trickle down tax cut didn't seem to do anything for them. Meanwhile, the President was forthright about rates having to go up on upper-income households in order to move towards a sustainable budget path... and he won.

- The Affordable Care Act will not face repeal on day one. Implementing this as well as financial reform will be critical second term agenda items.

- There is a will be a role for government in safety nets, market failure, social insurance, financial oversight. Though moderate Mitt muddied the waters towards the end, WITT beat YOYO -- and that is a very good thing.

Look, I'm not going to be listening for a chorus of Kumbaya to break out on Capitol Hill. But I believe a victorious Obama with an increased Senate majority should be able to get a compromise on the expiration of the top 2% of the Bush tax cuts, while extending the other 98%. Once you get that, a lot of other cliff issues fall into place -- e.g., I'm sure they can smooth out the automatic spending cuts to hit more gradually. Maybe-hopefully-there are some jobs measures in there too.

It make take going over the cliff to get there, and Republicans will demand more spending cuts for it -- they'll probably gun for the entitlements. So there will be more argumentation, for sure.

But again, it could be sleep deprivation, but I think we're a little bit closer to compromise and functionality today than we were a couple of days ago. And if I'm right, well then, that wasn't all for nothing, was it?

This post originally appeared at Jared Bernstein's On The Economy blog.