01/22/2013 10:44 am ET Updated Mar 24, 2013

The Reagan Era Is Over, The Obama Era Has Begun

President Obama has still got four more years (minus one day) in office, but it is already time to start thinking about his legacy.

This is a business-oriented blog, so I should limit these thoughts to business-related things. But Obama's second inauguration speech yesterday, though light on details and heavy on broad-stroke rhetoric, had major implications for business-y stuff, including the size and scope of the welfare state. It also contained a pretty surprisingly prominent shout-out to climate change, a business story if ever there was one. Obama's speech was aggressively liberal, by the standards of Barack H. Obama, the New York Times writes, but not nearly as liberal as it could have been. For example, Obama did not announce that he was confiscating all of the guns and rounding everybody up into UN-operated FEMA camps. He's saving that for 2014, maybe, once he's lulled us into a false sense of security.

Despite the disappointing absence of the camps, Obama is still fast becoming conservatives' worst nightmare, much as Ronald Reagan was liberals' worst nightmare -- and in a more profound way than the liberal nightmare of the overreaching, incompetent George W. Bush. In fact, Obama is well on track, barring some sort of Lewinsky eruption, to becoming the liberal Reagan, notes BuzzFeed's Ben Smith. This is not because Obama has been unusually liberal or anything. Time and again he has disappointed the liberal wing of his party, from dropping the public option on health-care reform to dropping the ball on financial reform.

Obama has governed like a liberal Republican, just like Reagan. But in one way the two presidents could well be opposite sides of the same coin, standard-bearers for competing strains in American politics. Reagan's actions weren't always aggressively conservative, but his presidency made it OK to be a conservative again after decades in the wilderness. Reagan heralded the rise of the conservative strain and the marginalization of liberals. It wasn't too long ago that "liberal" was a dirty word -- even during the presidency of Bill Clinton, who apparently felt he had to mask his own progressivism (he hired Dick Morris, for God's sake).

To the extent the word "liberal" is losing its power to wound, we can thank Obama. Though his policies have not been wildly progressive, he has tonally started to make it OK to be a liberal again. Conservatives, meanwhile, risk being driven to the sidelines, as evidenced by their frustrated (short-term) retreat on Monday from their threat to hold the debt-ceiling hostage in exchange for spending cuts.

Obama's liberalism will be constrained by economic circumstances and by his own innate conservatism. But in the many debates to come -- over the tax code, the size of government, climate change and more -- the framework may well be shifting, from Reagan-era conservatism to Obama-era liberalism.