Person of the year 2008

Why History Can't Wait - Person of the Year 2008 - TIME

Score that as follows: one imploding economy, one deteriorating war in an impossible region and two versions of Armageddon — the bang of loose nukes and the whimper of environmental collapse. That's just for starters; we'll hear the unabridged version shortly.

On Friday, Dec. 5, the President-elect sat down with TIME managing editor Richard Stengel, editor-at-large David Von Drehle and Time Inc. editor-in-chief John Huey in Obama's spartan transition offices in Chicago to discuss his plans for the coming months, the improbability of his victory and how he's fighting to stay in touch with the real world from inside the presidential bubble. Excerpts from their conversation:

What kind of mandate do you have?
Well, I think we won a decisive victory. Forty-seven percent of the American people still voted for John McCain. And so I don't think that Americans want hubris from their next President. I do think we received a strong mandate for change ... It means a government that is not ideologically driven. It means a government that is competent. It means a government, most importantly, that is focused day in, day out on the needs and struggles, the hopes and dreams, of ordinary people. And I think there is a strong mandate for Washington as a whole to be responsive to ordinary Americans in a way that it has not been for quite some time.

When voters look at your Administration two years from now, in the off-year election, how will they know whether you're succeeding?

I think there are a couple of benchmarks we've set for ourselves during the course of this campaign. On [domestic] policy, have we helped this economy recover from what is the worst financial crisis since the Great Depression? Have we instituted financial regulations and rules of the road that assure this kind of crisis doesn't occur again? Have we created jobs that pay well and allow families to support themselves? Have we made significant progress on reducing the cost of health care and expanding coverage? Have we begun what will probably be a decade-long project to shift America to a new energy economy? Have we begun what may be an even longer project of revitalizing our public-school systems so we can compete in the 21st century? That's on the domestic front.

On foreign policy, have we closed down Guantánamo in a responsible way, put a clear end to torture and restored a balance between the demands of our security and our Constitution? Have we rebuilt alliances around the world effectively? Have I drawn down U.S. troops out of Iraq, and have we strengthened our approach in Afghanistan — not just militarily but also diplomatically and in terms of development? And have we been able to reinvigorate international institutions to deal with transnational threats, like climate change, that we can't solve on our own?

And outside of specific policy measures, two years from now, I want the American people to be able to say, "Government's not perfect; there are some things Obama does that get on my nerves. But you know what? I feel like the government's working for me. I feel like it's accountable. I feel like it's transparent. I feel that I am well informed about what government actions are being taken. I feel that this is a President and an Administration that admits when it makes mistakes and adapts itself to new information, that believes in making decisions based on facts and on science as opposed to what is politically expedient." Those are some of the intangibles that I hope people two years from now can claim.

When you look at the economic issues that you ran on in the campaign, does [all the bad financial news] change your priorities about how quickly you've got to act on, say, jobs vs. energy?
Fortunately, most of the proposals that we made apply not only to our long-term economic growth but also fit well into what we need to do short term to get the economy back on track. I have talked during the campaign about the need to rebuild our infrastructure, and that obviously gives us an opportunity to create jobs and drive demand at a time when the economy desperately needs jobs and demand. I've talked about a tax cut for 95% of working families, and that fits into a stimulus package, and we can get that money out into people's pockets fairly quickly. I've talked about the need for us to contain health-care costs, and it turns out there's some spending that has to be done on information technology, for example, that we can do fairly swiftly. So there's no doubt that most of the priorities that I had are ones that will serve our short-term economic needs as well as our long-term economic needs.

The drop in oil prices, I do think, makes the conversation about energy more difficult, not less necessary. More than ever, I think, a wholesale investment in transforming our economy — from retrofitting buildings so that they're energy-efficient to changing our transportation patterns and thinking about how to rebuild our electricity grid — those are all things that we're going to need now more than ever. But with people not paying $4 a gallon for gas, it means it drops on their priority list. And that makes the politics of it tougher than it might have been six months ago.

So how long and how deep a recession should the American public be ready for?
I don't have a crystal ball, and economists are all over the map on this. I think we should anticipate that 2009 is going to be a tough year. And if we make some good choices, I'm confident that we can limit some of the damage in 2009 and that in 2010 we can start seeing an upward trajectory on the economy. But this is a difficult hole that we've dug ourselves into. You know, Japan found itself in a somewhat similar situation in the '90s, made some poor decisions, didn't squarely face some of the problems in its banking system and, despite significant stimulus, still saw this thing drag on for almost a decade. On the other hand, you've got countries like Sweden that went through this and acted forcefully and boldly and in two years were back on track and were growing at a really healthy clip. So the decisions we make are going to have an impact on it. But next year's going to be tough.