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JACKI LYDEN, HOST:

This is WEEKEND EDITION from NPR News. I'm Jacki Lyden in for Scott Simon. 2011 is ending on a relative high note for President Obama, with some of his best approval ratings of the year. But even as he relaxes with his family in Hawaii, Mr. Obama knows he'll soon face new skirmishes with Congress, beginning with the push to extend a temporary payroll tax cut. The president says he wants lawmakers to act without drama or delay. That would stand in contrast to many of his dealings with Congress this year. As NPR's Scott Horsley reports, the government produced far more drama and delay than legislative action.

SCOTT HORSLEY, BYLINE: 2011 was a year of missed opportunities and bad bargains. But Mr. Obama seems to have found his footing at year's end. Early in the year, he looked past a 9 percent unemployment rate and joined Republicans in preaching the gospel of fiscal austerity.

PRESIDENT BARACK OBAMA: We have to live within our means.

HORSLEY: Tough talk was the order of the day, but the president sat on the recommendations of his own deficit-cutting commission for months, waiting for the newly empowered House Republicans to make their move. When Congressman Paul Ryan drafted a budget calling for deep cuts in spending and taxes, Mr. Obama counter-punched, saying Ryan's plan would shortchange investment and end Medicare as we know it.

OBAMA: And worst of all, this is a vision that says even though Americans can't afford to invest in education at current levels or clean energy, even though we can't afford to maintain our commitment on Medicare and Medicaid, we can somehow afford more than one trillion dollars in new tax breaks for the wealthy.

HORSLEY: The president offered his own alternative plan and several tense rounds of negotiation followed. Mr. Obama was pursuing a so-called grand bargain, with cuts to Medicare and higher taxes on the rich. But those talks didn't go anywhere. The president complained that Republican House speaker John Boehner, uncertain of his own troops, twice walked away.

OBAMA: I've been left at the altar now a couple of times. And I think that, you know, one of the questions the Republican Party is going to have to ask itself is can they say yes to anything?

HORSLEY: Norm Ornstein of the conservative American Enterprise Institute could only shake his head at the deal Republicans had passed up.

NORM ORNSTEIN: We're not seeing rational actors behaving in a rational fashion at a time of divided government. And there's a level of dysfunction here, frankly, that I haven't seen in 41 years in Washington.

HORSLEY: Lawmakers eventually agreed to a smaller deficit-cutting deal and a clumsy arrangement to raise the government's debt ceiling. No one was happy with the bargain, or the process, which cost the government its triple-A bond rating. A few weeks later, supporter Emily Neal confronted the president during a bus tour in Iowa.

EMILY NEAL: It seems especially in the last year as if your negotiating tactics have sort of cut away at that trust by compromising some key principles. Even Social Security and Medicare seemed on the line when we were dealing with the debt ceiling.

HORSLEY: Mr. Obama insists the debt ceiling was a special case and that he had to bend over backwards to avoid financial disaster. Democratic pollster Geoff Garin adds that by postponing the next round of debt ceiling brinksmanship until after next year's election, the deal stripped Republicans of much of their leverage, allowing the president to take a harder line.

GEOFF GARIN: It frees the president to be more clear in terms of framing the choice with the Republicans, even when the Republicans don't like that he's doing that.

HORSLEY: This fall, Mr. Obama shifted focus from debt reduction to job creation, with a new set of proposals that he practically dared Republicans to vote against.

OBAMA: If they've got an alternative vision and they don't want to sit there and do nothing for the next 16 months while unemployment is still high and small businesses are still suffering then ultimately they're going to be held to account by you.

HORSLEY: Congress approved almost none of the president's jobs package, save a tax break for hiring veterans and a grudging two-month extension of the payroll tax cut. Even that required a concession from Mr. Obama, on a controversial oil pipeline. But political analyst Jack Pitney of Claremont-McKenna College says House Republicans overplayed their hand, and unwittingly helped the president by seeming to oppose a popular tax cut.

JACK PITNEY: The House Republicans seem to have snatched defeat from the jaws of victory.

HORSLEY: House Republicans had played right into the president's storyline about a do-nothing Congress. And when they later relented, Mr. Obama's victory seemed that much bigger. Little wonder many Democrats want the president to continue this tack in 2012, treating Congress not as a partner but as a foil. Scott Horsley, NPR News, Washington.

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