Obama in inaugural warns of tough times ahead

WASHINGTON, Jan. 21 (UPI) -- Barack Obama took office Tuesday as the 44th president of the United States with an inspiring inaugural speech in which he warned the American people to "put away childish things." But Wall Street was unimpressed, with the Dow Jones Industrial Average falling below 8,000 in its largest Inauguration Day drop in history.

Obama's inaugural was relatively short. His three written pages of speech were delivered in only 20 minutes. But his speech was striking for its mixture of unapologetic confidence and pride in America's great history and heritage, mixed with sober, frank warnings that the way ahead out of the present economic crisis and global conflicts would be neither quick nor easy.

The Dow plummeted 332.13 points -- 4 percent -- on Inauguration Day to close at 7949.09. The Wall Street Journal noted Wednesday that major financial institutions suffered particularly badly, with Bank of America plummeting no less than 29 percent, J.P. Morgan Chase 21 percent and Citigroup 20 percent. The Standard & Poor's 500 dropped 5.3 percent overall to close at 805.22. But S&P's financial section fell three times as far, losing 16.3 percent of its value to close at a record low level.

These huge falls reflected renewed worries about the stability of the financial sector along with a lack of confidence in the measures President Obama plans to take to fight the growing recession.

Obama wisely avoided singling out any specific enemy or "Axis of Evil" to cajole or threaten. But he made it clear that his willingness to extend the hand of peace to current or past adversaries of the United States was conditional upon their willingness to unclench their fists first. He told networks of extreme Islamists and other haters of the United States, "We will outlast you."

It was a speech surprisingly conservative in tone. Obama quoted liberally from the Bible and at length from Gen. George Washington's famous invocation in the dark first winter of the War of Independence. And he also emphasized the importance of personal responsibility, on the part of every individual American, in dealing with the crisis the nation now faces.

Obama scrapped the prevailing orthodoxy of the past generation that government was always bad and incompetent, but he did not replace it with any blind faith in government either. Where government programs worked, they should be expanded, he said. But where they failed, they should be scrapped.

He took a similar Aristotelian balance toward the principles of free markets. He extolled them in principle for having generated wealth and prosperity more effectively than any other known system. But he also emphasized the importance of keeping them open, honest and transparent, and, like Franklin Roosevelt 75 years ago, he emphasized the importance of government regulation to prevent the appalling institutional failures and business crimes that have rocked the United States over the past few months.

As anticipated, Obama reiterated his commitment to healthcare reform and improving America's schools. He included the necessary references to his party's powerful environmental wing about rolling back global warming and respecting the planet.

But he also emphasized the need for structural and economic change in the United States. He warned that special interests would not be allowed to stand in the way of reforms that are needed to stabilize the economy. He emphasized the need to drastically reduce U.S. dependence on imported oil -- a goal that will require sizeable reductions in U.S. oil consumption as well as dramatic advances in alternative technologies if it is to succeed. And most of all, he warned that the road to achieving these goals would inevitably be slow and hard, and require serious sacrifices.

This kind of talk was a drastic departure from the "success made easy" rhetoric of the past 28 years of inaugurals and presidential rhetoric going back to President Ronald Reagan. It marked the abandonment of the blind faith in the "upward and onward" progress of global democracy and freedom that so permeated the rhetoric and policies of outgoing President George W. Bush, and it abandoned the relentless demonizing of government as the source of all economic and social evils that has characterized the rhetoric of Reagan and the second President Bush.

Obama's speech made it clear he does not share the still widespread, complacent assumption popularized by Francis Fukuyama in the 1990s that the collapse of communism had made inevitable the ultimate triumph of the liberal free-market, democratic nation-state and therefore had heralded "The End of History." Instead, Obama recognized, as former U.S. national security adviser Zbigniew Brzezinski warned a decade and a half ago, that after the End of History, what would follow would be "more history."

Obama started making that history on the steps of the U.S. Capitol in his ringing inaugural speech Tuesday. He got off to a good start.