NEW YORK (CNN/Money) - So it wasn't the economy, stupid.
The war in Iraq and concerns about security dominated this year's presidential campaign. Yet the economy will, of course, be a vital concern as President Bush enters a second term.
"The economy is much improved over the past year but it's still underperforming," said Mark Zandi of Economy.com.
Bush will preside over an economy that is growing at a steady if unspectacular rate -- preliminary estimates of third-quarter GDP growth came in at 3.7 percent last week. But growth is also widely expected to slow next year.
"The policies that will affect the 2005 economy are pretty much in place already," says Dick Rippe, chief economist of the Prudential Equity Group.
With that in mind, here are five issues that will be key for the president's longer-term economic agenda, particularly with a Republican Congress in place.
Energy prices have soared in Bush's first term. The price of oil has climbed from around $26 a barrel before he took office in January 2001 to around $50 now.
Rising oil acts like a tax on consumers and businesses and can have a ripple effect, slowing economic growth.
Higher prices have reduced GDP growth by half a percentage point or more, according to various economists. That's not enough to cripple the economy, but it is clearly an added burden.
To confront that threat, Bush, a former Texas oil man, has focused on increasing our domestic supplies of oil. He has called for opening the Arctic National Wildlife Refuge to drilling, which he says could provide up to 1 million barrels of oil a day for nearly 20 years. He also favors building a natural gas pipeline from Alaska to the 48 contiguous states and has suggested incentives for natural gas production in the Gulf of Mexico. Bush has resisted calls for the administration to tap into the Strategic Petroleum Reserve to ease prices, saying the reserve should be used only in emergencies.
In addition, Bush has advocated increased use of nuclear power and further development of so-called clean coal technologies.
The budget deficit has ballooned under Bush, slipping back into the red from the surpluses of the late 1990s. The Congressional Budget Office says that the deficit will hit $422 billion in 2004. That's a record dollar amount, and represents 3.6 percent of GDP.
Bush, who did not veto one spending bill in his first term, campaigned on a pledge to cut the deficit in half over the next five years by growing the economy and limiting discretionary spending. That may not be easy.
Many economists say that Bush's spending proposals, combined with his desire to make permanent the tax cuts of recent years, mean that the numbers simply don't add up.
"There will have to be much more significant restraint on spending growth than we've seen over the last four or five years," says Tim O'Neill, chief economist at Harris Bank.
In fact, the anti-deficit Concord Coalition calculates that Bush's proposals would worsen the ten-year shortfall by $1.33 trillion.
"Throughout his presidency, George W. Bush has refused to calibrate his drive for lower taxes with his support for expensive initiatives such as the global war on terrorism and a major expansion of Medicare," the group concludes. "There is no reason to expect anything different in a second term."
The unemployment rate now stands at 5.4%, down from its recent high of 6.3% in June 2003, but nonfarm payrolls have fallen by about 800,000 since Bush took office in 2001.
"The president has an atrocious record when it come to job growth," says Robert Brusca, chief economist at Fact & Opinion Economics.
Here again, the business cycle will determine more than the commander in chief in the near term. "There is very little the president can do to stimulate the job market quickly," says Zandi, "but there is much the president can do to stimulate the job market long-run."
Bush's campaign proposals centered on strengthening business through tax cuts, increased trade, and reducing government regulations and the threat of lawsuits. He has resisted calls for a rise in the minimum wage from $5.15 to $7 an hour, but has proposed overhauling federal job-training programs and increasing the number of workers trained.
"Perhaps the best way to keep jobs here in America and to keep this economy going is to make sure our education system works," the president said in his third debate against Democratic challenger John Kerry.
Bush's free trade bona fides will also be tested quickly, as a decades-old deal regulating the global apparel trade is set to expire on Jan. 1, 2005.
U.S. trade associations have petitioned the government to limit imports from China, which stands to benefit, due to its cheap labor and a low exchange rate for the yuan against the dollar.
The Bush administration will have to decide whether to restrict imports. It could also use the issue to increase pressure on China over the level of the yuan. China has thus far resisted the administration's push to raise the exchange rate, a move that would make U.S. prices more appealing and raise the costs of goods produced in China.
"We'll see how much of a free trader" the president really is, Zandi says.
The Federal Reserve
Ultimately, Alan Greenspan and the Fed have more sway over the short-term economy than the president. The Fed is expected to raise rates for the fourth time this year when it next meets on November 10. The size and pace of future rates isn't as clear.
Greenspan has served since 1987 but is set to step down when his current term ends on Jan. 31, 2006. Pundits are already placing odds on a short list of candidates. Naming a replacement may be the most important and influential economic decision President Bush makes.