Post-re-election on Tuesday night, the US president faces a fresh challenge confronting the fiscal cliff, a mix of tax increases and spending cuts due to extract some $600 billion from the economy barring a deal with Congress.
At stake are two separate issues - individual tax cuts due to expire at year's end and tens of billions of dollars in across-the-board federal spending cuts due to kick in the day after New Year's Day.
Failure to prevent a dive off the cliff could rattle U.S. markets, and push the U.S. economy into a recession, which could have global implications. How Obama fares with a familiar set of challenges - most notably a Republican-controlled House of Representatives - could color his second term.
Obama, who defeated Republican challenger Mitt Romney based on television projections, will want to strike a deal with Washington lawmakers before Dec. 31 or risk a recession in the first half of 2013, budget experts and Democratic aides say.
His backers say his win gives him a mandate for an elusive grand bargain he sought in his first four-year term. Such a pact would raise new revenue, make changes to popular programs like the Medicare health program for the elderly and pare the federal deficit.
They have signaled that they want a big deal and I think Obama will be aggressive about getting it, said Steve Elmendorf, a former House Democratic senior adviser and now a lobbyist.
Obama and most Democrats are at odds with Republicans in Congress over the stickiest issue - whether to let low tax rates for the wealthiest Americans expire on Dec. 31.
The president and most Democrats want to raise taxes on income earned above $250,000; Republicans want to extend the current low rates for all income levels.
Financial markets and the business community crave long-term certainty - and that is what a major deal envisioned by Obama is intended to tackle.
A big X-factor is how congressional Republicans will respond to an Obama win. The hard line against raising revenue taken by many Republicans in the House may not abate after the election.
House Speaker John Boehner said this week that his Republicans would stand firm on their position opposing any tax increases, even for millionaires, though he was speaking before the election results.
Republicans kept control of the House, as expected, and Democrats were projected to maintain control of the Senate.
An Obama victory takes a lot of air out of the room for Republicans, Jim Walsh, a former Republican representative, who retired in 2009, predicted before the election. The odds of a grander deal with increased revenue - though not in the form of higher tax rates - goes up with an Obama victory, he said.
Former Democratic representative Bart Gordon was unsure whether more conservative elements of the party, associated with the Tea Party movement, would go along so easily. Those folks don't need much of a reason to fight, Gordon said.
Key players in U.S. 'fiscal cliff' drama
President Barack Obama's projected re-election brings into focus the most pressing issue of the next few months: preventing a fiscal cliff of $600 billion in tax increases and spending cuts that will take place barring a deal with Congress.
Here are the major politicians, administration figures, lobbyists and researchers who must find a way down from the fiscal cliff without pushing the economy over the edge.
* Thomas Barthold, chief of staff, Joint Committee on Taxation: Behind-the-scenes research chief. His non-partisan team of experts supplies make-or-break analysis to Congress.
* Max Baucus, Democratic Montana senator: Powerful chairman of tax-focused Senate Finance panel. Will cross party lines for a deal. May be vulnerable in 2014 re-election race.
* Ben Bernanke, Federal Reserve chairman: World's most important central banker. Has warned that mishandling of what he dubbed the fiscal cliff could seriously damage the economy.
* Joseph Biden, vice president: Played key role in forging 2010 deal to extend Bush-era tax cuts for two years after Republican takeover of U.S. House of Representatives.
* John Boehner, Republican House speaker: Capitol Hill veteran from Ohio. Struggles with Tea Party wing of his party in House. His work with Obama on deficit grand bargain fell apart in 2011.
* Erskine Bowles, former Clinton White House chief of staff: Co-chaired Simpson-Bowles deficit-cutting panel. Its report did not get a vote in Congress, but some see it as a reform model.
* Dave Camp, Michigan representative: Republican chairman of tax-writing House Ways and Means Committee until 2014. Gets along with Baucus. Voted against Simpson-Bowles. Has tax plan of his own.
* Timothy Geithner, Treasury secretary: Expected to step down soon, architect of Obama administration fiscal policy who has warned against a repeat of 2011 budget drama on Capitol Hill that led to downgrade of nation's credit rating.
* Group of Eight: Informal, bipartisan group of senators focused on fiscal issues. Includes Democrats Mark Warner, Dick Durbin, Michael Bennet, Kent Conrad; Republicans Saxby Chambliss, Mike Johanns, Tom Coburn, Mike Crapo.
* Orrin Hatch, Utah senator: Top Republican on Senate Finance Committee. Conservative but has worked with Democrats. Shifted right politically to fend off re-election challenge.
* Jack Lew, chief of staff to Obama: Former budget office director for Obama and Clinton administrations. Helped broker latest deal to raise the debt ceiling.
* Mitch McConnell, top Senate Republican: Worked with Biden on extending Bush tax cuts in 2010. Up for re-election in 2014 and faces scrutiny of strong Tea Party faction at home in Kentucky.
* Grover Norquist, activist: Heads Americans for Tax Reform. Almost every Republican in Congress has signed his group's no new taxes pledge but its power may be fading.
* Nancy Pelosi, House Democratic leader: California representative and close Obama ally. Holds sway with liberal Democrats.
* Harry Reid, Senate Democratic leader: Blunt Utah power-broker and dealmaker. Must balance liberal and conservative factions, with many fellow Democrats up for re-election in 2014.
* Paul Ryan, Romney's running mate and House Budget committee chairman: Wisconsin representative known for controversial budget proposals. Influential with Tea Party conservatives.
* Alan Simpson, co-chaired Simpson-Bowles committee: Wise-cracking former Republican senator, agrees with Democrats that a deficit-reduction deal will require more government revenue.
* Gene Sperling, Obama adviser: Coordinates economic policy within Obama administration. Held same job under Clinton. Worked for Geithner at Treasury.
* Jeffrey Zients, acting director, Office of Management and Budget: Took over as Obama's top budget official in January. Has had testy exchanges with Ryan in congressional hearings.
TAX/CLIFF-HISTORY (TIMELINE): America's long stumble toward the fiscal cliff
The long, bumpy road to America's fiscal cliff has been traveled over many years by Congress and a series of U.S. presidents, including Barack Obama, who was projected by television networks to have won re-election on Tuesday, and who may turn quickly to the issue.
Some of the steps along the way had good intentions. Some had no intention at all other than to avoid hard decisions.
After Tuesday's election, with Congress still divided between Democrats and Republicans, crucial deadlines loom at year-end.
Major budget and tax decisions are converging in a challenge Federal Reserve Chairman Ben Bernanke has dubbed a fiscal cliff. Will lawmakers rise to the occasion? Or will they delay again?
Here is a time line of how the country got where it is today.
* 1998-2001. Long economic expansion of 1990s peaks. U.S. government budget in surplus under President Bill Clinton.
* 2001. Stock market tech bubble bursts. President George W. Bush, Congress enact deep temporary tax cuts. Some Republicans predict cuts will spur economy, pay for themselves. Sept. 11 attacks occur. United States and its allies invade Afghanistan.
* 2002. After four years of surpluses, U.S. budget slips into deficit of $158 billion. Bear market in stocks.
* 2003. United States and allies invade Iraq. Bush and Congress cut taxes further. Deficit grows to $378 billion.
* 2004-2006. Stock market recovers. Deficit shrinks.
* 2007-2008. Housing market bubble bursts. World financial crisis. Stock market crashes. Worst U.S. recession since Great Depression. Unemployment, home foreclosures soar. Bush, Congress bail out big banks. Deficit jumps to $459 billion in 2008.
* 2009. Obama, Congress enact $787 billion stimulus, including expanded temporary tax breaks for children, education. Auto industry bailed out. Recession ends midyear. Stock market bounces back. Deficit hits $1.4 trillion.
* 2010. Obama signs healthcare overhaul into law. Obama creates Simpson-Bowles deficit reduction panel. Its plan for drastic fiscal reform is largely ignored. Led by Tea Party conservatives, Republicans win control of House of Representatives in midterm elections. Obama agrees to extend Bush tax cuts for two years. Def i c it shrinks to $1.3 trillion.
* 2011. Treasury Department request for increase in U.S. debt ceiling becomes focus of fight in Congress. Republicans, Democrats settle dispute by forming super committee to examine fiscal reform. Debt ceiling raised. U.S. credit rating downgraded. Super committee collapses in discord. Deep, mandatory budget cuts triggered for 2013. Stock market makes choppy advance. Deficit estimated at $1.6 trillion.
* Spring 2012. Bernanke warns lawmakers of massive fiscal cliff at year-end. Main elements of approaching crisis include the expiration of Bush tax cuts and other tax measures that Congress has allowed to slip, along with budget cuts due to super committee flop.
* Summer 2012. Presidential, congressional election campaigns in high gear. Stock market advances.
* Autumn 2012. Congressional Budget Office warns that the fiscal cliff, left unaddressed, could trigger recession. Mitt Romney named Republican presidential nominee. Obama reiterates support for keeping Bush tax cuts for all except high-income earners. Republicans support extension of Bush tax cuts for everyone. Deficit for 2012 estimated to shrink to $1.1 trillion.
* Nov. 6, 2012. Obama re-elected, Democrats retain control of Senate, Republicans retain control of House, according to network projections.
* Nov. 13, 2012. Congress scheduled to return for lame-duck session to deal with Obama on fiscal cliff issues.
* Dec. 31, 2012. If Congress takes no action, Bush tax cuts expire, other fiscal cliff elements kick in.
* Early 2013. If no action from Congress, automatic budget cuts set to kick in. Debt ceiling expected to be hit again.