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From NPR News, this is ALL THINGS CONSIDERED. I'm Melissa Block.
ROBERT SIEGEL, HOST:
And Robert Siegel. The confetti has fallen in Chicago, where President Obama celebrated a decisive reelection win early this morning. Now comes the hard work of preparing for a second term. Before flying back to Washington this evening, Mr. Obama acknowledged some of the big issues ahead.
PRESIDENT BARACK OBAMA: In the coming weeks and months, I am looking forward to reaching out and working with leaders of both parties to meet the challenges we can only solve together - reducing our deficit, reforming our tax code, fixing our immigration system, freeing ourselves from foreign oil. We've got more work to do.
SIEGEL: Well, joining us now to talk about that work is NPR's Scott Horsley. And Scott, what's first on the president's agenda for a second term?
SCOTT HORSLEY, BYLINE: Well, the most immediate challenge facing the president and lawmakers is to address the so-called fiscal cliff. That's the big wave of tax increases and spending cuts that are set to take effect automatically at the first of the year if Congress doesn't head them off. The president might not wait till the second term to deal with that. He might try to address it during the lame duck session that's coming up.
And there are incentives for all parties to deal with this. In fact, the president's hand is maybe somewhat stronger because the price of inaction is worse for Republicans than it is for Democrats. The automatic spending cuts, for example, hit defense spending pretty hard, but core Democratic social programs like Medicaid and Medicare are spared, so there is an incentive here for the GOP to make a deal.
SIEGEL: Now, the president also mentioned in that list reforming the tax code and fixing out immigration system. What are the prospects there?
HORSLEY: Well, you know, both Democrats and Republicans say they want to reform the tax code and they talk about doing it in similar ways - that is, lowering the marginal tax rates, either on corporations or individuals, and broadening the base by doing away with loopholes. The big question has been, and the big dividing line between the parties, has been whether in that process you try to raise more revenue for the federal government or do something that just keeps the level of revenue the same, as Governor Romney had proposed.
I think the election has answered that question. And if there is going to be tax reform, there will be more revenue coming out of it. In terms of immigration reform, you know, the president was the beneficiary last night of huge support from the Latino community, and he has said that the Republican Party is going to have to get right with Latinos if for no other reason than their own political survival going forward.
And he's optimistic that that might force Republican lawmakers to loosen their opposition to immigration reform.
SIEGEL: Now, Scott, the stock market went down today and analysts have put some of the blame for that on Mr. Obama's reelection. Also, they talked about Europe. Is this a sign of trouble ahead?
HORSLEY: Well, you know, for years, Robert, we've been hearing about the drag on the economy that comes from uncertainty over government policy. And one way or another, yesterday's election has removed a lot of that uncertainty. We now know, for example, the health care law will survive. We know that financial reforms under the Dodd-Frank Act will survive. Now, businesses may not be thrilled to have those laws, but at least they know what they're going to be dealing with.
The uncertainty has now been removed. And if lawmakers can actually reach agreement on some of these big fiscal issues, like lowering the deficit, like addressing the fiscal cliff, I think there's a lot of potential for upside in the economy.
SIEGEL: Okay. Thank you, Scott.
HORSLEY: My pleasure, Robert.
SIEGEL: That's NPR's Scott Horsley. Transcript provided by NPR, Copyright NPR.