David Frum tells hard truths:

Without the housing claim, it would have been hard to depict the Bush economic record as very much of a success. Employment was up, the Dow was up, but median incomes still lagged behind 2000 levels. It was the rise in home prices that represented the administration’s main argument that its economic policies had helped the American middle class. No way was the administration going to act to slow – let alone halt – that rise. To the extent that political appointees regulated the lending industry, the political appointees understood what was expected of them and did not interfere.

I don’t raise this point to cast aspersions, but to inspire thought as to how Republicans can deliver better results next time. Republicans talk budgetary policy (that’s why Paul Ryan has become a heart-throb of the party). They need to think about economic policy. The measure of success is not shrinking the deficit – that’s just a means to an end – but raising incomes. We need an open discussion about why our policies failed to deliver that result in the 2000s as a preliminary to doing better after 2012 or 2016.

Which is roughly a paraphrase of the president's critique yesterday. I suspect the answer is pretty bleak: conservatism as it has evolved since the 1980s has no fundamental solution to how to raise the incomes of the lower middle class in a global economy where Chinese and Indians can do what any American can for a fraction of the cost. If that's true for high-tech, how much truer for other sectors? Education is key, and is one of Obama's least-appreciated emphases. In other words, the free lunch is over. America's unique advantages and blessings during the Cold War have been removed. Protectionism won't help. And even higher levels of education won't make much difference. At some point, as David Brooks shrewdly notes today, the culture will have to adjust away from the pursuit of wealth to the pursuit of happiness within far more constrained horizons.

What I fear and see is the right's inability or refusal to face this or to innovate genuinely new policies to address these questions (Manzi is an exception who proves the rule). And in its place, they will offer a cultural politics of reaction at home and war abroad. They will intensify the red-blue divide, and blame the "elites" for everything, and turn Islam into the modern equivalent of Communism (unwittingly helping the enemy), and take the world to the brink of chaos. That's what I fear in my bleaker moments. Because it works for a while. And it will make millions for those who want to use America's decline rather than reverse it, and will distract the heart by deadening the mind. And I see no one with the gravitas or decency or responsibility in the GOP to be an Eisenhower.

That's why Obama still matters. It's why, in my view, he matters more than ever.