I've been incredibly underwhelmed by the various arguments that Obama just isn't sending the right message--he isn't populist enough, or he didn't push for a larger stimulus or a public option, or whatever it is the writer wishes he had done . . . and frankly, probably wishes he had done whether or not this improved the party's electoral fortunes.
Most of these analyses border on the frankly incredible. In the world of these writers, there was some hidden pocket of senators who could have been overcome had Obama simply unleashed his fierce presidential will. In the world I live in, the administration got as much stimulus as it was going to get, against a population that was tepid and a bunch of senators who were timid. He was limited on housing relief by homeowners and renters who weren't in trouble, and resented giving their money to people who had bought too much house. He in fact scored some major legislative victories, like health care, against fierce headwinds. The only place you could argue that he had more room was on a more bank-punitive bailout, and subsequent financial reform packages--but in those cases, the technocrats at Treasury had reasonable fears that this would have caused credit markets to contract even more severely, with the resulting economic decline making Democratic poll numbers even worse.
I think it's possible that the Democrats would now be in a better position if they had underpromised. Instead of framing the decline as a Bush-caused disaster that they could fix, they could have said that financial crises are multi-causal and take a really long time to fix, and that it was therefore going to get worse before it got better. Obama did make a few noises along this line, but mostly he followed the line of blaming Bush, and promising dramatic relief with his policies. Since the dramatic relief has not arrived, voters are naturally going to be skeptical of his policies.
But while in theory, telling people that everything was going to be awful no matter what he did might have worked, in practice, that is not a very electable ticket. Maybe he could have beaten McCain, given how dreadfully Republicans had damaged their brand. But he would have lost the primary on an "I can't do much about the economy" ticket, and had he changed tack for the general election, his congressional majorities would have been slimmer. And it would have been hard to pass a big stimulus, or much of anything else, with a signing message that "you're still going to be much worse off in a couple of years".
So no, I don't think Obama could have done much differently. In problems like this, I often think of a story in James Herriot's All Creatures Great and Small, about a conversation he had with his boss when his very first case, a horse, died of colic:
Farnon reached up into the glass-fronted cupboard above the mantelpiece and pulled out a bottle of whisky. He carelessly slopped out half a tumblerful and pushed it at me. He gave himself a similar measure and fell back into the armchair.
He took a deep swallow, stared for a few seconds at the amber fluid in the glass then looked up with a smile. 'Well, you certainly got chucked in at the deep end tonight, my boy. Your first case! And it had to be Soames, too.'
'Do you know him very well?'
'Oh, I know all about him. A nasty piece of work and enough to put anybody off their stroke. . . . '
The neat whisky burned a fiery path down to my stomach but I felt I needed it. 'I wouldn't like too many sessions like tonight's, but I don't suppose veterinary practice is like that all the time.'
'Well, not quite,' Farnon replied, 'but you never know what's in store for you. It's a funny profession, ours, you know. It offers unparalleled opportunities for making a chump of yourself.'
'But I expect a lot depends on your ability.'
'To a certain extent. It helps to be good at the job, of course, but even if you're a positive genius humiliation and ridicule are lurking just round the corner. I once got an eminent horse specialist along here to do a rig operation and the horse stopped breathing halfway through. The sight of that man dancing frantically on his patient's ribs taught me a great truth--that I was going to look just as big a fool at fairly regular intervals throughout my career.'
"Dancing frantically on the patient's ribs" is a pretty good metaphor for government economic policy in times like these. And no matter how eminent the specialists, the patient is going to make them look like big fools at fairly regular intervals.