Beat the new boss: D.C. libertarians plot their Obama administration strategies.

• Author: Weigel, David
• Position: Barack Obama - Column

FOUR YEARS AGO, after the re-election of George W. Bush, the Permanent Republican Majority had finally taken over. Grover Norquist of Americans for Tax Reform predicted that the Democrats would not even survive four more years. "Without effective control of the government, the Democratic Party is like a fish out of water," Norquist said at the time, "a vampire in the sun, Antaeus held aloft, an appliance unplugged."

But the Democrats survived. In fact, they came back faster than all but the most optimistic liberals expected. In January 2009, they are returning to Washington stronger than at any time since the Great Society Congress of 1965-67.

Washington's libertarian activists and think tankers are still trying to wrap their brains around the new reality. Today you can sort them into two rough categories. There are the Bargainers, the ones who believe they can do business with President Barack Obama. And there are the Battlers, the ones who believe Obama can--and should--be impeded while the Republican Party is rebuilt into a genuinely liberty-minded organization.

"The upside of the Obama victory," says Matt Kibbe, president of the pro-market group FreedomWorks, "is that it draws, more clearly, the lines between the good guys and the bad guys. It gives us an especially good idea of who the bad guys are." I.e., the new administration.

A D.C. libertarian's status as a Bargainer or a Battler largely depends on what issue he or she works on every day. Economic libertarians such as Kibbe, the people who spent the Bush era pushing unsuccessfully for market-based health care reform and private Social Security accounts, expect four to eight years in an even deeper wilderness. "I watched the Social Security campaign unravel from the inside," Kibbe remembers. Now there will be no "inside."

Obama has some advisers who sympathize with libertarians, many of whom he befriended at Harvard and the University of Chicago. These include Jeff Liebman, one of Obama's top economic advisers, who has been attacked by liberals for statements supporting Social Security privatization and tax cuts. "I know Jeff Liebman well," says Michael Tanner, a Cato Institute analyst who fought for private Social Security accounts in 2005, but "Obama ran a campaign that precludes Social Security reform."

The Battlers are not necessarily apocalyptic. A Democratic victory has been predicted for so long that they grew acclimated to the idea. Gallows-humor jokes about the Obama...