On November 6, 2012, the American people went to the polls and seemingly lent their endorsement to the status quo.

The Democratic Party did make gains in Congress, undoing some of the Republican Party’s shakiest 2010 wins, but the balance of power in Washington is largely unchanged. President Barack Obama (D) gets another four years in the White House, the Democratic Party gets another two years leading the Senate, and the Republican Party gets another two years running the House of Representatives. It’s safe to say that there won’t be any large partisan initiatives coming through any time soon; our government will only be able to act on new legislation when there is at least some cross-party support. As I’ve said before, I think that this kind of gridlock is a good thing.

I suspect that many voters remember what one-party rule was like in the first two years of the Obama presidency . . . and, before that, most of the first six years of the George W. Bush (R) presidency. Generally speaking, the worst policies come about when a single party runs the show.

When Obama was elected president in 2008, he received nearly fifty-three percent of the popular vote and won the electoral college vote in a 365-173 landslide. Although this was a solid win, it did not come with a resounding mandate for sweeping public policy changes except in the economic area—an area where he actually ended up making no significant changes whatsoever. This time around, he has won reelection by a narrower margin—less than fifty-one percent in the popular vote, and a smaller (though still impressive) 332-206 margin in the electoral college. This smaller margin is more notable than it may sound. Obama is the first president in modern history to win reelection with fewer votes than he earned when first elected. Uniquely among two-term presidents, he comes into his second term with a lesser mandate than the one he had in the beginning. He lost more supporters than he gained during his first term, and has further polarized an already-polarized electorate.

Because the Twenty-Second Amendment prohibits Obama from seeking a third term, he is now free from concerns about being re-electable. He could easily choose to double-down on those policies that have alienated some of his former supporters, particularly his poor economic and fiscal policies and the ‘ObamaCare’ health care reform law (which a solid plurality of Americans still favor repealing). Or he could be a statesman and abandon the kind of harried partisanship that he made the hallmark of his first term. He now has the opportunity to re-create himself as a reasonable, moderate president who isn’t afraid to work with his opposition for the common good.

Obama could easily leave office in four years more popular than he was when he came in, but he has to be willing to repair his relationship with those Americans he has served poorly—the economic producers he has demonized, the religious believers who have been forced to violate conscience, the civil libertarians who see a troubling erosion of our most basic liberties, the prudent people who already had health coverage before ‘ObamaCare’ but have since seen their premiums skyrocket, and those who have had their savings devalued by the Fed’s hidden inflation. Many in these and other categories—myself included—feel that Obama doesn’t care about them or, worse, that he has acted as their avowed enemy. But if Obama would moderate his rhetoric on some of these key issues, and roll back the most offensive of his policies, he could win back a lot of support and foster good-will across the political aisle.

Many on the political left have already made it clear that they see this win as a mandate for more of the same—more big-government spending, more un-funded entitlements, and more radical partisanship. Meanwhile, many on the right have chalked the election up to former Governor Mitt Romney’s (R-MA) poor candidacy and campaign, and point to the Republicans’ House majority as a sign that the people really do support a radically smaller federal government and conservative social policies. I see little evidence for either assertion.

If the voters, taken as a whole, really wanted more massive spending programs, they would have handed the House of Representatives back to the Democrats and supported Obama by a wider margin. If they really wanted a radically smaller government and conservative social policies, they would have given the Republicans more seats in the House and Senate and handed the presidency to Romney. They did neither. The voters, as they are apt to do in the United States, voted pretty much right down the middle. They sent mixed signals to Washington, and neither side received a clear mandate . . . except, perhaps, a mandate that they stop screaming at each other and start working together like civilized adults.

We are, on the whole, a centrist country. I would argue that we average to the center-right on fiscal and foreign policy, and to the center-left on the social issues. The exit polling from the November 6 election would seem to bear this out. Polls consistently showed Romney solidly ahead on economic and fiscal policy, Obama with a slight lead on foreign policy (where he has governed to the right, largely maintaining the same policies as his Republican predecessor), and Obama solidly ahead on social issues.

If the election had come down to fiscal and economic policy, which I expected it would, Romney would have won by a comfortable margin. But many voters—especially the late deciders who did not pick a candidate until the last week—voted against their economic interests because they felt Romney was out of touch with their views on social issues, and was too much of a hawk when it came to foreign policy. This was a major campaign success for Obama. He successfully caricatured Romney as a radical right-wing ideologue, even though he is quite moderate on social issues and espouses foreign policies almost indistinguishable from Obama’s. In addition, Romney’s turnout among the fiscally conservative wing of the party base was tempered by the fact that he governed Massachusetts as a big-government progressive.

The armchair pundits who are already declaring the death of the Republican Party, like those who declared the death of the Democratic Party in 2010, clearly haven’t bothered to study the exit poll data (or history). The voters are in the process of repudiating Democratic Party fiscal policy and big-government spending just as surely as they’re in the process of repudiating the more theocratic-leaning wing of the Republican Party. Democrats would be well-served by moderating their positions on deficit spending and paternalist government. Republicans would be well-served by actually strengthening their support for individual liberties (against government paternalism) and a balanced budget (with concrete proposals to achieve it within a decade), but moderating on immigration and the divisive social issues.

In other words, both parties have to make changes if they expect to maintain their long-term electoral viability. And over the next two years, the American public will be watching to see which party—if any—is listening. They’ll be looking for decisive moves toward balancing the federal budget. They’ll be looking for government to stop imposing itself on our individual liberties and on religious charities. They’ll be looking for reasonable, comprehensive immigration reform that doesn’t require mass-deportations. They’ll be looking for either a ‘repeal and replace‘ of ObamaCare or, at least, a serious bipartisan effort to address its worst deficiencies and overreaches. And perhaps most importantly, they’ll be looking for our elected representatives to work with one another in a civilized manner—debating, discussing, and compromising with one another like grown-ups.

I’m not saying that either party should give up on its principles. But principled people can have serious disagreements and still treat one another with respect. Principled people can find areas of common ground, and can accept incremental improvements and partial victories when there isn’t enough consensus to make a major change. Principled people can also admit when they have made mistakes, and work with their critics to make improvements. This is the kind of leadership that President Obama promised in 2008, but never delivered.

But now he has a second chance . . . and an opposition, bruised by an electoral loss, that has already indicated it is willing to give if he is. This is an opportunity for both sides to make a fresh start, correct some of the worst mistakes of the last four years (and the eight before), and begin making some positive changes. The outcome of the election obviously isn’t what I wanted, but it is not cause for discouragement. Even in defeat, there is opportunity.