Obama's health win could boost foreign policy

WASHINGTON (Reuters) - President Barack Obama's domestic success on healthcare reform may pay dividends abroad as the strengthened U.S. leader taps his momentum to take on international issues with allies and adversaries.

More than a dozen foreign leaders have congratulated Obama on the new healthcare law in letters and phone calls, a sign of how much attention the fight for his top domestic policy priority received in capitals around the world.

Analysts and administration officials were cautious about the bump Obama could get from such a win: Iran is not going to rethink its nuclear program and North Korea is not going to return to the negotiating table simply because more Americans will get health insurance in the coming years, they said.

But the perception of increased clout, after a rocky first year that produced few major domestic or foreign policy victories, could generate momentum for Obama's agenda at home and in his talks on a host of issues abroad.

"It helps him domestically and I also think it helps him internationally that he was able to win and get through a major piece of legislation," said Stephen Hadley, former national security adviser to Republican President George W. Bush.

"It shows political strength, and that counts when dealing with foreign leaders."

Obama's deputy national security adviser Ben Rhodes said the Democratic president's persistence in the long healthcare battle added credibility to his rhetoric on climate change, nuclear nonproliferation and other foreign policy goals.

"It sends a very important message about President Obama as a leader," Rhodes told Reuters during an interview in his West Wing office.

"The criticism has been: (He) sets big goals but doesn't close the deal. So, there's no more affirmative answer to that criticism than closing the biggest deal you have going."

Obama closed another deal, this one in foreign policy, on Friday, agreeing on a landmark nuclear arms reduction treaty with Russian President Dmitry Medvedev that the two leaders will sign on April 8 in Prague.

The agreement caps a successful week in Obama's presidency and one that he almost spent overseas. The White House canceled the president's planned trip to Indonesia and Australia so he could be in Washington on Sunday when the U.S. House of Representatives held its healthcare vote.

FOREIGN POLICY SUCCESS

Some analysts said Russia was watching Obama's domestic successes and failures throughout the long period of negotiating the START nuclear arms treaty.

"I think there were some in the Kremlin saying, 'how strong is he? If he can't get some of these things through, does that give us more leverage to push him on arms control?'" said Steven Pifer, a former U.S. ambassador to Ukraine and now a senior fellow at the Washington-based Brookings Institution.

Administration officials played down a connection between healthcare and talks with Russia on START, though Rhodes said the processes that led to success on both issues were similar.

"Like healthcare, the START treaty has been a negotiation where at times we seemed very close to getting a deal done and then there were huge roadblocks," Rhodes said, crediting Obama and Medvedev for sticking it out.

"So, it was a similar narrative of persistence, of refusing to throw in the towel at times when he could have."

One area where he will need persistence and where he did not achieve success this week involves Middle East peace.

A one-on-one meeting between Obama and Prime Minister Benjamin Netanyahu of Israel, a country that closely tracks U.S. domestic policy, yielded little sign of a breakthrough in a dispute over Jewish housing construction in East Jerusalem.

Many foreign leaders hope Obama's successes continue.

German Chancellor Angela Merkel, French President Nicolas Sarkozy, and British Prime Minister Gordon Brown were among the leaders who congratulated Obama, and South Korean President Lee Myung-bak said the healthcare win would have a positive impact abroad, according to White House spokesman Robert Gibbs.

Analysts said the bill's passage showed Obama could deliver votes for domestic legislation with foreign policy components, such as rules to fight climate change, currently stalled in the Senate, which European leaders are eager to see advance.

James Lindsay, senior vice president at the Council on Foreign Relations in New York, who was skeptical that Obama's healthcare win would have a huge foreign policy benefit, said the law did free up the president to focus less on purely domestic issues.

"If the president had lost on healthcare, it would have further sapped his popularity as president, requiring him to spend even more time on domestic affairs and left him with less time to devote to foreign policy," he said.

"That's not the same as saying that because the healthcare bill has passed that the Iranians are going to be more pliable in their nuclear program, that the Israelis are going to rethink their settlement policy or the Chinese are going to become more agreeable on currency issues."

(Editing by Eric Beech)