What midterms? Obama treats State of the Union as a victory lap.

The speech, in which President Obama laid out an agenda topped by free community college and tax breaks for parents and the middle class, was a consummate display of political bravado.

“The shadow of crisis has passed, and the State of the Union is strong,” a triumphal President Obama declared to the nation Tuesday night in an address bracing for its confidence and liberal promise.  

Amid signs that the economic recovery has firmly taken hold, Mr. Obama took a victory lap of sorts in his sixth State of the Union message, as he laid out an agenda of higher taxes on the wealthy and greater spending aimed at helping the middle class. Topping the list is free community college for most students and tax breaks for parents and married couples.

It was almost as if the Republicans’ crushing victory in last November’s midterm elections – a sharp repudiation of Obama and the Democrats – never happened. But the reality of Obama’s final two years in office sat squarely before him in the Capitol Tuesday night: the largest Republican majority in Congress in decades.

And in a remarkable piece of political showmanship, Obama by turns yearned for “a better politics” of bipartisan cooperation even as he promised sharp contrasts with his Republican foes through vetoes and executive action.

The president also framed his message as a form of personal vindication.

“At every step, we were told our goals were misguided or too ambitious, that we would crush jobs and explode deficits,” Obama said, reviewing the course of his presidency to date. “Instead, we’ve seen the fastest economic growth in over a decade, our deficits cut by two-thirds, a stock market that has doubled, and health care inflation at its lowest rate in 50 years. The verdict is clear.”

Obama also tucked a bit of news in an otherwise heavily telegraphed speech: He called on Congress to authorize the use of force against the Islamic State, after months of resisting such a request.

But more than anything, the speech was a consummate display of political bravado, best captured in an off-the-cuff remark after he reminded his audience that he had no more campaigns to run – eliciting derisive applause from some Republicans. 

“I know because I won both of them,” Obama said with a wink and a jaunty smile, departing from his prepared remarks.  

With his job approval ratings ticking upward toward 50 percent – and reaching that benchmark in some polls – perhaps Obama can get away with that little poke in the GOP’s eye. But where exactly does Tuesday’s State of the Union speech leave Obama and congressional Republicans, who have to live with each other for the next two years?

Practically speaking, both sides are right where they were before the address – suiting up for combat on issues where they disagree, and prepared to work together in the few areas where they agree, such as international trade and prison sentencing reform.

House Speaker John Boehner (R) of Ohio, who sat stone-faced behind Obama during the speech, aimed his message at the voters.  

“Finding common ground is what the American people sent us here to do, but you wouldn’t know it from the president’s speech tonight,” Speaker Boehner said in a statement.  “While veto threats and unserious proposals may make for good political theater, they will not distract this new American Congress from our focus on the people's priorities.” 

The official Republican response to the address, delivered by the newly installed Sen. Joni Ernst (R) of Iowa, also struck a populist note as she described her humble roots and her party’s desire to help “hardworking families.”

But it was both Obama’s and Senator Ernst’s treatment of the controversial Keystone XL pipeline that perhaps best telegraphed the politics of the next two years: Obama didn’t even dignify the proposed project – which would deliver Canadian tar sands oil to the Gulf of Mexico and which environmentalists oppose – by using its name. It was just “a single oil pipeline.”

Ernst didn’t call it a pipeline. It was “the Keystone jobs bill.” If legislation authorizing the pipeline reaches Obama’s desk, he has promised to veto it. But the issue has come to mean more than just a pipeline. It is one in an array of issues over which Obama and the Republicans are fighting, as much a power play over who gets to make the decision as over merits of the project itself.

What’s clear is that Obama, though finished with his own campaigns, will keep himself at the center of debate as long as he can, even as the 2016 presidential race comes to dominate national politics. As he wields his veto pen, he will resist the label of “lame duck.”

“Ironically, he is in a more central role now than he was last year,” says Michael Waldman, former chief speechwriter for President Clinton and president of the Brennan Center for Justice at New York University. “Vetoing bills is not the most fun part of a president’s job, but his veto pen is one of the only things standing between a lot of measures he doesn’t like and enactment.”

And though he will inevitably be seen as a lame duck, Obama’s performance in his final quarter will still bear directly on his party’s chances of holding onto the White House after 2016. As if on cue, the woman seen as likely to represent the Democrats in the next presidential election, Hillary Rodham Clinton, issued a tweet moments after Obama finished his hour-long speech. 

“@BarackObama #SOTU pointed way to an economy that works for all,” former Secretary of State Clinton wrote. “Now we need to step up & deliver for the middle class. #FairShot #FairShare.”

The torch has been passed.