From PEOPLE Magazine Click to enlarge
An Exclusive White House Interview

President Obama was running late after scolding Congress on stalled economic legislation. He kissed his wife, Michelle, and rolled his eyes at the jingle-bell collar she'd put on their dog Bo. With an exhale that suggested his first chance to sit all day, the President, 50, settled beside the First Lady, 47, on the brocade sofa of the Map Room for a chat-by turns feisty and sentimental-with PEOPLE Managing Editor Larry Hackett and Washington correspondent Sandra Sobieraj Westfall. Waving off aides who tried to call "time," the couple gamely reflected on the challenges of this first term and life in the White House with their girls, Malia, 13, and Sasha, 10.

Mr. President, what was your proudest moment of 2011? And what do the girls think was the coolest thing?

The President: The proudest was being able to go up to New York City the week that we got [Osama] bin Laden, and to meet with the children of those who had been lost on 9/11. To go to a fire station where they had lost half their guys, and to say, America didn't forget you, and then to go out and personally thank the Navy SEAL teams that had carried out the mission. There was a sense that America, when it comes together around a mission, can get it done.

Mrs. Obama: Compared to what the kids would say?

The President: They don't think anything I do is cool anymore.

November had the best employment figures since 2009. A one-time affair?

The President: I think the economy is strengthening, but there's still uncertainty out there-most of it coming out of Europe. When I talk to business leaders they feel pretty good about what they're seeing in terms of their sales and plans to hire. If we extend the payroll tax cut, extend unemployment insurance, continue to make progress on deficit reduction in an intelligent way that doesn't slash education spending and spending on basic science and research, if we are investing in infrastructure, then there is no reason why, by the end of next year, we couldn't be in a much better place.

What would you do differently in a second term?

The President: I'm very proud of our track record. Over the last three years we have made changes that help middle-class families get back on their feet and afford college-and once we get it fully implemented, keep their health-care costs down-and make sure that they've got opportunity in an economy that's built on making stuff and not just buying stuff. We made a lot of good decisions. I think we were so busy that we didn't spend a lot of time explaining to the American people exactly what we were doing. My most important task, in addition to getting the policy right, is making sure that we're telling people how there are brighter days ahead, if we make some admittedly tough decisions right now.

People ask, Where did that guy from Campaign 2008 go? Where is the Barack Obama who was so passionate, so inspiring?

Mrs. Obama: He's been busy fixing a lot of really hard problems! I mean, there's the campaign and then there's governing. [With a candidate], his full-time job is to gin up the crowds and lay out an important vision. But when you become President, particularly in a time when there is a financial crisis, two wars and any other array of issues that fell in his lap-the work he has been doing is governing. That guy is still here, he's just been working really hard. [Laughter.]

The President: I think Mario Cuomo said it best: Campaigning is poetry, and governing is prose. It's important for people to understand that all the values that animated that excitement in [2008], we have in very methodical, systematic ways been trying to make sure that they become a reality. But that process is hard and it's messy. And it's not just about speech-making, it's about the tough work of actually getting policies right and passing legislation. And there's been a lot of resistance from folks who prefer the status quo. The thing that I've discovered about myself is, I'm pretty stubborn and persistent. We keep on plugging away. Mrs. Obama, word is that, as a career woman, you're unhappy in the White House. What's the truth?

Mrs. Obama: The truth-oh, God, I have the best job in the house, and I know that very clearly.

The President: Except for Bo. [Laughter.]

Mrs. Obama: I've been able to focus on the issues that I care about deeply, and we've been able to make some excellent movement. My girls are settled, they're healthy, thriving. Going on trips, like visiting my brother in Oregon, where they're outside playing with their cousins. I've had more freedom than Barack has had. So I'm really good.

You answer 10 letters a night from ordinary Americans. Tell us about one that stuck with you.

The President: A young man who had Down syndrome and came from a military family was frustrated that he couldn't serve, so instead he did a community project with veterans. His mother wrote: "He asked me, 'Is the President proud of me for helping our troops?' " I had the opportunity, when I made my annual statement on Veterans Day, to say directly to the camera, "I'm proud of you." That was pretty satisfying.

To shift gears, do you let the girls on Facebook?

The President: No. Their theory is, "Why would we want to have a whole bunch of people who we don't know knowing our business?" ... We'll see how they feel in four years.

What's your must-see TV?

Mrs. Obama: For the girls and me, Modern Family, that's our favorite show.

The President: I'm a little darker. Boardwalk Empire and Homeland. Any reading for fun?

Mrs. Obama: He's pushed Malia to read some classics, The Grapes of Wrath, Tender Is the Night-she's reading those, so I've been doing a lot of rereading. Song of Solomon is my favorite book of all time, and I'm interested in hearing how she interprets it.

Do you help with homework?

The President: We do, but they just don't need much help. Very early on, we said to them, "Our job is to teach you to be able to function without us by the time you leave this house." Michelle started having them set the alarm and wake themselves up at the age of 5, make their beds and make sure that they were ready for school themselves.

Mrs. Obama: Sasha is in middle school; I tell them, this is the time that it's safe for you to practice your skills, because if you fall, the fall isn't that big. We're ever present.

The President: We're hovering. If they ask us for help, we will give them help. Sometimes we're just props. Malia, she'll have a list of 75 vocabulary words.

Mrs. Obama: Oh, God, yes, going through that list.

The President: She'll say, "Read them to me, and I'm going to write them out so that I can spell them right."

Mrs. Obama: That's excruciating. [Laughter.]

The President: You're sitting there -"abysmal"-and she'll write it. Sasha might ask if we can read something over. But they're remarkably self-sufficient.

Last campaign, you promised the girls a dog and your wife a date night. What did you promise all of them for when it's all over?

The President: Let me just say that when you put your family through a presidential campaign-

Mrs. Obama: Twice, twice! [Holds two fingers to his face.]

The President: -they basically have a blank check. Whatever she demands, she will get. Do you have dream jobs for your afterlife, whenever that comes?

Mrs. Obama: Oh, it's hard to think about the afterlife. The goal is to keep pushing on the issues that I care about, make sure that we have this man in office for another four years, because he's my President.