The yellow light isn’t blinking only on getting a debt-ceiling deal done — it’s flashing on President Obama’s reelection hopes, too.

If Obama and the debt deal face a yellow or red light at the end of July, voters might not be willing to give him the green light to go ahead with a second term.

White House officials acknowledge that July is a critical month for Obama and his 2012 campaign, and they are well-aware the outcome of the debt-ceiling debate could determine his reelection chances next year. 

Obama can’t win reelection this month, but he can lose it if the deal to raise the debt ceiling hurts him with either Democrats or independents. He could also lose if negotiations fail altogether and the economy is left in a shambles. 

Obama’s fate is tied to the economy, and without a debt deal, markets could go haywire, with potentially catastrophic damages to the economic recovery, according to Obama’s economic team. 

With a deal, the economy gets a needed boost and Obama shows Wall Street and independents that he is a leader who brings people together and solves problems. 

“The economy is key to the president’s reelection, and a sensible budget deal is key to the economy, because there simply isn’t much confidence right now that Washington can get it right,” said Democratic strategist Steve Murphy. 

“President Obama has to maintain the strong stance he established in his press conference and demand a balanced approach to cutting the deficit. And he’ll win in the end, because independent voters are fed up with all the ideology.” 

It’s pretty simple for the president: All Obama has to do is forge a deal with Republicans that cuts trillions from the deficit and saves the economy from going off another cliff, all while convincing his base that he is not selling them down the river again. 

It’s that last part that might be the most difficult piece for this president.

Obama has repeatedly shown an ability to get a deal done, but in doing so he has seriously damaged his credibility with the left.

Liberals wanted to believe that the president was really mad at last week’s press conference. They’ve wanted to believe that for a long time.

But time and again, liberals have seen Obama cave — in order to keep the federal government working or to ensure tax cuts for the middle class — and that has left them more skeptical of Obama than they’ve ever been. 

As a result, it will be hard for Obama to give ground on the key stumbling block to the talks: whether a deal will include the elimination of some targeted tax breaks. 

Liberals say a deficit deal can’t be built only on spending cuts, but the GOP has all but warned it will allow the U.S. to default on its debt before agreeing to a deal that includes any tax increases. 

If Obama gives in to the GOP and blinks in order to help the larger economy, liberals won’t be spending the rest of the summer and fall getting over hurt feelings from the last two years and knocking on doors for the president. They’ll fall into full-on revolt.

In this fight, liberals say Obama shouldn’t worry about independents. He should worry about the left. 

Rightly or wrongly, they say Obama is in a stronger position to negotiate than Republicans, who they argue rely more on Wall Street for fundraising. 

“One way or another, Wall Street will make sure the debt ceiling is raised — Democrats don’t have to do their work for them,” said Stephanie Taylor, co-founder of the Progressive Change Campaign Committee. “What’s important is that President Obama does not agree to Medicare, Medicaid or Social Security benefit cuts — which would hurt millions of Americans, muddy the brand of the Democratic Party and hurt every Democrat on the ballot in 2012. Americans don’t want a ‘deal’ — they want a strong president who fights for working families.”

White House officials wouldn’t say this week if Washington should expect to see more of the aggressive Obama from last week. 

That will depend largely on whether Republicans come back to the negotiating table, and on what’s being said in closed-door meetings.

The hope on the left is that the new Obama is here to stay. But that’s up to Obama.

How Obama moves forward will say much about what constituency the president values the most.

If Obama gives in, it will send a clear signal that the president values independents above all others.

If he stares down the GOP and comes up with a deal that makes his base happy, Obama will be showing that he remembers two of the first rules of politics:

Dance with the one who brought you — and don’t go to war without your army.

Youngman is the White House correspondent for The Hill.