Oscar star Michelle Obama unleashed

Dishing out Oscars, dancing with the stars and hamming it up with Big Bird — Michelle Obama is having all the fun.

While President Barack Obama’s re-election glow fades and he finds himself mired in another poisonous budget tussle with Republicans, the popular First Lady is enjoying the freedom of a second White House term.

In a shimmering silver Naeem Khan ballgown, Michelle stole the show at the 85th Academy Awards with a surprise videolink appearance to present the Oscar for Best Picture to Iran hostage drama “Argo.”

In a cross-continental double act with veteran Hollywood leading man Jack Nicholson, she opened the golden envelope, flanked by military officers in evening dress, in the Diplomatic Room of the White House.

Obama said she was honored to help celebrate movies that “lift our spirits, broaden our minds and help transport us to places we had never imagined.”

The appearance, innocent on its face, was in fact steeped in political implications. The White House welcomes any chance to showcase its most popular asset to a huge audience.

A debt was also repaid — Hollywood was a gushing fountain of campaign cash for the president’s re-election campaign.

Last year, for example, George Clooney — who picked up a statue as producer of “Argo” — hosted a $15 million fundraiser for the president at his Hollywood Hills mansion.

Michelle Obama’s comments also hit the president’s familiar political message, that by pulling together, Americans can overcome grim economic times.

She said the Best Picture nominees “reminded us that we can overcome any obstacle if we dig deep enough and fight hard enough and find the courage to believe in ourselves.”

“These lessons apply to all of us no matter who we are, or what we look like or where we come from, or who we love.”

The words “who we love” were a subtle shout out to the gay community, also a key fundraising driver for Democrats, which has sometimes expressed frustration with the pace of government action on issues like same sex marriage.

Obama’s Oscar performance was just one of a series of recent high-profile appearances, as she prepares to celebrate the third anniversary of her “Let’s Move!” fitness and healthy eating program with a nationwide tour.

Last week, a clip of Michelle Obama grooving with comedian Jimmy Fallon dressed-in-drag on his late-night comedy talk show went viral on YouTube.

In the video, Obama and Fallon, who was in a long brown-haired wig, performed a routine dubbed “Evolution of Mom Dancing” also in the service of publicizing: “Let’s Move!”

Obama also last week issued a public service ad on healthy eating with Big Bird, in a swipe at her husband’s vanquished Republican foe Mitt Romney, who wanted to cut subsidy for the PBS Network on which the Muppet stars.

She also unveiled a new official portrait and appeared on the Rachael Ray daytime show to weigh in on another issue that grabbed nationwide headlines, her new haircut with straight-cut fringe.

“This is my mid-life crisis — the bangs,” she said.

Michelle Obama’s is popular, polling a 73 percent approval rating in a CNN poll in December, and the publicity blitz shows that the White House has moved on from a time when she was regarded as a political liability.

She faced criticism in the 2008 campaign when, noting exploding support for her husband, she said: “For the first time in my adult lifetime, I am really proud of my country.”

There were also some early missteps as first lady, including a lavish trip to Spain in 2010 panned by critics and mocked by conservative radio talk show hosts as evidence of undue entitlement.

She rebuilt her image carefully, with targeted appearances on “Let’s Move!” and emerged as a spokeswoman for returning US war veterans.

At a key moment in the 2012 re-election bid, when her husband was listless, she injected a jolt of energy into campaign appearances, and delivered an acclaimed speech at the Democratic National Convention.

Her media handlers must be careful of over-exposing the First Lady, but it is incontestable that the freedom she enjoys now that her husband has no need to face voters again, gives new latitude for her public role.