If America were a stock, it would be a "buy": an undervalued market leader, in need of a new management. (...) In all sorts of areas—be it the fight against global warming or the quest for an Arab-Israeli peace—America is quite simply indispensable. That is because America still has the most hard power. (...) It will bounce back stronger again.

Its military troubles come at a time when the global strategic balance appears to be tilting away from America. Iran is filling the vacuum created in Iraq, and is accelerating its nuclear programme. China's military punch is growing along with its booming economy. Russia is more belligerent. The transatlantic relationship is loveless. Across the world, anti-Americanism has increased to the point where the United States is often regarded as a threat to world peace rather than its guarantor. Strategists wonder whether the Iraq war has damaged America so badly as to set it on a path to "imperial decline.

important as "hard" military power and economic might may be, these factors are not all that has made America a superpower or even a "hyperpower", as the French once put it. The "soft power" of its open culture and liberal democracy has provided an attractive model and encouraged others to see the world America's way. It has allowed America to multiply its influence through an unrivalled network of alliances. It is politically and diplomatically—and in terms of moral standing—that America has been most damaged.

We have become a nation consumed by fear, worried about terrorists and rogue nations, Muslims and Mexicans, foreign companies and free trade, immigrants and international organizations. The strongest nation in the history of the world, we see ourselves besieged and overwhelmed. While the Bush administration has contributed mightily to this state of affairs, at this point it has reversed itself on many of its most egregious policies—from global warming to North Korea to Iraq. (… ) We must begin to think about life after Bush. (...) America will have to move on and restore its place in the world. To do this we must first tackle the consequences of our foreign policy of fear. Having spooked ourselves into believing that we have no option but to act fast, alone, unilaterally and pre-emptively, we have managed in six years to destroy decades of international good will, alienate allies, embolden enemies and yet solve few of the major international problems we face.

•    Stop the fear-mongering: "To recover its place in the world, America first needs to recover its confidence. (…) If we are not terrorized, then in a crucial sense we have defeated terrorism."
•    Keep welcoming immigrants: "Perhaps the most hopeful sign for the United States is that alone among industrial nations, we will not have a shortage of productive citizens in the decades ahead. Unlike Germany, Japan and even China, we should have more than enough workers to grow the economy and sustain the elderly population. This is largely thanks to immigration. If America has a core competitive advantage, it is this: every year we take in more immigrants than the rest of the world put together."
•    "Admit that our mission in Iraq has substantially failed."
•    Boil down the military presence in Iraq to "core mission" like fighting Al-Qaeda, securing the Kurdish region and training the Iraqi army
•    Tightly contain Iran
•    Get far more engaged in the Israeli-Palestinian problem, global warming, Darfur, poverty alleviation
•    Listen to emerging Asian countries: "To function effectively in this new world, [America] can lead only through partnerships, collaborations and co-operation. The Bush-Rumsfeld model of leadership—through declarations, threats and denunciations—is dead."