By Joseph S. Nye

Many people will try to set US President-elect Barack Obama's priorities, but one person is sure to have a major effect. The outgoing US President George W. Bush has bequeathed an unenviable legacy: an economic crisis, two wars, a struggle against terrorism, and problems across the Middle East and elsewhere.

If Obama fails to fight these fires successfully, they will consume his political capital, but if all he does is fight them, he will inherit Bush's priorities. The new president must deal with the past and chart a new future at the same time.

Foremost on Obama's agenda will be the economic crisis, where his domestic and international priorities intersect. He will need to stimulate the economy and avoid protectionist pressures at home, while also taking the lead in restructuring the global financial system. Cooperation with others will be essential.

That Bush convened a G20 meeting in November sets a useful precedent of going beyond the G7 to include emerging economies such as China, India and Brazil.

In second place must be the US' two current wars. Obama campaigned on a promise to withdraw American combat brigades (but not troops engaged in training and counterterrorism) from Iraq by mid-2010. Now the Bush administration and the Iraqi government have signed an agreement for troop withdrawal by late 2011.

These timetables' effectiveness will depend on events on the ground, including political compromises inside Iraq and dialogue with Iraq's neighbors, but a clear sense of direction has been established.

Afghanistan looks more difficult, given the Taliban's reinvigoration with help from groups in Pakistan. Obama has called for additional United States and NATO troops to stabilize the situation, but too many foreign troops will only increase Afghan nationalist reactions.

We cannot simply shoot our way out of the problem. Increased training of the Afghan army and police, and a political dialogue inside the country and with neighbors will be important components of any solution.

The third priority will be what Bush misleadingly called a "global war on terrorism". The Obama administration will have to pursue the struggle against al-Qaida, but should drop the war rhetoric. It makes little sense to declare war on a tactic, and experience has proven that the terminology merely reinforces the narrative that bin Laden seeks to promote, which is why Britain now avoids the phrase.

A successful strategy against al-Qaida will require close intelligence cooperation with other countries and policies that attract the support of mainstream Muslim opinion.

The Middle East represents a fourth set of urgent priorities like Iran. Nonetheless, there remains time for a diplomatic initiative that includes Europe, Russia and China.

On Iran, Obama has pledged to conduct a broad diplomatic dialogue with Iran without the preconditions that hampered Bush.

But successful diplomacy will require repairing relations with Russia. Also high on the priority list in the Middle East will be to sustain and enhance Bush's efforts to bring about a two-state solution between Israel and Palestine, and to encourage the incipient dialogue between Israel and Syria.

Major issues will also arise in Africa, Latin America and Asia, and relations with these areas will grow in importance. Fortunately, none of them became political footballs in the recent election campaign. In Asian policy, with the exception of the Democratic People's Republic of Korea, the Bush legacy is better, bequeathing good relations with the key states of Japan, China and India.

The "Bush Doctrine" of preemptive war and coercive democratization, coupled with a unilateralist style, was based on a flawed analysis of power in today's world. The paradox of American power is that the strongest country since the days of Rome cannot achieve its objectives acting alone.

Obama's election has done much to restore American "soft" power, but he will need to follow up with policies that combine hard and soft power into a smart strategy of the sort that won the Cold War. Democracy promotion is better accomplished by soft attraction than hard coercion, and it takes time and patience.

Here Obama should lead by example and remember the historical wisdom of being Reagan's "shining city on a hill". Closing the prison camp at Guantanamo Bay, Cuba, would send such a signal. Right now, Bush's calls for democracy are heard as an imperial imposition of American institutions. We need less Wilsonian rhetoric about making the world safe for democracy, unless combined with John F. Kennedy's calls to "make the world safe for diversity".

A "liberal realist" policy should look to the long-term evolution of world order and realize the responsibility of the international system's strongest country to produce global public goods - things people and governments around the world want but cannot otherwise attain - as Britain did in the 19th century.

The US should similarly promote an open international economy and commons (seas, space, Internet), mediate international disputes before they escalate, and develop international rules and institutions. Early signals that the US will take the lead in dealing with global climate change will be an important start.

The US can become a smart power by once again investing in global public goods. That means support for international institutions, aligning America with the cause of international development, promoting public health, increasing cultural exchanges, maintaining an open economy, and dealing seriously with climate change. Indeed, Obama's most important priority must be to show that the US is back in the business of exporting hope rather than fear.

The author, a former US assistant secretary of defense in the Clinton administration, is a professor at Harvard University

(China Daily via Project Syndicate December 5, 2008)