America's soft power—its ability to persuade without coercion or force—has taken a major hit during the Bush years. The early overseas take on Bush as a unilateralist too quick to use force was never overturned, despite a more pragmatic second-term foreign policy. Go-it-alone tendencies on climate change, international justice, arms control, and—above all—Iraq harmed U.S. standing and invigorated anti-Americanism. America's moral authority was further battered by the way Washington waged the war on terrorism, especially reports of abuses at Abu Ghraib and Guantánamo.
Foreign politicians have avoided appearing too close to the United States. "Being helpful to the Americans is the kiss of death in domestic politics," says Joseph Nye, a Harvard political scientist and former Pentagon official who coined the "soft power" term. "Obama will find there is residual suspicion of the U.S."
One partial antidote to that toxic mood is Obama himself. His racial heritage and improbable rise to the peak of global power have resonated deeply in much of the world. He reminds all of the American capacity for renewal and change and of what can happen in a real democracy. With an Obama presidency, predicts Kishore Mahbubani, a Singaporean college dean and former diplomat, "at least half of the anti-Americanism will vanish."
Obama vows to restore America's standing in the world. But he will find that his diplomatic machine is sputtering. Underfunded and understaffed, the American Foreign Service is not primed for the diplomatic surge Obama may want to unleash. "Since the fall of the Berlin Wall, the diplomatic capacity of the United States has been hollowed out," charges a report by the American Academy of Diplomacy and the Stimson Center.
Recession. The reservoir of soft power available to Obama has been depleted further by the financial meltdown. The recession's mounting costs will limit foreign aid and other initiatives abroad. Obama is being handed both an apparent global downturn and, for the first time since 1982, a drop in world trade. The economic pain dims chances for reviving world trade talks. Poverty may balloon, provoking unrest where governments are fragile. More difficult, too, will be the transition to a new-style energy economy, with its considerable technology investments and costly steps to curb greenhouse gases. Bearing down early on the Obama administration are negotiations for a new global climate-change pact, due next December.
The new president also inherits an unprecedented two wars that have each lasted longer than the U.S. role in the two world wars, combined. Bush's elective war to topple Saddam Hussein will live on as a scene-setter for the Obama years. As a candidate, Obama rode to victory in part on his opposition to the Iraq invasion. He has been calling to withdraw U.S. combat troops within 16 months, leaving a residual force of thousands to train the Iraqis and for contingencies. Now, he will confront a separate timetable laid out in a new U.S.-Iraqi security agreement that establishes a Dec. 31, 2011, withdrawal date. Obama will benefit from the reduced insurgent violence that reflects both Bush's gamble on a U.S. troop surge (still at 146,000) and shaky truces by key Shiite and Sunni parties.
The advances have come at enormous cost: more than 4,200 Americans and tens of thousands of Iraqis dead and outlays approaching $700 billion. The gains are very fragile, and a core uncertainty remains: Will Shiite, Sunni, and Kurdish Iraqis restrain their sectarian and ethnic rivalries long enough to hold together as a nation?