President-elect Obama will take office in January with the largest mandate for change in recent history. In addition to demonstrating leadership in restoring the health of the global economy, the new president will need to reverse the legacy of an incoherent and poorly executed strategy in the Middle East. Underlying both challenges -- first, containing the contagious financial crisis that now threatens many emerging market economies and second, securing a peaceful and prosperous Middle East -- is the key notion that the President must regain the trust and confidence of those who have the power to tip the scale back in a positive direction.
In the context of the global financial crisis, consumers, lenders, and investors have all suffered a major blow to their confidence. President Obama, in concert with world leaders, has the chance to make both tangible and symbolic moves to allow the markets to regain that confidence. Some aspects of the federal bailout of financial institutions (and possibly the auto industry) will surely need to be executed under Obama's watch. All of these moves must be made after careful deliberation but with clear and transparent intentions. Uncertain market interventions will only breed further uncertainty and risk aversion.
It will also be extremely important to reassure the development aid community -- the private sector and international lending institutions included -- to ensure that foreign assistance pledges to those most in need do not falter during these hard economic times.
In order to sustain growth and reform in the Middle East, the U.S. must work to win back the trust of the region's young, moderate populations. Many have made this argument, but a commitment to resolving the Israeli-Palestinian conflict, to restoring stability and continuing political progress in Iraq, and to reforming the region's education systems and workforce development initiatives are all efforts that will help win back favor in the region and trust in U.S. intentions while, of course, contributing to the U.S.'s own strategic interests. According to a recent National Intelligence Council report, al-Qaeda is losing support for failing to address practical issues such as poverty, education, and unemployment in Muslim countries. While the same report also declares that the U.S. is waning in global leverage and influence, there is still an opportunity for the U.S. and other strong global powers to play a role in advancing economic growth in potentially volatile regions. Of the Middle East and North Africa, the report notes: "a greater emphasis on economics and, most importantly, greater participation of women in the work force may spur new forms of progressive Islam."
