The Red and Blue; Agendas: How Bush could re-establish the American claim to global leadership by borrowing heavily from John Kerry.

Byline: Jeffrey E. Garten (Garten is dean of the Yale School of Management.)

President Ronald Reagan used to say that America was a shining city on a hill. Former secretary of State Madeleine Albright called the United States the "indispensable nation." Such declarations are often mocked as arrogant exaggerations, but I believe they embody a lot of truth. Like many Americans, however, I think President Bush has undermined America's reputation in the world with his unilateral foreign policy and mounting deficits. It's a shame. But there is still no doubt in my mind that our assets still outweigh our liabilities. And as American historian Arthur M. Schlesinger Jr. recently wrote, "The great strength of democracy is its capacity for self-correction."

So here's a plan for self-correction in Bush's second term. Enough time has now passed since 9/11 for Americans to recalibrate their approach to the world, without letting up on the effort to combat terrorism. In its quest to lead other nations in a more enlightened way, the United States has formidable advantages: the world's strongest military by far, the most vibrant economy, the most innovative capital markets, the most widely used currency, the most flexible work force, the best system of higher education. America is the only country that is both a great Atlantic and Pacific power. It is the most multiethnic, multicultural, multilingual society, a huge advantage in a globalizing world. The guiding "American Dream" of opportunity for all has no counterpart anywhere.

President Bush should seize on ideas generated in the recent election that could form a bipartisan plan to help all advanced nations deal with global change. Among these is Bush's own call for an "ownership society"--by which he meant creating more opportunities for individuals to manage their professional training, possessions and health care. To be sure, the ideas are controversial even in our free-market society. But for many rich nations, including Germany and Japan, where populations are aging, government finances are strained and taxes are already high, the concept of less government and more individual responsibility is one whose time is coming.

A great innovation would be for Bush to combine the notion of an ownership society with Senator ...