In the post-9/11 world there is an urgent the need for Americans to understand the Muslim world, and vice versa. Yet precisely when they should be visiting Muslim countries, Americans are kept at home by fears of terrorism. War zones aside, those fears are overblown. It is time their government and their media helped would-be American travelers gain a more realistic understanding of the typically minor risk of anti-U.S. violence that awaits them in the Muslim world.

Recently my wife and I spent a week strolling the streets of Beirut and traveling by bus in its hinterland. The trip was a fool's amusement in the scary light of official and media images of the Middle East as a dangerous place. Yet everywhere we went we felt welcomed.

I own a t-shirt that spells out "CANADA" in large letters beneath a maple leaf. Before leaving California I thought, only half-facetiously, of bringing it along. I'm glad I left it behind. The Lebanese we met were hospitable not hostile.

I am not advising naivete; Lebanon's horrific civil war in the 1970s, 80s, and 90s destroyed much of this city. Washington intervened. More than 200 American soldiers died in a building shrunk to rubble, apparently by Hezbollah -- a self-described Party of Allah that the U.S. still considers a terrorist organization. Beirut became a synonym for mayhem.

Echoes of Beirut's frightening reputation were heard this year in a series of bombings that killed nearly two dozen Lebanese, including Prime Minister Rafiq Hariri in February, scholar-journalist Samir Kassir in May, and opposition politician George Hawi on 21 June, only two days after we had left the country.

An American visitor's initial impressions of Beirut today are ambiguous. Inspiring confidence are the relaxed atmosphere at the new, ultra-modern, and just-renamed Rafiq Hariri Airport and, seen through taxi windows, the attractively renovated downtown area. But then one's taxi skirts the burned-out hulk of the St. George Hotel and, alongside it, behind police tape and armed guards, the twisted carcasses of cars -- detritus from Hariri's assassination.

This juxtaposition of alarm and assurance has become the unnerving natural condition of American travel to and in Muslim or mostly Muslim countries. Survey research shows approval of the United States among the world's billion-plus followers of Islam near an all-time low. The U.S. is viewed unfavorably by 58 percent of Lebanese, according to a just-released Pew Research Center opinion poll. Lebanon and other Muslim-majority societies account for more than half of the 29 countries to which the State Department discourages American travel. Yet in these mainly Muslim destinations the odds that a prudent American tourist will become a casualty of terrorism remain infinitesimal.

I went to Lebanon to do research, to lecture at the American University of Beirut, and to help celebrate the 100th anniversary of my high-school alma mater, the American Community School. For decades, Arab sons and daughters have vied for entry into these and comparable institutions elsewhere in the Middle East, including the American University in Cairo. In Lebanon, in the upland village of Deir al Qamar, I found a small photo shop whose owner had proudly posted a sign identifying himself as a "U.S.A. GRADUATE, BOSTON."

These signs of American popularity must seem incomprehensible to Americans fearful of Muslim wrath. But what really makes no sense is the apocalyptic vision of the Muslim world that America's media tend to purvey, a vision that encourages would-be travelers to stay in Indiana and skip Indonesia.

Overseas Muslims in my experience have a split-level view of America. Most of them dislike -- some detest -- U.S. policy while simultaneously admiring the freedom and openness that Americans, at their best, represent. Many Americans feel the same way. Meanwhile, security concerns have encircled U.S. embassies with enough protective barriers and identity checks to make diplomacy resemble self-imprisonment.

As relaxed interactions at the official level have become a casualty of the war on terror, people-to-people contacts have become more vital than before. The fewer Americans Muslims meet, the less contested will be the image of the U.S. as a cruel montage of Guantanamo and Abu Ghraib.

A task force ought to brainstorm ways of overcoming unrealistic fears of travel. The Bush administration has acknowledged the need to win Muslim hearts and minds abroad. It is time to win back overfearful American hearts and minds as well.

Fifty years ago, in April 1955 in Bandung, Indonesia, the country's then-president Sukarno hosted a meeting that became a global icon of anti-colonial solidarity. The 29 African and Asian states represented at that first Bandung Conference swore their support for sovereignty and self-determination. Their priority was on national not individual freedom. The final declaration mentioned human rights. But it ignored the danger that foreign colonialists might be replaced with indigenous dictators. Democracy, corruption, and good governance were issues for the future.

This year in Indonesia, from 18 to 24 April, some 87 delegations, including 40 heads of state or government and more than 100 ministers, celebrated the "golden jubilee" anniversary of the Bandung Conference. In a series of summit, ministerial, and other meetings they sought to "reinvigorate the Bandung spirit" and forge "a new Asian-African strategic partnership" for the 21st century. The week climaxed on 24 April on the same day and in the same hall where the original conferees had launched the "Bandung spirit" of solidarity against imperialism half a century before.

Some of the leaders gathered for the celebration -- Bandung II -- were content to repeat the nationalist pieties of the past, or to redirect them from European colonialism to American unilateralism as the enemy of the day. But the current president of Indonesia, Susilo Bambang Yudhoyono, known as SBY, struck a different note. His theme was not independence but introspection, not sovereignty but self-reform. He gently urged his fellow rulers to replace the old dogma of national liberation with a commitment to "good governance" as the latest and highest priority for developing countries -- in effect, self-reform as the new spirit of Bandung. At that moment, in Blitar, East Java, where he is buried, the nationalist firebrand Sukarno must have rolled in his grave.

"Good governance" did not and will not become the buzzword of Bandung II. The only other speaker who mentioned it, to my knowledge, was Singapore's prime minister Lee Hsien Loong. Fewer voices were raised in favor of self-reform than were aimed at American unilateralism. North Korea's Kim Yong Nam was among the latter. So was "Comrade R. G. Mugabe," as Zimbabwe's dictator called himself.

An Iraqi delegate, unable to insert in the ministers' communique a paragraph supporting his country's embattled transition to democracy, told me privately and bitterly, "The spirit of Bandung has not changed at all." In his view, most of the conferees in Bandung II preferred the odious sovereignty of Saddam Hussein to the induced democracy that followed, just as the leaders of the anti-colonial movement had tolerated tyrants in their ranks.

Yet SBY's speech did not fall on wholly deaf ears, and Iraq is not a good test case. More than a few delegates in Bandung supported democracy but opposed democracy-by-invasion. In developing countries, as representative government has spread, so has the desire to make it less corrupt and more effective. Over time, a new Asian-African agenda could give more prominence to democratization, religious moderation, the rule of law -- and honest, accountable governments as means to these ends.

But even if this does not happen, even if SBY's challenge is forgotten, the prestige of successfully hosting Bandung II already has strengthened his otherwise vulnerably "American" position inside a country whose future will help tip the balance of extremism and moderation in the Muslim world.

SBY is John F. Kennedy-esque: tall, handsome, young for a head of state, and able to project a democratic vision for Indonesia. A retired army general, he received American military and civilian training, including a master's in management from Webster University. No president before him has had more American exposure. This background will be in the spotlight when he pays his first presidential visit to the United States at the end of May.

Indonesia is the largest Muslim society, the third-largest democracy, and a tropical archipelago where defenders of the Bush administration are as scarce as snow. Indonesians will appreciate SBY's American experience if it enables him to deal with the world's only superpower in ways that help Indonesia. But if he is seen as too enamored of supposedly "American" values, he will create an opening for his political opponents.

In Bandung on the last day of the commemoration, crowds lined the streets, smiling and waving at the VIPs. Through the closed windows of air-conditioned limos and busses, the VIPs waved back. Compared with the week's grand abstractions -- sovereignty and self-reform -- this third spirit of Bandung was fleeting and local. But unless Asian-African solidarity becomes more than a slogan, or the vision of a better-governed Indonesia comes true, it may have been the most real.

When the 9.0-magnitude earthquake and resulting tsunami struck Asia and East Africa on December 26, Indonesia took a devastating hit. More than 100,000 people died and another 500,000 were left homeless, with some experts predicting that the final death toll may rise above 250,000. Aceh province on the northern tip of the island of Sumatra, where the Free Aceh Movement rebel forces have been fighting against the Indonesian Defense Forces for almost 30 years, was at the center of the destruction. Donald Emmerson, a senior fellow at the Stanford Institute for International Studies and director of its Southeast Asia Forum, is an Indonesia specialist who has been traveling to Aceh since the late 1960s. He's finishing a book entitled What is Indonesia? Identity, Calamity, Democracy.

STANFORD: What do we need to know about Aceh province?

That it's a wonderful place, that the people have a tradition of hospitality, and that they share with you what they have. It's very sad that it has been subject to so much violence and conflict for so many years.

What's been happening in recent times?

Since May 2003, Aceh has been virtually off-limits to foreigners. The [military] reasoning is that it's for security reasons, but there's always been a suspicion that it's also because bad things -- horrible things, killings and so forth -- are done in the dark, and they don't want people to watch. Certainly the human rights community has had great difficulty getting access to Aceh.

What could happen as a result of some 1,000 representatives of aid organizations being on the ground there?

The opening of Aceh to foreign and domestic humanitarian aid workers has the potential to introduce elements that can serve as a check on human rights abuses. Obviously, the time for mourning is not over. But if we can insert a silver lining in this very dark cloud, it might be that the devastation of the tsunami opens up an opportunity to rebuild much of Aceh, and that it will require cooperation among all Acehnese. I am cautiously optimistic about the opening that this catastrophe represents for trying to lessen the man-made pain of the Acehnese people.

What might a rebuilt Aceh look like?

The plan is to take villages that were destroyed, and maybe even the town of Meulaboh on the west coast, which was the worst hit, and move them inland a certain number of kilometers. Then, construct mangrove swamps as barriers against a repetition of the tsunami, and also to protect the soil from erosion and generate the possibility of brackish-water fishing for the livelihoods of the people. This is a massive effort that is going to last for years and years. Authorities have estimated that the rebuilding costs in Aceh could run to $2.2 billion.

Fishing villages would no longer exist on the coast?

I spent nine months in fishing villages in East Java, and I found that the relationship of the populations on the coast to the ocean is not necessarily what one would expect. They are not happy bathers on the beach, fishing is an extremely dangerous operation, and the ocean is considered a wild place.

Many fishing communities are overfishing the source. I wrote a long report for the Ministry of Agriculture's fisheries office, arguing that what Indonesia ought to do was take the money the government was spending to supply nylon fishing nets and higher horsepower outboard motors, and spend it on wives who were involved in craft commodities. The women have commercial skills, and getting microcredit programs for women to set up shops and expand is the future.

How will religion figure in that future?

Aceh is known in Indonesia as "the front porch of Mecca." The Acehnese are almost entirely Muslim. While there's a tendency among Americans to presume that [a Muslim nation] must be fanatic, Indonesia remains an overwhelmingly moderate society. There is a poignant photo, which hasn't been circulated in the U.S. press, of a sign at a depot for humanitarian relief supplies. It reads, "If you try to steal this material, you will be responsible to Allah."

The following is supplemental material that did not appear in the print edition of STANFORD.

What was the overall impact of the tsunami in Indonesia?

I think it's important to keep in mind that each of the affected countries was affected in a somewhat different way. In Sri Lanka, an estimated 70 percent of the coastline of the entire island was affected, so the economic consequences there are going to be more severe than the damage that was done to Indonesia. If you go down the west coast of Sumatra, you will see damage, but the main damage was overwhelmingly concentrated in a single province, Aceh, which represents less than 2 percent of the total population of Indonesia. Aceh got a double-barrel assault -- from the earthquake and the tsunami. The death toll was horrid, with a huge loss of life, but it was concentrated on the coasts.

How does Aceh's history set it apart from the rest of Indonesia?

The first record we have of an Islamic sultanate in what is now Indonesia is a stone carving dated 1297, on the north coast of Aceh. Aceh was closest to the Middle East, and there were Muslim traders who would go short distances, pause, sell, buy and reload. Long-distance Arab-Malay trade finally got to Indonesia, and the logical landfall was Ache.

Then there were tremendous and unequal casualties in the war against the Dutch, who recruited Ambonese troops to fight a colonial war in Aceh in the 19th century. There's a photograph of Dutch troops standing on the dead bodies of Acehese rebels. The Acehnese war lasted a long time, and it was one of the last parts of the archipelago to be fully brought into the colonial orbit.

Aceh has been for some time under a state of military emergency, and an estimated 13,000 have died as a result of the [rebel] war since 1976. But the tsunami has changed all that. Looking at it from a political science point of view, if we don't begin trying to analyze the situation, I'm not sure we can make it better down the road.

What needs to happen?

In a time of crisis what you need is efficiency and effectiveness, and you need somebody to stand up and say, "This is the way things are going to be." But the governor of Aceh is, by all accounts, exceedingly corrupt. He is in Jakarta now, in detention, awaiting trial on corruption charges. So you don't even have an active, sitting provincial government leader to take charge.

The number of members of the provincial administration who died in the tsunami is quite high, and the central government has had to send up 300 replacements from Jakarta. The administration of Aceh has essentially been completely taken over by the central government. This is potentially unhelpful, depending on how sensitive and effective the central government is and how corrupt the atmosphere is within which masses of foreign aid are moving.

The somewhat optimistic scenario is that now Aceh is even more dependent on the central government than it was before, with the need to rebuild substantial portions of its coastline. So a leader of the [freedom] movement [might] look down the road and say, "It's unrealistic for us at this point, with this incredible body blow to our economy, to expect that we can now somehow take over Aceh. We are more dependent than we were before on the central government."

And, conversely, in Jakarta there might be the thinking that since Aceh now so obviously needs support within the republic, "We are in a stronger position, and therefore we can afford to be generous, and to extend concessions, short of independence, that will take advantage of this." The bottom line is that two enemies who were at each other's throats now face a third enemy -- nature.

Are there other voices that should be heard in Aceh?

One of the difficulties of having negotiations between the Acehnese Freedom Movement and the central government is that it tends to exclude other Acehnese views, which is one reason why negotiations that took place previously were not successful. Acehnese society is pretty diverse, and the Acehnese Freedom Movement does not represent all Acehnese, not to mention the Javanese and Indonesians who have migrated into the province, who are university students and [members of] religious communities.

The conflict has lasted for 30 years in its present form, and it has created such enmities that there is no particular mood to compromise. The government has no incentive to reach out, and the Acehnese Freedom Movement remains intransigent. In the long run, those who disagree with a so-called freedom movement are in the shadows and their views tend not to be reported. My hope is that as these voices are allowed to take part in determining the future of Aceh and its political leadership, the polarization will decrease and there will emerge a kind of more moderate center, in favor of autonomy and full rights.

In the 1990s, the United States cut military assistance programs to Indonesia. Is the relationship between the two countries improving?

SBY -- Susilo Bambang Yudhoyono -- is a former military man, but he's identified as relatively clean, and associated with a somewhat more reform-minded element within the military. More than any previous president of Indonesia, he has had exposure to the United States. Certainly this is an opportunity for an improved relationship between Indonesia and the U.S.

PALO ALTO, Calif. -- The European Union is increasingly showing a new independent stance on foreign-policy issues as the logic of its industrial and economic integration plays out in the international arena.

Already the EU has taken a distinct and independent approach to both the Israel-Palestinian conflict and the nuclear crisis in Iran. Now it has broken ranks over the Korean Peninsula, fed up and concerned with the failure to resolve the ongoing crisis over North Korea's development of nuclear arms.

Reflecting this new stance, the European Parliament this week passed a comprehensive resolution on the Nonproliferation Treaty (NPT) and nuclear arms in North Korea and Iran:

• It urges the resumption of the supply of heavy fuel oil (HFO) to North Korea in exchange for a verified freeze of the Yongbyong heavy-water reactor, which is capable of producing weapons-grade plutonium, to avoid a further deterioration in the situation. At the same time it is calling for the European Council and Commission to offer to pay for these HFO supplies.
• It urges the Council of Ministers to reconsider paying 4 million Euros of the suspension costs for KEDO (the Korea Energy Development Organization) to South Korea to ensure the continued existence of an organization that could play a key role in delivering energy supplies during a settlement process.
• It demands that the Commission and Council request EU participation in future six-party talks, making it clear that the EU will in the future adopt a "no say, no pay" principle in respect to the Korean Peninsula. Having already placed more than $650 million worth of humanitarian and development aid into the North, it is no longer willing to be seen merely as a cash cow. This view was backed in the debate by the Luxembourg presidency and follows a line initially enunciated by Javier Solana's representatives last month in the Parliament's Foreign Affairs Committee.
• It urges North Korea to rejoin the NPT, return to the six-party talks and allow the resumption of negotiations.

The EP cannot substantiate U.S. allegations that North Korea has an HEU (highly enriched uranium) program or that North Korea provided HEU to Libya. It has called for its Foreign Affairs Committee to hold a public hearing to evaluate the evidence. "Once bitten, twice shy" is the consequence of U.S. claims that Iraq possessed weapons of mass destruction.

The world order is changing; the EU -- like China -- is emerging as a significant global power economically with the euro challenging the dollar as the global currency (even prior to the latest enlargement from 15 to 25 member states, the EU's economy was bigger than that of the United States). Speaking at Stanford University earlier this month, former U.S. foreign policy adviser Zbigniew Brzezinski pointed out that the EU, U.S., China, Japan and India will be the major powers in the new emerging global order. Since the new Asia will have three out of the five major players, he stressed the importance of engaging with it.

How will those already in play respond? Some may claim that statements by North Korea welcoming the EU's involvement and participation are merely polite, inoffensive small talk that cannot be taken seriously. Yet there have been a spate of pro-EU articles appearing in Rodong Sinmun, the daily newspaper of the Central Committee of the Korean Workers Party, since 2001.

Of 128 EU-related articles between 2001 and 2004, a majority praised Europe's independent counter-U.S. stance, emphasized its increasing economic power and influence, and heralded its autonomous regional integration. Rodong Sinmun portrays the EU as the only superpower that can check and balance U.S. hegemony and America's unilateral exercise of military power.

North Korea's perception of the EU is well reflected in articles such as: "EU becomes new challenge to U.S. unilateralism"; "Escalating frictions (disagreements) between Europe and U.S."; "European economy (euro) dominating that of the U.S."; "Europe strongly opposing unilateral power play of U.S.," and so forth.

Concurrently, North Korea has pursued active engagement with the EU by establishing diplomatic relations with 24 of the 25 EU member states (the exception being France). It is not necessary to read between the lines to recognize North Korea's genuine commitment to engagement with the EU based on its perception of the EU's emerging role on the world stage.

The Republic of Korea has publicly welcomed the prospect of EU involvement, while China wishes to go further and engage in bilateral discussions with the EU on its new policy toward the North. Russia will follow the majority. The problem is with Japan and the U.S.

In Japan, opinion is split by hardliners in the Liberal Democratic Party who view problems with North Korea as a convenient excuse to justify the abandonment of the Peace Constitution. They don't want a quick solution until crisis has catalyzed the transformation of Japan into what advocates call a "normal" country.

The U.S. expects an EU financial commitment, but not EU participation. The neocons believe that EU participation would change the balance of forces within the talks inexorably toward critical engagement rather than confrontation.

The question is whether the EU's offer will point the U.S. into a corner or trigger a breakthrough. Will U.S. fundamentalists outmaneuver the realists who favor a diplomatic rather than military solution? Only time will tell.

Glyn Ford, a Labour Party member of the European Parliament (representing South West England), belongs to the EP's Korean Peninsula Delegation. Soyoung Kwon is a postdoctoral fellow at Stanford University's Asia-Pacific Research Center.

Chris Farrell: Remember the dot-com boom of the 1990s? It seemed as if every entrepreneur with a good idea and a PC could challenge established companies for customers. Brick-and-mortar companies jumped on the e-commerce bandwagon. The demand for digital workers soared. Long-time computer professionals hopped from job to job, pulling down more money with every employer. Newly minted college graduates juggled multiple job offers. But when the Y2K problem emerged in the latter part of the '90s business and government quickly realized there still weren't enough IT workers on hand to find and repair the computer glitch. The quick fix? Hire computer professionals overseas. And that temporary solution permanently changed the global economy.

Paul Saffo: Y2K was huge in getting the ball rolling on offshoring.

Farrell: Paul Saffo is director of the Institute for the Future, a high-tech think tank in Silicon Valley.

Saffo: But once they went overseas, they discovered it's not just a matter of cost. These programmers overseas are often better than the best you can get in the United States.

Farrell: Ireland, the Philippines, and Israel were among the more popular destinations for offshoring Y2K programming fixes. But India became the offshore capital. It had plenty of high-tech companies staffed with well-educated English speaking digital workers. Thanks to India's steep import barriers in the 1980s, no one could afford new computer systems. So Indian tech workers were the world's leading experts in the older software languages that needed upgrading. Suhas Patil is chairman emeritus of semiconductor maker Cirrus Logic.

Suhas Patil: And they were listening to their customers and what their needs were, and as the recognition came that systems had to be upgraded to not have the problem based on the Y2K issues, that's how they got their break.

Farrell: And made the most of the opportunity. AnnaLee Saxenian is Dean of the School of Information Management and Systems at the University of California, Berkeley.

AnnaLee Saxenian: I think the importance of Y2K was overwhelmingly about establishing Indian companies' reputation among US customers and helping begin a set of customer supplier relationships that have simply taken off in the last four years.

Farrell: Of course, Y2K contracts ended in 2000. Yet many Indian companies took advantage of their now sterling programming reputations to negotiate for more sophisticated work. Research. Software development. Accounting services. Long-distance medical advice. Rafiq Dossani is a senior research scholar at Stanford University.

Rafiq Dossani: India is now growing at 70-80 per cent a year in offshored services ... services which are maintaining an accounting system, maintaining an HR system, doing claims processing, that's growing easily at 70 per cent, maybe even higher.

Farrell: Offshore also came onshore during Y2K. The town of Mountain View lies at the heart of California's Silicon Valley. Housed in one of the many nondescript low-rise office buildings that crowd the region's business avenues is the Indus Entrepreneur, or TIE. It is a networking base for the Indian high-tech Diaspora.

Shankar Muniyappa: Y2K was a big opening as early as 98.

Farrell: Shankar Muniyappa is director of information systems for TIE. He came to America for Y2K-and stayed.

Muniyappa: Myself and many of us believe still believe this is the place where you need to be if you want to be middle of innovation.

Farrell: Some 30,000 Indian IT professionals now live and work in the Valley. Rafiq Dossani of Stanford University:

Dossani: At least 25 per cent of the start ups have Indian employees at fairly senior levels working for them. And ... there's a whole infrastructure therefore being built around them because it's a substantial number now, so you see shopping malls you see business services and so on catering to this particular immigrant community.

Farrell: That community is adding vitality to the American economy. Still, many American high-tech workers are threatened by the offshoring of white collar jobs. The numbers are murky, but according to Mark Zandi of Economy.com 370,000 non-manufacturing jobs moved overseas over the past fours years-with most of the information technology jobs going to India. Salaries are down too. Still, the big factor behind the loss of 1.5 million jobs lost since Y2K is improved business efficiency or productivity - not offshoring. And Y2K also played an important role in boosting business efficiency.

Economists initially looked at Y2K as a productivity killer.

Imagine a town threatened by a rising river. Every able-bodied person in town is put to work stacking sandbags. It's necessary work to save the town - but it's unproductive work. Nothing gets built. No food gets grown.

With the Y2K bug, programmers, chief information officers, project managers, and other digital workers were getting paid to do unproductive work - stacking sandbags of silicon. No innovative investments. No new productivity enhancing software.

But economists were wrong. Y2K wasn't a flood. Instead, think of it as clearing a path choked with underbrush. Once the trail is open, it is much easier to zip from point A to point B. Y2K gave companies an excuse to clean up their software and hardware underbrush - a critical factor in today's improved business productivity. Paul Saffo:

Saffo: A lot of companies said well, gosh, if we're going to have to spend all this money to fix our software let's also see what else we can do at the same time, so it was an invitation to replace a whole bunch of stuff. ... So it forced people to ask hard questions about how they were using things and in the best instances people really did become more efficient.

Farrell: The result? Companies used the new systems they installed to cut costs and work smarter - and hire fewer workers.

[Voice of Leonard Nimoy: "Do you have hard copies of all your important documents ... such as bank statements."]

That's Leonard Nimoy, Mr. Spock from Star Trek. He's narrating the Y2K Family Survival Guide video - one of thousands of products peddled by prophets of doom. Y2K did bring home how reliant we all are on computers. Many of us still don't back up critical data at home. The same isn't true for business and government. Many learned from Y2K just how vulnerable information systems are to a malicious attack or unforeseen disaster. Case in point: Y2K actually helped some businesses survive 9/11.

[News broadcast of President George W. Bush: "I've directed the full resources of intelligence and law enforcement communities to find those responsible and bring them to justice."]

The attack on the World Trade Center stopped trading on the New York Stock Exchange. Against the odds, that citadel of capitalism opened six days later.

John Koskinen: The reason the markets, securities markets, were able to open the Monday after the Tuesday of 9-11 was they still had the test scripts that had been developed in 1998 and 99.

Farrell: John Koskinen credits preparations for Y2K. He was President Clinton's Y2K czar.

Koskinen: ... they were able to in effect take all of those Y2K scripts and make sure that all the transactions with all of the major players would close. Without that they never would have been able to do it in the time frame with the confidence they had.

Farrell: A record 2.4 billion shares traded on the New York Stock Exchange the day it reopened.

Y2K was a unique economic event. Earlier jolts to the economy, like the 1973 oil price hike and the 2001 attack of 9/11, were shocks. But the Year 2000 arrived right on schedule. The surprise was how little immediate impact the much-feared transition had on the economy. Yet we're still living and working with the economic impact of Y2K five years later.

For Marketplace and American RadioWorks, I'm Chris Farrell.

The Presidential election campaign is in the home stretch. Neither the President nor Senator Kerry has secured a decisive advantage.

Iraq is now the central issue of debate, as one would expect, since the war is going badly, and the economy is reasonably robust. The debate is finally beginning to focus on substantive differences between the candidates after a summer in which they mainly exchanged personal attacks on their respective Vietnam records. Their strategies are now clear: Bush will challenge Kerry's steadiness and consistency; Kerry will challenge the necessity of the campaign in Iraq and the competence of the administration's efforts there. But while their diagnoses of the situation differ, their proposals for dealing with what is clearly a mess are not so clearly differentiated. Both propose to seek additional help from members of the international community; both emphasize the need to train and arm Iraqi security forces; and both are hopeful that elections will enhance the legitimacy of Iraqi leaders, fortify their efforts to dry up the insurgency, and allow American forces to be reduced and eventually withdrawn.

Historically, wars have been unkind to presidents on whose watch they occurred. The Korean War reduced Harry Truman's popularity so dramatically by 1952 that he gave up his quest for a second full term. The Vietnam War drove Lyndon Johnson from office, despite impressive domestic achievements. Victory in the Gulf War of 1991 sent George H.W. Bush's approval ratings soaring, but within a year he was defeated by an obscure Arkansas governor.

Yet President Bush still clings to a narrow lead in the polls. Why?

Senator Kerry has argued that the Iraqi campaign is a "war of choice." Perhaps so. But Osama bin Laden issued a fatwa declaring war on the United States nearly a decade ago. Whatever the outcome in Iraq, war with Islamic extremists will continue. And American voters remain nearly evenly divided as to whether John Kerry has the steadfast character and consistent judgment they want in a wartime leader.

Uneasiness about the financial and human costs of the war is growing. Casualty figures in Iraq are high compared to the numbers killed or wounded in post-cold war American interventions in Somalia, Haiti, Bosnia, and Kosovo. Yet, those earlier conflicts involved humanitarian interventions in which Americans perceived little strategic stake. However, military personnel killed in Iraq - now more than 1000 - still number less than a third of the civilians who perished in New York and Washington on 9/11. And ours is a volunteer military that is highly motivated.

When confronted by an attack, Americans have consistently taken the fight to the enemy, engaging them in combat as far from our shores as possible. The president has portrayed the campaign in Iraq as an integral feature of the war on terrorism. To at least a number of voters, the absence of any terrorist attacks in the United States since 9/11 provides evidence that his approach, while not without significant costs, is working.

Victory at the polls may be a dubious prize. Whoever is sworn in on January 20, 2005 will face daunting choices. American options in Iraq range from the "potentially disastrous" to the "extremely distasteful." We cannot simply walk away. And a host of other dilemmas - e.g. nuclear crises in Iran and North Korea, a Middle East peace process that has gotten off track, strains in the trans-Atlantic relations, a multilateral trade round that has lost momentum - demand urgent attention. Beyond this, the next president will be hampered by a gigantic fiscal deficit and a military that is stretched thin. In short, he will have few easy choices. It makes one wonder why politicians yearn for this job.

President Bush has claimed a renewed mandate, and has begun to reshuffle his national security team. Condi Rice will move to State; Steve Hadley will move up at the NSC. Rich Armitage and Jim Kelly, who have borne much of the day-to-day responsibility for U.S. policy in Asia, are leaving along with Colin Powell. What might we expect of the Bush administration in its second term?

Generally speaking, continuity rather than change is likely to be the watchword in foreign policy. Above all, the Middle East and South Asia are likely to remain the principal preoccupations of American concerns. In Iraq, Washington will seek to acquit its commitments - to hold elections, train Iraqi security forces, and accelerate reconstruction projects - with whatever measure of dignity and honor it can muster in the face of excruciatingly difficult choices. With Yassar Arafat's death, American engagement in Israeli-Palestinian issues is destined to increase. And Iran's bid for nuclear weapons will continue to challenge the United States and Europe.

Thus Asia will not have pride of place on the Bush agenda. Yet it will continue to command Washington's attention. Why? Because it is in Asia that the interests of the great powers intersect most directly. Asia is the world's most dynamic economic area, and it is becoming more tightly integrated. Washington cannot afford to neglect South and Southeast Asia, for in these areas Islam presents a relatively moderate face. And North Korea, of course, poses a direct and growing challenge to the administration's nonproliferation policy.

Fortuitously, the United States is better positioned in Asia than in most other regions. Our military presence remains sizable and retains mobility and flexibility. Our economy continues to generate solid demand for Asian exports and is a robust source of direct investment. While criticism of American policy is widespread in the region, it is not expressed with the virulence that is seen in Europe and the Middle East. Above all, Washington has cultivated the Asian great powers assiduously, and has managed to improve relations with Tokyo, Beijing, Moscow, and New Delhi - a substantial accomplishment. It remains to be seen whether it can work in concert with others to ameliorate the sources of discord on the Korean Peninsula and over the Taiwan Straits.

The United States, to be sure, confronts some daunting challenges in Asia. If the U.S.-Japan alliance is in excellent condition, defense cooperation with Seoul remains troubled by the sharp divergence in U.S. and Korean perspectives on North Korean aims and strategy. Nor have we found a solid basis for pursuing with Pyeongyang's neighbors a coordinated approach to the six-nation talks. Regional economic cooperation is taking shape along pan-Asian rather than trans-Pacific lines. Developments in the Middle East threaten to "Arabize Islam" in Southeast Asia. And the "Johnny One Note" quality of American diplomacy - i.e. its preoccupation with international terrorism - often plays poorly against Beijing's more broadly based effort to provide regional leadership.

Nor is America unconstrained in its policy efforts in the region. Our military forces are stretched thin globally, impelling some downsizing of deployments in Asia. Huge fiscal deficits loom, and with growing bills falling due in both Iraq and Afghanistan, resources available for policy initiatives elsewhere are likely to be tight. The president has succeeded in pushing negotiations with North Korea into a multilateral framework, yet Washington is being pressed by its negotiating partners to adopt a more conciliatory posture. The democratization of Asian nations, while welcome, does not automatically facilitate U.S. diplomatic objectives. Recent elections in South Korea and Taiwan were decisively shaped by a new generation of voters. Governments in Seoul and Taipei are increasingly accountable, yet viewed from the United States, they are not extraordinarily sensitive to Washington's views, let alone deferential to its lead.

With these considerations in mind, one should expect President Bush and his foreign policy team to continue cultivating close ties with the Asian powers. Whether Washington can effectively utilize those relationships to roll back North Korea's nuclear program and avert crises in the Taiwan Straits will depend heavily on its relationships with the governments in Seoul and Taipei. And at the moment South Korea appears determined to expand economic ties with the North virtually without reference to Pyeongyang's nuclear activities. Taipei remains preoccupied with efforts to assert its own identity while counting on American protection.

In the end, of course, foreign policy rarely sees carefully laid plans bear fruit. Someone once asked a new British prime minister, Harold MacMillan, what would drive foreign policy in his government. He answered without hesitation, "Events, dear boy, events." I expect the same may be true for Mr. Bush.

With his second inauguration looming, President Bush has his hands full in the Middle East and with ambitious plans for domestic reform during his second term. In this context, Beijing's recently announced plans for anti-secession legislation is particularly unwelcome.

The content of the anticipated legislation remains uncertain, and its motivation and timing are puzzling. According to letters sent by the Chinese Embassy in Washington to key members of Congress, it is intended to "give full expression to the strong resolve of the Chinese people of never allowing the 'Taiwan independence' forces to cut off Taiwan from the rest of China under any name or by any means." Or as a pro-Beijing daily in Hong Kong put it, "It will leave 'Taiwan independence' forces with no room for ambiguity to exploit."

This suggests that the legislation's main aim will be further to deter President Chen Shui-bian's salami-slicing separatist tactics. An additional motivation may be to further energize U.S. efforts to restrain Chen in order to head off a future crisis. And, to be sure, the new legislative initiative may be attributable to internal political forces.

But why now, within weeks of President Chen's setback in the Dec. 11 legislative elections? One can only guess.

Perhaps Beijing chalked up the Democratic Progressive Party's difficulties in the elections to their own martial rhetoric, and decided to pile on new forms of political pressure. Perhaps it has concluded that despite the election results, Chen will still move aggressively on his stated intention to revise Taiwan's constitution -- thus moving a step closer to independence -- before the conclusion of his term in 2008. Perhaps it deduced from the pointed warnings directed at Chen by senior U.S. officials during the recent Taiwanese elections that Washington will now tolerate blunter threats to reinforce the People's Republic of China's "red lines."

Whatever the suppositions behind Beijing's plan for anti-secessionist legislation, they probably underestimate the substantial risks involved. Such legislation will doubtless alienate many Taiwanese voters, perhaps contributing inadvertently to the evolution of a growing sense of Taiwan's separate political identity, and producing wider legislative support in Taipei for major arms purchases from the United States.

It could also set off an action/reaction cycle with Taiwan that would undermine any possibility of reviving a serious cross-Straits dialogue. While Beijing's planned legislation may be its "response" to Chen's frequent references to constitutional referenda, it is as likely to encourage such referenda as obstruct them. It will upset many Americans, and it will galvanize the Taiwan lobby in America to stir up unhelpful resolutions in Congress when it reconvenes.

The greatest risk, perhaps, is that this could exacerbate the dangerous remilitarization of the Taiwan issue that has emerged since 1995, marked by explicit People's Liberation Army deployments and training aimed at Taiwan contingencies on the one hand, and escalating U.S. arms sales to Taiwan, combined with closer cooperation between the United States and Taiwan's defense establishment, on the other.

To a disturbing degree, this process seems driven less by policy considerations than by the parochial interests of the PLA for enhanced equipment and budgets, and by the attractiveness of the lucrative Taiwan arms market for U.S. military suppliers. Not surprisingly, this evolution is convincing pessimists on each side that confrontation is simply a question of time, despite the disaster it would represent for all parties.

Stabilizing this situation will demand the Bush administration's attention, despite other urgent preoccupations. Stability in the Straits, moreover, is an achievable goal if good sense prevails on all sides. Realistic leaders in Beijing recognize that there is no short-term solution.

With Taiwan in full control of its domestic circumstances, no country whose support is necessary for its independence to be meaningful views such independence as worth the cost of conflict with Beijing. The growing economic interdependence between China and Taiwan also raises the ante of any such conflict for them both.

To be viable, a stabilization arrangement cannot negate the "one China" principle, but it should leave open the parameters of an eventual settlement. Its goal should be an end to explicit PRC threats to use force against Taiwan and of overt preparations for military contingencies in the Strait, supplemented by reduced missile deployments opposite Taiwan; reduced U.S. military sales to Taipei consistent with the lowered threat level; more international "space" for Taiwan in exchange for an indefinite halt to actions aimed at enhancing Taiwan's international position; augmented links across the Taiwan Strait; and cross-strait talks aimed at addressing immediate problems and encouraging the growth of greater mutual confidence.

At a moment when we are entering a new year, let us hope that progress toward stabilization can be achieved.

APARC's Henry S. Rowen is featured in James Mann's new book, The Rise of the Vulcans: The History of Bush's War Cabinet, Viking Penguin: New York, 2004, pp 186-97, for his role in formulating the military strategy that the United States should employ in a war against Iraq. The book details the Cheney-Wolfowitz-Rowen war plan -- dubbed "Operation Scorpion" -- which proposed an invasion of Iraq from the west, through the country's empty desert regions toward the Euphrates River.

While campaigning for president in 2000, George W. Bush downplayed his lack of foreign policy experience by emphasizing that he would surround himself with a highly talented and experienced group of political veterans. This core group, consisting of Donald Rumsfeld, Dick Cheney, Colin Powell, Paul Wolfowitz, Richard Armitage, and Condoleezza Rice, has a long history together dating back 30 years in some cases. Dubbing themselves the Vulcans, they have largely determined the direction and focus of the Bush presidency. In this new book, Mann traces their careers and the development of their ideas in order to understand how and why American foreign policy got to where it is today.