A test of influence: the agenda Blair should pursue with the President

President Bush will only win the war on terror if, to coin a phrase, he is equally tough on the causes of terrorism

The eagle has landed. The first state visit by a US President for a century is under way. Part of the problem with state visits is that ceremony gets priority over substance. The social round of state banquet at Buckingham Palace and return dinner at the embassy tests the digestive systems of the political leaders rather than stretching their intellect. Indeed it is a curious convention of the placement protocol that they are seated too far apart to do any serious business.

Yet even a state visit allows some opportunity for face time between Prime Minister and President, which is as well as there are real issues that need to be addressed if the visit is to justify the diversion of a tenth of the entire police force of Britain to provide security for it. What then should Tony Blair be jotting down on his notepad this morning as the priorities to be resolved over the next couple of days?

Most urgent is to secure a commitment from George Bush accepting that the recent World Trade Organisation (WTO) ruling requires him to scrap the protectionist tariffs he slapped on our steel exports. Among the many ironies of this visit is that it comes only a fortnight before the deadline for the US to comply with the ruling or to face retaliatory measures by the EU. It would be strange if a year that opened with Britain and the US as allies in a foreign war ended with the two countries on opposing sides in a trade war.

Yesterday I heard Sir Christopher Meyer venting his frustration that while one part of the Bush administration was working with the British Army on planning a joint invasion of Iraq, another was busy designing a unilateral attack on the British steel industry. Sir Christopher was our ambassador in Washington during my time at the Foreign Office, and I know him to be totally committed to the transatlantic relationship. Tony Blair needs to warn President Bush that the loyalty of even the most enthusiastic atlanticist is put under impossible strain when the White House damages British economic interests at the same time as it demands support for American strategic interests. But the case for President Bush to climb down over steel tariffs does not rest just on special pleading by Britain. Washington cannot be a credible advocate of free trade in global forums while acting as the domestic champion of protectionism in electoral swing states such as Pennsylvania. After the WTO conference at Cancun the world faces a challenging enough task in reaching North-South agreement on how to make trade fair as well as free, without the two principal trade blocks of the North ending up in confrontation.

The second pressing issue on Mr Blair's checklist can be cribbed from Donald Rumsfeld's recent memo conceding that we are in danger of losing ground in the war on terrorism. The invasion of Iraq has been a spectacular own goal in the war on terrorism. On Sunday President Bush described Iraq to Sir David Frost as "a front in the war on terrorism", which is a revealing admission from the man who only six months ago hailed the conquest of Iraq as a victory over terrorism. British intelligence has proved only too accurate in its assessment that the occupation of Iraq would open it up to al-Qa'ida and stimulate an Islamic jihad.

Nor will the situation be improved by the current fireworks being provided by the US occupying forces, which might have been calculated to swell support for the guerrillas rather than suppress it. If I were an Iraqi citizen I suspect I would conclude from the decision to call the current US offensive Operation Iron Hammer that it is not designed to win my heart and mind. No guerrilla war can be defeated by satellite-guided missiles, however impressive the explosion may look at home on Fox TV. The welcome, albeit belated, recognition in Washington that they need to speed up the return of the running of Iraq to the people of Iraq will be totally negated if in the meantime the US escalates the firepower that it uses against the local population.

The instinctive preference of the Bush administration for punitive measures has become a real menace and is a major barrier to denying terrorists the populist support without which they would be easier to isolate. The other week David Bolton, one of the leading neo-conservatives in the Bush administration, dismissed the European overtures to Iran with the one-liner, "I do not do carrots". Tony Blair needs to convince his guest that we will spread, not halt, terrorism if we only "do sticks".

President Bush will only win the war on terror if, to coin a phrase, he is equally tough on the causes of terrorism. This would logically bring Tony Blair to what must be the next item on his agenda, to remind George Bush that he promised that if we helped to remove Saddam, he would help to promote the road-map to peace in the Middle East. Far from driving forward on the road-map, President Bush has let tension between the Israeli and Palestinian peoples slip further into a permanent state of conflict.

It is remarkable that in the past week we have seen more outspoken criticism of the dangerous politics of Ariel Sharon from the present Chief of Staff of the Israeli army and from previous directors of the Israeli security agency, than we have yet heard from the President of the United States. If four directors of Shin Beit can warn that the construction of the new partition wall will provoke hostility and prolong conflict by seizing Palestinian territory, it is hard to understand why Washington cannot be equally strong in its criticism of policies of the Israeli government that are in flat contradiction of the road-map.

George Bush should not intervene more vigorously in the Middle East just because of a promise he made to the Prime Minister of Britain. He should do so because peace in the Middle East would do more to enhance the security of the US than any other foreign policy goal, by removing the greatest grievance of the Arab world against the West.

I have included no topic on this checklist where British advice would not be totally compatible with US interests. It is in the interest of US consumers and business that we do not become locked in an escalating trade war. It is in the interests of US troops that they are not asked to pursue tactics that strengthen support for the terrorists. I have deliberately omitted goals which may be desirable but would represent a bridge too far with the present US administration.

For instance, they are so saturated in the influence of the Texan oil industry that there is little point at any course between canapé and coffee in rebuking them for their sabotage of the Kyoto protocol. At some future point there will be a US administration that puts the rights of future generations not to casserole as a result of global warming ahead of a positive return on the next quarterly statement of Halliburton, but this is not that administration.

Before the invasion of Iraq we were told that, by taking part in the war, we would acquire influence over Washington. What could be a fairer test of that influence than whether before President Bush takes off on Friday we have secured agreement on an agenda in which progress is as much in the interest of the US as Britain?