Recent American foreign policy has been dominated by the venture into Iraq. Despite the much-vaunted coup of the capture of Saddam Hussein, this has not gone well. Most critics have focused on 'mistakes': not enough US troops, looting was not anticipated, the US depending too much on Iraqi exile intelligence. These were mistakes. But beneath them lay a more profound failure. The Iraq venture was doomed from the outset by a futile quest for a 'New American Empire'. Neo-conservatives said American power was much greater than that of the British Empire, even comparable to Rome, but this time spread over the globe. We should use our power, they said, to improve the world. Yet they grossly exaggerated American power, made facile comparisons with previous empires, and mis-identified the century we live in. My own research has consistently pointed to two significant differences between this and earlier imperialist ventures.

First, effective rule requires combining ideological, economic, military and political power. It is possible to go light on one or even two of them. But the US was relying overwhelmingly on military power - in fact only on offensive fire-power - and this is insufficient to create empire. Second, the world has moved on from the Age of Empires to an Age of Nation-States, thwarting any contemporary attempt at empire. But the Bush administration believed the US had the power to remake Afghanistan and Iraq, restructure the Middle East, and remove terrorists and weapons of mass destruction from the world.

Of course, the administration did not seek permanent rule. They would invade 'rogue' states, bring about regime change and then leave - a 'temporary territorial imperialism' planned for Afghanistan, Iraq, Iran, Syria and North Korea, if threats alone did not work. The Iraqi venture is under-funded and this year Congress will insist that Iraq gets loans not grants. The will to deploy America's material resources for a lengthy campaign is probably lacking.

But military might dominated the neo-conservative vision and they did not expect a long-haul. The US military budget is over 40 per cent of the world's total. This is the only military Superpower. The Pentagon's "revolution in military affairs" (the RMA) of the 1990s combined 'smart' long-range precision radar-guided missiles with satellites in space, handheld global positioning systems, and robot sensors. US forces can devastate the enemy with few US casualties. Even the infantryman's M-16/ M4 rifle can deliver 90 rounds a minute, disintegrating human bodies 2,000 feet away. In Afghanistan and Iraq enemy forces were destroyed before they could get their own weapons into range.

The new imperialists knew this would happen - it was the underlying reason they invaded. Though their motives were mixed - to destroy WMDs and terrorists, to bring freedom, to achieve strategic dominance of the Middle East, to aid Israel, to grab oil, to get revenge - they did not have to be either exact or pure, since swift victory was assured.

Yet offensive fire-power cannot pacify populations. Even temporary occupation requires mopping-up, quelling rebellions and riots, transitioning from military to political power. This initially requires more troops. Nineteenth century empires calculated they needed two-and-a-half times the troops for pacification as for battlefield victory. In Iraq that meant 250,000 soldiers. But the US has only 120,000 in Iraq and only half of these are fighters. Dividing them into three shifts gives only 20,000 US soldiers pacifying at any one time. There are 39,000 cops in New York City alone.

This might not be disastrous. Earlier empires did not rely on massive forces from home. In India only 20 per cent of the 250,000 strong imperial army were British. In Africa only 10 per cent were. The rest were natives. Imperial administration also worked through locals - princes, chiefs, and tribal and village councils. One thousand British Imperial civil servants presided over 250 million Indians. Natives were better policemen, judges and civil servants because they had local knowledge and control networks. Empires ruled indirectly. So did the US during the Cold War. Its 'native allies' came from propertied elites who favoured capitalism over socialism. With a little aid, they usually defeated their leftist opponents. Even in Vietnam, the worst failure, the US was reasonably confident its client South Vietnamese state, with a regular army of 300,000 men, might win.

But in Iraq the new imperialists abandoned indirect empire. The real 'unilateral' blunder of the US wasn't to ignore the UN and the Europeans (they were irrelevant and would come begging once victory came), but to invade a country without local allies on the ground (except for Kurds in the north who did form their own regime). The Iraqi exiles had no organisations inside the country, the Shi'a used theirs for their own ends, and some Sunnis used theirs to kill Americans and Iraqi collaborators. This was not merely a 'mistake'. There simply were no local allies. Iraqis did not look to Americans to deliver them from Saddam Hussein. It had to be a unilateral invasion, but this meant that it would likely fail.

Underlying this political failure was a sea-change in ideological power. Earlier empires were not confronted by nationalism. If conquered populations collaborated with imperialists, they were not seen as traitors to the nation but as advancing local interests by sharing in the spoils of empire. From Cortes helped by the Tlaxcalans against the Aztecs, to the British and French mobilizing rival networks of Indian princes, to the Belgians ruling through Tutsi chieftains in Rwanda/Burundi, there was initially no ideological obstacle to empire. But by the twentieth century liberal, socialist and fascist European ideals of rule by the people spread to the colonies. When Indian nationalists adapted them to local conditions, British rule was finished. Nationalism and anti-imperialism are now the world's dominant ideologies.

The Middle East contains four rival anti-imperialisms - nationalism attached to a state (e.g. Iraqi nationalism), pan-Arab nationalism, Islamism (i.e. 'fundamentalism'), and Sunni or Shi'a sectarianism. These divisions ensure that Iraq is only a fragile nation-state. There is distrust between Shi'a and Sunni, between secularists, conservatives and Islamists, and between tribes and clans. But Iraqis distrust alien occupiers even more. Iraq is for the Iraqis, they say, and so do Arabs and Muslims in general, for this is the dogma of nationalism and anti-imperialism everywhere. Saddam's capture changes little. He could not have organized the resistance from a hole in the ground. The insurgence involves co-ordination among secular Ba'athists, Iraqi Wahhabis and foreign jihadis which would have been impossible even under Saddam himself. The Shi'ites also still pursue their own goals. Iraq remains a quagmire.

To suppress resistance, the US could intensify militarism. Rome sometimes killed every tenth person in revolting villages or towns. But US forces cannot be seen to rampage through the Sunni Triangle, killing, burning, terrorizing whole villages. Americans themselves would not allow it.

The US is not without ideological power. It symbolizes material plenty, individual freedom, and democracy. Surveys show that the world appreciates these values but criticizes US policies for betraying them. The Pew Global Attitudes Survey for 2003 concluded "the bottom has fallen out of support for America in most of the Muslim world." Most people in seven out of the eight Muslim countries surveyed saw the US as a potential military threat to their country.

Should this surprise us? The war against terrorism only attacks Muslims (apart from a few Colombians). The US was rounding up immigrants from 25 countries, of which 24 are Muslim (North Korea is the exception). President Bush blatantly sided with Israel against the Palestinians. 10,000 Muslims were killed in Afghanistan for no significant improvement in the country.

Over 600 Muslim prisoners from that war have been incarcerated for two years in Guantanamo Bay in gross violation of international law. In 2003 the US killed 15,000 Iraqis in six months, a rate of killing Saddam had not matched since 1991.

So the US lacks the political and ideological resources for empire. It is trapped in Iraq, suffering losses, unable to find enough Iraqi clients, with insufficient soldiers and dollars. There is a real chance of a civil war producing casualties on a scale comparable with Saddam's worst excesses.

Invasions of Iran or Syria would encounter similar problems. In Korea there is a local ally, South Korea, but it opposes any invasion. The blow-back from failure is substantial. New terrorists created by US policy will move into Iraq, since the US has created the kind of failed state in which they thrive. And they will strike not just in Iraq but across the region, as they have recently in Casablanca, Riyadh and Istanbul.

Are alternative policies available? If invasions are ineffective, then we must rely on multi-lateral economic sanctions to threaten 'rogues'. But as well as sticks, carrots (security guarantees and economic inducements) should be offered. After all, buying them out is cheaper than fighting them.

The war against terrorism should distinguish between national and international terrorists, and condemn equally terrorism and state terrorism.

Since international terrorists like Al Qaeda attack us, we must attack them. Since their bombings usually kill more locals than Westerners, most governments are co-operating in tracking them down. It is one thing to 'fight terror' but quite another to make the mistake of engaging nationalist groups like Hamas, Hezbollah or the Moro Liberation Front (in the Philippines) who only attack those they identify as their national oppressor. Their 'national liberation struggles' are deeply rooted. It is unwise of the US to attack them, since it will likely fail and induce some of them to start attacking Americans.

The US should pressure both nationalist terrorists and their state terrorist opponents to settle their disputes - especially in the Israel/Palestine case, the great cancer of the Middle East. In Iraq the best hope would come from all the Great Powers and some Muslim states putting substantial forces at the disposal of UN commanders, and to bring about swift transition to Iraqi rule (to include former Ba'athists), immediate control of the oil by Iraqis, and an interim ban on any sales of Iraqi assets to foreigners.

Finally, the US should return to the so-called 'multi-lateralism' of the 1990s - which actually almost always enabled it to get its own way. If the UN or Europe want more influence, they must earn it, backing words with actions. 'Humanitarian interventions' might become possible again. But they require three preconditions: the invaders' motives must appear disinterested, command must rest with internationally legitimate agencies, and there must be local allies to provide an effective regime afterwards. These preconditions were present in Bosnia and Kosovo but absent in Iraq. The New American Empire was stillborn.