In September the U.N. Security Council passed a humiliating resolution calling for Syria to withdraw its 20,000 troops from Lebanon, which it has occupied since the civil war there in the 1970s. http://www.2la.org/lebanon/ee/terrorlb.htm The move took Syria by surprise. Particularly alarming was the role of France, Syria's key Western backer, in co-sponsoring the resolution with the U.S. The Syrians were "completely flabbergasted" by France's position, says Rime Allaf, a Syrian specialist at London's Chatham House.

Assad got the message: Syria's standing has fallen dangerously low. Even the country's presence in Lebanon, which the international community has long tolerated, is open to challenge. Thanks to shrewd maneuvering by Bashar's father, Hafez, who died in 2000, Syria had long enjoyed outsize clout in the region, but that influence may be ebbing under his 39-year-old son. The question is how Assad will deal with that situation. He could become more malleable in any peace talks with Israel or in cooperating with the U.S.-installed regime in Iraq. But he could be tempted into rash moves such as jacking up tensions in the region.

Border crackdown

For now, the U.N. rebuff has spurred Assad to take charge of foreign policy. He has redeployed 3,000 troops from Lebanon and persuaded representatives of Palestinian militant groups in Damascus to make themselves scarce. The Syrian military is making a show of cracking down on unauthorized traffic across the Iraqi border -- including the flow of suspected insurgents -- that has angered the U.S. And Assad is hinting he wants to resume peace talks with Israel.

The British-trained ophthalmologist is also taking small steps to modernize the economy. He has licensed several Lebanese and Arab banks to set up shop in Syria, which has no real bank system. And he has championed the spread of computers and mobile phones. Business welcomes the moves, but more is needed. Living standards are eroding as the state-controlled economy fails to keep up with population growth. Per capita gross domestic product is about $1,100.

Assad hopes to replace his father's advisers and policies. But he may not have much leeway to alter Arab nationalist policies, and the power structure could take years to overhaul. "Unlike [Hafez], he is not seen as the law of the land," says Murhaf Jouejati, a Syrian political science professor at George Washington University.

Assad has demonstrated little of his father's political flair. After Saddam Hussein's fall in 2003, for example, Syria's halfhearted attempts to secure its borders with Iraq left the country open to charges that it backed insurgents fighting the U.S. The contrast with the elder Assad's decision to join the coalition that defeated Saddam in 1991 couldn't be starker. The younger Assad also failed to appreciate that hosting militant Palestinian groups was no longer smart. The Israelis recently assassinated a Palestinian militant in Damascus.

These setbacks may be teaching Assad a valuable lesson. "He is becoming more involved to make sure Syria makes smart decisions," says Theodore H. Kattouf, U.S. Ambassador to Syria from 2001-03. But if Bashar doesn't greatly improve his game, a country used to punching above its weight may become marginalized.