LAST WEEK THE BUSH ADMINISTRATION'S second-term bear market bottomed out. On Monday, Bush nominated as the next Federal Reserve chairman Ben Bernanke, who of all the leading candidates will be the central banker least hostile to tax cuts and least likely to direct monetary policy to any end other than combating inflation. At the end of the week, the Commerce Department announced that economic growth in the third quarter had been 3.8 percent, suggesting that, thanks in large part to Bush's supply-side tax cuts, our economy may remain strong enough to overcome the twin hurdles of high energy prices and rising interest rates.

Meanwhile, the political process in Iraq continued in a relatively promising direction, as some Sunni groups seemed increasingly reconciled to pursuing their goals through politics rather than betting on the success of the insurgency. On the military front, the joint U.S.-Iraqi effort to fight an effective counterinsurgency seemed to be making some progress. And the prospects for less troublemaking by Syria seemed to improve as well, with the Assad regime thrown back on its heels by a U.N. report implicating it in the assassination of the former Lebanese prime minister.

On Thursday, Harriet Miers withdrew her candidacy for the Supreme Court, producing a massive sigh of relief from Bush supporters and conservatives throughout the nation. Now the president has the chance to pick a strong nominee and to rally his supporters for a winning fight on his or her behalf.

And then, of course, on Friday, Special Counsel Patrick Fitzgerald's two-year investigation came to an underwhelming conclusion with the indictment of Vice President Cheney's chief of staff, Scooter Libby--not for any underlying crime but for impeding the investigation through perjury and false statements. This is a distressing development for those of us who have known and admired Libby for many years. If Libby is guilty of purposely lying to a grand jury, that cannot be excused or minimized. But let's not forget that he has not yet had his day in court.

The larger story on Friday was that Fitzgerald indicted no one else. The wrongdoing leads in no way beyond this one individual and what he allegedly said to FBI investigators and the grand jury. There was no conspiracy, high level or otherwise, at the White House, or involving the Defense Department or the State Department--all scenarios that enemies of the administration had been fantasizing about for months.

It may sound odd to call this good news for the president. But go back and read the fevered anticipations and lethal expectations of Bush's critics over the last month. This was going to be the moment when the case for war was discredited. This was going to be the moment when the supposed venality and corruption of the Bush administration was going to be exposed. This was going to be the moment when the whole criminal conspiracy would unravel. This was going to be the moment of paralysis and disgrace for Bush and Cheney and the assorted warmongers in their employ.

This does not mean, of course, that the Bush White House and its supporters should heave a sigh of relief and relax. It does mean that the administration and its allies have a chance now to go on the offensive: to make the tax cuts permanent, to look for occasions to insist on spending restraint, to make progress in restoring constitutional jurisprudence, and above all to make strides toward winning the war in Iraq, and the broader war on terror.

With the dénouement of the Miers fiasco and the Fitzgerald investigation, President Bush's beaten-down political fortunes should be ripe for a rebound. As we've said before, the recipe for starting a rally is straightforward: Get back to basics on the economy, the courts, and foreign policy. Go on the offensive in all of these areas. To regain the ground that was lost and to forge further ahead will require energy, discipline, and boldness from the Bush administration, and from the president himself.

- William Kristol

Next Page