So now what?

The president has had a horrible year. But he’ll still be in the Oval Office for another three years. So how does he turn things around, assuming of course that he doesn’t just want to chop wood and cut brush? [IMGCAP(1)]

I asked a number of veterans of past Washington, D.C., wars about George W. Bush’s options, and found two general lines of argument (Some spoke on the record; others didn’t).

One view is that the White House has little or no near-term control over the two major issues of the day — Iraq and Republican ethics problems — so the president should simply hang tough for the next few months in the hope that those issues will fade or at least become less toxic, allowing him to retake the policy initiative.

These are two problems that “the administration can’t manage, can’t control,” said one observer, noting how frustrating that fact must be to a White House that has prided itself on the ability to control information and leaks.

“Reagan had problems. Clinton had problems. And they both were presented with opportunities to get beyond them. Bush will also have opportunities.”

The other basic line of argument is more proactive and more popular. It dismisses the “stand pat” response as too passive.

Yes, Bush could just “muddle through,” said one veteran, but that would mean nothing more than “managing a presidency in decline.”

“He needs Operation Fresh Start,” said a Republican insider, adding that that would include hiring new people to key positions, honing a domestic agenda and making a strong recovery from the Harriet Miers debacle (which already seems like ancient history).

But, I asked, wouldn’t proclaiming a fresh start acknowledge that Bush had hit a brick wall and that his presidency was in trouble?

“Every once in a while you have to acknowledge the obvious,” the veteran insider said, noting that the late Lee Atwater, a former top GOP strategist and White House aide, always argued that embattled presidents need to “pivot” to recapture the momentum and agenda when on the defensive.

Another GOP veteran, former White House Chief of Staff Ken Duberstein, generally agreed with those sentiments.

Duberstein was Ronald Reagan’s chief of staff in 1987 when the president had his own problems, including the Iran-Contra controversy and a thin domestic agenda. He told me Bush “needs to recapture a reform agenda. He needs to demonstrate that the status quo isn’t acceptable.”

So who is right? Those who propose that Bush gut it, out and circumstances will give him the opportunity to recast that national dialogue? Or those who insist he needs to prove that he has an agenda, recognizes his administration’s shortcomings and that he is going to retake the initiative in the nation’s capital?

They both are, to some extent.

Bush can’t do much to speed up the process in Iraq, and no credible officeholder or expert has suggested that the United States simply withdraw immediately. He must hope for better news from the region and improved conditions that allow for the beginning of a gradual withdrawal of U.S. troops from Iraq.

And the White House can’t do much about the ongoing ethics inquiries involving GOP officeholders and operatives in D.C. and around the country. All Bush can hope for is the best.

But you don’t have to be Bob Strauss or Atwater or even Karl Rove to see that this is an administration in deep, deep trouble.

The Miers nomination was a disaster, but was it really any worse than the way the administration rolled out Social Security reform, handled Hurricane Katrina or Iraq, or dealt with runaway federal spending?

The administration probably would benefit from a few fresh faces — and even more from getting rid of a few old ones.

“He must bring in new blood to the White House. For a president who has been loyal to a fault, to bring in a new team — people of the stature of John Danforth or Rudy Giuliani — would be a powerful signal,” argued Leon Panetta, who joined former President Bill Clinton as White House chief of staff at a time of controversy. But any replacement would have their share of detractors within the party.

And everyone I talked with agreed that the White House needs to find a few issues to push next year, possibly including changes in the tax code and in spending.

International travel and foreign policy initiatives could also help the president’s image, taking him out of the nitty-gritty of partisan domestic politics and surrounding him with the trappings of his office in his role as the nation’s top diplomat and its commander in chief.

Finally, Bush needs to once again become something he is not now — a leader.

Leadership can involve bringing the two parties together on a major issue (which inevitably means reaching out to Democrats) or rallying the base with a strongly conservative Supreme Court nominee. And it means admitting errors and charting a new course.

How likely is this to happen?

“It’s easy to tell yourself you have an agenda when you really don’t,” said one Washington veteran, adding, “It’s easy to hunker down and feel underappreciated and blame the media.”

But Bush must take steps to jump-start his second term. Now is the time for the president, working with party leaders and graybeards, to begin thinking about how he will recast his administration. He must be bold, even in these times of obvious weakness.

Stuart Rothenberg is editor of the Rothenberg Political Report.