When John McCain moved to the head of the pack of Republican contenders for the presidency early this year, it was widely understood that his prospects would be hostage to developments in Iraq. Having staked so much on the "Surge," what would McCain do if things in Iraq fell apart in the nine or ten months before Election Day?

It seems increasingly likely that this risk will not materialize. In its place has arisen a new and opposite threat to McCain: What will he do if things improve so much that Iraq is no longer an issue?

This was a danger few analysts comprehended in January, but it abruptly manifested itself in the last couple of weeks when Iraqi Prime Minister Nouri al-Maliki seemed to indicate that he favored Barack Obama’s 16-month pullout plan. Maliki quickly backtracked, arguing that he was misinterpreted and supported a withdrawal only if conditions permitted. However, he may well have calculated that improvements on the ground have passed the tipping point, and that there is little probability that the withdrawal of the preponderance of American troops will have to be slowed, much less reversed.

Whatever the case may be, McCain is facing a dilemma that seems to have caught him and his advisors flat-footed: Things are going so well in Iraq that even Obama’s withdrawal timetable can no longer assure defeat. By January 2009, as McCain himself recently admitted, it might actually be plausible. At the same time, the Bush administration has agreed to the concept of a withdrawal "horizon."

As one commentator put it, the choice is no longer victory versus surrender, but horizon versus timetable. This does not mean that Obama now has a clear edge on Iraq; if he is less wrong about Iraq now than he used to be, it is because George Bush followed McCain’s advice rather than Obama’s in January 2007. Gen. Petraeus also continues to voice deep skepticism about any rigid timetable, a fact that will continue to help McCain. It does mean that the issue is muddier than it used to be, and that McCain cannot count on it to carry the weight he had hoped.

So where does McCain go from here?

McCain cannot afford to let go of the national security issue or his large advantage on the question of which candidate voters would rather see as commander-in-chief. If things continue to improve in Iraq, he should embrace victory and make it his friend. There is, after all, no reason that Obama should reap the benefits of a victory won with McCain’s strategy. Nor should McCain let Obama and his friends in the media get away with portraying the recent negotiations with Iran, in which the U.S. participated, as a vindication of the Democrat’s views. To the contrary, nothing positive resulted from the talks, and nothing positive is likely to result. While Obama looks to atmospherics, McCain cares about solid reality, and the solid reality is that Iran took the talks as an opportunity to give extended raspberries to the U.S. and the West. Do we really want four years of that? Finally, McCain should never stop drawing the contrast between his own views and Obama’s views of the recent Supreme Court case extending habeas corpus to enemy combatants. This is the sort of judicial foolishness that drives average Americans crazy, and there is more to be made from it than McCain has yet managed.

At the same time, McCain has to attend to the two biggest drags on his campaign: the fear by voters that he represents an extension of the Bush years, and a general unease by voters with the direction of the country. These problems will not be solved with small-bore politics.

Instead, McCain has to build a broad narrative of why people are uneasy, and that explanation has to include a full accounting of the mistakes of the Bush administration. This is, of course, a tricky proposition, since partisan Republicans already distrust McCain and could perceive such a line of argument as disloyal. The way around that problem is to emphasize a mix of issues, some of which come at Bush from the left but most of which appeal to relatively conservative independents.

It is already clear that energy should be a key issue for McCain. It is highly salient to voters, and McCain can contrast his centrist position—favoring a combination of drilling, conservation, and alternative energy—with Obama’s impractical obsession with trying to solve the problem without new oil production as a component.

The explosion of the federal deficit provides McCain an opportunity to distance himself from Bush by reemphasizing his fiscal conservatism. The same opportunity presents itself in respect to inflation and the falling dollar. Indeed, all three issues can be bundled (as Reagan did in 1980) as a matter of sound money. The administration’s soft money policy—traditionally a Democratic rather than Republican tendency since the McKinley-Bryan race of 1896—is now costing American families a pretty penny. To the extent that Americans are feeling economic distress or anxiety today, more are feeling the pressure of rising prices than mortgage trouble. The cost of living, runaway deficits, and the anemic dollar are a bundle of issues that could play to McCain’s policy and temperamental strengths, that might have special appeal to suburban Republicans and the old Perot independents, and that are lying around just waiting to be picked up.

More generally, McCain has to avoid the fate of Bob Dole, whose 1996 campaign wandered aimlessly from one modest issue to another. He has to take the handful of issues that he settles on and weave a broader narrative around them that explains how we have gotten where we are and how we should (and should not) get out, framed by the nation’s experience and fundamental principles.

It has long been apparent that Republicans might only put themselves in a position to win the 2008 presidential race if they nominate their own version of Nicholas Sarkozy, who won the presidency of France by running a "change" campaign despite being a member of the unpopular incumbent’s party. Of all the potential GOP nominees, McCain offered the most plausible prospect of running a Sarkozy campaign. He is running out of time to put such a campaign forward, but it is not too late.

Andrew E. Busch is a Professor of Government at Claremont McKenna College and an Adjunct Fellow of the Ashbrook Center.