A few years back, British author Harold Evans wrote a book calling the last 100 years The American Century. He was mostly correct. The United States did indeed dominate the 20th century - but it wasn't the American century, it was an American century.

The next 100 years can belong to us also, although we can share them with the rest of the world, as we help make this, in President Bush's phrase, "liberty's century." Tuesday's vote confirmed that a clear majority of Americans want the president to lead us into that era. And there's plenty of work to do.

Overseas, our troops are busy fighting terrorists - on their turf, not ours. We've already exported democracy to Afghanistan, and we're about to do the same thing for Iraq.

But even as we win on foreign soil, this second Bush administration will need to take care of some things here at home to ensure that the United States is financially able to retain our leadership position for decades to come.

First, the president needs to work with Congress to cut spending. During the first four years of his administration, discretionary spending jumped 39 percent. Mr. Bush should institute a spending freeze and look for places to pare back spending.

There's plenty of fat out there. Lawmakers could start by trimming farm subsidies. Two-thirds of that spending goes to big agri-businesses, so it's really nothing but corporate welfare. Simply eliminating that wasteful spending would have saved $8 billion this year.

It's not just farm subsidies, though. Overall, the federal government spends about $60 billion a year on corporate welfare - direct payments, low-cost loans or insurance and subsidized services. By taking a chunk out of that waste, lawmakers could bring the budget closer to balance.

The president also should ensure that one of his priority items - making the tax cuts permanent - passes. And the sooner, the better.

Lower taxes help Americans achieve a better standard of living by increasing economic growth. Because of the 2001 and 2003 tax cuts, the American economy pulled out of a shallow recession three years ago. Now a record number of people have jobs and our economy is speedily expanding.

But our work here isn't finished. Some of the tax cuts are set to expire. We need to lock them in place, so people and businesses can plan for the future, secure in the knowledge they'll be able to keep more of what they earn.

The need to fix our biggest entitlement programs also looms. By mentioning Social Security so prominently right after the election, the president has shown that he understands the vital work that must be done here - although Medicare reform shouldn't be neglected.

Some time around 2018, Social Security will dip into the red, and from then on its deficits will grow and grow until they swallow our economy - unless we act swiftly to fix the program.

Personal retirement accounts are the answer. With PRAs, American workers would be allowed to divert a portion of their payroll taxes into accounts they control. Nobody would be forced to join the program, but younger workers would surely want to, since it would allow them to save substantial nest eggs they could then retire on or pass along to future generations.

There would be transition costs, of course. But as the Heritage Foundation's David John has estimated, the cost of doing nothing would be about $20 trillion more than the cost of transitioning to a viable - and far better - retirement program.

Now's the time to act, while the system is still running a large surplus. We owe that much to our children and our grandchildren.

Finally, the president should fix Medicare. Last year, he encouraged Congress to pass an expensive prescription-drug entitlement. It's set to take effect in 2006, when it will cost an estimated $44 billion. The price tag will only increase each year after that.

President Bush should reconsider and instead encourage Congress to expand the use of drug discount cards. This experimental program is already delivering low-cost drugs to needy seniors at a fraction of what the entitlement program will cost. We should give it a fair trial before moving to a less-efficient, more-expensive approach.

None of this will be easy. Our enemies overseas won't go down without a fight. Here at home, every spending measure has its champion on Capitol Hill, and our venerable retirement programs have long been considered untouchable.

So yes, Mr. Bush is clearly going to need all of his famed personal resolve. But if he shows bold leadership on these key issues, we'll become ever stronger as this new century of freedom - liberty's century - unfolds.

Ed Feulner is the president of The Heritage Foundation (heritage.org), a Washington-based public policy research institute.