By Meir Javedanfar

The smile on Ahmadinejad's face said it all. His was the smile of a victorious leader, visiting a country which represented his sworn enemy in the 1980s.

Back then, he was an officer in the Islamic Revolutionary Guards Corp (IRGC). Now he was returning as the most controversial and right-wing extremist political leader Iran has ever had; a fact that didn't seem to bother his hosts.

The United States has every reason to be extremely concerned about the friendly tone of Ahmadinejad's visit to Iraq.

Had a Soviet premier been warmly greeted in South Vietnam in the late 1960s, at a time when the US was providing South Vietnam with forces to fight communist North Vietnam, there would have been uproar. The South Vietnamese would have been accused of being ungrateful, at the very least. Some may have gone as far as calling the South Vietnamese as traitorous back stabbers.

The very fact that Iraq does not think twice about inviting Iran's president, accused of financing the death of hundreds of US soldiers in southern Iraq, clearly demonstrates that the US is losing influence in Iraq and in the Middle East in general. This is on top of the fact that some Shiite militias are wreaking havoc against their own countrymen in Iraq.

The US has no one to blame but itself. Thanks to one American misstep after another, Iran has essentially written the “Idiot's Guide to Becoming a Regional Superpower on the Cheap”.

It began with the toppling of Saddam Hussein, continued with the destruction of Iraq's infrastructure, and its terrible job of repairing it. This situation has allowed the Iranians to step in. For a fraction of the money which the US has paid to secure Iraq, Tehran is rebuilding infrastructure such as power plants and roads in the South, and making itself more popular.

The NIE report was another US contribution, which resulted in a collective sigh of relief in Arab capitals, including Baghdad. No longer are Middle Eastern countries avoiding Tehran. Disregarding President Bush's personal pleas to isolate Tehran, they are welcoming Iranian leaders with open arms.

The important question to ask is whether this means we are looking at the end of the road for US influence in the region?

The answer: not yet. There is still a chance. One way to prevent it and push back Iran's growing influence is to embark on a reconstruction “surge”, similar to the military one which we saw in Iraq.

Such a surge should involve improving the coordination between Coalition Provisional Authority (CPA), and US forces in Iraq, in order to strengthen the speed and efficiency of the reconstruction process. The other step should be, instead of giving dictatorial regimes such as Saudi Arabia state-of-the-art weaponry, investing in health and education programs in countries such as Lebanon, the West Bank, and when possible, Gaza. By providing social support, Iran has grown in influence.

Furthermore, in order to hit the Iranian regime where it hurts, the US should name and shame hundreds of Revolutionary Guard companies, and other companies owned by Iran's senior Ayatollahs, which are operating in the Persian Gulf countries.

These ventures are lining up the pockets of Iran's official with millions, thus enabling them to avoid the impact of sanctions that are hurting the Iranian people.

After all, the Iranian leadership shouldn't feel too triumphant or arrogant over their successful diplomatic march across the Middle East.

They would be unwise to forget that back home, millions of Iranians are unemployed, with inflation eating into the little money they have.

Failure to address these needs is more damaging to the regime's credibility and survival than any sanctions or even military action could accomplish.

This article originally appeared in PJM Media  .

Meir Javedanfar is the co-author with Yossi Melman of “The Nuclear Sphinx of Tehran – Mahmoud Ahmadinejad and the State of Iran.”