Bush has denounced Ahmadinejad at every turn. He has offered to sanction him, embargo him, isolate him, even bomb him. He has portrayed him as a monster of evil and "leading sponsor of terror". He has showered the Saudis and the Gulf states with $20bn of weapons to confront him "before it is too late". When Ahmadinejad thanked "divine intervention" for making him president in 2005, he should also have thanked God for having first selected Bush. To have Washington as your enemy in these parts is to have every man your friend.

The dwindling raggle-taggle army of neocons is currently trying to portray US strategy in the region as a success after all. This is entirely based on news from Iraq, where General David Petraeus has reduced the death rate of Americans and Iraqis from the astronomical to the merely appalling. Since this conflict is far too dangerous to report properly, world opinion is reliant on a notional monthly kill rate to measure progress. Petraeus, or at least the exhausted citizens of Iraq, have thus offered the White House a respite from horror.

The tactics are exactly those that Petraeus's predecessors rejected in the past four years of mayhem. He has encouraged and armed local militias, good and bad, to defend their communities. In Anbar province, this has meant backing Sunni sheikhs and former Ba'athist gangsters, styled "the awakening", to face down the al-Qaida mafia. This was suggested by British MI6 agents in 2003 and rejected by the Pentagon. In Baghdad, the tactic has meant building fortified and ethnically cleansed ghettos, mostly in Sunni areas, and arming them against the former campaign of slaughter by the Shia militia/police, many of whom work for the interior ministry.

Within the ambit of American protection, this has meant a modified return to normality. Petraeus has proved a wise commander. His men do not go kicking their way into women's bedrooms, shooting family parties and shelling villages, which was Donald Rumsfeld's way of winning hearts and minds. There is also a limit to how long any citizenry can remain in a state of medieval siege. Markets will struggle to operate. Schools will try to reopen.

Elsewhere, old habits die hard. Last week the biggest bombing raid since the invasion was unleashed on a populated area in Diyala, north-east of Baghdad, causing as yet unrecorded devastation. On Monday one of Iraq's most distinguished judges was left unprotected and was assassinated. Water and power supplies to the capital are said to be worse than ever. No effort has been made to stave off the conflict likely to envelop oil-rich Kirkuk, let alone a simmering war on the Kurdish-Turkish border. In other words, it remained unthinkable that Bush's lap of honour round the region last week might include the city he supposedly "liberated".

Sooner or later the Americans must withdraw from the enclaves they have de facto partitioned. A new, homegrown, home-fought balance of power will be found in Iraq. Petraeus's strategy is certainly the best yet tried by the coalition, but it offers no long-term surety of law and order because it is backed by no political settlement. It is worth noting that Basra, from whose civil chaos British troops withdrew in despair last year, has dropped from the radar. It is strange what happens when alien forces withdraw from occupied lands.

Stripped of its post-9/11 retribution, bombast and militarism, American policy towards the Muslim world has been to promote democracy as the one sure means to prosperity and peace. Condoleezza Rice and others declared in 2005 that "the bad old days of favouring stability over democracy are over". Even friends such as the Egyptians and the Saudis were mildly rebuked for turning a deaf ear to this message. As policy, this was noble. If America (and Britain) were ill-advised to call it a crusade, there are certainly worse causes to promote.

Yet Bush and Tony Blair were unaware of how their inevitably "neo-imperial" wars in Iraq and Afghanistan, coupled with American support for Israel's expansionism, would render their crusade hopelessly hypocritical. Muslim democracy is a moot concept, but it has made a sort of imprint on Iran, Palestine, Lebanon and even Iraq and Pakistan. Yet it was not these leaders that Bush graced with a visit this past week. He went to Kuwait, Abu Dhabi, Saudi Arabia, Egypt and Bahrain, where he was feted with gifts of gold, rubies, emeralds and diamonds. It sure beat a walkabout in downtown Baghdad.

In Pakistan, Bush continues to back dictatorship and must suffer the resulting Taliban "blowback" in Afghanistan. In Palestine he ignores the winner of an election, Hamas. He appeases Hosni Mubarak's dictatorship in Egypt and is craven to the autocrats of Saudi Arabia. His spokesman, Steve Hadley, challenged on what such rulers contribute to democracy, could only bumble that "these folks are on board with the freedom agenda, and are pursuing it in their own fashion". Stability trumped democracy after all.

Insofar as any strategy lay behind the Bush trip, it was a hope that the monarchs of the Gulf might support the US in military action against Bush's pet hate, Ahmadinejad. Yet if there is one lesson these rulers know, it is to live at peace with the wilder regimes to their north and east. Indeed, keeping them wild suits them fine. Dubai is built on the funk money of the region. The last thing the Gulf intends to do is help the US to yet another war, least of all with Iran.

Meanwhile, Bush cannot even see the final irony. The one thing that might unseat Ahmadinejad is a poor showing against the moderates in the half-free parliamentary elections in March. If his party does badly, there is a chance of a more reasonable regime taking over, reasonable on anything from Iraq to nuclear weapons. At least it is worth waiting.

Yet Bush does everything to generate the paranoia on which Ahmadinejad bases his electoral appeal. He threatens him with the constraint of war, and thus dilutes the constraint of democracy. Does Bush not realise how attack from outside helps an embattled leader? Has he forgotten 9/11?

simon.jenkins@theguardian.com