There it was, Blair's problem in a televisual nutshell: he can get no message across, can set no grand vision, drive through no important policy, because his voice is drowned out by political noise. This week's noise was Labour sleaze. Last week it was Labour's split on education reform. The week before that it was more alleged Labour sleaze, centred on the financial arrangements of Tessa Jowell. These are the passing squalls, but they are not the source of the storm. That lies elsewhere.

To find it, one has to look hard at that speech yesterday. Ambitious to lay out a coherent Blair doctrine of foreign policy, the prime minister began by restating his belief in liberal interventionism - the creed that democratic countries can no longer stand by while dictators commit hideous crimes against their own peoples.

When he first developed the idea, in the so-called Chicago speech of 1999, at the height of the Kosovo crisis, he won many admirers. Those who, like me, backed the principle of intervention believed Blair was articulating a new approach to international affairs, one that would no longer see the principle of state sovereignty trump all other moral considerations. That same year, Augusto Pinochet had failed in his attempt to hide behind the legal notion of "sovereign immunity" rather than be answerable for his crimes in Chile. The Blair doctrine suggested a new dispensation, one that would no longer let horror go unpunished, one that would not tolerate a second Rwanda.

Such talk sounds quaint now or, worse, deluded. The explanation is simple enough. The Iraq adventure poisoned the well for interventionism, perhaps for generations to come. Not because it made a case on humanitarian grounds, but because it invented a threat that was not there. At the turn of the decade many progressives were ready to believe in a new ethical, rather than realpolitik, motivation in foreign policy. But the Iraq war made a mockery of all that. From now on, any government urging military action for moral purpose will face hoots of derision and howls of scepticism. You said that about Iraq, the voters will say, and we won't be fooled again.

All of which lent Blair's speech a rather forlorn feel. As if in valedictory mode, the PM conceded those places where there had been no intervention, even though he wished there had. He had done nothing for Burma, nothing for the slave nation of North Korea, nothing for Zimbabwe. And, above all, though he referred to it only indirectly, nothing for Darfur. The lesson of Rwanda had gone utterly unheeded.

There was no hint of action for these places; Blair tacitly admitted that there is no chance of that. Partly because he is approaching the end of his tenure, but also because, after Iraq, the idea of marshalling an international consensus for armed action anywhere seems almost preposterous. His roll call of countries was a wish list, as remote from reality as a beauty queen's plea for world peace.

The same was true of his remarks on what he called "a clash about civilisation". Blair urged a firm stance not just against terrorist methods, but against the ideology of Bin Ladenist Islamism itself. We have to tell them, he said, that their "attitude to America is absurd, their concept of governance pre-feudal, their positions on women and other faiths reactionary and regressive". Yes, some may feel frightened of straying into this terrain, for fear of being branded a critic of Islam itself, but nevertheless a stand had to be taken against this particular "warped" strain of Islamism - chiefly by supporting those Muslims who are already fighting this battle themselves.

All of that made great sense and suggests that Blair has shifted his position. Once he tiptoed around the point; now he is willing to urge Muslims not to go into denial, but "to face up to the strain of extremism within [their] religion".

Yet this message too was drowned out. Of course, Blair is right that Bin Ladenist ideology is worldwide and lethal, and must be defeated. The trouble is, everyone knows not only that the Iraq war was unrelated to that titanic struggle, since Saddam had no link with al-Qaida, but that it has made it so much worse. Yesterday Blair urged us to ignore that fact, to realise that, whatever our earlier disagreements, we have to close ranks in wanting democracy to triumph over murderous sectarianism in Baghdad today. The trouble is, he is the one person who cannot make this case. Why should we follow his banner in the war against Islamist reaction, when it was he who led us blindly into such a calamity?

The crude, harsh truth is that no one can take what Blair says on foreign policy seriously, because he is responsible for the greatest foreign-policy disaster in half a century of British history. No matter that he emerged as a major world leader during the Kosovo war, or that he won international admiration after the Good Friday agreement. Now, because of that one fateful decision, his credibility is shot.

And it is not just in international affairs that Blair is overwhelmed by Iraq. Take the current sleaze affair. A useful law of scandal is that charges only bite when they confirm a pre-existing suspicion. In the 1990s Britons believed the Major government was decayed; the Hamilton and Aitken revelations duly validated that belief. When the Bernie Ecclestone affair broke in 1997, voters didn't see Blair or New Labour as financially corrupt (even though the charge then, of cash-for-policy, was much graver than anything revealed now). Today's scandal bites because it plays into something Britons do now believe about their government: that it is not honest and cannot be trusted.

And the explanation for that, once again, is Iraq. Polls show that Blair was broadly trusted before the invasion. But he told the nation that Saddam had weapons of destruction when he didn't, and Blair has never been trusted since. In this sense, removing Blair over a few undisclosed loans would be like jailing Al Capone for tax evasion: he will be punished for a small offence because the system couldn't get him for the much larger one.

Can he overcome this? Can Blair somehow persuade us, as he tried again yesterday, to draw a line under the three-year conflict that corrodes every aspect of his premiership, preventing him leading on matters domestic and foreign? I don't see how. It's understandable that he wants to recover his reputation and quit as a winner. He's like a gambler at the roulette wheel, sinking further and further into debt, but still praying for one more lucky spin that will restore his fortune. Maybe he'll enjoy a small win one of these days. But it can't last. His luck has run out. And he cannot blame fate or chance or anyone but himself - and his decision to fight the war that destroyed him.

freedland@theguardian.com