(FORTUNE Magazine) – WINNING THE PEACE/COVER STORIES 30 NOW TO WIN THE PEACE America emerges from the war in the Gulf as the world's only superpower. That doesn't make it Superman. by Thomas A. Stewart

37 WHAT'S NEXT FOR BUSH Look for more diplomatic victories, though the President's recent sky-high approval ratings probably won't lead to major legislative triumphs domestically. Still, it's hard to imagine him losing in 1992. by Ann Reilly Dowd

44 WHY BUSINESS WILL GET BETTER With the biggest uncertainties out of the way, companies will start hiring -- and more confident consumers will finally have the income to lift their spending. by Vivian Brownstein

50 FIERY WELLS WON'T IGNITE OIL PRICES Kuwait's torching is an ecological disaster, but the economic pain will be mild. by Peter Nulty

54 WHO WILL REBUILD KUWAIT Americans and others that sent troops. But Kuwait will be seeking low bidders. by Shawn Tully

58 HOW DEFENSE WILL CHANGE U.S. forces face an overhaul due to budget hold-downs. Smart contractors are turning this to their advantage. by Nancy J. Perry

64 GORBACHEV: ON THE ROPES? Bush's relationship with him weathered the war but may not survive the U.S.S.R.'s internal crackup. by Paul Hofheinz

CORPORATE PERFORMANCE 81 COMPANIES TO WATCH

TECHNOLOGY 84 PICKING JAPAN'S RESEARCH BRAINS At last U.S. companies are overcoming the ''not invented here'' syndrome and learning how to tap Japan's vast technological resources -- just as Japan has tapped America's. by Susan Moffat

POLITICS & POLICY 99 WHAT OUGHT TO BE DONE ABOUT TAXES Believe it or not, America's tax system is in pretty good shape. What's needed is another round of careful reform -- not the nostrums now on sale in Washington. by Rob Norton

GAMBLING 109 THE BIG PAYOFF FROM LOTTERIES How's this for a recession-proof business? Lotteries bring in $20 billion a year in revenues, cash-starved states want more, and the betting habit may be addictive. by Erik Calonius

INNOVATION 116 PRODUCTS TO WATCH

EUROPE 118 WINDSOR INC. The British monarchy has assets worth billions, a world-famous brand name, and a CEO who is in no danger of being fired. But royal costs have become a royal pain. by Christopher Knowlton

DEPARTMENTS 4 EDITOR'S DESK 6 INDEX 8 NEWS/TRENDS Rolling up the yellow ribbons, pie-in-the-face war predictions, another U.S. deficit -- trade with China, Wall Street's new fan club, credit card wars (cont'd), Big Blue vs. the body snatchers, executives go back to school, and more.

19 PERSONAL INVESTING Finding investments that pay rich returns without exposing you to undue risk. by Susan E. Kuhn

Now your very own accountant-in-a-box, a new bull market for midget stocks, and Portfolio Talk with Shearson Lehman Brothers strategist Elaine Garzarelli.

131 FORTUNE PEOPLE A new ball game for Pete Dawkins at Primerica Financial Services, the commissar of quality at Cadillac, Citicorp finds a Prince Charming in the nephew of Saudi Arabia's King Fahd, the new blade at Gillette, and more. by Mark M. Colodny

132 ON THE RISE

135 BOOKS & IDEAS In his most ambitious and best book yet, liberal political economist Robert Reich renounces industrial policy and makes his peace (sort of) with global markets. by Paul H. Weaver

139 KEEPING UP Civic insanity, the case of the crooked bench, great moments in pulchritude, the late news on sex roles (or Ozzie and Harriet redux), and other matters. by Daniel Seligman

ABOVE: American troops in an exuberant display in Saudi Arabia, photographed by Luc Delahaye (SIPA).

COVER: George Bush addresses the Economic Club in New York City in February. Photograph by Dirck Halstead for Time.