(AP) - From the disappointment of a failed White House bid, Hillary Rodham Clinton is on the threshold of the world's stage as chief diplomat for the Democrat who defeated her.

Clinton said Tuesday that she intends to revitalize the mission of diplomacy in American foreignpolicy, calling for a "smart power" strategy in the Middle Eastand implicitly criticizing the Bush administration for havingdowngraded the role of arms control.

At a daylong confirmation hearing before the Senate ForeignRelations Committee, President-elect Barack Obama's choice forsecretary of state sailed smoothly through an array ofnon-contentious questions until two Republican committee memberspressed her to take additional steps to ensure that formerPresident Bill Clinton's global fundraising work does not pose evenan appearance of conflict with her role as the chief U.S. diplomat.She balked, saying disclosure rules already in place were carefullycrafted and adequate to avoid any conflict.

Clinton appeared headed for easy confirmation. She encounteredno challenges to her basic vision for foreign policy.

Clinton also called Tuesday for a "smart power" strategy in the MiddleEast that goes beyond the Israeli-Palestinian conflict to addressother pressing issues like Iran's nuclear program.

While offering no specific new peace proposal, Clinton spokeconfidently of President-elect Barack Obama's intentions to renewAmerican leadership in the world and to strengthen U.S. diplomacy.

"As intractable as the Middle East's problems may seem and manypresidents, including my husband, have spent years trying to helpwork out a resolution, we cannot give up on peace," she told herconfirmation hearing before the Senate Foreign Relations Committee."The President-elect and I understand and are deeply sympatheticto Israel's desire to defend itself under the current conditions,and to be free of shelling by Hamas rockets."

"However, we have also been reminded of the tragic humanitariancosts of conflict in the Middle East, and pained by the sufferingof Palestinian and Israeli civilians," she said. "This must onlyincrease our determination to seek a just and lasting peaceagreement that brings real security to Israel; normal and positiverelations with its neighbors; and independence, economic progress,and security to the Palestinians in their own state."

The panel's ranking Republican, Sen. Richard Lugar, praisedClinton, calling her "the epitome of a big leaguer" who is fullyqualified for the job and whose presence at the State Departmentcould open new opportunities for American diplomacy, including thepossibility of improving the United States' image in the world.

Sen. John Kerry (D-Mass.) the new chairman of the committee,pressed Clinton on whether Obama sees a nuclear-armed Iran asunacceptable at any cost, or merely undesirable.

Clinton responded: "The president-elect has said repeatedly itis unacceptable. It is going to be United States policy to pursuediplomacy - with all of its [tools] - to do everything we can toprevent Iran from becoming a nuclear weapon state. As I also said,no option is off the table."

She said the new administration would pursue a broader approachto the problem of Islamic extremism in Afghanistan and Pakistan.

"We must also actively pursue a strategy of smart power in theMiddle East that addresses the security needs of Israel and thelegitimate political and economic aspirations of the Palestinians;that effectively challenges Iran to end its nuclear weapons programand sponsorship of terror, and persuades both Iran and Syria toabandon their dangerous behavior and become constructive regionalactors; that strengthens our relationships with Egypt, Jordan,Saudi Arabia, other Arab states, with Turkey, and with our partnersin the Gulf to involve them in securing a lasting peace in theregion. "

Clinton also promised to push for stronger U.S. alliances aroundthe globe.

"America cannot solve the most pressing problems on our own,"Clinton said, "and the world cannot solve them without America."