The policies of the United States and its international partners in Afghanistan during the past eight years have proven wrong-headed and ineffective in delivering the promised peace, stability and democratic governance. This paper critically examines the underlying assumptions behind these failing policies and explores alternative approaches to rescue Afghanistan’s war-to-peace transition. Faulty assumptions on the part of key US government advisors, decision makers and many of their Afghan and Pakistani clients have contributed to the resurgence of the Taliban and a crisis of trust for the Karzai government and the internationally supported state-building process. The Obama administration must discard the misguided policies of the past and adopt a historically informed and culturally sensitive strategy aimed at fundamentally changing the governance system in Afghanistan, rather than simply reinforcing the current dysfunctional regime through increases in levels of military and economic assistance.