GAO recently released: U.S. Public Diplomacy: Interagency Coordination Efforts Hampered by the Lack of a National Communication Strategy GAO-05-323, April 4, 2005
http://www.gao.gov/new.items/d05323.pdf
(from the abstract:)
"The war on terrorism has focused attention on the important role U.S. public diplomacy plays in improving the nation's image. The United States has undertaken efforts to "win hearts and minds" by better engaging, informing, and influencing foreign audiences; however, recent polling data show that anti-Americanism is spreading and deepening around the world. GAO was asked to examine (1) to what extent U.S. public diplomacy efforts have been coordinated and (2) whether the private sector has been significantly engaged in such efforts."
Another interesting report is the UK's Foreign Policy Centre's "British Public Diplomacy in the Age of Schisms"(February 2005). The report addresses many of the same issues and challenges that the U.S. faces in its public diplomacy efforts.
(from the introduction:)
"...Why is a new direction needed?
Authors Mark Leonard, Andrew Small and Counterpoint director, Martin Rose examine how Britain can forge a new public diplomacy role to suit an unstable, shifting, post-Iraq world, where divisions - or schisms - push nations into very different alliances. The lack of a significant debate about the role of public diplomacy post-Iraq, and the reliance on a Cold War-style public diplomacy suggests that a major rethink is needed. The authors argue that a new public diplomacy should be about mapping these schisms and bridging them, with a focus on trust and mutuality in the long-term, rather than about just delivering the message."