Much of my summer was spent on a consulting project that I did in conjunction with ESPN, in which I helped them a design a soccer ratings system known as the Soccer Power Index (SPI). SPI launched today and we're pretty proud of the results, which feature a combination of intuitive (Brazil and Spain are #1 and 2, natch) and somewhat bolder rankings (SPI is fond of 'second-tier' South American teams like Chile, Uruguay, and Paraguay, as well as African up-and-comers Ivory Coast). The United States is ranked 14th.
Unlike other soccer ratings systems, SPI is explicitly designed to be predictive -- so a team like Argentina, which in fact struggled to qualify for the World Cup, won't be penalized that much provided the system is convinced that the talent is still there. The two main innovations in the SPI are to incorporate results from club play -- if Cameroonian striker Samuel Eto'o scores a goal for Inter Milan, it will (marginally) help Cameroon's rating -- as well as to incorporate a "competitiveness coefficient" based on the actual lineups that each team used in each match. The latter is important because international soccer clubs play a lot of matches -- friendlies, some second-tier international tournaments -- in which they're essentially sending their taxi squads in, which tell us very little about the teams that will actually be on the field in South Africa next year.
Anyway, this is a politics blog -- not a sports one -- so I'll direct you over to the very, very, long article on methodology I did at ESPN.com if you're curious about the details -- or check out the Wall Street Journal's Carl Bialak for a good capsule summary.