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Its simple. He is the most powerful man in the world. This who bash America may not like that very much, but that is recognised by governments the world over. Because of that, he leads the free world. He doesnt lead the world as the countries that are not free tend to detest America and all it stands for. Hence him being the leader of the free world.
That doesnt mean America rules the world, it means he is the most powerful man in the free world.
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