The Digital Artist's Best Friend.

I've been using Paint Shop Pro in it's various versions since about 1995, Version 7 is without doubt the best version by far, and it's amazing to see this product come from a limited shareware program to one of the best graphics packages around.
You can manipulate graphics for any purpose in PSP7, but two of the main uses of a graphics package nowadays are probably Photo enhancement, and Web design. I'm going to give you a quick run down of what this excellent program will let you do in these areas...

PSP lets you automatically adjust color balance, contrast, and saturation, based on intelligent filters. I've got a digital camera, and the auto contrast adjust makes short work of the slightly darker photos I take of girl's asses in nightclubs.
You can Remove red-eye on people and animals. The program comes with a load of preset irises, of all different colours, and you basically re-draw a realistic iris over the red eye. It's amazingly effective, and i've used it a fair few times.
As well as the automatic features of PSP, there are a lot of highly customisable settings that allow the user to adjust the finest details of photos.
The program includes clever filters that can do wonders for the compression patterns on Jpeg or video files, and there are tools to remove noise, dust and scratches.
The picture tube tool is hard to describe, you have to see it in action to believe it. It allows you to paint with a theme of pictures, "fruit" for example. Drag the mouse, and a little trail of random fruit appears, all in different directions and all antialiased to look smooth and funky. Think how useful this is for your photos!
PSP can also add frames to your photos, bevel the edges, and add a host of excellent special effects. The special effects filters in PSP are extensive, customisable and well implemented. The program's multi level undo system also lets you experiment with all the features, without damaging your files.

PSP7 also comes with a free program, Animation Shop 3. This allows you to make professional quality gif animations for use on the web. Your creations can be previewed in up to 3 web browsers at the click of a button.
One of the most powerful web features has to be the new image mapper and slicer. This allows you to slice a large image (a menu bar, for example) into many different sections. Each section can be given an HTML link code, and a rollover graphic. The program can then save all the files together in a directory, ready for you to work on.. But, get this! Clever PSP also creates all the HTML and Javascript to run your page. It's very nearly all you need.