gimp... assuming you can't afford photoshop
gimp is a very powerful free image editing application. It's not quite as powerful as Photoshop, but the fact that people argue that statement should tell you that it can do a LOT.
It certainly can do everything that the majority of people use Photoshop for.
If you try it, remembering one thing will help you learn the program (since it has its own unique interface): most every function can be accessed by right-clicking on the image you're editing. It's very un-Photoshop-like in that regard. 🙂