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Bette Midler – From A Distance Lyrics 11 years ago
Here is an alternate interpretation:

The stanza

From a distance
There is harmony
And it echoes through the land
And its the hope of hopes
Its the love of loves
Its the heart of every man

shows that a harmonious world is desired by everyone, even though the reality on Earth is sometimes ugly.

Fortunately, “God is watching us from a distance” and therefore sees mainly the good in us, despite our flaws.

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Bette Midler – From A Distance Lyrics 11 years ago
I would like to expand on Swanie's comment

Even though the song lifts the spirit because of its beauty, it is actually sarcastic. Let me explain.

Everything looks better from a distance, but the reality of the world is much worse than that. We wish that the world was a better place. For example, consider the stanza

From a distance
There is harmony
And it echoes through the land
And its the hope of hopes
Its the love of loves
Its the heart of every man

It shows that the music heard from a distance is the dream of every person on earth.

The sarcastic part is the phrase “God is watching us from a distance”. That implies that God is happy with what he sees, and that God thinks we are doing a good job on Earth. But the real idea is that the people of earth should not feel too good about themselves, because God knows the real story.

Written another way the phrase might go: “God is watching us from a distance. That's not true. He sees everything and you people on Earth need to improve.”

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