The United States is frustrated with the government of Nouri al-Maliki and is seeking ways to dump him, well-placed sources say.
The prime minister has utterly failed in his efforts to reconcile the country's warring factions and is even thought unable to solve differences within his own ruling Shiite-dominated coalition.
The sources say that Maliki has caused the United States deep embarrassment, both in his government's inefficient running of the country and the way former leader Saddam Hussein was put to death.
Maliki himself doesn't seem to be interested in staying on and is reported to have openly expressed a willingness to step down, even before the end of his term.
The U.S. publicly backs Maliki, but it is in fact hugely disappointed by his government's performance, the sources say.
Maliki has his own grievances. Sources say he blames these failures squarely on the United States, which remains the real decision maker in the country. He and his officials complain that they lack the authority to redeploy even a single army battalion, since such decisions remain in hands of U.S. commanders. Essentially, while the Iraqi government seems sovereign on the surface, the real reins of power rest with the U.S.
But the United States, although it's unhappy with Maliki, lacks a clear picture of what to do next. In addition, there's no guarantee that dumping the prime minister or reshuffling the government will improve the security situation.
Saddam Hussein's execution is said to have dashed any hope for reconciliation, as the country's minority Sunnis now more estranged than ever from the ruling Shiites. Millions of Iraqis who oppose the U.S. and Maliki government see the execution as an act of revenge rather than justice.
The execution, though ordered by the government and carried out by its own militias, has further deepened the sectarian divide. It has also deepened America's difficulties. The Sunnis, which are the backbone of the anti-U.S. resistance, will now intensify their attacks on American troops and their supporters.
The quagmire that America is in is evident in its lack of a clear strategy. Washington is not at all happy with the Shiite-dominated coalition running the country, but at the same time it cannot come to terms with its nemeses, the Sunnis, who are determined to force the Americans to "cut and run."
The U.S. is a victim of its own disastrous policies, and there is no guarantee that whatever strategy it adopts will extricate it out of the quagmire it is in.
As President Bush contemplates a new Iraq strategy, these must be very difficult days.