The handover that became a shambles: ten U-turns on the road to 'peace'

Part one:The appointment of an interim Prime Minister who used to work for the CIA is one of a series of disastrous policy changes by the US. By Justin Huggler and Rupert Cornwell

The Prime Minister

The appointment of Iyad Allawi as Iraq's interim Prime Minister this weekend was being seen as an American-backed coup which wrong-footed Lakhdar Brahimi, the United Nations envoy supposed to be putting together the interim government which will wield "sovereignty" after 30 June.

The more that is learnt, however, about the sudden emergence of Mr Allawi, a man close to the CIA and MI6, the more it appears the appointment of the new government has been hijacked by the ambitious politicians of the Iraqi Governing Council - the very body it was meant to replace. The only question is whom the IGC was conspiring with as its members picked jobs for themselves.

But whatever the answer, the appointment of Mr Allawi is the culmination of a series of spectacular U-turns that has given President George Bush and his administration the appearance of lurching in a panic from one flawed policy on Iraq to the next. Since last November every decision seems to have been taken with an eye to one political event alone: Mr Bush's bid for re-election this November.

Originally, it was Ahmad Chalabi the Americans - and in particular Donald Rumsfeld's Pentagon - appeared to be grooming as their future tame man in Baghdad, but in recent weeks Mr Chalabi has fallen from grace in Washington. He has now been accused of deliberately duping the US and Britain into war with false intelligence about Iraq's non-existent weapons of mass destruction; some even allege he did at the behest of Iranian intelligence.

Originally the US wanted to hand over sovereignty to an expanded version of the IGC, mostly made up of former Iraqi opposition leaders who returned from exile with the American tanks. But the spiritual leader of Iraq's Shia majority, Grand Ayatollah Ali al-Sistani, demanded elections before any handover. The Americans called for the UN's Mr Brahimi, who was involved in setting up the transitional government in Afghanistan, to decide whether early elections were possible - in other words, to convince Ayatollah Sistani they were not.

Mr Brahimi duly obliged, and was asked to stay on and find a new interim government acceptable to the ayatollah and Iraqis in general. He let it be known he would pass over the IGC's members and choose a government of technocrats, but the council has now announced the appointment one of its own members as Prime Minister. And not just any member, but one who looks distinctly like Ahmad Chalabi Mark II.

Like Mr Chalabi, Mr Allawi heads his own Iraqi opposition group, and has long cultivated links with Western intelligence agencies - first MI6, and more recently the CIA. He passed intelligence to the US and Britain ahead of the war, including, it is reported, the notorious claim that Iraq could deploy WMD with 45 minutes.

Some US spokesmen seemed as mystified as everyone else when the IGC made its move, at first saying Mr Allawi was only the council's suggestion, not a final choice, which would be for Mr Brahimi to make. The US occupation governor in Iraq, Paul Bremer, was apparently with the council for an hour before Mr Brahimi was summoned to be informed of the decision.

Mr Brahimi's statement that he welcomed Mr Allawi's appointment, which effectively sealed it, sounded like nothing so much as a man relieved to pass the buck on an awkward question. But in outflanking the UN, Mr Bremer and his political masters have sacrificed much credibility for an interim government that is already the subject of huge scepticism both in Iraq and abroad.

How different from what has gone before. Mr Bush prides himself on his unbending sense of purpose. In fact, since he landed on the USS Abraham Lincoln on 1 May 2003 for arguably the most hubristic photo-op in modern times, events have forced one change of plan for Iraq after another.

Little more than a year ago, the neo-conservatives who dominate US foreign policy were rampant, peddling their vision of a Pax Americana throughout the Middle East, in which the road to Jerusalem and a lasting Israeli-Palestinian settlement ran through a newly democratic Baghdad. Today Messrs Dick Cheney, Paul Wolfowitz, Richard Perle and the rest have fallen quiet. Hardly had the "Mission Accomplished" banner been removed from the Abraham Lincoln's flight deck than the forced tinkerings began, of which the anointing of Mr Allawi is merely the latest.

The proconsul

Retired General Jay Garner was the official originally named to head reconstruction efforts. But as lawlessness mounted, he was considered ineffectual. After exactly a month General Garner was replaced by the former diplomat Paul Bremer, on 11 May 2003, in charge of the Coalition Provisional Authority. It was already apparent the US had grossly underestimated the difficulties.

Rebuilding Iraq

The original price tag was $50bn, and Mr Wolfowitz, deputy Secretary of Defence, predicted that reconstruction would soon be self-financing, thanks to a jump in Iraqi oil output. A year on, as violence and sabotage of oil installations continues, output is struggling to get back to Saddam-era levels. Mr Bush has now gone to Congress three times, for a total $187bn of Iraq funding. The occupation alone costs $4bn a month. The White House warned last week that if Mr Bush is re-elected, federal spending will have to be cut.

Troop levels

The administration has been forced to eat its words. Plans were for the US contingent to be scaled back to under 100,000 by now. Last Monday Mr Bush announced that it would be kept at the current 138,000 for the foreseeable future, and increased if necessary. The trouble predates the invasion itself. Several senior commanders warned that an occupation force of 250,000 or 300,000 was needed. General Eric Shinseki, the Army Chief of Staff, warned against "a 12-division strategy with a 10-division army". But the civilian Pentagon leadership disowned him and Gen Shinseki paid for his frankness with his job. The Pentagon is now paying the price for ignoring him.

The constitution

In mid-November 2003 came the biggest course correction of all. With plans for a new constitution foundering and US forces growing more unpopular by the day, Mr Bremer rushed back to Washington for consultations. Instead of waiting for a new constitution to be drawn up - a process that could take years - the US junked its existing seven-stage, multi-year plan and decided to transfer power to the transitional government that assumes power in 32 days' time. That government would preside over elections for an assembly This body is meant to produce a constitution, on the basis of which Iraq would hold its first election for a permanent government, all by the end of 2005. But Mr Bush still dares not set a firm date for the withdrawal of US troops. Critics accordingly accuse him of still lacking an exit strategy. The President says "full" sovereignty will be transferred on 30 June. But what does "full" mean?

Disbanding the army

The US was supposed to train a new Iraqi security force, but this has proved woefully inadequate. In the past two months the CPA has twice reversed course. De-Baathification was ditched when the US gave responsibility for policing the flashpoint Sunni city of Fallujah to a force under a senior Saddam-era Iraqi commander. The same could happen in the Shia south, where the US struck a deal with the rebel cleric Moqtada al-Sadr in Najaf under which local militias are taking over some security tasks. The about-turn is further admission that the US doesn't have the troops, or the respect of the local citizenry, to do the job.

'Foreign fighters'

When it revised its plans last November, the US said that it would use heavy weaponry, including fixed-wing aircraft, to destroy what Mr Rumsfeld called "foreign fighters and dead-enders". That approach has been tacitly dropped, as the last thing likely to win the "hearts and minds" of ordinary Iraqis.

UN involvement

Having spent two years cold-shouldering the United Nations, Washington appeared to have no choice but to place the destiny of Iraq largely in the hands of Mr Brahimi, an Algerian Sunni, whose views on Israel are anathema to many in the US government. The way he has been outmanoeuvred, however, may bedevil relations with the world body once more, and complicate the passage of the UN resolution on Iraq so desperately needed - not least by Tony Blair - to heal international rifts.

American bases

For the hawks in the Pentagon one of the key geo-strategic goals of the invasion of Iraq was to secure a new desert "aircraft-carrier" in the Gulf, once US forces were withdrawn from Saudi Arabia. There was talk of American forces pulling out of the populated areas of Iraq within months, and establishing up to five permanent bases in desert areas granted to them by a grateful Iraqi administration. So unpopular is the US in Iraq that all public mention of such plans has ceased.

Mid-east democracy

Since the uprisings against the occupying forces there has been less talk among Washington's neo-conservatives of a "democratic" Iraq as a model for the region, a policy particularly passionately esoused by MrWolfowitz. Officials now speak merely of a stable and secure Iraq. Next week's G8 summit, which will be dominated by Iraq, was originally to launch a "Greater Middle East Initiative" bringing reform to the Muslim world.

Thanks to the Iraq shambles, compounded by the Abu Ghraib prison abuse scandal, the project is virtually dead in the water. Last week USA Today reported that a draft document for the summit says: "Change should not and cannot be imposed from the outside." This phrase is likely to strike Middle Eastern states as particularly ironic. A regional conference to promote democracy has also been scaled back.

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