The spectacular confusion over whether an Iraqi woman can be released from prison has at least shed clarity on the question of who runs the country. It is not the Iraqi interim government. They have just been bluntly reminded by the Bush administration that the US occupying forces will decide which Iraqi citizens are freed and when. Yesterday Mr Allawi and his cabinet were reduced to putting a brave face on their rebuff by pretending it was their decision as they agree with the US position, now that it has been explained to them.

The spectacular confusion over whether an Iraqi woman can be released from prison has at least shed clarity on the question of who runs the country. It is not the Iraqi interim government. They have just been bluntly reminded by the Bush administration that the US occupying forces will decide which Iraqi citizens are freed and when. Yesterday Mr Allawi and his cabinet were reduced to putting a brave face on their rebuff by pretending it was their decision as they agree with the US position, now that it has been explained to them.

The Iraq cabinet may be pardoned for not at first grasping the US perspective. After all, the ostensible reason why the two women are in captivity is that they are helping the Americans with their enquiries into the Iraqi programmes of weapons of mass destruction. Those enquiries have now come to the embarrassing conclusion that there were no such programmes. Even the Iraq Survey Group which was set up to kick the issue into the long grass has finally run out of excuses for keeping up the charade that they are still looking for weapons. In the circumstances it is not obvious what reason the Bush administration has for keeping both women under lock and key, other than terror that if freed they will say to TV cameras what they have been telling their US captors for 18 months: that there were no weapons of mass destruction and that there had been no active programme to produce them for a decade.

Tony Blair might also be excused for being bewildered by the US intervention. He has put his career and his reputation on the line in the pursuit of a special relationship with George Bush. To keep his private commitment to the President on the invasion of Iraq he ignored public opinion at home, alienated his nearest neighbours in Europe and faced down the largest rebellion by government backbenchers for a century. The outcome of a judicial review ordering the release of the two women scientists may have been, as the Foreign Office protests, "an extraordinary coincidence", but it did have the welcome consequence of raising a glimmer of hope for the life of a British hostage. Then Washington stepped in to "sabotage", in the words of Mr Bigley's family, any attempt to implement the court order. Not for the first time Mr Blair is left ruefully reflecting that the special relationship is always interpreted by the White House as a one-way street.

Statistics are dry, unemotional words. The worsening, daily toll of carnage in Iraq does not convey the personal suffering and grief behind each figure. But the harrowing videos of Ken Bigley eloquently pleading for his life, and the evident pain and anguish of his family, have put a human face to the chaos, violence and tragedy of the Iraq we have created. On the personal level every decent and sensible person felt for Mr Bigley and his family. On the political level it is increasingly hard this week to accept that those responsible for the invasion of Iraq can go on evading responsibility for the consequences.

Tony Blair startled even hardened, cynical journalists at the weekend with his breathtaking presentation of the bloodshed in Iraq as a new, second conflict that has no connection with the original decision to invade it. But we should at least welcome his admission that the country is in turmoil. No one will argue with his central point that Iraq is in the grip of not one but several conflicts. Large, and growing, parts of it are now no-go areas for the occupation forces. What was most significant about the decision by the US to deploy helicopter gunships to destroy a stranded armoured vehicle - and a score of innocent bystanders - was the tacit admission that they could not mount a ground patrol to a location only a stroll away from their Baghdad compound.

Anyone with contacts in the British military know that for some weeks they have been warning that even in the southern sector the area under their effective control has been shrinking, and the threat to their patrols has been increasing. The Allawi government more and more resembles those bishops of the middle ages who were appointed in partibus infidelis to sees that had been overrun by Saladin and which they could not even visit.

Tony Blair presented the new conflict as a titanic struggle with international terrorism. This also is an interesting admission. There were no international terrorists in Iraq until we invaded it and created the perfect conditions for al-Qa'ida to thrive. Judged by its contribution to combating international terrorism the occupation of Iraq has been a spectacular, grotesque own goal.

But our Prime Minister is in denial about the depth of our difficulties in Iraq if he imagines that he is in conflict with only a handful of psychopathic terrorists. The coalition forces have lost control of whole cities, such as Samarra, Ramadi and Fallujah, as well as much of Baghdad. This is not the result of malign intervention by a few terrorists but of the hostility of the bulk of the domestic population to the occupation of their country. Failure to understand the unpopularity of our presence in Iraq is dangerous, because the myth that our enemies are terrorists leads to the delusion that there is a military solution to our predicament.

On the contrary, the heavy-handed military operations by the US forces have been the principal cause of our present dire situation. Every week they prompt a fresh stimulus to resistance. They even managed to kill Baghdad's most popular wedding singer by mistaking a marriage ceremony for an insurgency gathering.

Nearly every day now planes bomb Fallujah, and the rumours are thick that as soon as the Presidential election is out of the way the US army will launch a second attempt to capture the town. A repetition of their spring assault on the town will not weaken the insurgency but will lend it renewed strength. So long as the Bush administration treats Iraq as a colony it occupies by force, it will be resisted by force.

The solution to the Iraq crisis is political, not military. It requires a government which is accepted by its people as legitimate because it is chosen by Iraqis rather than hand-picked by us. And it must be a government which does not dance to the American tune as obligingly as it did this week when Washington tugged its strings. Above all we need to convince the ordinary Iraqi that we do not intend to stay in permanent occupation.

The fundamental problem with Tony Blair's approach to Iraq is that he continues to nurse an evangelical conviction that Washington and London between them can impose a solution on Iraq. We cannot. That is the reason why a previous generation of Labour leaders gave priority to getting out of colonies, not finding new ones.

The problems of their troubled country can be resolved only by the Iraqis themselves. We can help if our assistance is welcome, but will only hinder if it is resented. If Tony Blair really wants to reduce support for the insurgents he should tell next week's Labour conference that British troops will stay until there is a legitimate government and will then come home.