Hell to Pay

Sgt. Jonathan Scarfe, a broad-shouldered U.S. Marine with a square jaw and a 5 o'clock shadow, is trudging through a small town near Fallujah. On the opposite side of the street, taking his cues from Scarfe's movements, is Hussein Ali Jassim, who commands a small unit of the new Iraqi Special Forces. Scarfe says he trusts Jassim implicitly--which is more than he can say for most Iraqi National Guardsmen, less-trained locals thought to be collaborating with the insurgents. "The ING guys usually slept outside during the summer," says Scarfe. "When they slept inside, you knew a mortar barrage was coming." At one intersection, children laugh and shout as Jassim, who sports a small, well-trimmed mustache, distributes candy.

But a young Iraqi across the street smirks and makes an obscene gesture. "These people," says Scarfe, "will let us walk right to our death."

Now the Marines and their Iraqi proteges are gearing up for the biggest offensive in Iraq since April. Barring an unexpected breakthrough in talks with local leaders, a long-awaited attack on the insurgent strongholds of Fallujah and neighboring Ramadi may come as early as this week, shortly after the American presidential election. Fighting is expected to continue at least until December, U.S. officials say. In recent weeks American military trainers have been frantically trying to assemble sufficient Iraqi troops to assist in the assault. And they are praying that the soldiers perform better than last April, when two battalions of poorly trained Iraqi Army soldiers refused to fight. The insurgents struck first last week. On Saturday, a convoy of Marines was moving into position around Fallujah when a suicide bomber drove into them. The explosion killed eight, bringing the war's total to nearly 1,120 American dead.

And so the bloody battles of the Iraq war--which never quite ended--are about to start up again in full force. Much depends on the new offensive. If it succeeds, it could mark a turning point toward Iraqi security and stability. If it fails, then the American president will find himself in a deepening quagmire on Inauguration Day. The Fallujah offensive "is going to be extremely significant," says one U.S. official involved in the planning. "It's an attempt to tighten the circle around the most problematic areas and isolate these insurgents." But it will also be "the first major test" of the new Iraqi security forces since the debacle in April, says Michael Eisenstadt, an Iraq expert at the Washington Institute. Their performance, he says, will "provide a key early indicator of the long-term prospects for U.S. success in Iraq."

For months the American people have heard, from one side, promises to "stay the course" in Iraq (George W. Bush); and from the other side, equally vague plans for gradual withdrawal (John Kerry). Both plans depend heavily on building significant Iraqi forces to take over security. But the truth is, neither party is fully reckoning with the reality of Iraq--which is that the insurgents, by most accounts, are winning. Even Secretary of State Colin Powell, a former general who stays in touch with the Joint Chiefs, has acknowledged this privately to friends in recent weeks, NEWSWEEK has learned. The insurgents have effectively created a reign of terror throughout the country, killing thousands, driving Iraqi elites and technocrats into exile and scaring foreigners out. "Things are getting really bad," a senior Iraqi official in interim Prime Minister Ayad Allawi's government told NEWSWEEK last week. "The initiative is in [the insurgents'] hands right now. This approach of being lenient and accommodating has really backfired. They see this as weakness."

A year ago the insurgents were relegated to sabotaging power and gas lines hundreds of miles outside Baghdad. Today they are moving into once safe neighborhoods in the heart of the capital, choking off what remains of "normal" Iraqi society like a creeping jungle. And they are increasingly brazen. At one point in Ramadi last week, while U.S. soldiers were negotiating with the mayor (who declared himself governor after the appointed governor fled), two insurgents rode by shooting AK-47s--from bicycles. Now even Baghdad's Green Zone, the four-square-mile U.S. compound cordoned off by blast walls and barbed wire, is under nearly daily assault by gunmen, mortars and even suicide bombers.

Everyone is vulnerable. One evening two weeks ago a group of employees was leaving by bus from the Iraq Hunting Club, a green-lawned retreat once occupied by Ahmad Chalabi, the Pentagon's former favorite exile leader. Only one man survived to tell what happened: gunmen in a passing car fired on the bus, forcing it off the road. The attackers took a heavy machine gun out of the trunk and shot up the bus some more. Then they approached with Kalashnikovs and casually finished off the wounded. The sole witness lived only because he was under a corpse. A similar massacre on Oct. 20 along the highway to Baghdad airport, again on a mini-bus, killed six women and one man, Iraqi Airways employees on their way to work. The same day, ambushers murdered two women secretaries and a male official who worked in the office of Iraqi interim President Ghazi al-Yawar.

Throughout much of Iraq, but especially in the Sunni Triangle at the heart of the country, U.S. troops are unable to control streets and highways, towns and cities. And allied Iraqi troops are simply not numerous, well trained or trustworthy enough. Attacks on Coalition and Iraqi forces are now in the range of 100 a day; casualties among Iraqis are far greater. More than 900 policemen have been killed in the past year, according to the Ministry of the Interior. The Iraqi media have been targeted, too: in just the past three weeks, assassins have killed two Iraqi journalists, both female TV personalities. On Saturday, a car bomb detonated near Al Arabiya TV in Baghdad, killing seven.

Most overseas attention has focused on the 160 or so foreigners who have been kidnapped, many of them representatives of Coalition countries. But militants and criminal gangs have also kidnapped thousands of Iraqis, most of them held for ransom. As a result, Iraqi elites are fleeing by the thousands, many to neighboring Jordan. "Iraq is there for the bandits now. Anyone with the financial ability to do so has left," says Amer Farhan, who departed last summer with his father, Sadeq, a factory owner, and all of their family.

The insurgents clearly have a strategy to isolate the Americans--from their Coalition partners, and also from ordinary Iraqis. They know that both Bush's and Kerry's plans for success depend on putting Iraqi forces in place, and they've stepped up their campaign to sabotage that effort. On Oct. 23, insurgents managed to capture 49 Iraqi soldiers heading home for leave in three buses. The homebound soldiers had just finished their basic training at the U.S.-run center at Kirkush; they were traveling unarmed. The insurgents shot them all dead, execution style. Two days later, 11 Iraqi National Guardsmen were captured, and masked jihadists posted a videotape showing them being executed.

Just as worrisome, the insurgents have managed to infiltrate Iraqi forces, enabling them to gain key intelligence. "The infiltration is all over, from the top to the bottom, from decision making to the lower levels," says the senior Iraqi official. In the Kirkush incident, the insurgents almost certainly had inside information about the departure time and route of the buses. Iraqi Ministry of Defense sources told NEWSWEEK the Iraqi recruits had not been allowed to leave the base with their weapons because American trainers were worried that some of them might defect. "The current circumstances oblige us not to give them their weapons when they're taking vacations, in case they run away with them," said one Iraqi intelligence officer.

At Sergeant Scarfe's base outside Fallujah, the Marines discovered that the Iraqi Guard commander "was taking soldiers' paychecks and giving them to the resistance," says Lt. John Jacobs. "He was passing information to them and sometimes meeting them in person." The commander is now in Abu Ghraib Prison, but many ING recruits later quit, citing fears for their safety. Elsewhere U.S. soldiers have removed machine guns from Iraqi armored vehicles, fearing how they might be used. Even the Bush administration official who evinced confidence about the new Fallujah offensive admitted that the new Iraq under the interim government is "not jelling. How can [ordinary Iraqis] support a government that doesn't really exist in many ways?"

Last July, the Iraqi army's new chief of staff, Gen. Amer Hashimi, was quietly removed after one of his secretaries was implicated in passing information to the insurgents. In late September, U.S. forces arrested the commander of the 32nd Iraqi National Guard Brigade, Lt. Gen. Talib Abd Ghayib al Lahibi, "for having associations with known insurgents." His arrest came as he was being considered to command all the National Guard forces in Diyala province, part of the Sunni Triangle. The deputy governor of that province, Akil al Adili, was assassinated there on Oct. 22.

U.S. and Iraqi officials believe that a big victory in Fallujah and Ramadi is the best way to reverse this trend. They say more money has been spent recently on training, with a focus on producing quality troops, instead of churning out unreliable foot soldiers. Over the next few weeks, an additional six battalions of Iraqi soldiers should become operational, with a further six due by Christmas, effectively doubling active Iraqi forces. Some of the best local forces are in the First Iraqi Intervention Force brigade. Many have experience from the Iran-Iraq war. "Those guys are serious business," says an American officer who has observed them.

The U.S. military must convince ordinary Iraqis that in aligning themselves with the American-installed government they are siding with a winner. And U.S. occupation officials hope that Fallujah will take on symbolic importance, and that insurgents will attempt to stand and fight. "The model is Najaf," a senior Western official said. Last summer Shiite militia leader Moqtada al-Sadr lost thousands of his militia in a major battle for Najaf, and American and Iraqi forces killed or captured 45 of his top aides. Sadr has been muted since, and has hinted he will run in the January elections being orchestrated by the U.S.-installed government.

Yet unlike the Shiites of Najaf, the Sunnis of Fallujah cannot imagine that democracy will bring them power. (Sunnis represent a minority in the country, the Shiites a majority.) While Shia Ayatollah Ali al-Sistani was able to persuade insurgents to stand down in southern Iraq, no single Sunni leader has the moral authority or the inclination to play that role. Still, administration officials hope that the Fallujah offensive will so damage the Sunni insurgency that it will be reduced to containable levels through 2005. It's expected that many insurgents may simply flee; U.S. intel officials say that many are already hiding in surrounding villages along with escaped Fallujans. Yet the militants could still be deprived of a geographic base, which "will allow elections in January to proceed in areas they've vacated," says one administration official.

Washington has declared several times that the insurgency would soon be defeated or at least mostly neutralized. Senior officials made such statements when electricity was restored to its pre-occupation levels in 2003, when Saddam was captured in December, when sovereignty was handed over on June 28. Each time the insurgency has only grown. Now even military officials who are hopeful the insurgency can be defeated--or perhaps just reduced to a violent annoyance--say it will be a long haul no matter who is U.S. president.

The U.S. military is now pushing for what one top officer calls "a tipping point," when a critical mass of Iraqi units are on the streets, operating against the insurgency. Optimists hope this will happen by the Iraqi elections--if the Fallujah offensive succeeds. The Iraqis, they say, are resilient. One American general has a favorite anecdote. Last spring a car bomber drove into a crowd of would-be soldiers who were waiting outside a recruiting station in Baghdad. Several were killed, scores wounded. What didn't make the news, he said, was that the recruiting station was open for business the next day. And some of those injured in the blast turned up again, in their bandages, still determined to re-enlist in a war for the future of their country.