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Surge Reduction Fans Political Flames

The president's newest Iraq plan raises issues of economic import in the U.S.
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President Bush addressed the nation on Iraq last night -- his eighth installment on the ongoing war. The American people have heard a stream of edicts on Iraq over the last 4½ years: "mission accomplished," "the insurgency is in its final throes," the "surge is working," and now the "return on success." After considering all this, the term "quagmire" needn't be applied only to the progress of the war, but can also be attached to the political and economic impact of this latest iteration.

The president's position on Iraq has been unpopular for years and his approval ratings stand in the low 30s. But the president has forged on and ignored public disregard for the effort. Will he be able to continue his war in Iraq, or can the Democrats in Congress stop him?

The president did tonight what any good used-car salesman would do: He painted a pretty picture in the hope that nobody notices what is under the hood. When he spoke on Iraq on Jan. 10, the president announced a strategy called the "surge" -- an increase in U.S. troops to create an environment for political reconciliation in Iraq.

Technically, the "surge" has failed. The president never discussed his initial reason for the "surge." He instead focused on the gains made by the military. He proudly touts the success of improved security in the Anbar Province and Baghdad against al Qaeda in Iraq (AQI).

Intelligence experts and the U.S. military, however, agree that AQI only accounts for about 5% of the violence in Iraq. Yet the president barely mentions sectarian violence or the insurgents in the speech, whereas AQI gets 12 mentions. The public received an incomplete, and thereby incorrect, picture of violence in Iraq.

Political reconciliation has been an utter failure. The Iraqi government and Prime Minister Nuri al-Maliki have only achieved one of eight of their legislative priorities. The most important legislation remains an accord on oil revenue. Not only has no agreement been signed, but

the Kurds have agreed

to oil-and-gas sharing contract with Hunt Oil and Impulse Energy. So the Kurds prefer to make agreements to share oil with a Texas company before bothering to deal with their fellow Iraqis. Not encouraging.

Bush had hung his hopes on working with our former Sunni enemies in Anbar, like Sheikh Sattar Abu Risa, who led the Council for the Salvation of the Anbar Province. The sheikh had begun the struggle of fighting the extremism of AQI on his own last summer and had requested help from the U.S. for many months. We finally joined him during the surge.

But the gains made by the combination of Sunni fighters and the U.S. military are in doubt after the

sheikh was killed by a huge blast at his home Thursday

. A state of emergency was declared in the province following his assassination. So Anbar isn't so safe after all.

Despite the bad news, Bush only sees the bright side. He announced the endorsement of Gen. Petraeus' recommendation for troop withdrawals because of the "improving" security situation. As many as 5,700 could come home by Christmas, and another 21,000 may return by next July. This assumes no change for the worse, by the way.

The troop withdrawals are not really withdrawals. The Pentagon has said that the "surge" couldn't be continued any longer than next spring because of a lack of troops. Troop tours presently last 15 months -- up from 12 months before the war started. The surge troops were deployed between January and June of this year and would be returning anyway. Troop levels merely will return to pre-surge levels.

This raises the economic impact. A report from Merrill Lynch assessing the economic impact of a troop withdrawal suggests that the reduction in troops could have an impact on GDP. Based on CBO estimates, the spending on Iraq accounts for 20% of GDP. This leaves the two parties facing interesting challenges as the presidential campaign heats up.

The Democrats in Congress possess significant arguments to oppose the president's plan: the "surge" failed, Iraq remains violent, and troop withdrawals aren't withdrawals.

Still, I don't believe the opposition can succeed. The Democrats have a small majority in the House, where they can pass what they want. But the Senate is another story. They have 49 votes and possibly 50 with Bernie Sanders (D., Vt.) included. They can forget about Joe Lieberman (I., Conn.). The Democrats cannot muster 60 votes to end a filibuster, nor can they come close to 67 to override a veto.

But the Republicans face troubles of their own. The president has handed a lemon to the Republicans in Congress. The Republicans in Congress can in turn say to their constituents that we have made "progress" in Iraq and the troops will come home.

Ultimately, I expect no change of our policy in Iraq until January 2009. That means defense companies will maintain the high profit margins they have enjoyed since 2002 and there won't be any significant reduction in spending to drawdown on GDP.

The president also alluded to a future after he's no longer in office. "These Iraqi leaders have asked for an enduring relationship with America," he said. "And we are ready to begin building that relationship -- in a way that protects our interests in the region and requires many fewer American troops."

That future will be fought out all next year during the congressional and presidential elections where the public will finally weigh in on this long-term view.