Of the 10 to 12 million Iraqis who lived in ethnically intermixed regions before 2003, only about 5 million have been displaced since then, meaning that 5 to 7 million have not been. Many of the neighborhoods in Baghdad and its environs are quite mixed. For now, the combination of the surge, the Sunni Awakening, the Madhi Army ceasefire, and related trends have succeeded in capping any violence. Unfortunately, the situation is not inherently stable and could revert to much greater violence if the United States is careless about how it downsizes its military presence in the coming months and years.

What about the movement of people? Forcible displacement is slowing. Through 2006, up to 100,000 Iraqis a month were being driven from their homes, with roughly half winding up in other countries, largely Syria and Jordan, and the other half elsewhere in Iraq. Reports conflict as to how much that figure has declined, and also about whether substantial numbers of Iraqis are starting to return to the locations from which they have been displaced. On balance, it appears that the displacement has slowed but not stopped at present.

And what about the nature of the military coalition in Iraq today? More than ever, foreign troops are overwhelmingly from the United States. Over 150,000 US soldiers and Marines are stationed in Iraq; all other foreigners number about 10,000, which is half of earlier figures. But even if European and Asian allies are downsizing their forces fast, Iraqi forces are building up, and the army, while still rife with sectarian and militia influences, is much better than it was before. Iraqi security forces number nearly half a million overall at present. There is little reason, however, to believe that most are fully able to operate independently without a strong US presence. In addition, they may not yet be politically dependable enough to function on their own.

Casualties for foreign and Iraqi security forces are starting to decrease as well. While 2007 was a bloody year for US forces as the surge "took the fight to the enemy," the second half of the year was much less violent, with figures in the final quarter falling to roughly a third of their mid-year peaks. US casualties have increased in the early weeks of 2008, but casualty rates, while still unacceptably high, remain less than half those of the year before. Iraqi losses in the army and police declined by about half as well during 2007, with the downward trend continuing thus far in early 2008.

Politics

On the political front, events in late 2007 and early 2008 suggest that Iraqis are beginning to recognize that the political process does not have to be a zero-sum game, though improvement has been uneven and many fundamental questions remain unanswered. Most notably, the Iraqi parliament passed its first "benchmark" legislation on January 12, reversing elements of the de-Ba'athification process that became a chief driver of the Sunni insurgency in the immediate aftermath of Saddam Hussein's collapse. This came on top of a pension law in late 2007 allowing former government employees to receive their proper retirement pay. Momentum continued into February as three crucial measures were simultaneously passed by the Iraqi parliament: the 2008 federal budget, an amnesty bill permitting the release of tens of thousands of mostly Sunni prisoners not charged with a crime, and legislation outlining provincial powers that will pave the way for local elections by October 2008.

The Justice and Accountability law, as the reformed de-Ba'athification law is formally known, will allow most former mid- and lower-level bureaucrats to return to work at government posts and will even permit those who held senior positions to receive a pension as long as they are not implicated in crimes or corruption. Moreover, due process has been introduced to ensure that cases are subject to judicial review instead of being resolved by the parliament's de-Ba'athification committee. Rather than punish all former Ba'athists who by and large were party members out of expediency rather than ideology, Iraqis are trying to make any such punishment more selective, more limited, and more equitable. Initial enthusiasm, however, must be tempered. By some interpretations these measures could be counterproductive, leading to the firing of more Sunnis from jobs, particularly in the security sector.

This is why careful implementation is so crucial and why US policymakers intent on legislative benchmarks must be willing to look beyond what is officially "on the books" and consider what is occurring on the ground before rushing to judgment on Iraq's political progress. The project of reforming de-Ba'athification offers a case study. Paul Bremer's 2003 decree that all members of the Ba'ath party be purged from government positions was never fully implemented. In the ensuing years, subsequent Iraqi governments have gradually nurtured a system in which many former Ba'athists have in fact settled into productive roles in Iraq's new bureaucracy.

While progress in other areas is also worthy of "benchmark" status, scrutiny remains important. For instance, despite the absence of prior legislation defining provincial powers, local and provincial governing councils have been given unprecedented influence over the past year in crafting annual budgets and prioritizing specific reconstruction projects. This will continue as the passage of the US$48 billion federal budget for 2008 suggests that funds will continue to be distributed to the provinces at unprecedented levels. It must also be noted that the majority of the funding for the federal budget is being supplied by oil sales, even in the absence of hydrocarbon sharing legislation. The common pattern here is that there is and has been a tangible motivation among elements of the central government to promote certain conciliatory advancements even in the absence of legislation. As Iraqi politicians move forward and more bills make their way into law, we must be vigilant that these pre-legislative improvements are not lost.

Prime Minister Nouri al-Maliki appears to have recognized the growing momentum behind this "bottom-up" movement in Iraq and has effected some positive changes accordingly. For instance, improvements have been made in balancing the sectarian makeup of the security forces. Sunni volunteers are being brought into the police and army, albeit slowly and grudgingly. Moreover, in January the nearly 2,000 graduating cadets of the National Police Academy were for the first time half Sunni. Movement has also been made in purging Shi'a extremist elements from the central government. While some nationalists in Maliki's office continue to excessively promote sectarian agendas, significant progress has been made in removing militia leaders from government leadership positions.