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There used to be a mosaic of President George Bush on the floor at the entrance to the al-Rashid Hotel in Baghdad. It was placed there soon after the first Gulf War in 1991 and was a good likeness, though the artist gave Bush unnaturally jagged teeth and a slightly sinister grimace. The idea was that nobody would be able to get into the hotel, where most foreign visitors to Iraq stayed in the 1990s, without stepping on Bush’s face. The mosaic did not long survive the capture of the city on 9 April and the takeover of the al-Rashid by US officials and soldiers. One American officer, patriotically determined not to place his foot on Bush’s features, tried to step over the mosaic. The distance was too great. He strained his groin and had to be hospitalised. The mosaic was removed.

Almost all of the thousands of pictures of Saddam which used to line every main street in Baghdad have gone, though for some reason the one outside the burned-out remains of the old Mukhabarat – Intelligence – headquarters survives. My favourite was straight out of The Sound of Music: it showed Saddam on an Alpine hillside, wearing a tweed jacket, carrying an alpenstock and bending down to sniff a blue flower.

Other equally peculiar signs of Saddam’s presence remain. The Iraqi Natural History Museum was thoroughly ransacked by looters, who even decapitated the dinosaur in the forecourt. In the middle of one large ground-floor gallery almost the only exhibit still intact is a stuffed white horse which, when living, belonged to Saddam. Wahad Adnan Mahmoud, a painter who also looks after the gallery, told me the horse had been given to the Iraqi leader in 1986 by the King of Morocco. The King had sent a message along with it saying he hoped that Saddam would ride the horse through the streets of Baghdad when Iraq won its war with Iran. Before this could happen, however, a dog bit the horse, and it died. Saddam issued a Republican Decree ordering the dog to be executed.

‘I don’t know why the looters didn’t take the horse – they took everything else,’ complained Mahmoud, who was in the wreckage of his office painting a picture of Baghdad in flames. ‘It isn’t even stuffed very well.’ The horse, he added, was not the only dead animal which had been sent from Saddam’s Republican Palace to be stuffed by the museum. One day an official from the Palace had arrived with a dead dolphin in the back of a truck. He said the leader wanted it stuffed. The museum staff protested that this was impossible because a dolphin’s skin contained too much oil. Mahmoud laughed as he remembered the terrified expression on the official’s face when told that Saddam’s order could not be obeyed.

Saddam had three enthusiasms in the 1990s, two of which still affect the appearance of Baghdad. Soon after defeat in Kuwait he started obsessively building palaces for himself and his family. None of these is likely to be knocked down since they now serve as bases for the US Army and the Coalition Provisional Authority, as the occupation administration is called. Paul Bremer, the head of the CPA, has his headquarters in the enormous Republican Palace beside the Tigris, where he and his staff live in an isolation comparable to Saddam’s. Then, in the mid-1990s, Saddam began to build enormous mosques, the largest of which, the Mother of Battles mosque at the old Muthana municipal airport, was only beginning to rise from its foundations when the regime collapsed. Saddam’s third craze, beginning about three years ago, was more surprising. He started to write novels. He dictated them to his secretaries and they were published anonymously in cheap editions, but Iraqis were left in no doubt as to the author. The critical response was adulatory, the print run enormous. After the fall of Baghdad, documents were found in the Mukhabarat headquarters instructing agents to buy the books and get their contacts to do the same. Copies of his most recent novel, The Impregnable Fortress, as well as an earlier volume called Zabiba and the King, are still for sale in the Friday book market on al-Mutanabbi Street.

They can’t do much about the palaces and mosques Saddam built, but the US Army and the CPA are obsessed with removing every mention of his name from Baghdad. You can’t enter the main children’s hospital without walking through a stream of raw sewage, and on some days there is no electricity or water, but earlier this month two cranes were at work removing large green overhead signs for Saddam International Airport. The US officials now in charge of Iraq seem to believe that their problems will be over if all evidence of Saddam’s existence is eliminated. This obsession explains in part the political failure of the US and Britain after their swift military victory. Their demonisation combined with Saddam’s own personality cult to produce a picture of Iraqi society as being wholly dominated by one man. In fact the regime’s support base was always narrow – this was the reason for its exceptional cruelty.

Iraqis were never going to welcome the US and British Armies with cheering crowds hurling flowers. Many had long believed that Saddam was a CIA agent, or at the very least could not have risen to power and held it without US backing. It is, nevertheless, extraordinary that in only three months the US has managed to generate such fury against its occupation. Guerrilla actions have so far been limited, but they are popular. In the middle of June two men drove up to US soldiers guarding a propane gas station near al-Dohra power station in south Baghdad and opened fire. One of the soldiers was shot through the neck and killed and the other was wounded in the arm. An hour or so later I asked the crowd standing around a pool of drying blood on the broken pavement what they thought of the shooting. They all said they approved of it, and one man said he was off to cook a chicken in celebration.

A month later the attacks have spread to the centre of Baghdad. I was waiting outside the National Museum, where the CPA had arranged a brief showing of the 3000-year-old golden treasure of Nimrud, whisked for the occasion from the vaults of the Central Bank, to demonstrate that life was getting back to normal. Suddenly there was a six-minute burst of firing on the other side of the museum. It is a measure of the chaos in Baghdad that this turned out to be the result of two quite separate incidents. The first was a funeral: as is normal in Iraq, people were firing their guns into the air as a sign of grief. The American troops on the roof of the museum thought they were under attack and shot back. But most of the gunfire was in response to somebody firing a rocket-propelled grenade into an American Humvee in Haifa Street, wounding several soldiers. The surviving soldiers had then opened fire indiscriminately and killed a passing driver. As the Americans withdrew, the crowd, dancing in jubilation, set fire to the already smouldering Humvee.

A week after I had been to look at Saddam’s stuffed horse, Richard Wild, a young British freelance journalist, went to the Natural History Museum to get a story about its destruction by looters. He was a tall man with close-cropped blond hair and he was wearing a white shirt and khaki trousers. To an Iraqi he may have looked as if he were working for the CPA. As he stood in a crowd outside the museum a man walked up behind him and shot him in the back of the head, killing him instantly.

There are 55,000 US troops in and around Baghdad but they seem curiously vulnerable. They largely stick to their vehicles; there are very few foot-patrols. They establish checkpoints and search cars, but usually have no interpreters. ‘Mou mushkila – no problem,’ one driver said when asked to open the boot of his car. ‘Don’t contradict me,’ a soldier shouted. Military vehicles are often stuck in horrendous traffic jams (because of the electricity shortage the traffic lights are not working) making them an easy target for grenades. Just before the attack in Haifa Street I was talking to an American soldier outside the National Museum. The tag on his shoulder read ‘Old Ironsides’. I asked him what unit this referred to. He replied: ‘The First Armoured Division, the finest armoured division in the world.’ But tanks and heavy armour are not much use in Baghdad. A few hours later a sniper shot dead another soldier as he sat in his Bradley fighting vehicle by the gates of the museum.

Outside Baghdad the Army has been conducting search missions in the villages and giving them such names as ‘Desert Scorpion’. The press office puts out statements proudly listing the number of detainees and arms captured and suspicious amounts of money discovered. Villagers protest that they have always had weapons, and need them more than ever because of looters. They also have large amounts of cash, often in $100 bills. Iraqis haven’t kept much of their money in banks since Saddam closed them just before the first Gulf War. When they reopened the Iraqi dinar was worth only a fraction of its former value.

The guerrilla war doesn’t approach the scale of that in Lebanon in 1983-84 or Northern Ireland in the 1970s and is mostly confined to Sunni Muslim areas, but it is growing in intensity. It is damaging to the US because press coverage can no longer be controlled. Every time a US soldier is shot a horde of television reporters and print journalists descend on the scene. The CPA is very conscious of the fact that it will be more difficult for George W. Bush to win re-election next year on the back of victory in Iraq when US television is still showing pictures of dead and wounded soldiers.

Many of the mistakes the US and British made after the war were very obvious. They allowed the Iraqi state to dissolve overnight. They ignored the mass looting for weeks. They took seriously the advice given by exiled Iraqi groups which had no support within the country. They allowed the civilians in the Pentagon systematically to marginalise the rest of the Administration in Washington. Above all, they were over-confident. ‘They believed, because the war had been so easy for them, that they could do what they liked with Iraq,’ an Iraqi friend said to me.

Before the invasion most Iraqis wanted to see an end to Saddam Hussein because of the calamities he had inflicted on them, including two disastrous wars. Impoverished by sanctions, they wanted a return to some sort of normality. Expectations were high: they did not see why, once Saddam was gone, they should not live as well as Kuwaitis or Bahrainis. Instead, in the ferocious heat of the summer they have limited electricity, an intermittent water supply and a petrol shortage. Looting hasn’t stopped. Rumours spread: parents are convinced that gangs working for Kuwaitis want to kidnap their daughters.

The lesson of the three-week war was that Saddam had little real support. It should have been possible to isolate the senior echelons of the Baath Party, the security and intelligence services and the tribal factions on whom Saddam relied. The Baath Party had about half a million members, but most joined because they could not get a job as a manager, a teacher or even a driver without being a member. Yet from their heavily defended new headquarters US officials issued an edict on 16 May ordering sweeping de-Baathification. Every former member of the Party felt threatened. A few weeks later, the 400,000-strong Army was disbanded without compensation (this decision was hurriedly reversed a month later as guerrilla attacks increased).

Bush and Blair found it much easier to deal with Iraq when everything that went wrong could be blamed on Saddam. In his weekly press conferences in the National Convention Centre opposite the al-Rashid Hotel, Paul Bremer speaks almost as if Saddam were still in charge. To mounting scepticism and occasional derision from journalists he regularly explains that the lack of electricity and water is the result of sabotage by members of the old regime. The guerrilla attacks, he says, are the last throw of a small number of ‘desperate men’ still loyal to Saddam. ‘Those who refuse to embrace the new Iraq are clearly panicking.’ Everything will come right when Saddam is killed or captured; though, contradicting himself, Bremer has also said that the guerrilla attacks are not centrally organised.

Before the war ended the US had danced nervously around the prospect of a provisional government. Even Stalin felt that an indigenous authority would be a useful veil to mask imperial rule when he invaded Poland in 1944, but in Iraq it was soon obvious that the US did not want to share power. When Abu Hatem, a resistance leader who had been fighting Saddam for 17 years, captured the city of Amara (the only Iraqi Arab city to fall to local insurgents) in southern Iraq on 7 April, the CIA ordered him to leave within the hour.

Another problem is that the only Iraqi opposition parties with any demonstrable support inside the country are both Kurdish: the Kurdistan Democratic Party and the Patriotic Union of Kurdistan, who have ruled their enclaves in northern Iraq for a decade. The others are all, by and large, dependent on foreign backers and are despised by most Iraqis as carpetbaggers. It is not just groups supported by the US, such as the Iraqi National Congress of Ahmed Chalabi or the Iraqi National Accord of Iyad Alawi, that are regarded with suspicion. So, too, is the Iranian-backed Supreme Council for Islamic Revolution in Iraq, led by Muhammad Baqr al-Hakim, which is trying to present itself as the representative of the Shia Muslims who make up the majority of the Iraqi population. When I visited Hakim’s office in Najaf one of his guards spoke to me in Farsi before switching to Arabic.

By the end of May, Washington had decided that a provisional administration made up of Kurds and the exiled opposition would not help the occupation. This was certainly right. If the reputation of the opposition among Iraqis was low before the war it was further blackened by the enthusiasm with which they confiscated government buildings and cars. ‘They are just looters in suits,’ an Iraqi told me in disgust. According to a story in Baghdad (rumours here are always high on supportive detail), one opposition group has managed to seize 67 buildings and 120 vehicles and engaged in a shoot out when the police tried to recover a car.

The alternative for the US – Saddamism without Saddam – is also difficult. The Iraqi state had largely dissolved in April. Other parts of it, like the Army, had been dismantled. Saddam himself had not been captured or killed. And all the while it was becoming obvious that the US and Britain, with casualties mounting, had only limited control of the country. By early July, Bremer and the CPA were showing greater enthusiasm for an Iraqi interim administration – with a broader base than the old exiled opposition – which could reconstitute the police and civil government. The old imperial recipes for controlling an occupied country under the auspices of a client regime are particularly difficult to apply in Iraq: the country is too divided between ethnic, religious, tribal and political groups. But the US, with Britain tagging along behind, has found that direct rule by military force alone is failing. It was so much easier when they could blame everything on Saddam Hussein.

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