WASHINGTON – U.S. troops are out of Iraq's cities but not its future.
Even a best-case scenario is likely to feature an American role there for years — militarily as well as diplomatically.
That does not mean a permanent large U.S. troop presence in Iraq. Under a security deal struck with the Bush administration, American forces are to be out by the end of 2011.
But it's no secret that Iraq's security forces are not fully ready to handle even a diminished insurgency on their own.
Some senior U.S. military officers say privately they anticipate Iraqi setbacks in coming months, particularly if the insurgents regroup. But by partnering with American forces, the Iraqis stand a good chance of succeeding. That is why a number of U.S. troops will remain in the cities to assist and advise.
But most were gone Tuesday as Iraqis marked National Sovereignty Day with military parades and marching bands in Baghdad. In a sobering reminder the violence was not over, a car bombing in a crowded food market in the northern city of Kirkuk killed at least 27 people.
It's not possible to know how long Iraq will need American help, but it could be well beyond President Barack Obama's current term. Much will depend on the pace of progress toward Iraqi political reconciliation. That is because the success of the Iraqi security forces depends as much, if not more, on their willingness to operate in a nonsectarian, evenhanded way as on their technical competence.
Diplomatically, the U.S. role will be less visible but still crucial. Even with declining levels of violence since 2007, progress toward political reconciliation among Sunnis, Shiites and Kurds has been minimal.
Obama made clear Tuesday that while he expects violence to persist, the final outcome is an Iraqi responsibility.
"Iraq's future is in the hands of its own people," he said at the White House. "And Iraq's leaders must now make some hard choices necessary to resolve key political questions" and to provide security.
There are still about 131,000 U.S. troops in Iraq. They won't be fighting in urban areas any more, unless the Iraqi government asks for their help. Instead they will focus on securing Iraq's borders, keeping insurgents on the run in rural areas and conducting training with Iraqi security forces.
Gen. Ray Odierno, the top U.S. commander in Iraq, said Tuesday he was hopeful, in part because Iraqis have embraced the U.S. urban withdrawal as a confidence booster.
"They're not ready for us to go yet, but they are ready for us to allow them to attempt to exercise their security responsibilities, and to me that's very encouraging," Odierno said.
Even in the most optimistic of circumstances in which Iraq muddles through its political and ethnic problems — and keeps chipping away at the insurgency — it will still need U.S. support. And the Obama administration has said it wants to build a long-term relationship with a key Arab state in a volatile region.
But if today's relative peace in Iraq unravels within the coming year, Obama will face tough choices, including whether to push back his announced timeline for ending the U.S. combat role in the country by September 2010.
Obama could not reinsert U.S. combat forces in Iraqi cities without Iraqi government permission, under terms of the security deal negotiated by the Bush administration last year. And he could not change the 2011 deadline for removing all U.S. troops from Iraq without renegotiating that deal.
Nor might he want to, even with the prospect of Iraq spinning into a new cycle of sectarian warfare. Obama came into office promising to end U.S. involvement in the war, arguing that Iraq's remaining problems are primarily of a political nature and cannot be solved by continued U.S. military force.
And more recently, Obama announced that his administration was refocusing on what he considers a bigger problem — increasing instability in Afghanistan and a growing insurgency in neighboring Pakistan. In that context, U.S. troop reductions in Iraq are a one-way ticket; once out, they are unlikely to return.

Qubad Talabani, son of Iraqi President Jalal Talabani and the Washington representative of the semiautonomous Kurdish regional government in northern Iraq, believes that if security deteriorates in coming months and hot-button political issues are not settled, the 2011 deadline should be renegotiated.

"Regardless of whether things go well or things deteriorate, there is going to be a strong connection between the United States and Iraq," Talabani said in an interview Tuesday. "The nature of that relationship will depend on whether things improve or deteriorate. The U.S. has invested too much in this effort just to walk away."

What would Obama do if Iraq reverted to major violence?

Stephen Biddle, an Iraq watcher at the Council on Foreign Relations, wrote in a recent analysis that a full-scale civil war could mean a civilian death toll in the range of 600,000 to more than two million.

"Given its role in precipitating the war in Iraq, the United States would bear special responsibility for such a catastrophe," Biddle wrote. He added that if the conflict spread beyond Iraq's borders it would risk a disruption of world oil markets and might derail prospects for successful Israel-Palestinian peace talks.

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EDITOR'S NOTE — Robert Burns has covered national security and military affairs for the AP since 1990.

In the Eastern Orthodox Church and the Eastern Catholic Churches of the Byzantine Rite, the baptismal garment is worn by the newly baptized for eight days, after which there is a special ceremony on the eighth day for the removal of the baptismal robe. For adults, the robe is a long, sleeved garment, similar to the Western alb, tied at the waist usually with a white cloth belt or rope. A woman may also cover her head with a white veil (usually a simple kerchif). For infant baptisms, the robe may be a white gown and bonnet, and a white blanket.

"O Thou who, through holy Baptism, hast given unto Thy servant remission of sins, and hast bestowed upon him (her) a life of regeneration: Do Thou, the same Lord and Master, ever tgraciously illumine his (her) heart with the light of Thy countenance. Maintain the shield of his (her) faith unassailed by the enemy [i.e., Satan]. Preserve pure and unpolluted the garment of incorruption wherewith Thou hast endued him (her), upholding inviolate in him (her), by Thy grace, the seal of the Spirit, and showing mercy unto him (her) and unto us, through the multitude of Thy mercies..."

Christening Gifts

Staff and wire reports
With signs the economy is improving but still fragile, Federal Reserve policymakers held the Fed funds rate steady -- at zero to 0.25% -- on June 24, and maintained its pace of purchases of government debt at mortgage-backed securities.
The Federal Reserve Open Market Committee said at the end of its two-day meeting that indications are that the "pace of economic contraction is slowing," and financial markets have improved in recent months. Household spending is also stabilizing, the FOMC said, but remains hampered by continuing job losses, declines in household wealth, and tight credit. Businesses, meanwhile, are cutting back on spending and staffing, and are reducing inventory.
"Although economic activity is likely to remain weak for a time, the Committee continues to anticipate that policy actions to stabilize financial markets and institutions, fiscal and monetary stimulus, and market forces will contribute to a gradual resumption of sustainable economic growth in a context of price stability," the Fed statement said, adding that inflation is expected "to remain subdued for some time."
Driving Down Rates
In March, the Fed launched a bold $1.2 trillion effort to drive down interest rates to try to revive lending and get Americans to spend more freely again. It said it would spend up to $300 billion to buy long-term government bonds over six months and boost its purchases of mortgage securities. So far, the Fed has bought about $177.5 billion in Treasury bonds.
The Fed is on track to buy up to $1.25 trillion worth of securities issued by Fannie Mae and Freddie Mac by the end of this year or early next year. Nearly $456 billion worth of those securities have been purchased.
But slowing down the purchases carries risk, including that rates on mortgages and government debt could rise more than expected, which could hurt the economy's prospects for emerging from recession, economists said.
A recent runup in rates on mortgages and Treasury securities, if prolonged, could choke off prospects for an economic recovery. Some of those fears were eased last week, when rates on 30-year mortgages dipped to 5.38% after a string of weekly increases.
Paul Ashworth, senior U.S. economist at Capital Economics in Toronto, said the Fed dropped a statement warning about too-low inflation. "We take those changes to mean that Fed officials are less worried about the threat of deflation now," Ashworth said in an e-mailed statement.

BRUSSELS/FRANKFURT (Reuters) –
Efforts to save two leading European carmakers took a twist on Tuesday that could change the ownership of both crisis-hit General Motors Corp's (GMGMQ.PK) Opel and German sportscar maker Porsche (PSHG_p.DE).

As GM readied for bankruptcy, the Financial Times reported Belgium-based holding company RHJ International (RHJI.BR), a former bidder for Opel, was back in the running and close to a deal that would strand Canadian-Austrian auto parts group Magna International (MGa.TO).

Elsewhere, Qatar made an offer to the Porsche and Piech families that control the Porsche SE automotive holding that could help cut its debt mountain.

Porsche and Volkswagen (VOWG.DE) have been in talks to create an "integrated" automotive group after Porsche's 9 billion euro ($12.6 billion) debt burden forced it to drop plans for a full takeover of VW. But progress toward creating a combined company stalled after Porsche chief executive Wendelin Wiedeking sought investment from Qatar's sovereign wealth fund.

RHJ-OPEL DEAL CLOSE?

The FT reported GM was close to a deal with RHJ to sell a stake in Opel, and a memorandum of understanding could be signed within days.

Talks on a stake in Opel between its parent, GM, and Magna -- going on since Magna clinched an agreement just before GM's bankruptcy filing in May, pipping Fiat (FIA.MI) to the post at the time -- have hit snags, the paper said.

RHJ was named as a potential Opel buyer in media reports but never confirmed or denied it had made an initial bid let alone a second, improved one. But according to the Financial Times, RHJ has improved an earlier bid and is being taken "very seriously" by GM and a memorandum of understanding could be signed in days.

The FT reported RHJ's new offer was said to be more sensitive to job losses in Germany, which is providing $2.1 billion of bridge financing to keep the carmaker afloat as GM goes through bankruptcy proceedings.

Another sticking point in negotiations with Magna is access to the Detroit carmaker's global technology, which Magna wants to secure on behalf of Russian partners, the paper said. Magna has teamed up with GAZ (GAZA.RTS) and Sberbank (SBER03.MM) for the bid.

RHJ and Magna declined to comment, as did Fiat whose chief executive Sergio Marchionne has said he wants to focus on Chrysler (CBS.UL) -- in which it has taken a 20 percent stake -- after the Italian automaker's bid for Opel failed, and that its existing bid for Opel was the best it can do.

Back in the United States, GM is due to seek approval from a court on Tuesday to sell its assets to a "New GM" in a plan to reinvigorate the automaker under government ownership.

Also on Tuesday, Hyundai Motor Co (005380.KS) offered to allow customers to lock in fuel prices for new vehicles in a sales promotion aimed at the economic anxieties of American consumers.

(Reporting by Reuters reporters; Writing by Helen Massy-Beresford; Editing by Dan Lalor)

($1 = 0.7143 euro)