The New Rules of Engagement

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It's through midlevel al-Qaeda operatives like Abu Abdullah, who retains ties to some of his former Baathist comrades, that nationalist groups have newfound influence with al-Zarqawi. "What he's now having to do is balance the hard-line ideology with the softer line of the Iraqis within his group," says Abu Marwan. Sunni insurgent leaders say it was their insistence on voting in the October referendum that discouraged al-Zarqawi from disrupting the poll. For now, the nationalists say they will be voting again on Dec. 15, and they expect al-Qaeda to once more hold its fire. But so far no announcements have been made, and nationalist commanders are worried that al-Zarqawi may decide to go for broke this time. "The debate is being had," says Abu Baqr, the Baghdad insurgent commander. "But soon the orders have to be given."

TALKING WITH THE ENEMY

What does that mean for the U.S.? Ambassador Khalilzad says, "There is a reaching out to noncriminal Baathists." Evidence of shifts within the insurgency in some ways presents the U.S. with its best opportunity since the occupation began to counter parts of the Sunni resistance. Adopting the long-standing attitudes of secular Baathists, some Sunni leaders tell TIME they have lost patience with al-Zarqawi and would consider cutting a political deal with the U.S. to isolate the jihadis. "If the Americans evidenced good intent and a timetable for withdrawal we feel is genuine, we will stand up against al-Zarqawi," says Abdul Salam al-Qubaisi, spokesman for the Association of Muslim Scholars. "We already stood up against him on the Shi'ite issue, and if he doesn't follow us, it will be a bad path for him." Baathist insurgent leader Abu Yousif, who has met with U.S. intelligence officers, says, "The insurgency is looking for a political outlet--once we have that, we could control al-Qaeda."

U.S. officials are actively exploring political bargains that might induce nationalists to split with al-Qaeda, including an easing of restrictions on former Baathists' involvement in the new government. Khalilzad says it's time for the "excesses" in the de-Baathification process to be reversed, a call echoed by military-intelligence officials. According to Khalilzad, the U.S. believes that Baathists who committed crimes under the former regime should be tried and senior regime members barred from political office. "As far as the rest are concerned, the time has come to reintegrate them into the political process," he says. Moves have already begun to bring back the guts of Saddam's army, disbanded in the first months of the occupation. "We're reaching out to officers and noncommissioned officers that we're going to put in place in the new Iraqi army," says a U.S. military-intelligence officer, although he adds that the new army will be more "reflective" of Iraqi society than Saddam's was. Having the men they are fighting enter the government will be hard for some U.S. battle commanders to accept, the officer says. "But we're trying to shape an end state."