As bad as things are in Iraq, there is every possibility that they could get worse in coming months. That's not a rationale for pulling U.S. troops out; quite the opposite, in my view. But it does argue for the Bush administration to think more creatively about how to craft a sustainable strategy for Iraq and the region.

The central problem in Iraq is the same one the United States encountered when it invaded the country in March 2003. That conundrum can be summed up in a phrase attributed to a top U.S. commander a week or so into the war: "Where are the Iraqis?" By that, he meant: Where are the Iraqi generals and troops the CIA had hoped would switch sides as coalition forces moved toward Baghdad?

The failure of this secret intelligence effort to recruit Iraqi military commanders to assist the postwar transition is one of the least understood aspects of the war. U.S. and British agents worked frantically in the months before the war to persuade Iraqi generals to lower their tank barrels as coalition forces approached, and come over. The hope was that some of them might emerge as transitional leaders.

But it didn't happen that way. As U.S. and British troops moved north, the Iraqi generals failed to make the dramatic moves that intelligence officials had expected. In most cases, the Iraqi commanders and their troops just melted away.

Waiting in the wings was Ahmed Chalabi. The Iraqi exile leader had failed in his earlier efforts to get the Bush administration to declare him head of a provisional government when the war began. But now, with the failure of the CIA's strategy to get Iraqi commanders to switch sides, Chalabi was rushed to Nasiriyah in early April with 600 or so "Free Iraqi Forces." That wasn't enough people to keep order in a Baghdad neighborhood, let alone the country. And so the disastrous chaos and looting began. It continues to this day. This failure was compounded when the United States formally disbanded the Iraqi army in May 2003.

Where are the Iraqis? That's still a question more than two years later. Over the past year, the job of building Iraqi security forces has fallen to one of America's finest military officers, Lt. Gen. David Petraeus. He has done his best, but Iraq still doesn't have anything cohesive enough to take over from U.S. troops. Meanwhile, Iraqi militias are growing more powerful.

Here's where some new strategic thinking would be useful. The militias are a fact of life. The Kurdish pesh merga forces are maintaining order in the Kurdish areas of northern Iraq. The Iranian-trained Badr Brigade and other Shiite militias are keeping peace in the south and in Shiite areas of central Iraq. It's only in the Sunni heartland north and west of Baghdad, and in the checkered quilt of the capital itself, that true anarchy reigns. People will not tolerate that lawlessness forever. The Sunnis will eventually turn to a militia that can protect them -- against both U.S. forces and the jihadist insurgents who have intimidated the Sunni mainstream.

In the long run, the only hope for a stable, democratic Iraq is the success of Petraeus's project. But that's a long way off. In the short run, the practical reality is that tribal warlords and religious or ethnic militias will maintain stability, province by province. The new Iraqi government has publicly embraced the security role played by the Badr Brigade and the pesh merga. Given that, it's inevitable (and appropriate) that Sunnis gain their own counterpart.

The obvious danger with this strategy is that the militias could compete for turf and drag Iraq into civil war. That risk was highlighted by The Post's Steve Fainaru and Anthony Shadid this week in a story about abductions of Sunnis and Turkmens by Kurdish militiamen in the divided city of Kirkuk. The United States must make clear that it will tolerate the militias as local peacekeepers -- and continue doling out cash to tribal warlords -- only if they avoid such provocations and observe "red lines."

To build a sustainable Iraq policy, the administration must also level with the American people -- admitting and correcting mistakes when they happen. That's why it's crucial to hold people accountable for moral and legal outrages such as Abu Ghraib and Guantanamo Bay. Without a strong base in law and American values, the Iraq project will fail. The consequences of such a failure would last a generation. It's time to stop looking in the rearview mirror at Iraq and look straight ahead, eyes wide open.