As of December 2006, nearly 2,900
Americans have lost their lives serving in Iraq. Another 21,000
Americans have been wounded, many severely.

To date, the United States has spent roughly $400 billion on the Iraq
War, and costs are running about $8 billion per month. In addition,
the United States must expect significant "tail costs" to come. Caring
for veterans and replacing lost equipment will run into the hundreds
of billions of dollars. Estimates run as high as $2 trillion for the
final cost of the U.S. involvement in Iraq.

Despite a massive effort, stability in Iraq remains elusive and the
situation is deteriorating. The Iraqi government cannot now govern,
sustain, and defend itself without the support of the United States.
Iraqis have not been convinced that they must take responsibility for
their own future. Iraq's neighbors and much of the international
community have not been persuaded to play an active and constructive
role in supporting Iraq. The ability of the United States to shape
outcomes is diminishing. Time is running out.

B. Consequences of Continued Decline in Iraq

If the situation in Iraq continues to deteriorate, the consequences
could be severe for Iraq, the United States, the region, and the
world.

Continuing violence could lead toward greater chaos, and inflict
greater suffering upon the Iraqi people. A collapse of Iraq's
government and economy would further cripple a country already unable
to meet its people's needs. Iraq's security forces could split along
sectarian lines. A humanitarian catastrophe could follow as more
refugees are forced to relocate across the country and the region.
Ethnic cleansing could escalate. The Iraqi people could be subjected
to another strongman who flexes the political and military muscle
required to impose order amid anarchy. Freedoms could be lost.

Other countries in the region fear significant violence crossing their
borders. Chaos in Iraq could lead those countries to intervene to
protect their own interests, thereby perhaps sparking a broader
regional war. Turkey could send troops into northern Iraq to prevent
Kurdistan from declaring independence. Iran could send in troops to
restore stability in southern Iraq and perhaps gain control of oil
fields. The regional influence of Iran could rise at a time when that
country is on a path to producing nuclear weapons.

Ambassadors from neighboring countries told us that they fear the
distinct poss