The military occupation of Iraq by the United States and its allies was intended to last for at least a year. In fact, large numbers of American and allied forces remained in Iraq for much longer, but sovereignty was formally handed over to an Iraqi government in June 2004. Nevertheless, the brief period of direct American rule brought out certain trends in Iraqi politics, reflecting different possibilities in Iraq's history, but leaving an ambivalent legacy. On the one hand, the US administration seemed intent on setting up a fully functioning liberal democracy within a very short space of time, encouraging the development of a market economy and providing a secure environment by reconstructing the Iraqi security establishment, gearing it to police a thriving civil society. Yet the way the US administration set about this ambitious task was at odds with its declared goals. The result was a troubled and increasingly insecure country in which insurgency, lawlessness and sectarian conflict claimed growing numbers of Iraqi lives, in addition to taking a mounting toll of the occupation forces.

During this period the gradual establishment of formally representative institutions could have given the impression of the emergence of a new, democratic Iraq from the ruins of Saddam Husain's dictatorship – were it not for the backdrop of mounting violence, the flight of hundreds of thousands of Iraqis into exile, the sectarian murders and the widespread corruption that depleted still further the uncertain income of the Iraqi state.