The Kurds are ethnically different from Arabs and have inhabited the mountainous northeast of Iraq for centuries, but Sunni and Shiite Arabs have cohabited in the Mesopotamian plains since the rise of Islam in the seventh century. Greater Baghdad, accounting for a quarter of the national population, has been a mosaic of Sunni, Shiite and mixed neighborhoods. Now the mixed districts are turning into single-sect neighborhoods. Mosques that once attracted both Sunni and Shiite worshippers no longer do so. For protection, Shiite Baghdadis are turning to the uniformed police or army, whose personnel are mostly Shiite. Conversely, their Sunni counterparts call on local Sunni vigilantes for protection. A low-intensity civil war is under way in Iraq. This has caused alarm in other Arab countries.

REGIONAL CONSEQUENCES—The feeling of foreboding is one shared by both governments and intelligentsia within the Arab countries. They realize that every major country in the area is susceptible to the kind of division that is roiling Iraq. In Syria, for instance, Sunnis are only two-thirds of the population, the rest being Alawi, a subsect within Shiite Islam, as well as Druze and Christian. In Egypt, one of the most homogeneous of the Arab states, nearly 10 percent of the population is Christian. In Saudi Arabia, 8 percent of citizens are Shiite, almost all living in the oil-rich eastern province—and victims of official discrimination.

This state of affairs has provided powerful ammunition to authoritarian Arab regimes resistant to political reform. They warn that the American model of democracy will tear apart national identity and create divisive sectarian and ethnic identities, turning the region into mini-states along the lines of the post-Yugoslavia situation.

Also helping in this direction is the intense anti-Washington sentiment in the Muslim world stemming from the U.S. invasion of Iraq after making assertions about it that turned out to be false. There is little difficulty in marginalizing the advocates of political liberalization by describing them as allies of the hated Bush White House.

At the same time, there is much schadenfreude at Washington's mounting predicament. "The Iraqi debacle is throwing U.S. policy off balance," said a recent editorial in Al Ahram (The Pyramids), the official mouthpiece of the Egyptian government. "The United States needs friends in the region. It needs them to help it emerge from the Iraqi quagmire, but there is a price to pay, and that price may involve abandoning democratic reforms in Arab countries."

DEMOCRACY ON ICE—In fact, the Pentagon's assault on Iraq put a brake on the liberalizing trend—more marked in the economic and informational fields than in politics—that had been in progress in the region since the mid-1990s.

Like the rest of the world, Arab countries were affected by the economic globalization movement that gathered momentum with the collapse of the Soviet Union in 1991 and the transformation of the General Agreement on Tariffs and Trade (GATT) into the World Trade Organization (WTO) in January 1995. Globalization loosened the grip of dictatorial Arab states over the economy.

Equally, the arrival of the Internet and satellite television during the latter half of the 1990s undermined the monopoly over information that most Arab governments had arrogated for themselves.

The launching of the Doha-based Aljazeera satellite TV channel in 1997, followed by the abolition of censorship by Qatar's ruler, Shaikh Hamad ibn Khalifa al-Thani, in 1998, broke the long-established mold of state-managed news in the Middle East. Aljazeera also pioneered talk shows, debates and investigative journalism of the sort not witnessed in the region before. The network broke taboos by interviewing Israelis and tackling such controversial issues as the role of religion in politics. At one time or another, almost all of the Arab states have closed down the local Aljazeera bureaus in protest against its editorial policies. Yet audience figures of some 35 million in the Arabic-speaking world have so impressed their governments that they, too, have tried to incorporate some of Aljazeera's features.

Similarly, the information explosion from the early 1990s onward has impacted the Arab world. Internet use has become more common, and there has been a mushrooming of satellite television channels. The governments try to control information by blocking websites and banning satellite dishes. But those savvy about Internet technology invariably find ways to circumvent the barriers. Satellite dishes have become small enough to be mounted indoors.

Yet these developments have proved insufficient to prime a vigorous movement for political liberalization, committed to a representative government through elections and a choice of political parties. Perhaps what was missing was a catalyst to transform economic liberalization and the information explosion into an instrument for political reform. Those who urged Washington to invade Iraq confidently predicted that a democratic Iraq would come into being in the post-Saddam era, becoming a beacon of liberty, good government and the rule of law for the Arab world. Three years after Saddam's overthrow, the reality is chaos and violence.

Instead of initiating and aiding a democratic wave in the Arab world, Bush's invasion of Iraq has achieved the opposite result. Thus humbled, the Bush White House should accept political reality, and deal in a reasonable manner with organizations such as Hamas, the Muslim Brotherhood and Hizbollah—as it is already doing in the case of the United Iraqi Alliance and the Iraqi Accord Front.