A week earlier the United Nations (UN) headquarters in Iraq and with it their chief envoy, Sergio Vieira de Mello, were blown up by a truck bomb. There have been 143 US military deaths since George Bush declared an end to combat operations - more than died in the military campaign itself.

"Retreat in the face of terror would only invite further and bolder attacks. There will be no retreat." George Bush's speech to army veterans belies the increasing desperation of the US regime faced with this situation in Iraq.

They are failing to resolve the fundamental problems experienced by most Iraqis. In Baghdad power cuts are more frequent, tap water if it flows at all is undrinkable and there is a complete lack of security.

The head of the occupation authority, Paul Bremer, has described the price of reconstruction as "almost impossible to exaggerate." The US is already spending $4 billion a month on the occupation but he estimates that the restoration of the electricity supply will cost a further $2 billion and drinking water $16 billion.

The failure of the US to address these fundamental problems is fuelling the anger of ordinary Iraqis against the occupation and support for the attacks on American and British soldiers.

US officers talk of over a dozen attacks a day.

The UN itself has become a target with the blowing up of the chief envoy. His successor, Mr Lopez da Silva, admitted that the lack of security could limit the UN's work and underline the reluctance of countries to commit their armed forces to the conflict.

US dilemma

The US needs to commit more troops to Iraq, some estimates say that up to one million may be required. There is a battle taking place in the Bush administration over this - poor morale in the army and doubts about the occupation amongst the American public would make the deployment of extra US troops problematic, with its echoes of the 'mission creep' in Vietnam.

Because of this, and their failure to get substantial forces from other countries, they are forced to turn back to the UN.

They need a new Security Council resolution and endorsement for a multi-national force that will draw in other countries. The US will not relinquish political control of Iraq but, according to deputy Secretary of State Richard Armitage, may accept a multinational UN force under a UN military commander who is American.

The turmoil in Iraq is being reflected in the US - a Newsweek poll found a majority opposed to a Bush re-election for the first time since before September 11.

This is also due to the problems in the US economy, with an expected record deficit of $455 billion this year - which in turn will limit the amount of resources the US can put into Iraq.

The situation can only get worse. Shia groups are arming themselves and escalating religious and ethnic conflict is possible.

The recent bombs show that the activity of resistance groups from inside and outside Iraq is increasing. The US is not only a deeply unpopular occupying power, its presence in Iraq will be a magnet for every group that wants to fight US imperialism.