MAJOR SETBACK FOR U.S. POLICY IN IRAQ

Just when the Bush Administration and Jennifer Griffin of FOX NEWS and BRIT HUME'S "FOX NEWS SPECIAL REPORT" were boasting about how well things were going politically in Iraq, the Iraqi government rejected a measure to hold provincial elections.

The rejection is a major blow to the United States and the Bush Administration who were hoping the elections would solidfy Iraq.

Iraqi council rejects elections law

24 minutes ago

http://news.yahoo.com/s/ap/20080227/ap_on_re_mi_ea/iraq_politics

Iraq's presidential council rejected Wednesday a measure setting up provincial elections — seen as a key step to develop Iraq's nascent democracy — in the latest setback to U.S.-backed national reconciliation efforts.

The three-member panel approved the 2008 budget and another law that provides limited amnesty to detainees in Iraqi custody.

The three laws were approved as a package by the Iraqi parliament on Feb. 13. The move drew praise from the Bush administration, which had sought passage of a provincial powers law as one of 18 benchmarks to promote reconciliation among Iraq's Sunni and Shiite Arab communities and the Kurdish minority.

"No agreement has been reached in the Presidency Council to approve the provincial elections draft law and that it has been sent back to the parliament to reconsider the rejected articles," the presidential council said in a statement.

The panel is composed of President Jalal Talabani, a Kurd, Shiite Vice President Adel Abdul-Mahdi and Sunni Vice President Tariq al-Hashemi.