From its sprawling, $750 million embassy in Baghdad - the largest, most expensive American diplomatic mission in the world - Washington had hoped for a cozy relationship with the Iraqi government, forged after a U.S.-led military coalition ousted former president Saddam Hussein.
But in the seven months since the United States withdrew its combat forces from Iraq, U.S. relations with Baghdad have deteriorated as Iraqi insurgents have carried out a major attack at least once a month.
Hundreds of people have been killed in the ongoing violence that included coordinated bombings and gunbattles on July 23 unleashed by Iraq's al-Qaida affiliate.
As American influence in Iraq has ebbed to its lowest point in years, and with Iraq in political turmoil, the Obama administration recently announced large reductions to the size and scope of its mission in a country less willing to accept a significant American footprint.
These include plans to slash the huge diplomatic presence it had envisioned for Iraq by one-third, drastically pare down a highly-touted but deeply unpopular police training program and close its consulate in Kirkuk.
U.S. Cuts Iraq Funding
Government experts warned U.S. lawmakers earlier this year that Iraq is questioning the continued presence of large numbers of Americans on its soil. A slimmed-down staff of 1,235 U.S. diplomats was present at the end of June, along with 12,477 employees of U.S.-funded contractors, most of whom were sent to guard and feed them.
In May, the U.S. Senate appropriations committee reduced the Obama administration’s original $2.26 billion request for 2013 Iraq funding in half, to $1.1 billion.
If approved, the biggest chunk of the reduction would eliminate $850 million for the Police Development Program, a key component of the U.S. civilian aid mission to Iraq, advertised as America's largest rebuilding project since the post-World War Two Marshall Plan.
A critical report by the Special Inspector General for Iraq Reconstruction, released last week, cited Iraqi "disinterest" in the program as the primary reason for cutting the number of in-country advisers by nearly 90 percent, from 350 to 36.
The report said the American embassy in Baghdad never received a written commitment from Iraq to participate in the project and will close its $108 million Baghdad Police College Annex, turning it over to the Iraqis by the end of the year. Another $98 million was spent to construct a consulate in southern Iraq so it could be used for police training. But the Basra component ended "because the [Iraqi Interior Ministry] decided to terminate training at that location," it added.
Iraq's deputy interior minister, Adnan al-Asadi, told U.S. inspectors in May the program was "useless" and that Iraqi police officers had indicated the training received was "not beneficial," the report said.
With Americans now largely confined to the Baghdad embassy because of safety concerns, investigators recently disclosed that "support costs and security expenses accounted for 93 percent of the estimated $4 billion [allocated for] 2012 operations in Iraq."
U.S lawmakers say they are cautiously examining future investments in Iraq.
U.S. Rep. John F. Tierney, ranking U.S. House minority member of a Congressional subcommittee on foreign operations, said in June that he has “long expressed concern about the U.S. government’s significant footprint in Iraq.” He added that “the transition in Iraq and the taxpayer dollars that are being spent in that country” will be closely monitored.
Representatives from across Iraq's political spectrum claim they want both independence from and a close relationship with the United States.
"We need the Americans. We need to work together to reach the point when Iraq no longer needs help from anyone, including the U.S.," said Sami al-Askari, a Shi'ite lawmaker close to Prime Minister Nouri al-Maliki.
Independent Kurdish lawmaker Mahmoud Osman added that "foreign countries" have exacerbated domestic conflicts, such as Baghdad's ongoing dispute with the Kurdish regional government over oil rights.
Osman said Kurds should try to solve their own issues directly within Iraq and beware of depending too much on alliances with other nations, including the United States.
"These countries have their own interests. Today they help you, they talk to you, then they leave you or sell you [out]. We've seen this in the past," Osman said. "So I hope the Kurdish leadership will try...to [conduct] a dialogue with other blocs [and] with the government here, as long as we are part of Iraq, anyway," he said.
Baghdad resident Sadun Salam says "the U.S. withdrawal was a mistake because rebuilding and [fostering] democracy would have needed an American military presence."
Another Baghdad resident, Huda Ahmed, credited Washington for ousting Saddam Hussein, but said Iraqis' hopes for change have not been met.
"While I am not denying the huge role the U.S. played in toppling the [former] regime, the U.S. is not doing anything right now for the sake of Iraqi citizens. Americans are not trying to help Iraq improve its economic situation," Ahmed said.
Iran's Expanded Role
Meanwhile, as U.S. power in Iraq has steadily declined since the 2003 invasion, Maliki's embattled government has increasingly aligned itself with the region's dominant Shi'ite state, Iran, which is at odds with the U.S. on several fronts.
Last month, the Islamic Republic thwarted anti-American cleric and Iran ally Moqtada al-Sadr's push to join Sunnis and Kurds in calling for a no-confidence vote to oust the Iraqi prime minister, a fellow Shi'ite.
"Mr. Sadr was the key element in the process," said parliament member Askari, who acknowledged that Sadr's changed stance "is mainly a result of Iranian pressure" as well as pushback from within his devout base of Shi'ite supporters opposed to U.S. influence in Iraq.
That rankles many Iraq policy brokers in Washington who "dislike intensely when they see Iraqis following [Iran] on so many issues in the region," said Alex Vatanka, an analyst at the Middle East Institute.
While the Iraqi political crisis has eased for the moment, the sectarian conflict in neighboring Syria continues to unnerve Shi'ite leaders in Iraq.
Resurgent religious violence has added to fears that regional Sunni powers - chiefly Saudi Arabia, Qatar and Turkey - want to topple the Damascus and Baghdad governments by any means.
"Whenever you have [the] Shia-Sunni schism across the Middle East, the Iraqi Shia look to [their co-religionists] in the region for support, and, obviously, the biggest, most powerful Shia state is Iran," said Vatanka. "If the sectarian issue doesn't blow up, if it becomes less of a factor, the way it was just a decade ago, why can't we see an independent Iraq?" he asked.
Continued U.S. Presence
Maliki's government insists it wants good relations with Washington, and has signed a $3 billion deal to buy American-built F-16 fighter planes. U.S. oil giants have also begun to invest in Iraq's petroleum sector, which drives national commerce and accounts for more than 90 percent of the country's budget.
"I think the United States was and will stay the milestone in Iraq's future," lawmaker Askari said. "Most Iraqi leaders - I'm talking about the [ruling] National Alliance - are keen to have strong relations with the U.S. because this is the way to build Iraq and stabilize this important region."
Many analysts agree Washington still has an important role to play in Iraq, while some American officials say a smaller, more reserved U.S. presence may actually produce better results.
"I don't think we should count the U.S. completely out," said Gregory Gause, a Middle East expert at the University of Vermont. "I think there are plenty of political players in Iraq who want to keep the Americans in reserve because they don't want to be completely beholden to Iran."
Vatanka said most American diplomats who deal with Iraq believe the U.S. has a good chance of remaining a significant player in the country despite Tehran's current advantage.
"It becomes an issue of looking [at] the balance sheet...and asking yourself, if you’re in Baghdad, 'what can Iran actually bring to the table in the long term while [Tehran] itself is [so] isolated in the region and internationally?" he said. "That’s why I think the U.S. can be, by far, the most likely attractive partner for Iraq."
Still, by nearly all accounts, the grand strategy behind the 2003 U.S. invasion has yet to be realized.
"I think the most optimistic and ambitious version of that vision - a stable, democratic Iraq, strongly allied with the United States, at peace with Israel and confronting Iran - was a pipe dream," analyst Gause said.
"That was never going to happen," he said. "The medium ambitious version of the vision - a stable, democratic Iraq with a close relationship with the U.S. - has not been achieved."
VOA's Kurdish Service in Washington and Baghdad stringer Goran Tawfeeq contributed to this report.