On August 31, President Obama will deliver a major speech on the war in Iraq.  August 31 is the deadline set by the president for the exit of all U.S. combat forces from the country. Fifty thousand non-combat troops will remain until the end of 2011. The reduction in U.S. troops reflects a change in approach to Iraq, from military to diplomatic. But with security fragile and a government not yet in place, analysts ask if U.S. diplomacy can be effective.

President Barack Obama says the U.S. commitment is changing from military to diplomatic in a bid to help bring stability to Iraq. The U.S. embassy in Baghdad is the world's largest.  And Washington plans to open consulates and branch offices in four other Iraqi cities.   Diplomats in the northern Kurdish city of Erbil will work on soothing Arab-Kurdish tensions.  The consulate in the southern city of Basra will help US companies set up operations in the oil rich area.

Thousands of American troops left Iraq this month. Manal Omar, who heads the Iraq program at the U.S. Institute of Peace, says Iraqis are wondering what will happen next.

"They hear what Obama is saying but what they are actually seeing is the large pull out, and so they're wondering is there really strength behind the words. That's a big question for the Iraqis.  The average Iraqi is saying, 'Are the Americans going to leave us,'" she said.

The 50,000 U.S. troops remaining in Iraq will focus on security for American civilians, counter-insurgency and training Iraqi security forces. In 2011, the remaining U.S. troops are to pull out.  But General Ray Odierno, the top U.S. commander in Iraq, says some troops may stay past the deadline.

Ken Pollack, an Iraq expert at the Brookings Institution, says some Iraqis want U.S. troops to remain.

"There is a sense that the Americans are leaving, they're withdrawing, they're pulling all their troops out, with no regard for what is happening in Iraq.  That's the kind of thing that creates real fear on the part of the Iraqis.  Right now, every Iraqi wants the United States to leave and they're terrified that they will," he said.

The failure to form a new Iraqi government is complicating U.S. efforts.  Prime Minister Nouri al-Malaki and former Prime Minister Ayad Allawi are struggling over forming a new government.  Mr. Allawi's party narrowly won the March parliamentary election.

Pollack met recently with officials in Iraq and says he does not see the stalemate ending soon.

"All the key leaders believe that the election has effectively given them the right to lead the country.  But, of course, no one can agree on who actually has that right or how they would come together that would actually move the country forward, and no one has any good idea how to bring it to an end," he said.

Manal Omar says the U.S. could garner support in Iraq by helping to improve basic services.

"There's a lot of frustration at the lack of a delivery of services.  Iraqis are still amazed that there's problems with electricity and problems with water and they look at the U.S. for answers-why did that not take place.  And I think if the diplomatic effort was able to show these are improving, you will see a huge amount of cooperation from the Iraqi people," she said.

By October 2011, the State Department is to assume responsibility for training the Iraqi police.

To pay for the ramped-up presence in Iraq, the department needs to convince Congress that spending more money on diplomacy is cheaper than military operations.

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