The End of the Surge: What Next for Iraq?

The last of the so-called "surge" brigades has left Iraq.

Most of the remaining soldiers from the 2nd Brigade Combat Team, 3rd Infantry Division, returned to Fort Stewart, Ga., at the beginning of the month. Only the stragglers remain in Kuwait.

Having deployed in May 2007, it was the last of the five brigades to arrive in Iraq as part of President Bush's strategy to send 28,500 additional troops to fight the insurgency and pull the country back from the brink of all-out civil war.

"When we got here things were very bad," U.S. Army Capt. Mark Battjes recently told ABC News on one of his final patrols before returning home. "We've been able to see the dramatic improvements over time and that gives the soldiers a lot of sense that they really accomplished something over this tour."

Iraq Troop Surge EndsPlay

Violence continues in Iraq but it's at the lowest level since 2004, according to the U.S. military. American and civilian casualties are down significantly and Iraq's government has grown in standing and confidence after confronting Shia militias in Basra and Baghdad.

When soldiers from the 2nd Brigade Combat Team arrived in Baghdad, there were 43 attacks a day in the city. That number fell to four a day last month.

Patrolling Alrabi'a Street in the Jamia neighborhood of the capital, Battjes recalled that it was a ghost town when his company moved in. "There was absolutely no traffic on this street," he said. "It was possible to walk the entire length of the strip, over a mile long, and not see a single person."

In those early weeks, his soldiers came under daily attack from gunfire, rocket-propelled grenades and roadside bombs in what had once been a thriving commercial district and upscale residential neighborhood.

Walking down Alrabi'a street today, the situation in Jamia has apparently been turned around. Some of the families that fled the fighting have returned. Hundreds of small stores have reopened and, while local traders say that business is still slow, they acknowledge that the situation is much better than it was a year ago.

The U.S. military attributes the improvements to large-scale searches, joint patrols with the Iraqi army, the recruitment of local men known as the "Sons of Iraq" to provide security and grants to small business.

Up to $700,000 has been spent on grants to businesses in the Jamia neighborhood in order to kick-start the local economy. Grocery store owner Uday Adnan told ABC News that a grant from U.S. forces enabled him to buy two freezers and replenish his stock. "People are coming back to shop here," he said.

About 550 local volunteers were recruited and trained to provide basic neighborhood security in October 2007. The "Sons of Iraq" were paid $350 a month. "That made a big impact on security," Battjes said, "because locals really feel like they have a stake in the security of their own neighborhood. We put these guys to work getting a regular paycheck so now they're paying money to buy things from the stores that have just reopened, and now those stores are able to buy more things and the better economic situation feeds back into the security situation because now someone doesn't have to go to the insurgency to get money to feed their families. It's created a positive feedback cycle where we used to have a negative feedback cycle."

Iraqi's security forces have grown in capability since last year and now play a bigger role in operations. The Iraqi Army has moved into Lamia and established a permanent headquarters. Iraqi police are receiving more intelligence from anonymous calls.

"From my perspective and in my neighborhood the surge was absolutely a success," Battles told ABC News from Fort Stewart. "It allowed us to place combat power where it was needed, and increase security in a very dangerous part of Baghdad. The surge forces also gave the Iraqi security forces the chance to develop and assume our duties as we left."

That success came at a cost to Battles' Bravo company, 1st Battalion, 4th Armour Regiment. Three of his men were killed and four were seriously wounded in some of the heavy fighting during their first month of deployment.

And serious questions remain about whether the recent improvement in security is sustainable. Iraqi troops still rely on American support. Al Qaeda is still operating in areas like Diyala and Nineveh provinces. The Shia militia affiliated with radical cleric Muqtada al-Sadr called a ceasefire earlier this year but some Iraqis fear that it may simply be regrouping. And, perhaps most crucially, Iraqi politicians are yet to take advantage of the momentum created by the surge to pass key legislation on oil and provincial elections, as well as reach out to those groups who have felt left out of the political process.

The departure of the surge troops means those left behind have a much bigger area to cover. There is no replacement for the 900 American soldiers who were responsible for Jamia and surrounding neighborhoods in western Baghdad.

"There is no longer extra U.S. force capacity to place overwhelming numbers of U.S. soldiers in lots of places simultaneously," Battjes told ABC News. "Therefore, the ability of the Iraqi Army and the Iraqi police to maintain and improve the security situation is critical."

Jamia storeowner Waleed Khalid told ABC News that he wishes Battjes and his men had not left. "For the time being they should not leave, because the Iraqi Army and police are not strong enough," he said. "They need a supporting force."

There's also uncertainty about the future of the "Sons of Iraq," which currently number around 100,000 across Iraq. In Jamia, about 100 have now quit after finding better jobs, and 180 have joined the police, leaving 240 waiting to see if they can get jobs inside the Iraqi security forces or join another work program.

Battjes warns that, "If the 'Sons of Iraq' are not transitioned in a satisfactory manner, there could be some serious security problems as a result."

As the chairman of the joint chiefs of staff, Adm. Mike Mullen, said recently at a town hall meeting with his officers, "We're not at the irreversible point yet."