Washington continues to insist that everything is going as planned in Iraq. I continue to be skeptical of that optimism. While it is important to recognize the continuing progress in Iraq (and there is continuing progress there), it is equally important to acknowledge the serious problems looming on Iraq’s horizons—both near and far.

In particular, Moktada al-Sadr’s sudden return to Iraq this month—and the dismissal of the warrant for his arrest for the death of ‘Abd al-Majid al-Khoi—strikes me as far more pernicious than the administration has suggested. It is a mistake to dismiss it, as some senior administration officials have, as a positive sign that all of Iraq’s former warlords are now taking part in the political process. Moreover, the administration’s rather blasé reaction to this development is itself adding fuel to the fire.

First off, it is important to understand why Moktada returned at this moment. It was not a coincidence. It was not that he had simply finished his studies in Tehran and now was off to seek his fame and fortune back in Iraq. He came back because changes in Iraqi politics, and particularly the composition of the new Iraqi government, made it possible and propitious for him to do so.

The new Iraqi government is a national-unity government in all but name. Consequently, it has transferred all of the deep-seated political and personality differences among the various parties inside the Iraqi government. In particular, the Kurds joined Prime Minister Nuri al-Maliki not because they have any love for him but because they concluded, rightly or wrongly, that Ayad Allawi’s Iraqiya party could not successfully form a new government, especially with al-Maliki barring his way. The Kurds joined, and then helped persuade the Sunni-dominated Iraqiya to join as well, explicitly to block what they believe to be a dangerous tendency toward autocracy on the part of the prime minister. Again, whether they are right or wrong (and there is evidence of both), their goal within the government is largely to prevent al-Maliki from acquiring too much power and acting against their interests.

Although Iraqiya and the Kurds disagree on a great deal, their mutual suspicion of the prime minister and concomitant determination to limit his exercise of power means that al-Maliki is likely to face frustrations from within his cabinet on a wide variety of issues of great importance to himself and his constituency. Inevitably, this will drive him more deeply into the arms of the only other large group within the government who will be willing to support him in these circumstances—the Sadrists. In other words, the influence of the Sadrists is growing not just because they won roughly 40 seats in the 325-seat parliament, but also because the tetrarchic new national-unity government will likely create circumstances in which the prime minister will see the Sadrists (whom he otherwise dislikes) as a crucial ally.

For their part, the Sadrists seem more than willing to provide the prime minister this support, not out of any affection for al-Maliki either, but purely in return for his turning a blind eye toward their activities in southern Iraq. Already the Sadrists are throwing their weight around in al-Basrah, al-Amarah, An Nasiriyah, and other cities of the south, ousting local officials and telling people that the prime minister has effectively ceded the south to them. They are spreading the word that no one in the south will be able to look to Baghdad to protect them from the Sadrists as they could in 2008 after Operation “Charge of the Knights.”

The greatest problem with the Sadrist trend is not their connection to Iran, although that is a worry and should not be dismissed. Rather it is that the Sadrists make no bones about the fact that they seek to employ a Hezbollah model to create a state-within-a-state and eventually dominate Iraq. This is an insidious model to combat, as the endless tragedy of Lebanon makes all too clear. The longer that the prime minister feels forced to ignore their activities in southern Iraq because he needs their support against his other intragovernmental opponents, the harder it will be to stop this trend and the more likely that Iraq will someday find itself in a situation similar to Lebanon’s.

In addition, Moktada’s return and the dismissal of the arrest warrant against him is a shocking, but not necessarily surprising, blow to the rule of law in Iraq. There is considerable evidence of al-Sadr’s guilt, which the government dismissed out of political expediency. There are few things that could set a worse precedent for the rule of law in Iraq, upon which all hopes for stability and pluralism rest. Moreover, it is the United States (and the UN) who are responsible for enforcing the rule of law and insisting that Iraqi politicians play by the rules.

By downplaying (even lauding) al-Sadr’s return, the United States has struck a further blow to the prospects for the rule of law in Iraq. Washington’s reaction has struck many Iraqis as further proof that the United States is no longer interested in Iraq, let alone wiling to use its influence to prevent Iraq’s political leaders from subverting the political system. This is the path back to civil war: eventually, various actors will conclude that there is no power with the strength and willingness to enforce the rules, and therefore it is every man for himself and there are effectively no rules. It is just such a vacuum—such an absence of trust in one another and trust in the ability of the system to enforce its rules—that plunged Iraq into civil war in 2004–2005, and that has caught so many other countries in the civil war trap in the past.

Thus, far from being a sign of progress, Moktada al-Sadr’s return should be seen as a sign of the grave problems that continue to face Iraq. Moreover, the Obama administration’s unwillingness even to cry “foul,” let alone attempt to block or mitigate the problems it is creating, further undermines the prospects for long-term stability in Iraq by opening the door to a Hezbollahization of southern Iraq and subverting the rule of law. If the Obama administration is going to fulfill its pledge to responsibly end America’s involvement in Iraq, it is going to have to invest its time, energy and influence to help keep Iraqi politics on track. As we continue to see, again and again, Iraq’s political system is not yet ready to stand entirely on its own, and if it falls, it will bring down America’s vital national interests along with the hopes of 27 million Iraqis.