Terrific post at the Counterterrorism Blog. Read it carefully, as you might be confused initially between the Islamic State of Iraq, the umbrella group formed by AQ to unite all Sunni insurgents under one banner, and the Islamic Army in Iraq, an individual insurgent group made up of Baathist soldiers and Islamists who want to wage jihad on Americans but not so much on Iraqi civilians. IAI published an open letter to ISI today suggesting that the red-on-red is getting redder by the moment:

[D]ropping all pretenses towards brotherly unity, the IAI has suddenly fired off a volley of sullen contempt for Al-Qaida, its Islamic State [of Iraq], and its leader Abu Omar al-Baghdadi–accusing the ISI of spreading “unfair, false accusations” about its would-be connections to the Baath party, threatening other insurgents with death if they refuse to swear allegiance to the ISI, and the fratricide of at least thirty fellow Sunni militants from other groups (such as the 1920 Revolution Brigades, the Mujahideen Army, and Ansar al-Sunnah). The IAI took particular exception to Abu Omar al-Baghdadi’s challenge to other insurgents to justify their existence by attacking American military bases: “Oh, forgive us Allah, does this era need further evidence? …the Islamic Army has executed dozens of raids on bases and military barracks…[including] in the year 2003 before the Al-Qaida network in Iraq was even founded.” The IAI even directed an appeal straight to Al-Qaida leader Usama Bin Laden in Afghanistan, urging him to personally look into these allegations and “correct the path” of Al-Qaida’s leaders in Iraq.

Evan Kohlmann, the author of the post, speculates that IAI might have split into two groups, one loyal to ISI and the other very much not. (The same thing happened to the 1920 Revolution Brigades, another Baathist insurgent group.)

Like I said yesterday, if there really is a new Osama video coming it’s probably because AQ in Iraq is rapidly alienating every last political and paramilitary group in the country — including their own best propagandist and jihadist brothers in arms — and as such the jihadi in chief feels the time has come to do damage control. For all their nihilism, AQ does care about popular support; the caliphate can’t happen without it, a point Zawahiri drove home to Zarqawi in his now-famous letter. The way Time describes the letter to ISI, IAI is positioning itself as defenders of the Sunni population from the scourge of AQ, whose relations with the locals now mainly take the form of chlorine truck bombs. That’s pretty much the opposite, one would think, of how Osama wants it, and unless Sadr and the Shiites bail out him by going back on the offensive, I don’t know how he undoes the damage.

Speaking of which, it looks like we’re tired of waiting:

Iraqi and U.S. soldiers battled with Shiite cleric Muqtada Sadr’s Al Mahdi army today in the south-central Iraqi city of Diwaniyah that has been in the throes of a Shiite power struggle.

As many as six Mahdi army members were killed, 27 were detained and six wounded during fighting, the U.S. military said…

A man named Jassim, from Sadr’s Diwaniyah office, said that U.S. troops had entered the city before dawn from three locations with tanks and helicopters flying overhead, taunting the Mahdi army fighters.

“In some American vehicles, somebody who speaks Arabic using a loudspeaker challenged the gunmen with ‘where are you oh, cowards come on!’ and such words,” the man said.

I don’t believe that, but it’s sweet enough to warrant a blockquote.

The Diwaniyah operation is actually an expansion of the surge from Baghdad to surrounding areas. It’s not sectarian fighting that’s causing the trouble there, though:

There is increasing friction in Diwaniyah between Sadr loyalists and the province’s ruling party, the Supreme Council for the Islamic Revolution in Iraq (SCIRI)…

The two groups are preparing for elections tentatively set for later this year. SCIRI controls the provincial council, but Sadr forces are popular on the streets and have infiltrated the police, said Polish Maj. Gen. Pawel Lamla who commands the 1,500 foreign troops in both Diwaniyah and Kut.

I wrote about the inevitable SCIRI/Sadrist confrontation on Wednesday and what Iran’s role in it might be. If there really is a new, separate Iranian-backed wing of the Mahdi Army, then that’s probably not the wing that’s in Diwaniyah bumping heads with SCIRI; Iran wouldn’t tolerate infighting among its proxies. Which means the JAM there must be loyal to Sadr, which in turn means that it’ll be interesting to see how he receives this news of open warfare breaking out between his guys and ours. Keep an eye out for news from that city, as it might foretell what Sadr’s planning to do in the near future vis-a-vis us and Iran.

Update: Whatever other problems Osama might have in Iraq, he’s all set for money.

“Al-Qaida has become self-sufficient inside the country,” Gaskin said in an interview with The Associated Press.

The terrorists successfully target truck stops and other points along roadways leading east from the border area to hijack commercial vehicles and intimidate merchants, the general said. He estimated that a hijacked truck carrying fuel oil could yield $64,000.

“If you get a few of those a day, you can fund your enterprise,” he said of the terrorists.

Gaskin speculates that one of the reasons for the backlash against AQ among the Sunnis is because they’re cutting into the sheikhs’ smuggling rackets.