Iraq's in civil war, and the US is bogged down in a mess. "Stay the course" has gone out the window, but few ideas have entered the political landscape to replace it. Most of these ideas are military, and include restructuring the police force, adding more US troops, removing US troops, training the Iraqi military, directly striking militia groups, etc.
The only political idea that's popularized by policy-makers is that of asking Iran and Syria for help. Let's be clear that the guys in charge of these countries are not nice guys, and are not our friends. Embracing their help will, at best, give them huge influence in Iraq, or, at worst, backfire completely. But if the situation in Iraq becomes desperate enough, an unholy alliance may look more tempting.
But for now, we explore other political options. To preface my thesis, I am going to make a few assumptions:
1) The fighting between Sunnis and Shiites is a power struggle. That is, they're not just killing each other simply because they're racists, but because each ethnic group has specific needs and political agendas, and they do not want the other ethnic group to impose conflicting political agendas upon them.
2) The key to power in Iraq is currently Baghdad, due to the central nature of the government.
The Shiites and Sunnis may very well be trapped in a cycle in which neither is secure while the other still fights, and neither will stop fighting until it is secure. It will take a drastic military or political intervention to change this. But can we do it without shedding the blood of thousands?
If the fighting really is a power struggle, then we should take away the reason for fighting: take away power from Baghdad. The American Federalist system works by giving the Federal government in Washington limited power over the states, mostly to ensure interstate commerce is smooth, that national defense is strong, and that fundamental freedoms are not infringed. If Iraqi "States," like American states, are set up, each with a large deal of autonomy, it's very possible the desperate power struggle between the Sunnis and the Shiites will decrease. It will be important to be clear that Baghdad is a city not affiliated with any state, like Washington DC.
Above is an image of a three-state Federalist system as proposed by goalsforamericans.org. They ask for a very high degree of decentralization, almost to the extent of separate countries. but I believe that maintaining a strong army run by Baghdad will decrease the incentive for the three regions to go to war.
The states would be divided up largely along ethnic lines, as it's Sunni and Shiite ethnic loyalty that seems to drive the actions of political and militia groups. By giving ethnic states a level of autonomy, they will have secure power, and will be less likely to fight to make sure that their own interests are protected.
We've seen this work in the Kurdish state already. The Kurds have had semi-autonomy for 15 years (since the first Gulf War), and have dealt with it very well. It is the Kurdish semi-autonomous state that is the most peaceful, despite being the least represented in the central government parliament, because its regional power means it does not need command of the central government to feel secure.
There are criticisms of the Federalism idea. The first criticisms are that it addresses the wrong problem; that the ethnic clashes are not politically motivated. This is just untrue. The militia sympathizers boycott elections, walk out of parliament, and make careful political assassinations to try and either protest or gain political advantage. This is not simply racial genocide and carnage.
The second criticism is that Turkey, our allies, would be very upset at the move, as it would invigorate the Kurds in eastern Turkey, and open up the possibility of the formation of a Kurdish state. I find this problem to be largely overplayed. The Kurds simply don't need more autonomy (as their region is so peaceful), and they would be unlikely to get more. In fact, the Kurdish semi-autonomous state should be used as a model for the other two.
Finally, there are fears that an Iraqi three-state program would turn into a mass migration and refugee nightmare like India and Pakistan/Bangladesh when they formed. While many people would likely move between states, this problem is also overplayed. First, American and Iraqi forces would clearly oversee state migrations in the first few months to make sure that the situation remained as peaceful as possible, and so fewer fights are likely to break out. Also, many fewer people would be moving across a border with better infrastructure, so the migration would be faster and easier. It's entirely possible that blood could be shed during this process, but we are clearly not saving lives by doing nothing at all, and the long-term benefits could be the saving grace of Iraq.
Clearly, Turkey's worries and the problems of migration and refugees should not be ignored, but they are relatively small problems compared to the civil war that rages in Iraq today, and could be managed to some degree by coalition and Iraqi forces. Once the migration has occured, the two new states could set up their own constitutions and parliaments, like American states, and begin a sense of self-rule that would bring great political security to all three regions.
Ultimately, the average Iraqi person wants peace. And if the average Iraqi person feels political and military security, he is not going to support dangerous militias that will propogate a civil war that is primarily targeting civilians. But until the Iraqi people have this security, they will fight desperately and bitterly to make sure they get it, and this civil war will rage on, no matter how many troops we have (or don't have) in Iraq.