In a grim report just before Christmas, the Pentagon has told Congress that levels of violence in Iraq have reached a new high.

USA Today writes that Pentagon's report, called "Measuring Stability and Security in Iraq," says the situation is far more "complex" than the term "civil war" implies. The report also said that confidence in the Iraqi government has reached an all-time low and the economy is faltering.

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The Pentagon says injuries and deaths among US and coalition forces in Iraq rose 32% during the period from mid-August to mid-October over the previous three months. Both the average number of attacks each week and the average number of people killed or wounded in those attacks were at their highest levels since the United States handed over power to the Iraqi government in June 2004.

The rise of ethnic and sectarian militias and other armed groups drove the increased violence, the Pentagon report says. The militia led by anti-American Shiite cleric Muqtada al-Sadr has replaced al-Qaeda as the biggest security threat in Iraq, it says. Death squads are continuing to target civilians, sometimes with help from the Iraqi security forces.

The Washington Post reports the Pentagon also acknowledged that anti-US fighters have achieved strategic success by encouraging the start of a spiraling series of sectarian killings in Iraq. In the report – which is mandated quarterly by Congress – officials traced the start of sectarian violence to the destruction of a Shiite mosque in Samarra last February. The violence has become so pronounced that it is threatening the stability of the government.

The report also said that, for the first time, the Mahdi Army, the militia of radical Iraqi cleric Moqtada al-Sadr, has replaced Al Qaeda as the "most dangerous force" driving the country towards a civil war. The US military has yet to call the sectarian conflict in Iraq a civil war, although many different media outlets, including The Christian Science Monitor, have started to use that term. The Post reports, however, that this is the first study given to Congress by the military in which it did not explicitly state that there is no civil war in Iraq.

ABC News reports that Lt. Gen. John Sattler of the Joint Staff described the rise in violence as proceding at "an incredibly rapid pace." General Sattler also said the violence is "the premier challenge facing the coalition ... and is something that has to be squashed." And while a debate has begun in Washington about whether more troops are needed to quell the violence, Sattler said it would be difficult to end the sectarian conflict, regardless of how many troops were in Iraq.

"I don't know how many forces you could push into a country – either us or coalition or Iraqi forces – that could cover the entire country where these nefarious death squads couldn't find somebody," Sattler said. "They're not after particular individuals. It's a tit-for-tat thing that keeps going back and forth."

Voice of America reports that Sattler also said there had been no joint Iraqi-American political decision to label Sadr's Mahdi Army as a hostile force, which would result in direct military action against it. Assistant Secretary of Defense Peter Rodman said that such a decision would be part of President Bush's Iraq policy review, which is expected sometime in January.

Despite the failure of the Iraqi government to do more to promote reconciliation between the different sectarian groups engaged in conflict, VOA reports that Mr. Rodman said that he is still hopeful the government will be able to play a key role.

Rodman praised recent efforts by the Iraqi Prime Minister to cajole and pressure the various groups into cooperating with the government. But the report says "Iraq's political parties are often unwilling or unable to resolve conflicts through compromise" and that some politicians support violent groups even while participating in the government.

Finally, The Washington Post reports that there is a serious disagreement between the White House and the Joint Chiefs of Staff over the idea of a "surge" of US troops to stem the violence in Iraq. The Post says that the White House is "aggressively promoting" the idea over the unanimous opposition of the Joint Chiefs. The Joint Chiefs' greatest concern is that the White House still does not have a defined mission and is "a latching on to the idea" because it has so few alternatives. The Joint Chiefs have taken a stand against the idea because they believe it will be the most important decision made in regard to Iraq since the March 2003 invasion.

For its part, the White House says that the Joint Chiefs have not taken a stand against the idea, but are just questioning it as part of a normal review process.

• How to beat insurgents: Military updates playbook (ABC News)
• Blair makes one last push in Middle East with Palestinian funding plan (Guardian)
• US plans Gulf naval buildup to warn Iran: report (Agence France-Presse)
• Iranian leader loses vote, reformers say (Reuters)

Feedback appreciated. E-mail Tom Regan.