Many commentators seem puzzled over President Obama’s decision to use an Oval Office speech to mark the “end of combat operations” in Iraq. The reason: Iraq is important to Barack Obama, even if most Americans are nowadays preoccupied with a foundering economy.

Iraq, in fact, may be the reason Obama is President. During the 2008 campaign, the very green Junior Senator from Illinois used his opposition to the war to distinguish himself from more experienced rivals like Hillary Clinton and Joe Biden. His anti-war credentials allowed him to ride the powerful tide of anti-Bush sentiment among progressives. It also buttressed his claims to be a Washington outsider, the most authentic agent of political change in the race. This appealed to independents.

Long one of urban America’s ugly ducklings, Washington D.C. is beginning to shine as a national showcase for school reform.

Two developments this week burnished the capital city’s growing reputation as a laboratory for tough-minded reforms in the areas of school choice and teacher accountability. Education Secretary Arne Duncan named Washington along with nine states as winners in Round 2 of the Obama administration’s Race to the Top grants. And a new Fordham Foundation survey, America’s Best (and Worst) Cities for School Reform ranked D.C. second among the 26 cities most receptive to change.

U.S. officials say they have al Qaeda on the ropes in Pakistan. Unfortunately, the same can’t be said for al Qaeda’s homicidal ideology, which is spreading to extremists in other Muslim countries. This poses new risks for Americans, and highlights a big hole in President Obama’s counter-terrorism policies.

According to The Washington Post, the Central Intelligence Agency now rates al Qaeda in the Arabian Peninsula, a Yemen-based offshoot, as an even greater threat than Osama bin Laden’s original. Under the “spiritual” guidance of Anwar a-Aulaqi, a cleric and U.S. citizen, AQAP is busy plotting attacks on America, including a failed attempt earlier this year to set off a car bomb in Times Square.

Opposition to nuclear energy seems to be melting fast, especially in the South. The Tennessee Valley Authority voted last week to complete a nuclear reactor in Alabama it stopped working on in 1988.

Earlier this year, the Obama administration awarded loan guarantees to Southern Company and two partners to build two new nuclear reactors in Georgia – the first new generating plants to be approved since the 1970s. Others are in the works for South Carolina, southern Maryland, and Texas.

It took a lot of arm-twisting, but Secretary of State Hillary Clinton announced last week that Israel and the Palestinians have agreed to return to the bargaining table. The Obama administration’s faith in the power of diplomacy, which some consider misplaced, is about to face its sternest test.

It’s not hard to find grounds for pessimism. For one thing, Palestinian President President Mahmoud Abbas agreed to participate only under heavy U.S. pressure. He had to give up his demand that Israel continue the freeze on settlements as a precondition for talks, though the “Quartet” (the U.S., Europe, Russia and the United Nations) cooked up a face-saving declaration last Friday.

4,419. That’s the number of Americans who have died in Iraq since the 2003 invasion, according to the Pentagon. Tens of thousands more have been wounded, maimed, or traumatized in various ways. And although it’s hard to get an accurate count, it’s likely that more than 100,000 Iraqis have perished.

As U.S. troops head home ahead of President Obama’s Sept. 1 deadline for ending major combat operations in Iraq, it’s worth asking: What did all this sacrifice achieve?

Defense Secretary Robert Gates makes an unlikely progressive hero. A holdover from the Bush administration, Gates is an ex-spy and button-down conservative who keeps a portrait of President Eisenhower behind his desk. Yet he’s also warned against the “militarization” of U.S. foreign policy, forced the armed services to adapt to untraditional modes of warfare, and axed major weapons programs.

Republicans like to posture as the scourge of big government, but they’ve long been AWOL in the battle to discipline the biggest, most bloated bureaucracy of them all: the Pentagon. Not so with Gates, who has taken Ike’s farewell warning about “the military-industrial complex” to heart.

I returned yesterday from an overseas vacation to find Washington embroiled in furious controversy over Robert Gibbs’s gibes at the “professional left.” Somehow, the shock waves from this momentous development had failed to register in Corsica, which may be a gorgeous, sun-splashed rock in the Mediterranean, but is hopelessly apathetic about U.S. politics.

Fortunately for slackers like me, Washington’s chattering class is too busy for vacations. And cable TV never rests, keeping the vital discourse of democracy going even as Americans frolic heedlessly on beaches, lakes and mountains. Well, the fun’s over for me, so I might as well wade into the fray between the frazzled White House Press Secretary and his netroots tormentors.

The Congressional Budget Office’s latest fiscal forecasts confirm that America faces a fiscal emergency. The national debt is projected to double as a share of GDP from 32 percent in 2001 to 66 percent next year. Then it could rise to 90 percent by the end of this decade, and reach 146 percent by 2030. At that point, we’d be spending about 36 percent of tax revenue to finance our debts, up from 9 percent today.

The nation’s yawning fiscal gaps, driven largely by entitlement spending, can’t be closed by a combination of economic growth and tax hikes. When it comes to government spending, there will be blood. Only not now: At the federal level at least, unemployment will have to fall dramatically, probably to around 5 or 6 percent, before real discipline can be imposed on public spending. Otherwise a premature turn to austerity could plunge the national economy back into recession.

Democrats like to think of themselves as champions of economic fairness for working families. But for decades now, working class voters – especially white ones – haven’t been feeling the love. Even as their economic condition has deteriorated, they persist in voting against their “class interest” by voting Republican.

Few U.S. political leaders have studied this phenomenon more intently than Virginia Senator James Webb. In a thought-provoking Wall Street Journal article last week, Webb took aim at government policies intended to promote “diversity,” which he says have marginalized many white workers.

After much self-congratulation over passing a massive financial regulatory bill, the U.S. Senate has punted on pricing carbon. That decision is likely to have a bigger long-term impact on the U.S. economy, and not in a good way.

Senate leaders yesterday conceded they don’t have the votes to put a price on carbon. Instead, they’ll try to pass a pallid energy bill that raises liability caps on oil companies and makes modest gestures toward energy efficiency. Even the catastrophic BP oil spill, it seems, was not enough to overcome lawmakers’ fear of being accused of raising taxes on energy as the economy struggles, even though a carbon price wouldn’t have gone into effect for several years.

President Obama has reorganized U.S. foreign policy around a new trinity of diplomacy, development and defense. That’s been a sore point among some progressive internationalists, who see the omission of a fourth “d” – democracy – as an overreaction to George W. Bush’s messianic freedom agenda.

Administration officials insist that they aren’t abandoning democracy, just promoting it in new and more subtle ways. Secretary of State Hillary Clinton recently offered an intriguing case in point.

It’s puzzling that President Obama keeps returning to the combustible subject of immigration. You’d think that, with big financial reform and energy/climate bills hanging fire, he’d have his hands full. And with unemployment stuck at nearly 10 percent, it’s not exactly a propitious time for a national debate over legalizing millions of immigrants who are living and working illegally in this country.

So what gives? Maybe it’s simply that Obama is the son of an immigrant father. Republicans, of course, have a more cynical explanation. They say Obama is throwing a bone to Latino advocacy groups disappointed by his failure to redeem a campaign pledge to move comprehensive immigration reform. Facing a very difficult midterm election, Democrats can’t afford to give Latino voters reasons to stay home.

The following is the is an excerpt from Will Marshall’s June 30 testimony before the National Commission on Fiscal Responsibility and Reform during the commission’s first public listening session:

Chairman Bowles, Chairman Simpson, and Members of the Commission, I appreciate the opportunity to appear before you to discuss ways to put America on a fiscally sustainable course.

Once unemployment rates start to fall, U.S. policy makers must be prepared to pivot sharply from fiscal stimulus to fiscal restraint. Otherwise, a large and growing federal debt will deplete our capital stock and thereby limit future economic growth. It will divert resources from productive investment to interest payments on the debt, half of which is already held by foreign lenders. And it will shake investor confidence, here and abroad, in the fundamental soundness of the U.S. economy, eventually driving interest rates up and the dollar down.

There’s a move afoot in Congress to cut one of President Obama’s most creative and cost-effective reforms – the Education Department’s $4.3 billion Race to the Top fund. Which GOP troglodyte is behind it? Actually, it’s a prominent liberal: Rep. David Obey (D-WI).

Obey, chairman of the mighty House Appropriations Committee, introduced a bill this week to cut $500 million from the fund. He also wants to skim $200 million from the Teacher Incentive Fund, which helps districts set up pay-for-performance systems to reward excellent teachers, and to take $100 million from a pot of money set up to help finance charter schools.

First the giant stimulus package, then the ambitious revamping of America’s health care delivery system. Now Congress, under the patient prodding of President Obama, is lurching toward passage of another stupendously complex bill, this time centered on financial regulatory reform. Whether you like them or not, you have to admit that big things are getting done in Washington on Obama’s watch.

If Congress passes the Dodd-Frank bill, it will be another major notch in the belt of a president who could use a political victory about now. But what’s a non-master of the universe like me to make of this 2,000-page behemoth?

Congress isn’t always the first place you look for intellectually honest discussion of America’s fiscal dilemmas. Neither party has clean hands, yet each points smudged fingers at the other. How refreshing then to hear Rep. Steny Hoyer (D-MD) uttering blunt truths rather than partisan cant about America’s exploding debts.

“Unfortunately, we can blame our long-term deficit on policies that are almost universally popular,” the House Majority Leader said yesterday at a forum hosted by Third Way. “We’re lying to ourselves and our children if we say we can maintain our current levels of entitlement spending, defense spending, and taxation without bankrupting the country,” he added.

President Obama firmly took charge of the Gulf oil disaster last night. That was something he needed to do. But am I the only one who found his martial tone off-putting?

There were even moments when I flashed back to his predecessor’s portentous declarations about the war on terror.

More than most of President Obama’s major speeches, this one seemed like a performance aimed at achieving a particular political result: belying a media narrative that says he’s lost control of the crisis. His histrionic address from the Oval Office suggested an actor who has read too many critical reviews.

The following is an excerpt from Will Marshall’s column in today’s U.S. News & World Report:

Engagement with North Korea has been a bust—at least in South Korea’s eyes. In sinking the South Korean warship Cheonan, the regime in Pyongyang also torpedoed the South’s “sunshine policy” of humanitarian aid and economic investment in the North. Let’s hope the incident also shatters some illusions in Washington.

Expect stern words tomorrow when President Obama speaks to the nation about BP’s failure to stop the Gulf oil spill. He should also use the occasion to deliver a strong message to the U.S. Senate.

The world’s greatest deliberative body has been flailing around energy and climate legislation since the House passed the Waxman-Markey bill last year. You’d think that, with oil still gushing into the Gulf, senators would be moved to do something serious about America’s oil addiction. Instead, the Senate seems headed toward the path of least political resistance.