On Christmas Eve in the Green Zone, karaoke is blaring into the night from a contractor's villa while U.S. troops use a sniffer dog to check for car bombs just a block away.

This morning saw the start of perhaps the most extensive security operation I've seen in this fortified home to the Iraqi government and U.S. mission. Army engineers came with cranes and blocked side streets in the 4-square-mile district with concrete barriers. Snap checkpoints (in addition to the usual checkpoints) were mobilized to stop cars and check IDs of pedestrians. There's been an obvious reinforcement of troops, crowding the streets with their convoys of enormous MRAP (mine-resistant ambush protected) armored trucks, all causing gossip and speculation among the thousands of American and Iraqi residents who live in the big compounds, apartment blocks and suburban-style streets.

 By Jessica Ramirez

By Daniel Stone

Late Sunday afternoon, during President Bush's surprise visit to Baghdad over the weekend, an Iraqi journalist forcefully threw both of his shoes at Bush before he was quickly subdued by Secret Service and Iraqi security officials.

The incident took place at the end of a press conference Bush was giving with Iraqi Prime Minister Nouri al-Maliki. A local TV journalist stood up and yelled at Bush. His comment, according to a New York Times translation from the Arabic: "This is a farewell kiss, dog."

Even pointing the soles of your shoes toward someone is impolite in local culture, and hitting someone with your shoe is a brazen insult. After U.S. troops toppled the government of Saddam Hussein in 2003, Iraqis relished hurling shoes at the dictator's statues and portraits.

Bush avoided contact with both shoes, dodging the first and putting up his right hand to fend off the second. Both sailed past him and hit one of several American flags positioned behind the two men. Video of the incident  shows the room of reporters and security officials scrambling to detain the man, who reportedly was working with an Egypt-based station, Al-Baghdadia.

By Jessica Ramirez

In the weeks before Maj. Gen. Mark Hertling wrapped up his time as commander of Multi-National Division North Iraq, an Iraqi soldier struck up a conversation with him on the streets of Mosul. “General, our blood has come together and sprinkled the ground of Iraq," the soldier told him. “From that blood the seeds of liberty will grow.”

Hertling recounted this exchange in a gym at Forward Operating Base Speicher near Tikrit during the transfer of authority ceremony to the incoming Task Force Lightening this week. His point—the bloodshed that has swept Northern Iraq is real, but so is the progress.

When Hertling and his 1st Armored Division arrived in October 2007, the surge was showing signs of success in Baghdad and Al Qaeda’s presence in Anbar Province was weakening. By comparison, the situation in the North had grown bleak. The economy was at a standstill, and the region was headed toward its worst drought in about 15 years. There were roughly 1,800 attacks a month in the area, and Qaeda had sunk its teeth into cities like Mosul and Baqubah, where murders for hire and suicide attacks became as normal as shopping at the local markets.

In the past 14 months, U.S. and Iraqi forces were able to put a severe dent in the statistics, bringing attacks down to 108 for last week. They also helped train some of the five Iraqi Army divisions in operation as well as the more than76,000 Iraqi police officers. Local tribal leaders played their part in the reduction of violence as well, and the fruit of their labor is reflected in the local economy. The continued drop in overall attacks against the North’s oil pipeline was key to the rise in its crude oil exports. Provincial Reconstruction Teams also worked to build and rebuild critical parts of the area’s infrastructure.

But improvements have come at a price. At least 104 U.S. soldiers were killed and 891 were wounded during this period. There are also an unknown, but certainly large number of Iraqi lives that were lost. Even with the “monumental” success that Hertling spoke of, the North remains the most dangerous part of Iraq. Places like Mosul are still Qaeda targets and tensions between ethnic Kurds and Arabs in the region remain strong. Not even Iraqi security forces are immune to the troubles. Enemy combatants have infiltrated them three times in the last 12 months and American soldiers were shot or murdered in each instance.

As of this week, it’s up to Maj. Gen. Robert Caslen, who replaces Hertling, to keep the precarious peace. That could prove to be a unique challenge come January 1, 2009 when the Status-of-Forces Agreement, referred to as the SOFA, goes into effect. Under the SOFA, the Coalition Forces will hand over all bases to Iraqis by July. In a press conference held in the gym’s weight room following the handover ceremony at Speicher, Iraqi journalists questioned Caslen about the role of his forces in the coming year.

Caslen suggested their presence in the area will be more like that of “guests.” They will leave the bases in the cities, which is part of the agreement, and work as a support system for Iraqis in the North. If the Iraqi government happens to want Coalition forces in towns like Mosul, Caslen says they have that option. The Iraqi journalists seemed happy with the response, if not totally convinced by it.

However the partnership between the two countries plays out, the battle for Iraq is entering a new phase. As the Iraqi soldier from Mosul said to Hertling, there have been plenty of blood-soaked seeds scattered all over this country. Have they sprouted liberty? We’re about to find out.

Today is a Muslim holiday, so the traffic through Baghdad's Nasoor Square was light. When I went out to take a look, Iraqi police ate lunch on a bench near their traffic booth and greeted passing colleagues with hugs and handshakes near the red fire truck stationed along the sprawling roundabout. The city government has refurbished the curbs with new cement work around the centerpiece, an abstract statue of eaglets bursting from an egg--"Nasoor" means "eagles" in Arabic. There are saplings planted on the circle's fringe. Workers have even installed a spiky metallic date palm that lights up at night, an artistic take on the city's trademark flora. The security improvement in Baghdad has allowed such public works to flourish. Occasionally holiday revelers cruised through the circle, clapping hands in their minivans or blowing a trumpet.

A little over a year ago, this was the scene of one of the worst single-incident killings of civilians by U.S. forces during the war when members of the U.S. Embassy's private guard force, contractors working for Blackwater Worldwide, opened fire on commuters, killing 17 men, women and children and injuring more than 30 others on Sept. 16, 2007. U.S. prosecutors in Washington this week announced that they had charged five of the men with manslaughter and accepted a guilty plea made by a sixth. The Blackwater guards insisted at the time of the shooting that they had come under attack but Iraqi and now U.S. investigators have concluded the killings were unjustified. The Iraqi government threatened to throw the company out of the country and U.S. diplomats, apparently caught by surprise by the furor, rushed to provide new oversight to Blackwater teams.

Hard feelings still permeate what continues as a flashpoint between Americans and Iraqis. This major crossroads is at the corner of a National Police compound and a route skirting the fortified Green Zone. Large convoys for the Iraqi security forces, U.S. military and private security contractors regularly push through, prompting civilian traffic to an abrupt halt.

As a colleague and I chatted with Iraqi police and videotaped the unusually orderly flow of cars, a U.S. Army convoy passed by, first three or four of the hulking, monstrous MRAP armored trucks and then a couple of armored Humvees. I had stopped filming about the same time as the soldiers parked far away. To my surprise, they headed our way.

"Let's have it," demanded the first one, gesturing to my camera. We told him we were American reporters taking footage of the notorious roundabout and he answered, "[You're] videoing our convoy at a f---ing checkpoint." We protested that this was a public square albeit with a casual Iraqi checkpoint open to all passersby at one spot and that reporters regularly videotape passing convoys. A second soldier arrived to provide a friendlier face for the U.S. military. Explaining that they view video as a security breach, he accepted that we were not a risk and let me keep my camera.

The Iraqi police nearby laughed about the encounter. "You're from the same tribe," one said, crossing his wrists to signal the handcuffs he believed would have been employed if I had been Iraqi (in fact, I'm often mistaken for Iraqi, with my light beard, and my female colleague wore a black headscarf to help her blend in, so I suspect that is how the troops viewed us from their vehicles).

We had been talking to the police about yesterday's news of the Blackwater indictments. They were pleased but not satisfied. "Anyone who kills someone should be killed. That is the law of God," said one Iraqi police officer, asking not to be identified offering an opinion outside his duty. "You call someone a 'terrorist' when they kill without reason." The police pointed to bullet holes in a utility post and their own police booth left over from the shooting.

At a bus stop, unemployed Ali Abdel Ali sat in a place where he says he sometimes comes to take a break and think. He knows a man whose mother was injured in the shooting. "[The guards] were armed and the people were unarmed," he said. "I don't know if they are going to sentence them. It will have to depend on the trial." He said he would need to hear the evidence before judging the men. But he said he feels safer coming to Nasoor Square these days than he would have a year ago. "I feel safe and you feel safe talking to me," he said, and smiled.