Iraq takes power two days early

BAGHDAD, Iraq -- Iraq's new leaders reclaimed their nation two days early, accepting limited power Monday from U.S. occupiers, who wished them prosperity and handed them a staggering slate of problems -- including a lethal insurgency the Americans admit they underestimated.

With the passing of a sheaf of documents and a prime minister's oath on a red Quran, the land once ruled by Saddam Hussein received official sovereignty from U.S. administrators in a secretive ceremony moved up to thwart insurgents' attempts at undermining the transfer.

"The Iraqi people have their country back," President Bush said at a NATO summit in Istanbul, Turkey.

On paper, the U.S.-led Coalition Provisional Authority granted power to Iraq's interim government at 10:26 a.m., 467 days after the U.S. invasion began. The reality is more complicated: Some 145,000 foreign forces -- most of them American -- remain in charge of keeping rebellion at bay.

The U.S. civilian authority, which rode in on a swift military victory that swept away Saddam's generation-long regime, withdrew quietly. Its leader, L. Paul Bremer, left Iraq aboard a military plane two hours after the transfer and was swiftly succeeded by U.S. Ambassador John Negroponte.

Hours later, NATO leaders agreed to help train Iraq's armed forces -- a decision that fell short of U.S. hopes that the security alliance would take a larger role in Iraq.

The shift of authority was held in Baghdad's heavily guarded Green Zone against a backdrop of Louis XIV furniture and a row of Iraqi flags -- the same green-black-red banner that flew over the nation while Saddam was in power.

"Please let us not be afraid of those outlaws that are fighting Islam," interim Prime Minister Iyad Allawi said in his inaugural address. "Some of them have already gone to the fires of hell and others are waiting their turn."

On the streets of the Iraqi capital, there was no sign of unusual activity or celebratory gunfire.

Iraq's tentative step toward democratic rule will operate under major restrictions -- some imposed at the behest of the country's influential Shiite Muslim clergy, which wanted to limit the powers of an unelected administration.

The interim government will hold power for seven months until, by U.N. Security Council resolution, elections are held "in no case later than" Jan. 31. The Americans retain responsibility for security.

Bush raised no objection to Allawi's possibly imposing martial law in Iraq or other hard-line measures to deal with the insurgency, including Abu Musab al-Zarqawi, the most wanted militant in the country.

"He may take tough security measures to deal with Zarqawi, but he may have to," Bush said. "Zarqawi is the guy who beheads people on TV. He's the person that orders suiciders to kill women and children."

Though the government is unable to amend the interim constitution, it assumes responsibility for the daunting problems that have bedeviled U.S. occupiers for more than a year -- public turbulence, a ruined infrastructure that has angered the citizenry and, most urgently, the accelerating and violent insurgency that has left hundreds dead. It must make initial attempts to stitch together a patchwork of ethnicities that Saddam pitted against each other -- including Iraqi Kurds who had carved out a largely autonomous region in the north.

It also inherits responsibility for the fate of Saddam, the dictator-turned-prisoner whose harsh rule left tens of thousands dead. His brutality and Iraq's alleged terror links was one reason cited by Bush for the decision to invade.

Saddam will be transferred to the custody of his countrymen and will appear before an Iraqi judge in the "next few days" to face charges, officials said Monday. A military spokesman said he will remain in a U.S.-run jail because the Iraqi government lacks a suitable prison.

The transfer of sovereignty places Iraq's immediate future in the hands of two men with widely different styles and power bases: Allawi, a Shiite Muslim, physician and former Baath Party member with longtime ties to the State Department and CIA; and President Ghazi al-Yawer, a Sunni, American-educated engineer who lived for many years in Saudi Arabia and prefers traditional Arab dress.

"I will leave Iraq confident in its future," Bremer told them and fellow ministers at the handover ceremony.