George W. Bush wrote in his recent memoir: "There are things we got wrong in Iraq, but the cause is eternally right. The region is more hopeful with a young democracy setting an example for others to follow."

Meanwhile, back in the real world, the "young democracy" has finally got a new Prime Minister, Nouri al-Maliki. He's the same one who led the last government, although every party (including much of his own) wanted to get rid of him after the election in March last year.

Iraq's ethnic and religious rivalries have become so fierce that no new and more inclusive coalition of parties can be agreed on.

It has taken eight months of tortuous negotiations to get this far - a world record for the length of time taken after an election to create a new government. And the job's not actually done yet.

Maliki now has a month to form a Cabinet, which means fierce rivalry between and within the parties for control of the ministries that are the main source of wealth and power in Iraq. Even now, the deal could still fall apart.

And what about the al Qaeda terrorists whose supposed links with Iraqi dictator Saddam Hussein were one of Bush's pretexts for the United States invasion of the country in 2003?

Osama bin Laden's Islamist extremists actually had no links at all with Saddam Hussein, nor any presence in Iraq until 2003. It was the invasion that gave them a role there.

And although al Qaeda's fanatical desire to kill Shia Muslims and Christians, rather than concentrate on the US occupation forces, eventually alienated them from even the Sunni minority during the "surge" period in 2007-08, that has changed too.

"Now they're back," said General Hussein Kamal, the head of the intelligence division at Iraq's Interior Ministry, in an interview with the Guardian. "It's like 2004 again ... They are pure al Qaeda, not a mixture of groups like before."

It was 2004 when Iraq began its descent into hell. The invasion killed a lot of people, but the resistance really only got under way in the following year, when the Sunni Muslims started attacking US troops - and the al Qaeda volunteers among them also began murdering Shia Muslims in industrial quantities.

That triggered the Sunni-Shia civil war of 2005-2007, which the Sunnis lost decisively. So the Sunni community turned against the al Qaeda fighters who had brought this disaster upon them and that in turn enabled the US "surge" to succeed for a while.

But the subsequent years have seen the Sunnis excluded systematically from any meaningful share of power, and the clock is turning back to 2004. At no time in the past few years has the killing stopped in Iraq, but now it is ramping up again fast.

On October 31, al Qaeda gunmen stormed a Christian church in Baghdad, killing 58 worshippers and security officers. On November 2 there were 15 almost simultaneous bombs in Shia districts of the capital that killed scores of people and injured hundreds. On November 10 there were 11 more bombs, this time targeting Christians in their homes.

Half of Iraq's million-strong Christian minority has already fled the country, and the rest are thinking seriously about following suit. And Iyad al-Allawi, whose party got most of the Sunni vote in the election and actually won the largest number of seats, has effectively been frozen out of power by a Shia-Kurdish alliance. Just like after the previous election.

Under huge US pressure, Allawi has been persuaded to become chairman of the "National Council for Strategic Policy", a body created precisely to give him a job. But it is a pretty poor consolation prize, and may turn out to mean nothing at all. The US has lost almost all influence in Baghdad (although there are still 50,000 American troops in the country) and Iran rules the roost.

From the moment that Bush decided to invade Iraq, it was certain Iran would be the big winner. Almost two-thirds of the Iraqi population, although Arab, belong to the Shia sect of Islam, and Iran is the one great Shia power.

When the post-invasion scramble for power began in Iraq, it was natural for Iraqi Shias to turn to Tehran for support against Sunnis in their own country.

During the eight months of stonewalling that preceded the deal on November 11, both Maliki and Allawi spent more time seeking support in Tehran and the capitals of Iraq's Sunni neighbours to the south than negotiating with their rivals in Baghdad itself.

The country has become a pawn in the confrontation between Iran and the Arab countries, but Iran has emerged as the clear winner. Meanwhile, Iraq may be sliding into another mini-civil war, and there is no reason to think that the astonishing level of ministry corruption is going to decline.

There are not many countries that want to follow the example set by this "young democracy". They are just hoping that the bloodshed and the hatred do not spread.

* Gwynne Dyer is an independent journalist based in London.