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They honestly need their own countries...
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Iraq is a bit like Yugoslavia was. It was an artificially created state, with the disparate groups concentrated in specific areas. After Yugoslavia reformed, we had to establish separate areas for the groups, and relocate those who would move or protect them if they chose not to. The problem is that the Sunnis have the industrial and urban areas, while the Kurds and Shiites occupy the areas with most of the oil.
If the economic picture were better and there was less animosity, perhaps a confederation of semi-autonomous states, like the U.S. would be a viable option.
Also, area political forces (i.e., Iran, Syria, etc.) do not want this to succeed. And are willing to offer at least some support to the insurgency so as to keep open the possibility of the US running home in defeat. There are many "visitors" at play within Iraq as well as your rivaling hometown factions.