Dozens Die As U.S., Iraqis Battle Militias

Two days of fighting in Basra between Shiite militias and government forces have killed at least 40 people and wounded 200, an Iraqi military spokesman said Wednesday.

The violence spread north to the capital, where officials said at least 15 people had been killed in the impoverished Sadr City district, and three Americans were seriously injured by rockets or mortars landing in Baghdad's heavily fortified Green Zone. Shiite militants were suspected of firing the rounds.

American Embassy officials said Wednesday rockets or mortars fell inside the sprawling, highly secured area in downtown Baghdad for the third day in a row. The embassy did not say who the injured U.S. nationals were, when they had been hurt, or where they thought the rounds were being fired from.

Col. Karim al-Zaidi gave the Basra figure to reporters Wednesday but did not say how many were militiamen, Iraqi soldiers or civilians caught up in the fighting.

CBS News reporter Phil Ittner, at a British military base on the outskirts of Basra city, says Prime Minister Nouri al-Maliki personally traveled to the oil-rich city to take charge of the effort to seize power from the militias

An aide to the prime minister said Wednesday that al-Maliki had given militants in Basra a three-day deadline to handover their weapons. Sadiq al-Rikabi said gunmen who fail to turn over their weapons to police stations in Basra by Friday will be targeted for arrest.

Ittner reports that al-Maliki has demanded the militants surrendering their weapons also sign an agreement not to return to violence against the government - a requirement that would be logistically difficult at best. Basra has been largely run by militias, most notably the powerful Mahdi Army, controlled by radical Shiite cleric Muqtada al-Sadr, and getting any of them to voluntarily give up their arms was going to be a daunting task. "The prospects of that are very low," says Ittner.

Followers of al-Sadr have been fighting U.S. and Iraqi forces in Baghdad and other cities in reaction to the Basra crackdown. The Interior Ministry said Wednesday that least 15 people have been killed and 100 wounded in two days of fighting between join U.S. and Iraqi forces and militiamen loyal to al-Sadr in Sadr City district.

A ministry official was speaking to reporters Wednesday on condition of anonymity because of operational security. It is not known how many of the dead were soldiers, militiamen or civilians.

The fighting is the gravest challenge in months for Iraq's leaders.

Al-Sadr's Mahdi Army militiamen appeared on some Baghdad streets for the first time in more than six months Tuesday, as his followers announced a nationwide campaign of strikes and demonstrations to protest a government crackdown on their movement. Merchants shuttered their shops in commercial districts in several Baghdad neighborhoods.

U.S. and Iraqi troops backed by helicopters fought Shiite militiamen in Sadr City after the local office of al-Maliki's Dawa Party came under attack, the U.S. said. Residents of the area reported intermittent explosions and gunfire in the area late Tuesday.

An American soldier was killed in fighting Tuesday afternoon in Baghdad, the U.S. military said. No further details were released, and it was unclear whether Shiite militiamen were responsible.

CBS News chief foreign correspondent Lara Logan reports that two U.S. military convoys were attacked Tuesday night by Mahdi Army militiamen.

In an effort to win support, al-Sadr ordered his men to deliver the Holy Koran to Iraqi soldiers and police manning checkpoints - the gesture was apparently well received, says Logan.

Although all sides appeared reluctant to trigger a conflagration, Brig. Gen. Ed Cardon, assistant commander of the U.S. task force operating south of Baghdad, said the situation in the south was "very complicated" and "the potential for miscalculation is high."

The burgeoning crisis - part of an intense power struggle among Shiite political factions - has major implications for the United States. An escalation could unravel the cease-fire that al-Sadr proclaimed last August. A resumption of fighting by his militia could kill more U.S. soldiers and threaten - at least in the short run - the security gains Washington has hailed as a sign that Iraq is on the road to recovery.

Shiite militias in Iraq, including al-Sadr's, are widely believed to be receiving extensive support from inside Iran, though Iran's government denies providing any material support. Logan reports that, according to senior U.S. intelligence officials, Basra - located very near Iraq's southern border with Iran - has become the scene of a proxy battle between the United States and Iran.

The confrontation will also test the skill and resolve of Iraq's Shiite-led government in dealing with Shiite militias, with whom the national leadership had maintained close ties.

Underscoring the serious stakes at play, al-Maliki, a Shiite, remained in the southern city of Basra to command the security operation. Sweeps were launched at dawn to rid the city of militias and criminal gangs that ruled the streets even before the British handed over control to the Iraqis in December.

Basra, located about 340 miles southeast of Baghdad, is the center of the country's vast oil industry. Stability in the city is essential if Iraq is to attract huge investments needed to restore its neglected oil fields and export facilities.

Throughout the day, the sounds of explosions and machine gunfire echoed through Basra's streets as Iraqi soldiers and police fought the Mahdi Army in at least four strategic neighborhoods.

Iraqi police and soldiers prevented journalists from reaching the areas of heaviest fighting, and it was unclear which side had the upper hand by sundown.

Iraqi military spokesman Col. Karim al-Zaidi acknowledged that government troops were facing stiff resistance.

Residents of one neighborhood said Mahdi Army snipers were firing from rooftops. Others fired rocket-propelled grenades at the troops, then scurried away on motorcycles. Other residents said police fled their posts.

Residents spoke by telephone on condition of anonymity because of fear of reprisals, and their accounts could not be confirmed.

British troops remained at their base at the airport outside Basra and were not involved in the ground fighting Tuesday, reports Itner. Air support was being provided, but a spokesman would not say if it was U.S. or British planes.

The British had given assurances that the Iraqis could handle security in the city when they withdrew last year. Maj. Tom Holloway, a British military spokesman, told CBS News on Tuesday "the situation down in Basra has been deteriorating for a while, arguably," and that is why al-Maliki decided to come to the region himself.

Lawmakers from al-Sadr's movement announced that a civil disobedience campaign which began Monday in selected neighborhoods of the capital was being extended nationwide. The campaign was seen as an indication that the Sadrists want to assert their power without provoking a major showdown with the Americans, who inflicted massive casualties on the Mahdi Army during fighting in 2004.

Iraq's national security adviser, Mouwaffak al-Rubaie, was in contact with the Sadrist leadership in hopes of easing the crisis, said a top Sadrist official, Liwa Smeism.

The showdown with al-Sadr has been brewing for months but has accelerated since parliament agreed in February to hold provincial elections by the fall. The U.S. had been pressing for new elections to give Sunnis, who boycotted the last provincial balloting three years ago, a chance for greater power.

Al-Sadr's followers have also been eager for elections, believing they can make significant gains in the oil-rich Shiite south at the expense of Shiite parties with close U.S. ties.

Sadrists have accused rival Shiite parties, which control Iraqi security forces, of engineering the arrests to prevent them from mounting an effective election campaign.

They also complain that few of their followers have been granted amnesty under a new law designed to free thousands held by the Iraqis and Americans.

"The police and army are being used for political goals, while they should be used for the benefits of all the Iraqi people," said Nassar al-Rubaei, leader of the Sadrist bloc in parliament. "If these violations continue, a huge popular eruption will take place that no power on Earth can stop."