The plan was hatched by Joe Biden, which tells you everything you need to know about how disastrous its implementation would be. Lenin points out that one somewhat major problem with the idea of partitioning Iraq is the fact that this overtly imperialistic game plan doesn't exactly have a history of working (e.g. Ireland, Palestine, India, Cyprus, Yugoslavia, etc).
Tom Engelhardt has some critical analysis of the partition over at Alternet. As with almost everything Engelhardt writes, this article deserves to be read quite closely. His indispensable blog is www.tomdispatch.com.
Also, see this review of the current dynamics of the occupation written by Anthony Arnove here. His analysis of the "partition" option:
One plan that the ISG did not recommend, and which Bush has also criticized, but which remains a real possibility as the crisis in Iraq unfolds, is partition. The deteriorating situation on the ground has encouraged some analysts and politicians—including incoming Democrat Joseph Biden, the powerful Senate Foreign Relations Committee chair—to call for the breakup of Iraq into three independent countries or three relatively autonomous territories within a loosely federated state.
Such a division of Iraq, however, could only be accomplished by massive ethnic cleansing. The largest urban concentration of Kurds in Iraq is not in the northern zone that would likely make up a future Kurdish enclave or state, but in Baghdad. Most cities described by reporters as “Sunni strongholds” or “Shiite townships” have mixed populations with significant minorities of Sunni, Shiite, Turkmen, Kurds, or Assyrians. In addition, any predominantly Sunni state in central and western Iraq that emerged from a tripartite division of the country would be significantly impoverished compared to its oil-rich southern and northern neighbors.
See also here and here for further analysis of the partition option being floated in Washington.



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