This is big
news, if it holds:
Talks between Kurdish leaders and a Shi'ite bloc to form the next Iraqi government have collapsed three days before the country's first fully elected parliament meets, senior politicians said on Sunday...
The article goes on to quote some bitter sounding Kurd leaders, and a Chalabi (!?) aide.
I'd bet the hangup remains Kirkuk, and Kurdish autonomy. Kurdish leaders have spent the last few decades calling for independence, and their people expect them to deliver. However, there are susbstantial numbers of Sunni and Shiite in the Kirkuk areas, and Sistani has been clear about keeping Iraq united.
How Chalabi fits in is somewhat murky, but it's probably not good.
A weak government will be dependent on the U.S., much as Allawi was, and probably fuels the insurgency.