Shiite Prime Minister Nouri al-Maliki has accused Sunni Vice President Tariq al-Hashemi of being involved in a November bombing of Parliament and plotting a coup, sharply heightening the traditional sectarian divisions that have long plagued Iraq.
Officials say Maliki has issued an arrest warrant for Hashemi, the top ranking Sunni official in Iraq, a move that could well trigger a dangerous sectarian backlash.
Hashemi has been banned from leaving the country and is reported to be holed up in the semi-autonomous Kurdish enclave in northern Iraq.
Maliki also turned on one of his aides, Deputy Prime Minister Saleh al-Mutlaq, another member of the minority Sunni sect that dominated Saddam's tyrannical regime, for branding the premier as a "dictator."
Maliki has for some time been showing signs of dictatorial ambition, in the classic mold of the Arab strongman.
The hundreds of arrests were made possible because Maliki has an iron grip on the security forces. He controls the interior, defense and national security ministries.
At the same time, the Iraqiya political bloc headed by Maliki's rival, former premier Ayad Al-Allawi, and the minority but martial Kurds are boycotting the 325-seat Parliament to protest mass arrests and Maliki's refusal to share power.
Iraqiya won the most votes in the inconclusive March 2010 parliamentary elections, trailed by Maliki's State of Law alliance. But Maliki put together an alliance that gave him a parliamentary majority.
Allawi agreed to work with Maliki, but claimed Iraqiya has been "marginalized." On Sunday, Iraqiya threatened to withdraw its nine ministers from Maliki's fragile coalition.
On top of this, several provinces, including in the oil-rich, Shiite-dominated south, are demanding greater autonomy, like the Kurds who have had their own enclave in the provinces of Dohuk, Erbil and Sulaimaniya since 1991 courtesy of the victorious U.S.-led allies who liberated Kuwait from Saddam's clutches.
These autonomy moves will further undermine the central government by dividing the nation of 22 million and trigger confrontations over control of its oil wealth, something that's already happening between Baghdad and the Kurds.
U.S. President Barack Obama said when he hosted Maliki in Washington to mark the end of a nine-year war launched by George W. Bush and his coterie of neocons, that the Americans were leaving "a sovereign, stable and self-reliant Iraq with a representative government elected by the people.
But, as the Financial Times observed, "the reality is somewhat less encouraging."
It said in an editorial: "True, a brutal dictator and his evil regime have been consigned to the annals of history. Two parliaments have been freely elected. The press and speech are far freer now than they were before 2003.
"But these gains have come at the devastating cost of years of conflict. For many Iraqis, the fear of living in a dictatorship had merely been replaced by the fear of living in a society bitterly riven by bitter sectarian divisions," the newspaper noted.
"But perhaps the most debilitating consequence of the chaos … was the exodus of Iraq's professional middle class …If Iraq is to rise successfully from the rubble of its past, the government must find a way of encouraging its scattered middle class to return."
With the U.S. military gone, Iraq is more prey to the regional ambitions of its neighbors, Iran, Saudi Arabia and Turkey.
"Just as Iraq will be key to Iran's ascendancy as a regional power, so too will Iraq be essential to the United States, its Arab allies and Turkey for containing Iran," the U.S. global security consultancy Stratfor noted.
"Neither Iran nor its opponents wish to destabilize Iraq but its place at the center of a regional struggle bodes ill for its continued political stability."
This can only intensify Iraq's internal divisions as Maliki seeks to take control.
Maliki, a lifelong conspirator who was one of the top targets of Saddam's notorious security services for two decades, has been supported in office by the Americans.
With U.S. forces gone, he may be filling the shoes of the man he, and the Americans, fought against for so long.