By Christian Caryl

As you walk around the streets of this city of 500,000, you could be forgiven for thinking you’re in the capital of a small but up-and-coming Middle Eastern country. Police officers and soldiers sport the national flag on their uniforms — the same flag that flies proudly on public buildings, and, in a giant version, from a towering pole in the center of town. There’s a national anthem, which you might hear on the national evening TV news, broadcast solely in the local language. You’ll also notice imposing buildings for parliament and the prime minister, as well as the diplomatic missions of a number of foreign states, some of them offering visas.

Yet appearances deceive: This is not an independent state. You’re in Iraq — more precisely, the part of northern Iraq known officially as the Kurdistan Regional Government (KRG). You’ll be reminded of this fact when you open your wallet to pay for something: the local currency is still the Iraqi dinar (though the U.S. dollar circulates widely). Nor do any of the foreign governments that maintain consulates in Erbil recognize Kurdish statehood; nor, for that matter, does the government of the KRG itself. For the time being, Iraqi Kurdistan is still under Baghdad’s writ.

Emphasis on “for the time being.” In July of last year, KRG President Massoud Barzani asked his parliament to start preparing for a referendum on independence. It was a suitably dramatic response to the stunning disintegration of the Iraqi state under then-Prime Minister Nouri al-Maliki. Earlier, in January 2014, Maliki’s government had cut off financial transfers to the Kurds as part of a fight over control of oil resources, enraging Erbil even as his repressive policies toward Iraq’s Sunni Arabs were fueling the dramatic rise of the Islamic State (IS). Last summer, after IS forces shocked the world by seizing control of Mosul, Iraq’s second-largest city, the jihadists pushed from there deep into Kurdish territory, at one point getting within 25 miles of Erbil.

Buoyed by U.S.-led airstrikes on IS positions, the Kurdish army, the Peshmerga, soon rallied, forcing the Islamic State to retreat. But the Kurds didn’t stop there. The collapse of the demoralized Iraqi Army in large swathes of northern Iraq had created a vacuum that Kurdish troops were only too happy to fill. Almost by accident, KRG leaders abruptly found themselves ruling 40 percent more territory than at the start of the conflict.

This expansion brought a particularly important prize: Kirkuk, the city long hailed by Iraqi Kurdish nationalists as “our Jerusalem,” the spiritual and political focus of a future state. It also helps that Kirkuk sits at the center of one of Iraq’s biggest oil fields, and that gives the Kurds a lucrative source of income that could help to sustain the economy of a new country. Iraq’s Kurds, Arabs, and Turkmen have long squabbled over control of the city; in the 1980s, Saddam Hussein poured huge resources into an “Arabization” campaign that used forced population transfers to undermine Kurdish influence there. In June 2014, by contrast, the government in Baghdad could only look on helplessly as Peshmerga forces supplanted fleeing Iraqi troops and took over the city.

The 30 million Kurds of the Middle East don’t only live in Iraq, of course. But all of them are feeling the tremors of change. Iran, which has a significant Kurdish minority of its own, is strengthening its ties with the KRG, which it views as a vital ally in the fight against IS. In Syria, the civil war has enabled Kurds to set up wide-ranging self-administration in the northeast of the country — thus eroding the border between Syrian and Iraqi Kurds, who now travel back and forth across the line without visas. And in Turkey, home to the region’s largest Kurdish minority, the government of President Recep Tayyip Erdogan has abandoned long-held policies aimed at the suppression of a distinct Kurdish identity and is conducting peace talks with the Kurdish Workers’ Party (PKK), responsible for a decade-long insurgency in eastern Turkey.

All of this means that the Kurds, who enjoy the unenviable status of the world’s largest nation without a state, now find themselves on the verge of establishing their first viable national homeland — nearly a century after the Great Powers carved up the post-World War I Ottoman Empire into the countries of today’s Middle East, ultimately leaving the Kurds out in the cold. (The Soviet Union sponsored the creation of a Kurdish republic in Iran in 1946, but it quickly collapsed when the Soviets withdrew their support.)

“An independent Kurdistan is something that all Kurds dream of,” retiree Ramzi Maaroof, 65, told me as we chatted in the Erbil bazaar. “I’ve been waiting all my life to see it.”

If the dream finally becomes a reality, there is one nation in particular that the Kurds will have to thank for it: the United States. Even though U.S. policy toward the Kurds has often been subordinated to the same spirit of realpolitik that defines so many of Washington’s policies in the region, today’s Iraqi Kurdistan traces its origins to two key events: the establishment of a no-fly zone over the region after the Allied victory over Saddam in 1991, and the overthrow of the Iraqi dictator in the U.S.-led invasion in 2003. As a result, Kurds tend to be overwhelmingly pro-American — to an extent that comes as quite a jolt to anyone who’s spent time in other parts of the Middle East.

And yet President Obama and his predecessors in the White House have all been notably reluctant to give their blessing to Kurdish statehood — out of the not entirely unreasonable fear that creating a new player in such a volatile neighborhood could invite serious instability. To name but one possible risk: a declaration of secession by Iraqi Kurdistan could prompt the final collapse of rump Iraq into separate Sunni and Shiite statelets, intensifying sectarian conflict throughout the region.

This climate of uncertainty helps to explain why Kurdish leaders respond to questions about their timetable for statehood with perceptible caution. “The path is full of obstacles,” says Fuad Hussein, President Barzani’s chief of staff. Iraqi Kurds, he says, are still a long way from standing on their own feet economically. Kirkuk may give them a promising source of petroleum, but since they have no access to the sea, they’re dependent on the goodwill of Baghdad or their neighbors to ship their oil to world markets. And even if matters have improved in recent years, Hussein notes, that goodwill is far from given. Over the past century all the governments that harbor big Kurdish minorities have embarked on brutal efforts to tamp down any hint of Kurdish self-determination — and Kurds haven’t forgotten. More urgently, Iraqi Kurds still face a major existential threat from the new Islamic State stretching along a 600-mile border to the south. And collapsing oil prices certainly don’t help.

Far from wholeheartedly embracing President Barzani’s announcement of the independence referendum, most Kurdish officials now hasten to downplay it. “There will come a time when Kurdistan will become an independent state,” Deputy Prime Minister Qubad Talabani told me. “Whether now is the right time is not clear.” For his part, Hussein stressed that the Kurds are intent on giving Iraq another chance — especially now that the troublesome Maliki, who resigned in September, has given way to the much more congenial Prime Minister Haider al-Abadi, who recently signed a deal with the Kurds ensuring them a 17 percent share of Iraqi oil revenues as well as funding for the Kurdish military. (Indeed, Barzani’s referendum announcement may have been aimed partly at pressuring Baghdad to get serious about negotiations.)

“We want to give Iraq a chance to be a democratic state,” Hussein assured me. He didn’t have to add that the Kurds have been waiting for just such an outcome for more than a decade now, and that they can’t be expected to wait forever.

But they’ll still need to proceed carefully. Given the vulnerabilities of their position, the Kurds can’t afford to be seen as the ones responsible for the final demise of Iraq. If Iraqi Kurdistan really does decide to grab the ring of independence, it will need to make sure that Baghdad, its own neighbors, and, perhaps, most importantly, the United States, are all more or less reconciled with the move. Hussein compares the birth of a Kurdish state to a newborn baby: “We don’t want to have a child that has many illnesses, and that will pass away after a few months. A child must have a good environment, and parents that will take care of it.” If Kurdistan is to be born, he says, “it must be a part of stability in this area.” Of course, even the healthiest babies have sometimes been known to give fits to the neighbors. The Kurds may yet pull it off. But don’t bet on it anytime soon.

Foreign Policy