It isn't "progress" unless you're moving forward:

BAGHDAD (AP) — Iraq's presidential council rejected a plan for new provincial elections and sent the bill back to parliament Wednesday for reworking, a major setback to U.S.-backed efforts to promote national reconciliation.

The ruling came despite a reported last-minute telephone call by Vice President Dick Cheney to the main holdout on the three-member panel, which has to sign off on laws passed by the legislature. The White House tried to put its best face on the development, saying "this is democracy at work."

Other administration officials are a little more blunt:

The veto is "somewhat of a setback," Mike McConnell, the director of national intelligence, acknowledged Wednesday during a hearing in Congress.

Five years after the fall of Baghdad, and the Iraqi government has yet to agree on a power-sharing agreement (or otherwise meet 18 benchmarks of progress).  As the AP points out, the "surge" was supposed to make this process easier:

Such power-sharing agreements are the end goal of last year's buildup of U.S. troops. The hope has been that the declining bloodshed will remove the fear that has paralyzed Iraqi politicians, enabling them to compromise and strike deals across the sectarian divide. And that, in theory, should blunt support for the Sunni insurgency and allow American troops to withdraw from the country.

Political progress, of course, just a "hope" but was the explicit justification and goal of the escalation.  Will the media look beyond the administration's "shit happens" spin and report on this and other setbacks whenever John McCain & Co. claim that the "surge" is a "success"?  

Yeah. I didn't think so.

For more on this topic, check out dday's excellent diary here.