The single most important indicator (that will be visible to us) of whether "the surge" will succeed will be the fate of the Mahdi Army and Muqtada al-Sadr in the next several months. Al-Sadr is a client-state-in-waiting of the Iranians, a virulent anti-American, the leader of the largest group of "insurgent" sectarian murderers in Baghdad and a key supporter of State Prime Minister Nouri Kamel al-Maliki. He's a litmus test.
If al-Sadr is destroyed, we are almost certain to win. If he is marginalized, victory is very likely. Failing either of those occurrences, we need to withdraw into our laagers and tell al-Maliki that he has two years of intelligence, logistics and air support left in which to solve his problem.
Because his power is a crucial indicator, look for the MSM to downplay, or agonize over, any slap-down of al-Sadr. A preview of the headlines: "The fragile Iraqi government is threatened by...", "Al_Sadr vows to bring down Maliki government...", "Bush's plan foundering on the rock of al-Sadr...", "Mahdi Army kills 6 US soldiers in pitched battle...". The fact that al-Sadr is the one really threatened will be ignored, as will the likelihood in the last example that the Mahdi Army would experience 150 killed.
The President must not go wobbly on his own words:
In earlier operations, political and sectarian interference prevented Iraqi and American forces from going into neighborhoods that are home to those fueling the sectarian violence. This time, Iraqi and American forces will have a green light to enter these neighborhoods.
Victor Davis Hanson has a fine article on this. An excerpt:
[Will this work?] Only if the Maliki government is honest when he promises that there will be no sanctuaries for the militias and terrorists. So when the killing of terrorists causes hysteria — and it will, both in Iraq and back here at home — the Iraqi-American units must escalate their operations rather than stand down.