In Najaf, U.S. tanks have surrounded the holy Imam Ali Shrine site where Shiite Cleric Moqtada al Sadr is believed to be holed up. Yesterday associates of Sadr suggested he was ready to vacate the shrine and disarm his militia after 10 days of fighting. Al Jazeera is reporting that Sadr also demanded the US withdraw from the holy city. Instead the US has moved closer to surrounding one of the holiest sites in the Muslim world–the holy shrine. CNN is reporting the US and Iraqi forces may use military action within the next day if Sadr does not personally and publicly announce he is disarming. Iraq’s Defense Minister said “The coming hours will be decisive and we will teach them a lesson they will never forget.” Meanwhile in Baghad, U.S. forces stormed into Sadr City in Baghdad and reportedly killed 50 Iraqis.

In other Iraq news, a national conference has to pick a 100-member interim legislature has ended in a storm of controversy. The legislature is comprised almost entirely of former members of the U.S.-appointed Interim Governing Council and pre-selected members from five major political parties. Many candidates who attempted to run were removed from voting lists because of technical reasons. And a slate of independent candidates removed themselves from the selection process in protest. Many other delegates left the conference.

No actual vote was taken, the slate of 81 candidates was simply approved. The 19 former members of the US-appointed Iraqi Governing Council were given automatic seats. Abbas Khadim, an Iraqi lecturer in California, compared the selection of the legislature to elections under Saddam Hussein: He said “There was no election whatsoever. It was one list of names prepared by the government. Take it or leave it! Not much different from Saddam’s elections which he always won by 99.99%” The head of a group called Free Iraqi Civilians and Officers said “It’s impossible to build Iraq in this way … representatives of [Prime Minister Iyad] Allawi and other officials want a parliament that just roots for them and not for the Iraqi people.”

A leading Republican Congressman from Nebraska, Doug Bereuter, has broken with party ranks and admitted that he now believes the U.S. was wrong to invade Iraq. In a letter to constituents he wrote “It was a mistake to launch that military action, especially without a broad and engaged international coalition.” Bereuter, who served as vice chairman of the House Intelligence Committee, is retiring from Congress this month after serving 26 years.

In New York, United For Peace and Justice filed a lawsuit yesterday against the city of New York for not allowing the group to hold a massive anti-war rally in Central Park on August 29, before the start of the Republican National Convention.

In Venezuela, the opposition to president Hugo Chavez has announced it will not take part in an audit of Sunday’s vote where voters backed the Chavez presidency. The Organization of American States and the Carter Center have deemed the vote free and fair but the opposition maintains massive fraud occurred.

A federal judge yesterday held reporters from four major news organizations in contempt of court for refusing to name confidential sources in their reports on Wen Ho Lee, the nuclear scientist once accused of being a spy. The judge ordered reporters from the New York Times, Los Angeles Times, Associated Press and CNN to tell Lee’s attorneys the names of federal officials who provided them confidential information.

And the AFL-CIO is estimating some six million workers could lose overtime pay when new federal rules go into effect on Monday. The new rules allow employers to exempt from overtime pay most workers making a salary above about $23, 660. The Bush administration circumvented Congress and changed the rules through the federal regulatory process. And though the Senate voted twice since April to block the changes, House Republican leaders blocked moves to overturn the new rules.