Morale is already reaching late Vietnam War levels.
And no wonder; see "Ouch!" below.
Lind has a series of interesting presciptions for this; maybe our military readers can comment on them. As for grand strategy:
Most important, America should learn from its mistake. Woodrow Wilson was wrong; you cannot export democracy on bayonets. Nor is it the business of an American republic to try. Iraq would mark America's entry into and exit from the strategy of creating an American world empire. The lesson will have been expensive for the people of Iraq, but their suffering will at least have saved other peoples from having to go through similar "liberations" by cruise missiles and armored divisions. With the end of imperial ambitions abroad, America might be able to restore liberty at home. "Homeland security" a la 1984 ("War is Peace") may no longer justify secret detentions and star chamber courts when fewer people see us as an enemy.
But then, from the Establishment's perspective, that may define the problem, not the solution.
Out of the mouths of true conservatives...