Jobless men pay $500 bribes to join the police force. Families build houses illegally on government land, car washes steal water from public pipes and nearly everything the government buys or sells can now be found on the black market.

Painkillers for cancer (from the Health Ministry) cost $80 for a few capsules; electricity meters (from the Electricity Ministry) go for $200 each and even third-grade textbooks (stolen from the Education Ministry) must be bought at bookstores for three times what schools once charged.

"Everyone is stealing from the state," said Adel al-Subihawi, a prominent Shiite tribal leader in Sadr City, throwing up his hands in disgust. "It's a very large meal and everyone wants to eat."

Corruption and theft are not new to Iraq, and government officials have promised to address the problem. But as Iraqis and U.S. officials assess the effects of this year's U.S. troop increase, there is a growing sense that, even as security has improved, Iraq has slipped to new depths of lawlessness.

One recent independent analysis ranked Iraq the third most corrupt country in the world. Out of 163 countries surveyed, only Somalia and Myanmar were worse, according to Transparency International, a group based in Berlin that publishes the index annually.