Captured documents, and overheard conversations in Iraq reveal that many key terrorists are discouraged by setbacks and the ineffectiveness of their tactics. The increasing number of terrorist safe houses raided in the past few months has provided a large haul of "progress reports" written by low and mid-level terrorist leaders. Most of them complain of the ineffectiveness of their attacks, and the increasing number of successful raids by Iraqi and American troops. While Western media breathlessly reports every car bomb or ambush, there are not enough of these attacks to make a difference for the terrorists. The terrorists lose a much larger percentage of their people than the Iraqi security forces or American troops do. And in the Kurdish north and Shia Arab south, the terrorists rarely make any attacks at all, because the Sunni Arabs are too easily spotted. The captured "progress reports" and email, and overheard phone conversations, also reveal a sense of desperation. There is less money available for hiring the many people needed to carry out a bombing or ambush. And the people who took these jobs are shifting to better paying, or simply safer, reconstruction work, or other work in the booming economy.
American and Iraqi Information War experts have also been successful in releasing a lot of this captured material in a way that demeaned the terrorists. The Iraqis, in particular, learned from Saddam (some of these guys used to work for Saddam, but have now switched sides), about how to manipulate opinion via the media. The writing style of the terrorist progress reports resonates with Iraqis, who are encouraged by the hard times the terrorists are having. The progress reports also describe problems and mistakes, and these are publicized as well, to show that the terrorists are not as efficient as they like to present themselves.
Video is even more effective in humiliating the terrorists, and making them less fearsome. For several years now, Iraqi TV has been broadcasting the tearful, or at least fearful, confessions of captured terrorists. The U.S. recently released embarrassing outtakes from a terrorist video. The released version was edited to show the al Qaeda men as powerful and in control. The captured outtakes were more like a gag reel, and the terrorists did not look impressive at all. Iraqi TV has shown similar footage, as well as videos of terrorists torturing and killing Iraqi captives. This made for grim viewing, but it also convinced most viewers that the terrorists are scum who must be found and destroyed.