Long term, Sadr can't win. He is opposed by the majority of the Shia clergy, and the Shia people. Sadr is considered a fanatic and opportunist, trying to capitalize on the reputation of his martyred (by Saddam in 1999) father. But Sadr has attracted the young Shia religious fanatics who want to be Iraqi Taliban and turn the country into an Islamic Republic.
Sadr's other problem is one of numbers and logistics. Reports from Shia areas where Sadr has followers, often reports only a hundred or so Sadr people out in the street demonstrating, and being avoided by other Iraqi Shias in the area. The Iraqi governing council has long complained of Sadr's armed militia, but were unwilling to push for disarming them. Thirteen of the 25 members of the governing council are Shia and they all condemn Sadr's use of violence. For the moment, Sadr's men can run wild because they outgun the police in many towns and neighborhoods. But coalition troops are better armed, and there are large numbers of Iraqi security troops that can be used to help disarm the al Mahdi militia.
Logistics is the real weakness of Sadr's forces. Coalition troops control movement between cities with armored vehicles and air power. Coalition forces control the water, electricity and food supplies. Hunger, thirst and darkness can be more powerful weapons than bullets. But another powerful weapon Sadr has to deal with is Iraqi public opinion. Shia leaders, religious and civil, hostile to Sadr are talking to the people Sadr is trying to stir up. In a battle for public opinion, Sadr is at a disadvantage, and this has always been obvious. Now it's likely to be fatal.
Fallujah is surrounded by American and Iraqi troops. U.S. Marine patrols have been moving through the outskirts of the city, with helicopter and fixed wing gunships overhead. A 7 PM to 6 AM curfew has been announced for the city. The operation, called Vigilant Resolve, will last several days and has the objective of arresting those responsible for killing four Americans in the city last week, as well as arresting or killing leaders of anti-government groups in the city.
Radical Shia cleric Muqtada al Sadr is apparently trying to take over the government in Shia areas of the country. The coalition had long feared a move like this, but was hoping it would happen after Iraqi army and police were again in charge of security, and Iraqis were running their own government. Sadr, with an arrest warrant out for him (for murdering rival Shia clerics), has decided to go for broke now. Sadr's armed followers, the Al Mahdi Army, have chased away the police (or been joined by them) in many neighborhoods. Looting has broken out in some areas. Sadr himself has barricaded himself in a the main mosque in Kufa, south of Baghdad, guarded by armed supporters. Sadr was long suspected of using violence, and murder, against opponents. A months long investigation last year, using Iraqi police and detective, uncovered the details of Sadrs use of death squads and terrorism against civilians, clerics and government officials who opposed him. In the last week, members of these death squads were arrested, and this apparently pushed Sadr to open rebellion.