Yesterday we learned that Iraqi plans to release Ali Musa Duqduq–a Hezbollah terrorist with American blood on his hands. The Maliki government claims it has no “legal basis” to keep him in custody, and has rejected a U.S. extradition request. Duqduq is a senior Lebanese Hezbollah operative and masterminded a 2007 ambush that resulted in the capture, torture, and murder of five American Soldiers. The Wall Street Journal reports that the decision is considered a victory for Iran, and a blow to American prestige and Iraq-US relations.

The situation illuminates Iraq at a crossroads between two powerful “friends,” neighboring Iran and the powerful regional player; the United States. On ‘Real News’ Tuesday the panel discussed the Duqduq situation, how important Iraq is to America’s regional goals, and what is the likelihood for Iraq to fall into the Iranian orbit–if it is not there already.