As British troops pull out of Basra and Bush pays a surprise visit to Al-Anbar the situation in Iraq, despite what the US president says, is spinning out of control As 550 British soldiers from the 4th Battalion continued their symbolic, albeit surprise, pullout from Britain's last military base in Basra Palace in the south of Iraq -- a sign that their presence has been a failure -- US President George W Bush had a surprise of his own up his sleeve. Landing at a US airbase in Al-Anbar province in an unexpected visit on Monday morning, Bush hinted, for the first time, at cuts in US forces in Iraq. His reasoning, though, appeared to have little to do with realities on the ground. For Bush, the military "surge" earlier this year which pushed US deployment to an all-time high of 162,000 troops had led to improved security in Iraq. Whether he was simply alluding to a reduction in attacks against US troops remains unclear, though the US president's assessment of the situation was in stark contrast to the picture painted by official Iraqi figures. According to the Iraqi authorities, 1,805 Iraqis were killed in August, making it the second bloodiest month since the invasion in 2003. Last week also saw the burying of 40,000 unidentified Iraqi corpses. A cholera outbreak in northern Iraq is expected to take thousands of lives and spread in other parts of the country. World Health Organisation (WHO) experts attribute the epidemic to a shortage of potable water and a security situation that prevents Iraqis from seeking medical attention or travelling to hospitals. As if to contest Bush's security assurances, four American soldiers were killed on Wednesday and another four wounded in two attacks in Baghdad, according to the US command. A day before, a statement issued by the military said three soldiers had been killed and two wounded by a roadside bomb in east Baghdad. According to the statement, the bomb was an explosively-formed penetrator, of the type the US says Iran has been supplying to Shia militias, a charge the Iranians deny. The US said the blast occurred in east Baghdad but gave no further details. However, a US Humvee was seen burning Tuesday at an intersection in Mashtal section of eastern Baghdad. Last week, Shia leader Muqtada Al-Sadr ordered a six- month suspension of operations by his Mahdi Army militia, a move which raised eyebrows and suspicions about the motives and future plans of the young leader. US officials believe mainstream Mahdi forces have generally struck by the order though breakaway factions of the militia are continuing attacks. In a second attack on Tuesday, one soldier was killed and two others injured during combat operations in the west of the capital, said US command. The Electricity Ministry announced Tuesday that eight of its engineers and technicians had been kidnapped and murdered the day before by unknown gunmen in east Baghdad. The eight were travelling to a training session out of town when they were abducted. Relatives identified their bullet- riddled bodies in a hospital, ministry spokesman Aziz Al-Shamari said. In Mosul, 225 miles northwest of Baghdad, gunmen ambushed a car in the city centre, killing three men and a woman, police Brig Gen Abdul-Karim Al-Jubouri said. Despite all this, the American president, who arrived in Sydney Tuesday following his Iraq stop, insisted that "the security situation is changing, so that reconciliation [in Iraq] can take place". He added that the fact that the Iraqi legislature had passed 60 pieces of legislation "was illustrative of a government that's beginning to work". The much anticipated report on political progress in Iraq by a non-partisan Congressional watchdog, the Government Accountability Office (GAO), released on Tuesday, flatly contradicted Bush, characterising the Iraqi government as "dysfunctional" and concluding that it had failed to meet most US Congress targets. The Iraqi government had met three targets fully, partially met four but failed to make progress towards 11 of 18 benchmarks. "Overall key legislation has not been passed, violence remains high, and it is unclear whether the Iraqi government will spend $10 billion in reconstruction funds," said the report. It is "unclear", it continued, whether sectarian violence in Iraq has decreased since it is difficult to assess whether the perpetrator's intents are sectarian in nature. "As Congress considers the way forward in Iraq," said the report, "it should balance the achievement of the 18 Iraqi benchmarks with military progress and with homeland security goals, foreign policy goals and other goals of the United States." On Tuesday, the most senior US commander in Iraq hinted that he may recommend a reduction in US troop numbers to avoid placing strain on the army. General David Petraeus told US television there were "limits" to what the military could do, but agreed that next March was "about right" for reductions. The general is due to present his much anticipated assessment of US military strategy in Iraq to Congress next week. The Number 2 US commander in Iraq said Tuesday the next three to four months will be "crucial" in determining whether the US can start to withdraw troops from Iraq without sacrificing security gains since the troop build-up began early this year. "I think the next three to four months are critical," Ray Odierno told reporters. "I think that if we can continue to do what we are doing we'll get to such a level where we think we can do it with less troops." On Tuesday, an Al-Qaeda front group announced on an Islamist website that it was forming new suicide battalions to strike at the Americans and their "renegade" allies -- an apparent response to the burgeoning revolt against the terror movement. "These battalions, with God's help, will perform their duties in an excellent manner during the month of Ramadan and the enemies of God will suffer a lot," the statement said, referring to the Islamic season of fasting that begins in two weeks. Odierno said US forces were alert to the possibility of increased attacks during Ramadan but in the run-up to the holy month "violence has been going down". (see Editorial p10) Additional reporting: Associated Press