In what is being described as the worst defeat for Iraqi arms since the terrorists took over half the country last month, forces of the Islamic State smashed the Iraqi government's ineffective effort to retake the city of Tikrit - Saddam Hussein's birthplace - taking up to 800 prisoners and destroying up to 8 helicopters.

McClatchy:

Witnesses reached by phone, who asked not be identified for security reasons, said that by Friday morning the final pocket of government troops had collapsed, an ignominious end for a counteroffensive that had begun with a helicopter assault into Tikrit University but ended with troops trapped at Camp Speicher.

There was no comment from the Iraqi government. On Wednesday, the military had acknowledged that its forces had made what it called a “tactical retreat” to Ajwa, a town about 10 miles south of Tikrit, after the push into the city failed.

Interviews with Tikrit residents and statements on Twitter accounts associated with the Islamic State described massive government losses. One Twitter post said Islamic State militants had shot down or destroyed on the ground as many as eight helicopters, a number that if confirmed would be a catastrophic loss for the government. Another Twitter posting said Islamic State militants had set the base’s fuel storage tanks on fire and that a suicide bomber had attacked a “gathering” of government soldiers.

One resident said that as many as 700 government soldiers and 150 fighters he described as Iranians, but who may have been Shiite Muslim militiamen, had participated in the final battle. Sunni Muslims in central Iraq often inaccurately describe Iraqi Shiites as Iranians.

“They were being bombarded and mortared all night, and by Friday morning you could see burning helicopters everywhere and the fighting had stopped,” the resident said.

He said many of the captured soldiers had been executed. “They are parading prisoners through the streets of Tikrit,” the resident said.

A military officer from the Kurdish peshmerga militia, who until the recent political split between the Kurdistan Regional Government and Baghdad had served in the Iraqi military’s special forces, confirmed the defeat.

“The government forces, which were a mix of regular army, special forces units and Shiite militias, have been destroyed,” he said, speaking only on the condition of anonymity so as not to aggravate the already poisonous relationship between the Kurds and the government of Prime Minister Nouri al Maliki in Baghdad.

“When they were unable to push past Ajwa with reinforcements on Wednesday, their fate was sealed,” the officer said.

The fact that Shiite militia were involved in the battle at all tells us that the government doesn't trust most of its army to fight on their side. Iraq has a 500,000 man army and they couldn't muster more than 700 for an important offensive?

Meanwhile, the Islamic State's terror campaign in Baghdad is proceeding. They took credit for a wave of bombings yesterday in the city that claimed 27 lives.

But all is not peaches and cream for the Islamic State. Their Sunni allies are balking at their barbarity and there have been clashes between the terrorists and Sunni militias in recent days. But there is not likely to be a complete break - not until Bagdhad is secure.