A dangerous groundswell of resentment is building up on the streets of Baghdad

Without American power, Iraqis would still live in fear of Saddam. With American power, they feel weak and humiliated

When we look back in a few years it may – and I use the conditional with some deliberation – turn out to be one of history's small turning points. The day began as most Baghdad days begin, with a morning trawl across the city. We pile into the armoured car and drive around the city's different districts. There are far fewer burning buildings than a week ago. The throat doesn't burn with the bitter aftertaste of inhaled rubber and plastic fumes. There are still looters, but there are plenty more Iraqis who are trying to re-open shops and businesses.

So we drove across a calmer city than the one which greeted our convoy a week ago. We travelled with Dr Mohammed, our translator and Iraq's foremost Joycean scholar (astonishingly, in spite of Saddam's loathing of intellectuals, a few brave men like Dr Mohammed kept translating the classic works of foreign writers). Halfway between the Palestine Hotel and Abu Hanif, I heard Dr Mohammed call out from the front of the vehicle: "Look, look. They are back." The rear of an armoured vehicle is a strange, stifling, cave-like place. You don't see what the people up front can see. What Dr Mohammed saw were traffic policemen. Fine, plump and smiling in white uniforms. It gladdened Dr Mohammed's heart. A little flicker of order after 10 days of chaos.

But the policemen and the slowly normalising city centre are not the history I was referring to at the outset. They are part of the surface music of this city. The small turning point came about an hour later. Someone in the van had the idea that we should go and attend the Friday prayers at one of the big Shia mosques. Maybe the imam would be talking about the Americans or the fall of Saddam.

We never got to the Shia district. Even from the small window at the back of the vehicle, I could see the crowds gathering outside Abu Hanif mosque. This is a place of worship for the city's Sunni population, and our attention was drawn to the men standing on the wall carrying Islamic banners. Looking closer I saw they bore slogans: "Occupiers Go Home", "No US and UK in Iraq". So, a small demo at a mosque. The initial reaction is, no big deal. I've been attending such protests for the past six weeks in the Arab world.

And then you remember that you are standing in Baghdad, where nobody has held a free demonstration in more than 25 years. Then you hear a loud noise. It grows as you walk closer to the mosque. By the time you reach the main gate it is a deafening roar. They are shouting slogans forbidden under the secular rule of Saddam, slogans which, if George Bush could hear them, would surely cause him to revolve with anxiety: "With our blood and our souls we will defend Islam."

The same slogans rattled the walls of the Shah's palaces in Iran a quarter of a century ago. I had not expected to hear them in Iraq. At the end of prayers, the crowd poured into the streets. It was a big crowd. Thousands. I couldn't tell how many but at least as many as 10,000. An imam came and asked to be interviewed. "The Americans are here in our country for one thing. They want the oil. They want to defend Israel. If they don't leave soon there will queues of mujahedin lining up to drive them out." Again it was rhetoric familiar from the streets of Cairo and Beirut. But this was Baghdad, and there were American troops just up the road. The American "enemy" wasn't a distant entity – it was carrying M16 rifles a few blocks away.

Then came one of those moments that you live through with every nerve of your body vibrating. I saw young men breaking away from the main crowd and running toward a street corner. There was some shouting. Then I spotted American helmets bobbing above the crowd. "Look, buddy, I've got the gun – now back off," a voice shouted. An Iraqi man was confronting an American soldier. "Go ahead and shoot me. Go ahead," the man said. A woman shouted into my face: "It's about our pride. Its just about our pride."

In everything I have heard and seen in Iraq this past week, the words "pride" and "shame" recur. The elderly writer who was jailed under Saddam but wept when he saw the ransacked museum. It was looted by Iraqis under American eyes. The woman on the corner in Mansur whose husband vanished under Saddam but who railed with anger because Iraqis themselves could not do what America had done. The monster was driven away by foreigners, and Iraqis are as traumatised by this reality as they are by the presence of these strange, muscular, well-armed boys on their streets. So many of those I have spoken with are torn apart by the immense contradiction in their new lives: without American power, they would still live in fear of Saddam. With American power, they feel weak and humiliated.

Into this vacuum have come the clerics, both Shia and Sunni. I sensed it a week ago when we were stuck at an American checkpoint on the way into Baghdad. The troops smiled and were polite. They sunned themselves on top of their Bradley fighting vehicles and Abrams tanks. A voice crackled on a tannoy about a block away. "What is the voice saying?" I asked. Our translator said the imam at the local mosque was saying the occupiers should go home.

The Americans hadn't the slightest idea what was being said. It's too early to make definitive statements on how all of this is going, but the verbal incomprehension is a metaphor for much larger understandings. The men and boys from Wisconsin and Iowa and California have been unanimous in their earnest desire to be seen as liberators. But they know precisely nothing about the culture or language, and are genuinely surprised when they encounter hostility.

I have been around plenty of nasty, vicious armies. The US ground forces do not belong in that category, not by a long way. With only one exception – a very angry Marine officer in Tikrit – they have been open to the media and helpful. Nor does every Iraqi hate or even resent them. But my sense is that there is a groundswell of resentment building up.

The greatest tragedy of all has been the failure to prepare a political future. To invade Iraq without having a well-thought-out political plan was an extraordinary miscalculation. Now the forces suppressed for the last quarter of a century are emerging. None are friendly to the US or its vision for the Middle East. What exactly did the Allies believe would emerge when it burst open the doors of Saddam's demented republic? Peace, democracy, secularism?

There is still time to make the best of a very bad situation. I do not say "turn things around". There is too much pain in this land – the legacy of Saddam's terror, the years of sanctions, the wars – for glib talk of fixing things. But if the Allies can start by restoring basic amenities, it could earn some appreciation from locals. More than that, they must move quickly to show that those brought to the negotiating table are genuine representatives of the Iraqi people.

None of this will be easy, and none of it guarantees success.

The writer is a BBC Special Correspondent