'It's the same old Iraq, just a tiny bit worse than it was last month'

Each time I return to Iraq, it's the same, like finding a razor blade in a bar of chocolate. The moment you start to believe that "New Iraq" might work - just - you get the proof that it's the same old Iraq, just a little tiny bit worse than it was last month.

At the border yesterday morning it was all smiles. Passport formalities would be over in minutes. But $10 (£5.40) would help. It did. That's what we used to do under Saddam - they are the same Iraqi officials, just not up to their previous standards of venality - but soon, no doubt, we'll be up to $15, or more.

The bombed road bridge on the Baghdad highway has been repaired - despite the murder of the owner of the company rebuilding it five weeks ago. There's a three-mile convoy of new American troops humming westwards along the motorway - you can tell the new units because their Humvees and armour are forest green; the invasion tanks are in desert yellow - and all seems well until we stop to chat to the sheikh of the little mosque by the last petrol station before Ramadi. He says there are three "Ali Baba" cars waiting. They crashed into a civilian car and sent it spinning off the highway into the desert. We drive on at 110mph.

The radio - BBC Arabic service, Iranian radio in Arabic, anything rather than the one run by the occupation authorities - announces a settlement with Grand Ayatollah Ali al-Sistani over the constitution that's supposed to be signed this morning. Iraq's leading Shia cleric doesn't want the Kurds to have a veto over the permanent constitution and wants more Shias on a five-person council. Then a Shia on the Governing Council - where everyone is handpicked by the Americans - speaks those words that always fill me with dread in the Middle East because they always turn out to be wrong. "We have reached an agreement," he said. "There is going to be very good news very soon." Well, we shall see.

Baghdad is yellow and grey under a fierce wind and, with sinking heart, I see more walls. The massive concrete ramparts around Paul Bremer's consular headquarters, the hotels of westerners, of the Governing Council, of every American barracks are familiar. Now government ministries are to be hidden behind concrete. And woe betide those Iraqis who work for the Americans as translators and fail to heed warnings about "collaboration". Three of them ignored the threat. One, a Christian, was shot dead in her car in the Zeyouna quarter, a second wounded with her, their driver also was shot dead.

I arrive at my dingy hotel and find that yet another translator is dead. He worked for an American newspaper and was driving home with his mother and two-year-old daughter when gunmen with silencers shot all three of them. There's a rumour that this was a revenge killing. So while we are outraged, we all secretly and cruelly hope it's revenge, not a collaborator killing, that has contaminated our hotel.

I lean over my balcony and watch four miserable Iraqis from the Civil Defence patrolling the road below. One of them is lame. The last man, the lame one, is walking backwards and staring at the rooftops.

Groceries in Karrada Kharaj, to a vast emporium crammed with the new Iraqi rich, middle class; the poor can't afford this place. There is fresh Danish butter, Austrian fruit juice, Perrier by the gallon. And then there are the cigars. Churchills at a quarter of the price of a European duty free, Cohibas at less than a third of their cost. Are these part of the untaxed imports with which the occupation authorities are trying to encourage the economy? Or part of the loot from Saddam's stores? In the evening, gunfire ripples across Jadriya, near the university - I hear it away as I write - and two American helicopters are thundering up in the darkness. I listen to this unreported battle, glad I didn't buy a bar of chocolate.

* At least 10 rockets exploded last night near the Baghdad headquarters of the Coalition Provisional Authority. There were no reports of casualties. The Katyusha rockets were fired towards the Convention Centre and the al-Rashid Hotel. The vehicle from which the rockets were fired blew up.