You're completely ignoring the fact that the STATED goal behind the troop surge was to create an environment in which political reconciliation could take place.
By arming non-state actors like the Sunni tribes (who tend to be among the most backward, antidemocratic forces in Iraq), the "progress" being made is actually moving Iraq further away from the stated goal of political reconciliation.
You don't get to move the goalposts, sorry.
Furthermore, the primary reason behind the drop in violence seems to be the fact that Baghdad has pretty much been successfully ethnically cleansed.
And the idea that Iraq isn't going to be a salient issue in '08 is nothing more than wishful thinking.