Washington ? Unable to dissuade Congress and the White House from backing the only Iraqi opposition group with a record of fighting against Saddam Hussein and for democracy in Iraq, the State Department is now trying to strangle the Iraqi National Congress with red tape provided by State’s inspector general’s office.

The tip of an ugly struggle between the INC and the State Department’s Bureau of Near Eastern Affairs surfaced last week when the opposition group was forced to shut down satellite television broadcasting into Iraq. The rebels had plunged $2 million in debt broadcasting propaganda against the Iraqi regime after State cut off funding in February in a dispute over accounting procedures.

This was no isolated event: The INC television shutdown came immediately after the White House rebuffed Deputy Secretary of State Richard Armitage’s effort to funnel $5 million to the Middle East Institute, a Washington think tank working to promote rival Iraqi groups. Armitage had failed to notice that Ned Walker, the head of the institute, had publicly scorned President Bush’s “axis of evil” metaphor as “ridiculous.”

A State Department spokesman was quick to deny to me that this remark and other recent strong criticisms of Bush’s Arab-Israeli policy by Walker, who was director of the Near East bureau in the Clinton administration, resulted in the withdrawal of the grant for a series of conferences that were to have been run by Walker’s institute. The institute also receives funds from Saudi Arabia, which opposes the INC specifically and Bush’s approach to regime change in Iraq in general.

Also insistently ruled out was any suggestion that Armitage or others in the State Department leadership would attempt to use the inspector general’s office to settle a policy dispute, as official sources on Capitol Hill, within the State Department and elsewhere in the foreign policy establishment tell me they have come to suspect.

You are free to believe the spokesman’s account, since these are subjects that rarely generate a paper trail of official documents spelling out intentions and motives. And while you are here, could I interest you in a rather large bridge in Brooklyn?

The funding cutoff to the INC, an amazingly detailed and fussy set of audits the inspector general’s office was instructed to perform on the Iraqi group, and State’s abrupt cancellation of the Walker grant are matters of public record. Armitage’s urgent telephone call to Henry Hyde to get the chairman of the House International Relations Committee to let the Walker grant go ahead despite serious questions the astute Republican legislator had is confirmed by State and Hyde’s office. The White House role? I trust my sources.

State Department animus toward the Iraqi National Congress much of it generated by old and festering quarrels between the group’s leaders and the CIA over toppling Saddam Hussein is also an established reality. Since Congress passed the Iraq Liberation Act in 1998 to force the Clinton administration to fund the INC as the core of an effective Iraqi opposition, the Near East bureau has worked to undo the intent of the legislation while avoiding responsibility for doing so.

Enlisting Armitage’s office and the inspector general’s staff conveniently accomplishes both goals, INC leaders charge. Well, they would say that, wouldn’t they? But their suspicions are shared by some officials at the State Department who have witnessed the trial by auditing and persecution by leaks to the press that the Iraqi group has endured.

“I have never seen a group we are told to help treated the way the INC has been treated,” says an authoritative source. “Any group trying to run an espionage and guerrilla campaign is going to have accounting problems, of course. This kind of find-every-flaw approach only happens when there is pressure from the top to change an outcome.”

This is a serious allegation, spoken by someone who would be fired if identified by name or position. After three weeks of examining this and similar charges in an unrelated case, I report the allegation as a highly plausible, if unproved, one.

It is also highly regrettable. The endless battles between State and the INC are a serious distraction from President Bush’s drive to deal with the Iraq threat. Both sides contribute to the bitterness and food-fight quality the skirmishing has taken on. Resolving such petty strife is not why George W. Bush came to Washington.

It is time for the bureaucrats and the rebels to get behind Bush’s vision of change in Iraq. It is time for them to put aside the scramble for advantage and the temptation to indulge in covert policy assassination. Only Saddam wins from this unhealthy disarray.

Jim Hoagland is a columnist for Washington Post Writers Group.