Short Term:

Iraq is making progress in fighting terrorists, mostly due to US troops
Iraq has failed to meet almost every political milestone
Iraq has had a spotty record of building democratic institutions, with widespread corruption throughout the government
Security forces have yet to credibly stand up without US help, with the debacle in Basra earlier this year as a sterling example.

Grade: D - no victory

Medium Term:

Iraq has failed to take the lead in defeating terrorists, relying on US troops and bribes to deal with terrorists
Iraq has a fully constitutional government in place, but not all parts of the constitution have been ratified
Iraq is on its way to fulfilling its economic potential, but progress is uneven and fragile, as many basic parts of infrastructure such as electricity and water are still below pre-war levels, hindering economic development

Grade: C - marginal victory

Longer Term: Iraq is not peaceful, united, stable nor secure, as the political and sectarian reconciliation that was the goal of the surge has not occured.
Iraq is only partially integrated into the international community, with many nations still not having formal relations with the Iraqi government
Iraq is not a full partner in the global war on terrorism, as their strongest ally at this point is Iran, which is still on the US list of state sponsors of terror

Grade: D- No progress, no victory