To redeploy United States Armed Forces from Iraq and to establish a new direction for United States policy toward Iraq.


New Direction for Iraq Act of 2007 - Prohibits Department of Defense (DOD) funds from being obligated or expended to increase the number of U.S. Armed Forces serving in Iraq so that the total number serving in Iraq at any time exceeds the number serving in Iraq as of the date of the enactment of this Act unless the increase is specifically authorized by Congress.

Directs the Secretary of Defense to begin the redeployment of U.S. Armed Forces from Iraq within 30 days of enactment of this Act, which shall be completed in the shortest appropriate time frame. (Expresses the sense of Congress that the shortest appropriate time frame should be no longer than one year.)

Prohibits: (1) permanent or long-term U.S. military installations in Iraq; and (2) U.S. actions to control Iraqi oil reserves.

Provides for assistance to Iraq for: (1) reconstruction and economic development through Iraqi businesses and nationals; (2) promotion of democracy and civil society;and (3) disarmament, demobilization, and reintegration of militias.

Authorizes the President to terminate all contracts with a contractor having more than one federal Iraqi reconstruction contract for non-fulfillment of one such contract.

Expresses the sense of Congress that: (1) the Attorney General should seek to prosecute criminal fraud in the awarding and carrying out of federal contracts for Iraq reconstruction; and (2) the appropriate House and Senate committees should investigate the awarding and carrying out of specified Iraq-related contracts.

Directs the President, through the Secretary of State and the Secretary of Defense, to: (1) undertake a regional diplomatic effort to promote stability in Iraq; and (2) undertake a renewed effort towards securing Israeli-Palestinian peace on a basis similar to the parameters for peace presented to Israel and the Palestinian Authority by former President Bill Clinton in December 2000 and the unofficial Geneva Accords of 2003.

Directs the President, in partnership with the government of Iraq, to develop reconciliation, security, and governance benchmarks. Expresses the sense of Congress that further political and economic support for Iraq should be conditioned on significant progress towards achieving such benchmarks.

Directs the President to appoint a Special Envoy for Iraq Reconciliation.

Directs the President, for any country with a significant Iraqi refugee population, to: (1) seek to negotiate a bilateral refugee resettlement agreement for such refugees' U.S. admission; or (2) devise strategies, in consultation with the host government and international organizations and agencies, for provision of assistance to facilitate such refugees' host country integration.

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