Because we need them to be on our side, not on the terrorists side. The slightly flawed principle is that if they believe in the occupation they'll be prepared to fight the terrorists alongside the troops (as many, many thousands of Iraqi soldiers and policemen are doing). To be honest, the terrorists don't get that much support, they're just the most vocal/violent/obvious. The ordinary Iraqis, the 99% of them who just want to live in peace and bring their kids up and get an education are being bombed, murdered, terrorised, destroyed and are living the most horrific lives, at the mercy of fighting factions. Daily, the families of people who support the coalition forces or work to fight the insurgents are threatened, kidnapped, tortured or killed so understandably many Iraqis don't want to show any outward allegiance. But you don't hear much about them as they're largely barricaded in their houses trying to survive and mourning their daily losses. Tragic, absolutely tragic.