Lord Ashdown has called for a new kind of agreement drawing in Iraq's neighbours to try to bring future peace.
Lord Ashdown recalled his own time as a soldier in Northern Ireland
The former Liberal Democrat leader told the Hay Festival that the post-invasion policy of trying to impose a Western democracy there had failed.
He said Iran and Syria needed to be involved in the peace process to stop Iraq falling into a "black hole".
An agreement was needed to ensure Iraq's "territorial integrity".
He said of the US-led coalition: "They went in with enought troops to win the war but not enought to secure the war - the troops needed to defeat Saddam Hussein, but not enough to provide security."
That was compounded by the disablement of the Iraqi army and the selections of some troops who "believe you can buy peace on the edge of a bayonet".
But Lord Ashdown said suggesting a fixed date when the coalition forces should leave Iraq was not the right move.
LORD ASHDOWN FACTFILE
Born Jeremy John Durham Ashdown, India, 1941
Brought up in Northern Ireland, earning nickname 'Paddy'
Joined the Royal Marines as officer in 1959, serving until 1972. Had special forces training and learnt Chinese
Joined the Foreign Office, involved in treaties and work with UN bodies
Became a youth worker in Somerset and stood in Yeovil for Liberals in 1979
Elected as MP in 1983 and eventually leader of merged Liberal Democrats in 1988
Stood down as leader in 1999 and became UN high representative in Bosnia in 2002
Created life peer in 2001 after retiring from Commons
Appointed chairman of Northern Ireland parades body in 2007
Married with two children; president of the deaf charity RNID
"We ought to set the conditions and then we leave, " he told a packed audience at the 20th literary festival in Powys.
Lord Ashdown said the role of the ordinary soldier patrolling Iraq and mounting roadblocks was important.
Rule of law
He recalled his own experiences fighting in Northern Ireland when the soldiering role had to be combined he said with that of a social worker.
"When I arrived as a young Green Jacket in Belfast in 1969 I was welcomed by the Catholics with tea and sandwiches.
"A year later we were their enemies."
The former UN High Representative in post-war Bosnia said he was an "optimist".
He stressed that while the situation in Iraq was now verging on disaster, it could be turned around, and an agreement - similar to the one agreed over Bosnia in 1995 - would be the way forward.
And he said it was up to the people of Iraq, once the rule of law was established there, to decide what kind of government they want to fit in with their traditions - not for a Western power to impose its own democracy.
Lord Ashdown, who has recently taken on a new role reviewing Northern Ireland's parades, joked he was asked why he was always taking on "suicide missions" - the Liberal Democrats, Bosnia, and now Northern Ireland."