The Bush Administration, the Pentagon included, values loyalty über alles. That's why. This guy probably wants to keep his job.
Or he is a career civil servant who doesn't agree with our involvement in Iraq and wants to torpedo the Bush administration by painting a bleak picture. People leak for a reason and it may not always be the "truth." How senior is this "official" and how knowledgeable is he about the current situation in Basra? And it hasn't been beyond the ability of the MSM to make up anonymous/unnamed sources.