With Hillary Clinton finally waving the surrender flag, Barack Obama is now free to begin convincing independent-minded Americans that he would be a better president than John McCain.

The first duel, underway right now, is about Iraq and Iran, an issue of vital importance. John McCain is painting Obama as a naive appeaser who has no idea about Iran's villainy. But Obama quickly responded:

(BEGIN VIDEO CLIP)

BARACK OBAMA: There is no greater threat to Israel or to the peace and stability of the region than Iran.

(END VIDEO CLIP)

And that's true. But the senator from Illinois is also saying this:

(BEGIN VIDEO CLIP)

OBAMA: Keeping all of our troops tied down indefinitely in Iraq is not the way to weaken Iran. It is precisely what has strengthened it.

(END VIDEO CLIP)

So the debate over exactly how to contain Iran becomes central to the election.

There is no question that there's been a dramatic improvement in Iraq. Even the left-leaning news agency Reuters admits that. Also, there's no question that having American forces on Iran's border restrains that vicious government.

So McCain has a point here, especially since Senator Obama has said he doesn't even want to keep U.S. bases in Iraq — something the Iranians are happy to hear.

Now, most Americans still want out of Iraq and Obama well understands that. But the situation there is changing quickly, and over the next few months this will become a hot story again, even though many in the media don't want to report it.

And McCain is turning up the heat right now. In a speech this week, he scorched American companies like General Electric that are still doing business with Iran, even as that country is killing Americans. McCain also blasted Obama for not supporting a terrorist designation for Iran's Revolutionary Guard:

(BEGIN VIDEO CLIP)

JOHN MCCAIN: He opposed this resolution because its support for countering Iranian influence in Iraq was, he said, "a wrong message not only to the world, but also to the region." But here, too, he's mistaken. Holding Iran's influence in check and holding a terrorist organization accountable sends exactly the right message to Iran, to the region, and to the world.

(END VIDEO CLIP)

Barack Obama's more diplomatic approach towards Iran, and his rejection of using Iraq as a bulwark against the mullahs, is popular in the liberal community.

But among independent voters, the improving Iraq situation and an aggressive posture towards Iran may resonate. If it doesn't, McCain loses. If it does, Obama's got problems.

And that's "The Memo."

Pinheads & Patriots

Our auction to benefit Operation Shoebox is complete. Five flags that flew over U.S. bases in Kuwait brought $12,500. And I will match that, so Operation Shoebox gets $25,000.

Wendy Jersey from Bristol, Connecticut; Irene McCartin who lives in Asheville, North Carolina; Mark Macron of Rehoboth, Massachusetts; and Tony Silvanic from Alford, Mass in the Berkshires are all patriots for their winning bids. Tony won two flags.

Operation Shoebox provides our forces overseas with stuff they need like calling cards. Most of the volunteers are unpaid, and of course they are patriots as well.

On the pinhead front, welcome to Fenway Park, Boston. During last night's Red Sox game this moron ran on the field and led security on a merry chase to the amusement of the fans.

Click here to watch the Fenway Park hooligan.

Of course, this stuff is dangerous. The guy should pay a hefty fine, and be forever known as a pinhead.

You can catch Bill O'Reilly's "Talking Points Memo" and "Pinheads & Patriots" weeknights at 8 and 11 p.m. ET on the FOX News Channel and any time on foxnews.com/oreilly. Send your comments to: oreilly@foxnews.com