It’s getting harder for Barack Obama to use Yemen as a model of successful U.S. foreign policy as al-Qaida and the Iran-backed Houthi rebels made significant military gains in the beleaguered state in recent days. Last week, al-Qaida militants claimed the key Yemeni port city of Mukalla, freeing nearly 300 prisoners and delivering a setback to the 10-nation coalition led by Saudi Arabia that has been engaged in an air and land campaign there. Among those freed were Khaled Batarfi, a senior leader of al-Qaida in the Arab Peninsula (AQAP). So much for al-Qaida being “on the run.”

The Saudi-led coalition, which began operations in late March, has been aided by U.S. intelligence, but America is still standing on the sidelines. Even as the civilian casualties mount and U.S. diplomats and military personnel have fled the country, the White House continues to insist Yemen is a success story in its deeply flawed foreign policy strategy.

According to White House Press Secretary Josh Earnest, Obama’s strategy is to “try to mitigate the threat that is posed by extremists and to prevent them from establishing a safe haven.” Too late.

Mukalla, one of the largest cities in Yemen, fell to AQAP after that group rose to take advantage of the power vacuum left when President Abd Rabbuh Mansur Hadi fled the country. Of course, according to the Obama White House, al-Qaida is not a serious threat, so perhaps they don’t believe losing a major port city to a terrorist organization they don’t take seriously is a problem.

Similarly, Obama would have us believe that the Houthi rebels in Yemen aren’t a big issue either. This group has received strong support from the Iranian government, including tanks and heavy weapons that have complicated Saudi attempts at a ground assault to retake the country. While John Kerry replays the role of Neville Chamberlain with the Iranians over the so-called nuclear agreement, Iran is deeply engaged in removing one of the remaining strategic footholds the U.S. had in the Arabian Peninsula.

The Saudis are now shouldered with the thankless job of trying to prevent the establishment of a terrorist state on their southern border as Obama continues to pat himself on the back. Yet public support in Yemen for the Saudi-led airstrikes is quickly eroding as civilian casualties mount and more damage is inflicted on the country’s infrastructure. In another twist that only further illustrates Obama’s inept foreign policy, Saudi airstrikes are pinpointing stores of U.S. weapons to keep them from falling into the hands of al-Qaida or the Houthi rebels.

So, to sum up the situation, Yemen, which was once considered a strategic base of operations in the U.S. fight against jihadis in the Arab Peninsula, has basically fallen into the hands of the Houthis, a Shiite rebel group supported by Iran, a country that has gained a major diplomatic victory over the White House in its attempt to develop a nuclear weapon. Additionally, al-Qaida in the Arab Peninsula, a terrorist organization Obama wrote off as “decimated,” is claiming territory in Yemen and using the country as a recruitment center and base to launch more deadly terrorist attacks.

Meanwhile, the Obama administration remains comfortable in its assertion that everything is under control. The big question is, under whose control?