Iraq's Power Grab

By Lisa Beyer

With hindsight it looks so obvious, so wickedly brilliant. There sat Kuwait, fat and ripe, bulging with enormous reserves of oil and cash, boasting an excellent port on the Persian Gulf -- and utterly incapable of defending itself against Iraq's proficient war machine. Saddam Hussein, hungry for money but greedier still for regional dominance, knew before the first of his soldiers crossed the border that it would be a walkover -- and it was. In 12 hours, Kuwait was his.

With his brief romp through the desert, the imperious Iraqi President doubled the oil under his control to some 20% of the world's known reserves; only Saudi Arabia, with 25%, has more. He strengthened his claim to the position he has long coveted: overlord of the Arab world. And he made the entire world quake, weak-kneed, at his raw power. Not since the brilliant military leader Nebuchadnezzar ruled the Babylonian Empire more than two millenniums ago had Baghdad exercised such sway.

Just how far will Saddam Hussein's lust for power carry him? By provoking the first major military conflict of the post-cold war era, he provided the maiden test of the proposition that the U.S. and the Soviet Union can create more peace working together than apart. As recently as a year ago, such an incursion in the Middle East would probably have caused a fearsome rift between the superpowers. But in the summer of 1990, the Iraqi blitz prompted Washington and Moscow to act in stunning unanimity, each abhorring the raid and demanding, in an unprecedented joint statement, that the invaders retreat. That position was also endorsed by the United Nations Security Council. While all parties were clearly loath to take on the mightiest army in the Arab world -- a force of 1 million fighting men -- the rare convergence of views raised the possibility that Iraq's expansionism can somehow be contained.

Or can it? To Saddam, the end of the cold war, the breakup of the Soviet empire and America's re-evaluation of its military spending offered a safe opening for his claims of hegemony. He has the army, the arsenal and the audacity to pursue his grand ambition to rule the region -- or rock the world. In effect, Saddam has leveled a brazen challenge: Stop me if you can. Last weekend one of his spokesmen snarled that if anyone moved against Iraqi forces, Baghdad would "chop off his arm from the shoulder."

Saddam's power grab is a bold reminder of the role brute force will always play in the history of nations. Without the threat of escalation to superpower conflict, countries with sophisticated weapons and thuggish rulers will try to take advantage of the shifting international climate to assert their will. The ( threat to U.S. interests is not some distant danger. It is very real, and not only because of the region's oil reserves. Does America really want to let the Saddams of the world shape the new global power structure?

Saddam's aggression immediately cast the financial markets into turmoil. Some economists believe that even a slight surge in prices could push America's economy, already weakened by sluggish demand, the federal deficit and the S&L crisis, over the brink into recession. Perhaps more important, Saddam's move on the Middle East is an unexpected test of whether nations will pay the necessary price to assure peace and stability in the new global climate. Said a senior State Department official: "You just cannot allow this kind of behavior to go unchecked."

But Saddam is not easily intimidated. He is convinced that no nation has the nerve to take him on. His conquest might have been deterred, but undoing it now will be nigh impossible. Baghdad radio warned that Iraq would "make Kuwait a graveyard for those who launch any aggression." The feckless international response to his muscle flexing during the past decade has nourished his belief that he has little to fear if he misbehaves. A loner, he has rarely if ever been told no -- probably because the few who tried to do so tended to wind up dead. So no one can be very sure what, if any, message will derail his ruthless drive to be the paramount power in the Persian Gulf. Fortunately, Saddam has few friends around the globe, and his truculence is knitting unlikely partners into a broad-based opposition.

The emerging harmony of international opinion, however, was scant consolation for Kuwait, since no one appeared actually willing to come to the defense of the tiny state and its 1.9 million people. While Iraq in the face of the world's condemnation promised to bring its troops home beginning five days after the invasion, a subsequent announcement made nonsense of that pledge. Baghdad said it was raising a new army for Kuwait in which -- surprise -- 100,000 Iraqis had volunteered to serve. What's more, Baghdad named a new government, composed of nine Kuwaiti army officers, that would clearly be a puppet regime. For all practical purposes, Iraq has annexed its southern neighbor.

Iraq's land grab drew inevitable comparisons with the 1930s, when Hitler began to gobble up Europe in pieces small enough not to provoke a military response by the other powers of the day. It did not take long before fears + grew that Iraq, having devoured Kuwait, would turn next to other appetizing and vulnerable gulf nations -- most notably Saudi Arabia, the richest of them all. The extent to which the NATO countries, the Soviet Union and the threatened Arab states move to thwart Saddam will determine whether they have learned the lesson of history or are doomed to repeat it.

Even in the fine points of his strategy, Saddam evoked echoes of the past. He excited his people with impassioned speeches full of grievances toward their neighbor. He exploited a border dispute, scheduled negotiating sessions that were intended all along to be fruitless, and cooked up a request for intervention by supposedly downtrodden locals. The invasion sequence itself was classic '30s: bluff, feint and grab.

Baghdad's bitterest complaint against Kuwait was that the gulf state had been grossly overproducing oil in violation of OPEC quotas. Combined with similar cheating by the United Arab Emirates, Kuwait's excess pumping had depressed the average price of an OPEC barrel nearly $7. Iraq, which relies on oil for 95% of its export revenues, claims that every $1 drop in the price of a barrel of oil costs it $1 billion a year. As Saddam saw it, the Kuwaitis might as well have been stealing from his treasury.

That business, however, was supposedly settled late last month at OPEC's midyear meeting in Geneva. Just before that session began, Saddam resorted to outright intimidation: he marched his 30,000-strong elite Republican Guard, the troops who did the toughest fighting in the gulf war, to the Kuwaiti border. Through Egyptian President Hosni Mubarak, who called the spat "a cloud that will pass with the wind" -- a comment he would soon bitterly regret -- Saddam promised he would not attack his neighbor, at least for the moment. Still, Kuwait and the U.A.E. got the hint, meekly agreed to abide by their production caps and consented to the first hike in OPEC's target price in four years.

But rather than pull its forces back, Iraq sent in 70,000 reinforcements. Saddam had other scores to settle with Kuwait. There was the quarrel over the rich Rumaila oil field, a finger-shaped deposit whose tip reaches just into frontier territory claimed by both Iraq and Kuwait. Baghdad insists that when its attention was turned to fighting Iran in 1980, Kuwait surreptitiously moved the border 2.5 miles north to tap into Rumaila. Now Saddam wants $2.4 billion in compensation for oil he claims Kuwait withdrew.

! Then there was Baghdad's insistence that Kuwait forgive $10 billion to $20 billion in loans it extended to help fund Iraq's eight-year war against Iran. Saddam, who started the conflict, maintains that he fought off Iranian fundamentalism on behalf of all Arabs and is therefore entitled to relief from the entire $30 billion to $40 billion debt he racked up with the rest of the Arab world.

Finally, Iraq saw in Kuwait a way to compensate for the disadvantages -- enormous for an oil exporter -- of being virtually landlocked. Iraq has just 18 miles of shoreline, and most of that is blocked by Kuwait's Bubiyan Island. Baghdad has long pressed Kuwait to cede or lease Bubiyan Island, but the Kuwaitis refused, figuring they would never get it back. Then there is Iraq's long-standing claim that all of Kuwait rightfully belongs to it. Once part of the province of Basra under the Ottoman Empire, Kuwait has never been acknowledged as a separate entity by Baghdad. Iraq tried to reclaim the land by force in 1961, when Britain granted Kuwait independence, and again in 1973 and 1976.

All the points of discord between Iraq and Kuwait were on the agenda of talks between the two countries last Wednesday. From the outset the Kuwaitis made it clear that they were willing to pay Baghdad a sizable sum for peace. But the Iraqis, who demanded Kuwait's total capitulation on every count, were determined to see the negotiations break down. After a fruitless two hours, they did. At exactly 2 the next morning, the 100,000 Iraqi soldiers massed on the border -- a force nearly five times as great as the entire Kuwaiti military -- spilled south. Two additional commando units swarmed in by air and sea.

Rolling unchallenged down the empty superhighway Kuwait had built -- as a token of friendship with Iraq -- to link the two countries, the troops made the 37 miles to the capital, Kuwait City, in just four hours. "It was chaos in the streets," said Stephanie McGehee, a photographer who witnessed the attack. Panicked residents tried to flee south toward Saudi Arabia, but the Iraqis forced people out of their autos and angrily ripped out car phones -- no rarity in a country with so many wealthy citizens -- presumably because they could be used to communicate troop positions.

While an estimated 300 Iraqi tanks prowled the city, an additional 50 surrounded the Emir's palace and the nearby U.S. embassy. But the Emir, Sheik Jaber al-Ahmed al-Sabah, and his family were able to flee to Saudi Arabia by helicopter. Though the invaders had quickly seized Kuwait's radio and television station, a hidden transmitter continued to broadcast exhortations to resist the raiding foreigners and pleas for help from other Arab states. "O Arabs, Kuwait's blood and honor are being violated. Rush to its rescue!" cried a voice thought to be the crown prince's. "The children, the women, the old men of Kuwait are calling on you."

Though help never came, Kuwaiti troops put up small pockets of resistance. At the palace, the country's symbolic heart, the Kuwaitis held their own through a two-hour artillery barrage. During the battle, the Emir's younger brother Fahd was killed. The Iraqi force assigned to secure the oil rigs off Kuwait's shores saw the most action. Kuwaiti troops and missile boats managed to sink and burn an unknown number of Iraqi landing craft and escort ships. By early afternoon, however, nearly all Kuwait's guns had been silenced. In all, it is estimated that 200 Kuwaitis were killed in the assault. No figure for Iraqi casualties was available.

Concocting the flimsiest of excuses for an invasion, the Iraqis announced that they had entered the country at the invitation of the Free Interim Government, which had supposedly seized control of the country from the Emir. This previously unknown organization was said to be made up of "young revolutionaries." But no one bought the tale. "Instead of staging a coup d'etat before the invasion, they got it the wrong way around," said Thomas Pickering, Washington's U.N. ambassador.

To one and all, it was obvious that the Iraqi assault was, as President Bush termed it, "naked aggression." Resource-rich but sparse in people, Kuwait was a timely acquisition -- an act of piracy, pure and simple -- for Iraq, whose war with Iran left the country with $70 billion in debts and tremendous reconstruction costs. While Saddam does not face an immediate cash shortage, he is intent on proceeding with some $40 billion worth of self-memorializing development projects that he has been unable to finance. Among them: the Baghdad metro, 2,000 miles of railway and two gigantic hydroelectric dams. Now Saddam can not only pocket the profits of Kuwait's oil wells but also manipulate their production levels to ensure a high price for his own oil.

Equally tantalizing were Kuwait's enormous investments overseas, estimated at $100 billion, which provide the gulf state with more than $6 billion a % year, a sum roughly equivalent to its oil revenues. What's more, Iraq's new piece of real estate, which includes Port Ahmadia and 120 miles of coastline, gives it direct access to the Persian Gulf.

Of course, Saddam had more on his mind than money. Having won -- by his lights -- the war against Iran, he is intent on making himself the new Gamal Abdel Nasser, master and hero of the entire Arab world. As Robert E. Hunter, former director of Middle East affairs for the National Security Council, points out, "If you're going to run a protection racket, every once in a while you have to blow up a dry cleaner."

No country that shares a border with Iraq can rest easy. It is obvious that Saddam has the military might to seize more territory in the gulf, and he could move -- who knows? -- into Jordan or Syria as well, a prospect that raises anxieties in Israel. The first modern Arab invasion of another Arab state has broken the myth of family that held those competing states in check. But even if Saddam reins in his soldiers, the threat that he might loose them will scare his Arab neighbors into submission. They will find it easier and the better part of valor to knuckle under.

Nor can they necessarily count on foreign help. Kuwait pleaded for military intervention. "My friend, we are desperate for any kind of assistance we can get," said Sheik Saud Nasir Al-Sabah, Kuwait's ambassador to the U.S., addressing a reporter. But the immediate international response smelled of appeasement. Although the U.S. moved to position three of its aircraft carriers in the region, President Bush at first said his government was not "discussing intervention." The Arab League met for a full day in Cairo and was unable to come up with even an expression of concern.

Soon enough, however, the danger of allowing Saddam to get away with murder began to sink in. The U.S. State Department reported that some of the Iraqi invaders had moved to within five miles of the border with Saudi Arabia. Though the Saudis have stockpiled tens of billions of dollars' worth of Western military hardware over the years, they have only a 65,000-man armed force that is no match for the Iraqis. Holding that neighbor under its guns, Iraq would control more than 44% of the world's proven oil reserves. Suddenly backbones straightened up. Bush said he was not ruling out a counterstrike and warned later that Iraq would be attacking U.S. "vital interests" if it took on Saudi Arabia. His aides asserted that Washington had unspecified , "contingency plans" in the event of an Iraqi move beyond Kuwait. Bucking itself up, the Arab League, though rejecting foreign interference, condemned the invasion and demanded an immediate withdrawal.

In a compelling display of the new relationship between the superpowers, U.S. Secretary of State James Baker quickly flew to Moscow to consult with his Soviet counterpart, Eduard Shevardnadze. After what Shevardnadze called "a rather unusual meeting," the two issued a rare communique, the first team effort by the superpowers to muster global support to halt a regional war. Decrying the "brutal and illegal" Iraqi attack, the two countries called on all nations to join in an arms embargo of the aggressor state. Signing the statement, Shevardnadze allowed, was "rather difficult" for the Soviet Union, since Iraq had long been a close client. But, he said, the joint declaration was "more consistent with the new political thinking."

For the moment, the consensus seemed to be that it was more prudent to try to squeeze Saddam dry than to outgun him. "There are two approaches to the problem: confrontation or asphyxiation," said a Western diplomat in Cairo. "Asphyxiation is the best, but it requires the complete cooperation of all the countries if it is going to work." The U.S. immediately froze Iraqi assets and imposed a boycott on Iraqi oil. Last weekend the European Community adopted those measures, banning arms sales to Baghdad and adding on a boycott of Kuwaiti oil. The U.S. and the European countries have also frozen Kuwaiti assets to keep the Iraqis from getting their hands on them. Japan asked its financial institutions to follow suit.

Whatever countermeasures are taken, they had better be decisive. "The invasion is the first fundamental challenge to the new superpower order," says John Hannah of the Washington Institute for Near East Policy. The implications of failure are underscored by the fact that Iraq, with its less than punctilious attachment to the rules of civilized conduct, is thought to be three to 10 years away from possessing a nuclear bomb. Already Iraq is one of the world's largest producers of chemical weapons, and Saddam has shown he is willing to use them not only to subdue his external enemies but also to cow his own compatriots.

As with any bully, the key to taming Saddam is to make sure he gets away with nothing. Given "the mind-set of a person as ruthless as he is," says a high-level U.S. State Department official, "unless you meet this kind of aggressive behavior very firmly, he's encouraged to try again, and you'll pay a substantial price later." What the U.S., the other Arabs and the rest of the international community must come to terms with is that the time to draw a line in the sand is now.

With reporting by William Dowell/Cairo, J.F.O. McAllister/Washington and Christopher Ogden/Moscow