HOUSE OF BUSH, HOUSE OF SAUD -- THE SECRET RELATIONSHIP BETWEEN THE WORLD'S TWO MOST POWERFUL DYNASTIES
CHAPTER FOUR: Three Dimensional Chess
The fortunes of newly elected presidents are always subject to the deeper forces of history, and the Reagan-Bush administration was no exception. By the time George Bush and James Baker moved into Washington in January 1981, a powerful wave of Islamic fundamentalism had already begun transforming the Middle East. The implications were staggering. The Islamic revolution threatened America's ability to slake its unquenchable thirst for oil, its support for Israel, and its geostrategic position in the Cold War vis-a-vis the Soviet Union.
The humiliation of America by the Shiite regime of Iran's Ayatollah Khomeini in 1979 was just the beginning. Islamic terrorism was an increasingly brutal reality. Each assertion of American and Israeli interests in the Middle East was parried by a dramatic, forceful, and violent response. Arab leaders too close to the United States now risked the same fate as the deposed Shah of Iran or worse.
In 1979, Egyptian president Anwar Sadat signed the historic Camp David Peace Accords with Israel. In October 1981, nine months after the Reagan-Bush administration had taken office, Sadat was assassinated by members of the Al Jihad movement.  [i] Israeli troops moved into southern Lebanon. In retaliation, Hezbollah, an Iranian-supported paramilitary group of Shiite militants, went into action. The militant Muslim Brotherhood, which had been banned since the fifties, continued to defy Egypt's West-leaning government. [ii] Islamic militants spread throughout the region, planting the seeds of the militant Hamas, to arise later on the West Bank and Gaza Strip,  and Al Qaeda, in Saudi Arabia.
By and large, the response of American politicians was to demonize Islamic fundamentalism and rally public opinion against the militants in Iran who had seized American hostages. Reagan and Bush owed their 1980 electoral victory to a campaign charging President Jimmy Carter with being "weak and vacillating" in dealing with Iran.  Bush said that the American people regarded Iran with "hatred." Then he added, "I feel that way myself." 
But the political realities were far too complex to lend themselves to such a reductionist approach. The United States was entering a bizarre and perplexing game of three-dimensional chess complicated by not one but two regional wars -- between the Soviet Union and Afghanistan, on the one hand, and between Iran and Iraq, on the other. In both cases, the United States played an enormous but low-profile role, waging covert war by proxy, and ironically, funding and financing Islamic fundamentalists whom, in other contexts, the U.S. government demonized. In the Afghanistan War, the United States supplied weapons, training, and billions of dollars to forces aiding the mujahideen rebels fighting the pro-Soviet Afghan government. In the Iran-Iraq War, short-term realpolitik considerations and factionalism within the administration led the United States to tilt toward Iran, then Iraq, back and forth again and again while secretly arming both sides.
A vital factor in these stratagems was that Saudi Arabia had begun to replace Iran as the United States's primary regional ally. The United States had long had "a special relationship" with Saudi Arabia, but with the Cold War still ongoing, and Iran no longer a friend, it became increasingly important in geostrategic terms as well.  [iii]
The subtext behind the new relationship could be explained in two words that are the eternal and defining pillars of American policy in the Middle East: oil and Israel. During OPEC's oil embargo in the aftermath of the 1973 Arab Israeli war, the United States had learned about the wrath of the Arab oil-producing countries when it leaned too far toward Israel. Now, by arming the Saudis, the United States would ensure the stable flow of oil at reasonable prices.
The process began with the sale of just five airplanes. Reagan had come into office with the reputation of being pro-Israel, but to the dismay of the Israeli lobby, one of his first decisions was to sell five AWACS (airborne warning and control system) planes to Saudi Arabia, as part of a $5.5-billion package with associated technology and infrastructure.  This was the first crucial foreign policy test of the Reagan era. Dashing young Prince Bandar, who, at thirty-two, had just earned his master's degree at Johns Hopkins University, led the Saudi lobby in a fierce battle against its Israeli counterpart by getting Vice President Bush to push Reagan on the arms sale,  and then dazzling senators with his wit and charm.
Behind that charm was a driving psychological need to succeed on a grand scale. Bandar was the grandson of Abdul Aziz, the founder of modern Saudi Arabia, and Hassa bint Ahmed al-Sudairi, one of the most honored and respected women in Saudi history. But he had little contact with his father, Prince Sultan, who was the governor of Riyadh and still in his early twenties at the time of Bandar's birth. The reason was that Bandar's mother, Khizaran, was a dark-skinned sixteen-year-old from southern Saudi Arabia and a commoner who, as Bandar himself put it, served as Prince Sultan's concubine. Bandar grew up living with his mother and hoping to legitimize himself in the eyes of his father. "It taught me patience, and a defense mechanism, if you want, to not expect anything," he told the New Yorker. "And the way I rationalized it to myself was if I don't expect anything and I don't get anything, I don't get disappointed. So nobody can hurt my feelings."  Bandar's great success in the AWACS lobbying effort not only enhanced his standing with his father and the House of Saud, it also won him the coveted position of Saudi ambassador to the United States, an extraordinarily powerful post.
Just before Congress was to vote on the package, the Pentagon told Washington Post reporter Scott Armstrong that the AWACS planes cost about $110 million each. When Armstrong first did the math, he mistakenly thought that five times $110 million must be $5.5 billion. Then he realized that a decimal point was misplaced, which meant that the AWACS sale was about far more than just five airplanes.  What had been announced as a small arms deal was the start of something big. Where was all the money going? "This was ... the linchpin to an elaborate electronic communications system that would be the equivalent of the heart of what we have in NATO, for example," Armstrong said in a PBS Frontline documentary. "It was creating a new theater of war." 
On October 28, 1981, the Senate narrowly approved the AWACS package, 52 to 48.  Four days later, Armstrong's front-page article in the Washington Post outlined a secret plan that had never been confronted in the congressional debate.  [iv] An unwritten agreement lay behind what had been framed as merely the sale of five airplanes. In return for an integrated package of highly sophisticated military technology, Saudi Arabia would build a massive network of naval and air defense facilities that could sustain U.S. forces should they ever be needed to protect the region or wage war against an aggressor. 
The Saudis had no problem footing the bill. By 1981, Saudi oil revenues had reached $116 billion a year. The Saudi monetary agency was charged with the task of investing nearly $320 million a day.  Over the next decade, the Saudis bought $200 billion in American arms and built nine major new ports and dozens of airfields all over the kingdom. A beneficiary of the military buildup was the Saudi Binladin Group, which built facilities for the Al Salaam Aircraft Company.  "They have now hundreds of modern American fighter planes and the capability of adding hundreds more," said Armstrong. 
More than a massive military buildup, the U.S.-Saudi alliance constituted a major shift in American foreign policy in the Middle East that took place with virtually no public debate in the press or in Congress. "It's absolutely phenomenal, a two-hundred-billion-dollar program that's basically put together and nobody's paying attention to it," said Armstrong. "... It is the ultimate government-off-the-books." 
Even more secretive was the new understanding that Saudi Arabia would become a U.S. partner in covert operations, not just in the Middle East but all over the globe. As a monarchy without the constitutional constraints that burdened the CIA, the Saudis had enormous flexibility to help the Reagan administration execute covert operations prohibited by Congress. Not long after the AWACS sale was approved, Prince Bandar thanked the Reagan administration for the vote by honoring a request by William Casey that he deposit $10 million in a Vatican bank to be used in a campaign against the Italian Communist Party.  Implicit in the AWACS deal was a pledge by the Saudis to fund anticommunist guerrilla groups in Afghanistan, Angola, and elsewhere that were supported by the Reagan administration. 
And so, Saudi-American relations were becoming an ever more complex web of international defense and oil deals, foreign policy decisions, covert operations, and potentially compromising financial relationships between Saudis and American politicians who shuttled back and forth between the public and private sectors.
Increasingly, Bandar, who was appointed ambassador in 1983 just after Fahd became king, was at the heart of these operations. He was learning to love politics. "When I first got to America, I didn't understand politics," he said. "I was confused by it. Then it became like a game, like a drug. I enjoyed the game. It was exotic and exciting. There was no blood drawn. It was physically safe, but emotionally tough." 
Officially, the United States was neutral in the Iran-Iraq War. But from the onset, two factions within the Reagan-Bush administration battled over which country posed the greater threat to U.S. interests. That struggle became the most acrimonious foreign policy conflict within the administration during the entire Reagan-Bush era. One bloc, which was led by National Security Adviser Robert "Bud" McFarlane and two members of his National Security Council staff, Howard Teicher and Oliver North, argued in favor of arming Iran. Their rationale was a variation on the old saw that the enemy of my enemy is my friend. In this case, since Israel's biggest enemy was Iraq, and Iraq's enemy was Iran, the McFarlane faction proposed moving toward Iran to enhance Israeli stability. As early as 1979, Teicher had written a highly classified study endorsing Israel's view that Saddam's Iraq, not Iran, would ultimately pose the greatest threat to the Gulf region.  [v] History would prove him right.
The other faction, led by Secretary of Defense Caspar Weinberger and Secretary of State George Shultz, was virulently opposed to Ayatollah Khomeini's fundamentalist regime in Iran. After all, failure to oppose it could allow Islamic fundamentalism to spread throughout the region, endangering pro West governments in Kuwait and Saudi Arabia, and thus America's oil supplies. "It was insanity," said Weinberger. "How could you send arms to the ayatollah when he was sworn to destroy us?" 
But if arming Iran to support Israel was insane, the flip side of the policy, in the long run at least, was truly demented: Weinberger and Shultz favored defending Saudi Arabia and the enormous U.S. oil interests there by secretly bolstering the brutal Iraqi dictator Saddam Hussein. As a result of their efforts, billions of dollars in aid and weapons were funneled to Saddam's regime.
From the outset, the Reagan administration had promised to take a tough, uncompromising policy against Islamic fundamentalists, and just eight days after it took office, Reagan's first secretary of state, Alexander Haig, spelled it out unequivocally: "Let me state categorically today that there will be no military equipment provided to the government of Iran."  Officially, Iran was a terrorist state and an arms embargo was in place.
Nevertheless, a secret strategy to arm Iran got under way almost immediately. Within a few months, Haig had told Israel that "in principle" it was okay to send weapons to Iran, but only for spare parts for F-4 fighter planes, an aging, technologically obsolete warhorse from the Vietnam era, and that the United States had to approve specific arms sales lists in advance.
By early 1982, however, the U.S. government was aware that Israel was providing U.S. arms to Iran that went far beyond that agreement. In the New York Times, Seymour Hersh later reported that "Israel and American intelligence officials acknowledged that weapons, ammunition, and spare parts worth several billion dollars flowed to Iran each year during the early 1980s." 
Ultimately, the secret arms sales to Iran became enmeshed with another covert policy of the administration -- its attempt to overturn the left-wing government of Nicaragua by subsidizing right-wing rebels known as the contras. This was the scandal known as Iran-contra. It was striking that in trying to shape the future of a tiny Latin American country, the Reagan-Bush administration would go to the other side of the world for help.
The Saudis had no particular interest in Nicaragua; they didn't even have diplomatic relations with this small country half a world away. But at the time, congressional opposition to the administration's policy was so strong that on December 8, 1982, the House of Representatives voted unanimously to prohibit the use of U.S. funds to overthrow the government of Nicaragua.
However, even the Boland Amendment, as the bill was known, was not an insurmountable obstacle to a National Security Council that was prone to macho covert operations, bravado, and cowboy-style adventurism. It considered a variety of options to fund the contras, including obtaining funds from other countries and skimming profits from arms deals with Iran. Finally, in the spring of 1984, National Security Adviser Robert McFarlane raised the possibility of approaching Prince Bandar for the money. If the Saudis were to accede to the request, clearly they would gain favor from the Reagan administration. On June 22, 1984, Bandar and McFarlane agreed that the Saudis would give $1 million a month to the contras.
But the gambit was like playing political Russian roulette and had to be approved by the White House before it could proceed. What would happen if Congress found out? On June 25, 1984, a special meeting of the National Security Planning Group was called to discuss the issue. The highest officials in the country were present -- Ronald Reagan, George Bush, George Shultz, Caspar Weinberger, William Casey, and Robert McFarlane, among others. According to minutes taken at the meeting, James Baker, ever the vigilant attorney, argued that actively soliciting money from third countries -- such as Saudi Arabia -- could be an impeachable offense.
But Vice President Bush took issue with that position and said there was nothing wrong with encouraging third parties to help the anti-Sandinistas so long as there was no explicit quid pro quo. "The only problem that might come up is if the United States were to promise these third parties something in return so that some people could interpret this as some kind of exchange," he said. 
Bush, after all, had been director of the CIA. The way to do it, he seemed to be saying, was for the United States to let the Saudis finance the contras. Afterward, the United States could then reward the Saudis for their loyalty, but the two events would have to happen without being explicitly tied to each other.
And so, Bandar deposited $8 million in a Swiss bank. Over time, the amount given by the Saudis to the contras reached $32 million.  [vi] No explicit promises had been made to the Saudis, so the administration could assert there was no quid pro quo, and therefore no impeachable offense had taken place. And yet the Saudis did not go away empty-handed. After all, tens of millions of dollars had changed hands. At the time, King Fahd and Bandar wanted several hundred Stinger missiles from the United States, which had put restrictions on the sale of such weapons. To help the Saudis out, President Reagan invoked emergency measures to bypass Congress and four hundred Stingers were secretly flown to Saudi Arabia. The Saudis had received their payoff. To put it baldly: in exchange for doing something that had been explicitly prohibited by the House of Representatives by a vote of 411 to 0, Saudi Arabia received lethal, state-of-the-art American weaponry it would not have been allowed under normal conditions. The Saudis had come a long, long way from their first few airplane deals with James Bath. But in many ways their dealings with the House of Bush had just begun.
The Reagan-Bush administration and the Saudis were not just helping the contras. Early on, the administration also used Prince Bandar as an intermediary to meet Saddam Hussein, and soon Bandar told the United States that Iraq was ready to accept American aid.  Even though Congress would never have approved arms transfers to Iraq, the Reagan administration secretly began allowing Saudi Arabia, Kuwait, and Egypt to transfer U.S. weapons, including howitzers, helicopters, and bombs, to Iraq. These shipments may have been in violation of the Arms Export Control Act.  [vii]
U.S. support for Saddam Hussein could be traced all the way back to 1959, when the CIA hired him as a twenty-two-year-old assassin to shoot Iraqi prime minister General Abd al-Karim Qasim. Saddam fired too soon, however, and as a result he killed Qasim's driver and only wounded the prime minister.  In the ensuing two decades, the Agency saw him as a cutthroat and a thug, but at least he was their thug -- one who could be called on to fight Soviet expansion in the Middle East. In 1963, that meant that CIA officers in Baghdad provided Saddam with lists of "communists" whom he then assassinated. 
In 1979, Saddam began his rule by purging his political opponents with a slew of show trials and executions designed to maximize terror and establish his authority. Meanwhile, thanks to the high price of oil in the seventies, Iraq had become relatively prosperous, and Saddam saw it as a propitious time to make a play for regional leadership. In September 1980, he invaded southwestern Iran,  hoping to keep the Shiite fundamentalist revolution in Iran from spreading to Iraq, which is largely Shiite. Initially supported by the United States, the Soviet Union, most of Europe, and many Arab countries, including Saudi Arabia, Saddam had plenty of backing for a long war.
The single most powerful reason for U.S. support of Saddam was to protect the Saudis and, of course, their oil reserves. Ayatollah Khomeini's Islamic fundamentalist revolution in Iran had repercussions throughout the entire Arab world and represented a grave threat to the House of Saud. Khomeini's appeal extended beyond his Shiite constituency. Other fundamentalist Muslim groups began emulating him, and the House of Saud was panicked. Rich with petrodollars but with no military to speak of, the Saudis could not risk confronting Iran directly. Instead, they bankrolled Saddam's war against Iran with $30 billion.  Likewise, the United States feared that a new, Middle East version of the domino theory was in play. Saddam would have to act as a bulwark against Shiite extremism to prevent the fall of pro-American states such as Saudi Arabia, Jordan, and Kuwait.
As the Iran-Iraq conflict wore on, evidence of Saddam Hussein's ruthless ways became increasingly apparent. Iranian diplomats came to the United Nations armed with horrific photos of Iranian soldiers whose bodies had been burned by chemical weapons.  Key members of the Reagan administration, including Vice President Bush and James Baker, repeatedly reacted to these revelations of Saddam's atrocities largely as if they posed a delicate public relations problem rather than a genuine moral issue. The Reagan administration knew that Iraq was using mustard gas, sarin, VX, and other poisons. In public, the United States condemned such actions. But privately, senior officials supported a covert program in which the Defense Intelligence Agency provided Saddam with detailed planning for battles, air strikes, and bomb-damage assessments. 
The architect of these covert operations aiding Saddam was William Casey, and according to Howard Teicher, a National Security Council staffer who leaned toward Iran, one of the people Casey confided in was Vice President Bush. As recounted in Spider's Web, a book by British journalist Alan Friedman about the arming of Iraq, Bush also made it clear that he was open to aiding Iraq.  "I attended meetings where Bush made clear he wanted to help Iraq," said Teicher. "His door was always open to the Iraqis. If they wanted a meeting with Bush, they could get it."
In fact, Bush had leaned toward Iraq from the start.  Early on in the administration, on June 7, 1981, Bush articulated his sympathy for Iraq when Israel bombed Saddam Hussein's nuclear reactor in Osirak. The power plant was considered Iraq's first step toward making a nuclear weapon. "Reagan went around the room and asked each of us to give our opinion on the Osirak raid," recalled Alexander Haig, who felt strongly that Israel had done the right thing. "I remember Bush and then Baker making it very clear that they thought Israel needed to be punished." 
By November 1983, a State Department memo confirmed Iraqi chemical weapons producers were buying materials "from Western firms, including possibly a U.S. foreign subsidiary," and added that "it is important that we approach Iraq very soon in order to maintain credibility of U.S. policy on CW [chemical weapons] as well as to reduce or halt what now appears to be Iraq's almost daily use of CW." 
But in another memo just three weeks later, the State Department decided not to press the issue because it did not want to "unpleasantly surprise" Iraq. As a result, the administration's policy against chemical weapons was confined to "close monitoring." 
One of the key people in carrying out U.S. policy toward Baghdad during this period was Donald Rumsfeld, who had been Gerald Ford's secretary of defense and later took the same post under President George W. Bush. In December 1983, when Iraq continued to use chemical weapons "almost daily," Rumsfeld traveled to Baghdad as a special presidential envoy to meet with Saddam and pave the way for normalization of U.S.-Iraqi relations. 
In 2002, Rumsfeld told CNN that during that visit "I cautioned [Saddam Hussein] about the use of chemical weapons." However, a "Secret" memo of that 1983 meeting, which has since been declassified, contradicts Rumsfeld and indicates that there was no mention of chemical weapons whatsoever during that discussion. [viii] Far from confronting Saddam, Rumsfeld warmly assured the Iraqi dictator that America's "understanding of the importance of balance in the world and in the region was similar to Iraq's." 
As the United States continued to criticize the use of chemical weapons, the administration wanted to make certain that Saddam knew such pronouncements were merely for public consumption. So in March 1984, Rumsfeld returned to Baghdad. According to a cable from Secretary of State George Shultz, Rumsfeld was to tell Iraqi foreign minister Tariq Aziz that the recent U.S. statement on chemical weapons, or CW, "was made strictly out of our strong opposition to the use of lethal and incapacitating CW." The cable added that the statement was not made to imply a shift in policy, and the U.S. goal of improving "bilateral relations, at a pace of Iraq's choosing" remained "undiminished." The cable further advised Rumsfeld, "This message bears reinforcing during your discussions."  In other words, Rumsfeld was to assure Saddam that U.S. concerns about chemical weapons were nothing more than posturing.
And so it went -- a double policy. Throughout the entire Reagan Bush era, the United States publicly denounced Iraq's use of chemical weapons, but secretly it supported Saddam. In an Apri1 5, 1984, "Top Secret" National Security Decision Directive, the Reagan administration condemned chemical weapons use, but also called for the preparation of "a plan of action designed to avert an Iraqi collapse."  As a result, the United States allowed programs to go forth that may have aided Iraq's development of biological and chemical warfare. Beginning in 1984, the Centers for Disease Control began providing Saddam's Iraq with biological materials -- including viruses, retroviruses, bacteria, fungi, and even tissue that was infected with bubonic plague. Among the materials that were sent were several types of West Nile virus and plague-infected mouse tissue smears. 
The exchange may have been initiated in the spirit of an "innocent" transfer of scientific information. But it is not difficult to argue against giving bubonic-plague-infected tissues to Saddam Hussein. "We were freely exchanging pathogenic materials with a country that we knew had an active biological warfare program," said James Tuite, a former Senate investigator. "The consequences should have been foreseen." 
Initially at least, Vice President Bush played a low-profile role in the Reagan administration, his position circumscribed by the stigma he bore from being perceived as the lone "moderate" in a conservative revolution. [ix] As he saw it, his mandate was to display his unfettered loyalty to Reagan. Even before he took office, in the fall of 1980, Bush's stated goal was to be as innocuous as possible. "I've thought a lot about it," he said. "I know I'm not gonna have much input on policy, nothing substantive to do at all. ... And I've decided I can be happy with that."  Over time, however, Bush played a bigger role, albeit an ambiguous one. Most figures within the Reagan Bush administration tilted to one side or the other with regard to Iran or Iraq. But Bush played both sides. "He was good at conducting diplomatic dialogue," said Teicher. "He knew the style, the diction. He was good at having diplomatic discussions. But he could be swayed by personal relationships with foreign leaders. Regarding Iraq, he and Casey both had great naivete, thinking you could be friends with Saddam Hussein, which was not unlike a lot of government officials at that time. And he saw the geostrategic logic in new relationships with Iran. Bush's goals were contradictory because our policy was full of contradictions. ... He thought talking to both sides was good." 
Such duplicity had always been characteristic of Bush and had long served his ambitions. As ambassador to the United Nations, Bush had observed Henry Kissinger, who as national security adviser kept him in the dark about his secret diplomacy. Now, in the morass of American foreign policy in the Middle East, Bush was a player. 
In 1984, that meant helping Iraq construct a new oil pipeline to the Jordanian port of Aqaba to circumvent the Iranian blockade of Iraq's ports in the Persian Gulf.  To support the Aqaba pipeline, the administration had to tacitly accept Iraq's ongoing use of chemical weapons, but it also had a second problem. The Export-Import Bank, a U.S. government agency that covers loans for American companies if foreign customers default, had determined that war-ravaged Iraq was not creditworthy enough to merit a loan for the pipeline. As a result, the Reagan administration had to lobby to get the bank to overlook its own guidelines. On June 12, 1984, Charles Hill, executive secretary to Secretary of State George Shultz, sent a confidential memo to Vice President Bush, suggesting Bush call William Draper, chairman of the Export-Import Bank, and pressure him to provide the okay for the loan. 
Bush was a logical choice for this task, not only because he had such a high office, but because Draper and he were old friends. Draper had been at Yale when Bush was there; he had been co-chairman of the Bush Financial Committee for the 1980 presidential race  and had invested in young George W. Bush's first oil company, Arbusto. 
The talking points that were prepared for Bush suggested he tell Draper that the loan affected America's vital interests and that America's goal in the Iran-Iraq War was "to bring the war to a negotiated end in which neither belligerent is dominant."  Almost immediately after the call from Bush, Draper reversed the previous position of the Export-Import Bank and agreed to provide the financing. [x] Bush's lobbying of the bank marked the point at which he began to take an active role in the covert policy to support Saddam Hussein's Iraq.
In November 1984, the Reagan-Bush team won reelection, and in Reagan's second term the internal struggle over the two covert strategies exploded. The United States had been trying a variety of policies including both incentives and punitive measures against Iran. Secretly, CIA director William Casey worked with Prince Bandar to execute the harshest measures of all toward Iranian-backed fundamentalists: assassination. As reported in Bob Woodward's Veil, in early 1985, Prince Bandar invited Casey to his home in Virginia just after the Iranian-supported Hezbollah had bombed American facilities in Beirut and kidnapped CIA station chief William Buckley. Casey and the Saudis agreed it was time to strike back. The target: Sheikh Fadlallah, leader of the Party of God, Hezbollah. Control of the operation was given to the Saudis. If anything went wrong, they would deny CIA involvement.
According to Woodward, the Saudis laundered $3 million through various bank accounts and found an operative from Britain's elite special forces to handle the operation. Vice President Bush was apparently left out of the loop. On March 7, 1985, he was in Sudan, meeting with Sudanese president Jaafar Numeiry to discuss the plight of starving refugees and whether the United States would resume food aid. The next day, a car packed with explosives blew up about fifty yards from Fadlallah's high-rise residence in Beirut. Eighty people were killed and two hundred injured. Fadlallah, however, escaped unharmed. To cover their tracks, the Saudis provided Fadlallah with incontrovertible information leading to the operatives they had hired. "You suspect me and I turn in my chauffeur and say he did it," Bandar explained. "You would think I am no longer a suspect."  The bombing was widely blamed on Israel.
Meanwhile, others in the administration argued vociferously that it was time to try a policy of incentives toward Iran. Perhaps the most forceful case was made by Graham Fuller, the CIA's national intelligence officer for the Middle East, in two memos he wrote in May 1985. "Our tilt to Iraq was timely when Iraq was against the ropes and the Islamic revolution was on a roll," Fuller wrote to CIA director William Casey in May 17, 1985. "The time may now have come to tilt back." Fuller argued that the United States should once again authorize Israel to ship U.S. arms to Iran. 
Fuller's rationale was the mirror image of the argument that Secretary of Defense Caspar Weinberger had made in favor of supporting Iraq three years earlier. To counter the effects of one covert policy, another one was needed. This time, however, another factor had to be taken into consideration. In the preceding year and a half, seven Americans had been taken hostage in Beirut by Hezbollah, the Shiite fundamentalist group backed by Iran. 
Meanwhile, the Iran-Iraq War escalated. A wave of Iranian assaults against which the Iraqis used chemical weapons left twenty thousand Iranians and fourteen thousand Iraqis dead. At roughly the same time, Hezbollah took two more American hostages in Beirut. President Reagan angrily charged that Iran was a member of a "confederation of terrorist states ... a new, international version of Murder, Incorporated." He pledged, "America will never make concessions to terrorists."
But secretly, the White House was already preparing to send weapons to Iran in an arms-for-hostages deal.  On June 11, 1985, just two days after Thomas Sutherland, a dean at the American University in Beirut, was kidnapped, the National Security Council drafted a presidential directive advocating that the United States help Iran obtain selected weapons. The opposing faction in the administration -- principally Secretary of State George Shultz and Secretary of Defense Caspar Weinberger -- was irate. "This is almost too absurd to comment on," Weinberger wrote in a memo. "It's like asking Qadaffi to Washington for a cozy chat." 
Nevertheless, on August 30, Israel sold more than five hundred U.S.-origin TOW missiles (Tube-launched, Optically tracked, Wire-command) to Iran. Just over two weeks later, on September 15, 1985, the Reverend Benjamin Weir, who had been kidnapped in Beirut more than a year earlier, was released.
The administration hoped that other hostages would be released, too, but none were. The problem: Iran didn't need more weapons. Now, something else had to be done.
Over time, Bush had begun to win over key members of the Reagan administration. Even William Casey, the brilliant spymaster who Reagan had named to head the CIA, had initially distrusted Bush, but grew to admire him. "Casey knew there was no one in government who could keep a secret better," says one former high-level CIA official.  "He knew that Bush was someone who could keep his confidences and be trusted. Bush had the same capacity as Casey to receive a briefing and give no hint that he was in the know."
That such qualities went hand in hand with Bush's patrician background won him the highest compliment of all from Count Alexandre de Marenches, the legendary godfather of French intelligence. A crusty Cold Warrior who had nothing but contempt for most players on the world stage, de Marenches found Bush to have the perfect pedigree for covert operations: he was a gentleman. All through Bush's political life, journalists and colleagues have spoken of him as if he were two people. One was the gracious and courtly George Bush who was so acquiescent to those who had higher rank and power. The other was George Bush the ruthless politician, who would go into campaign mode to do whatever it might take to win. Casey confided to his colleagues that he felt that the two sides of Bush were really one and the same. Bush had the capacity to act on the judgment of others, to live within the constraints of their agendas. This philosophy had served him well in the long line of appointive offices he had won. Casey, according to his colleagues, understood that Bush's compliant nature, like his merciless side, served a higher ambition. As a result, he chose Vice President Bush to carry out his secret mission to break the impasse that had stalled the release of the remaining hostages.
Casey, according to two aides who worked with him at the CIA, reasoned that if Iraq escalated the air war, Iran would have a renewed need for U.S. weapons and that would force it to conclude the stalled arms-for-hostages deal on acceptable terms. 
In the past, the United States had turned to the Saudis to help out on such matters. In February 1986, to induce Iraq to carry out more bombing operations, the Reagan administration had secretly authorized Saudi Arabia to transfer U.S.-origin bombs to Iraq and encouraged the Saudis to provide Saddam with British fighter planes as well. Later that month, according to classified reports, Saudi Arabia sent Iraq fifteen hundred MK-84 bombs, nonguided two-thousand-pound devices designed for operations where maximum blast and explosive effects are desired. [xi]
But to the dismay of U.S. officials, because the Iraqis were afraid to lose planes and sometimes did not even know where they should be striking, Saddam failed to make full use of the U.S. bombs.  Vice President Bush would have to intercede.
On Friday, July 25, 1986, Bush left for Israel and the Middle East to meet with the heads of state of Jordan and Egypt. More than a dozen reporters accompanied him. Bush said the purpose of the trip was to "advance the peace process," but exactly what that meant was unclear. The day before the trip, the Bush aide said, "I don't think it is sensible to talk in terms of dramatic initiatives. In fact, I would play that down." 
A Bush adviser discussed the agenda in terms that seemed to have been cribbed from Chauncey Gardner, the hero of Jerzy Kosinski's comic political novel Being There. "It's like tending a garden," he told the Times. "If you don't tend the garden, the weeds grow up. And I think that there are a lot of weeds in that garden." 
Once the trip got under way, in Israel alone there were thirty-five opportunities to shoot photos of the vice president as a world leader advancing the peace process in the Middle East. When Bush got to Jordan, aides tried to arrange to have a photo of him peering through binoculars at enemy territory -- until it was pointed out that the territory in question was Israel's. At one point, Bush turned to Jordan's commander in chief.
"Tell me, General, how dead is the Dead Sea?" the vice president asked.
"Very dead, sir," the general replied. 
Secretly, however, Bush was pursuing a very different agenda from the one written about in the media: the former CIA director was now actually working as an intelligence operative on a mission from William Casey to facilitate the arms-for-hostages deal with Iran and to set in motion the delivery of military intelligence to Saddam Hussein.
Now the feverish double-dealing began in earnest. On July 29, Israeli counterterrorism adviser Amiram Nir briefed Bush at the King David Hotel in Jerusalem and told him that Iran had agreed to release the American hostages in exchange for four thousand missiles. 
The next day, Bush went to Jordan to perform the most delicate part of his mission, initiating the transfer of military intelligence to Saddam. According to two Reagan administration officials, Bush told King Hussein that Iraq needed to be more aggressive in the war with Iran and asked that Saddam Hussein be urged to use his air force against targets inside Iran. 
A few days later, on August 4, Bush met in Cairo with President Hosni Mubarak and asked him to pass on to Saddam Hussein the same message he had given King Hussein of Jordan. Saddam had previously rejected U.S. advice to escalate the bombing, but now, because of the cost of the war, he desperately needed American money and weapons. In addition, CIA officials began directly providing the Iraqi military both with highly classified tactical intelligence and technical equipment to receive satellite intelligence so Iraq could assess the effects of its air strikes on Iran.
During the forty-eight hours after Bush's meeting with Mubarak, the Iraqi air force flew 359 missions. Over the next few weeks, Iraqi planes struck deep into Iran and bombed oil refineries, including for the first time the loading and storage facilities on Sirri Island, 460 miles from the border -- a daring feat for the Mirage pilots, who risked running out of fuel.
On August 5, Bush returned to Washington and was debriefed by Casey. "Casey kept the return briefing very close to his vest," one of his aides said. "But he said Bush was supportive of the initiative and had carried out his mission."
Meanwhile, the covert arms sales to Iraq almost came undone. Low-level American officials at the U.S. embassy in Riyadh had become aware of the Saudi transfer of U.S. MK-84 bombs to Iraq earlier that year. Unaware that the Reagan administration had secretly authorized the deal, the officials went so far as to question Prince Bandar, who assured them the transfer had been accidental and small. The White House forwarded a similar message to Republican senator Richard Lugar, chairman of the Senate Foreign Relations Committee. But in fact, fifteen hundred bombs had been sold to Iraq with the authorization of the Reagan administration, and Bandar had played a far bigger role than Congress realized. He had even played the middleman in making sure that Iraq obtained highly sensitive satellite information about Iranian troop movements from the CIA. 
If Bush's team seemed like characters in a Kosinski novel, perhaps it was because American Middle East policy had taken on such an astonishingly dark, surreal cast that was so utterly at odds with what was being reported in the American press. Bush's trip was widely touted as a peace mission. But in fact he had gone to the Middle East as a spy, an operative whose cover was that he was trying to advance the peace process. His real mission, however, was to give strategic military intelligence to a murderous dictator, Iraq's Saddam Hussein, so that he might kill more Iranians. After Iran had seized more American hostages and President Reagan had termed it "Murder, Incorporated," the United States had promised a harsh response. But instead the United States sold Iran four thousand missiles. And Bandar had asserted that he so loved the game of politics because "there was no blood drawn." But he had launched an operation that had killed eighty innocent people in Lebanon.
In November 1986, the Lebanese newspaper Al Shirra broke the story about the Reagan administration's arms sales to Iran. As the ensuing Iran-contra revelations unfolded, Robert McFarlane, Oliver North, and most of the key officials who had advocated tilting toward Iran left the White House in disgrace, giving their rivals a clear field. Consequently, the Reagan administration, in its closing days, leaned strongly toward Iraq.
When the Iran-contra disclosures broke, Bush told the Washington Post that he had not been aware that Shultz and Weinberger had raised serious objections to selling weapons to Iran. "If I had sat there and heard George Shultz and Cap express it strongly, maybe I would have had a stronger view. But when you don't know something, it's hard to react. ... We were not in the loop," he said.
On August 6, 1987, the day the Post story appeared, Weinberger telephoned Shultz, incredulous that Bush had denied knowledge. "He was on the other side," Weinberger said. "It's on the record! Why did he say that?" 
The answer may have lain in Vice President Bush's ambitions. By early 1988, he had been all but anointed Reagan's successor as the Republican presidential nominee and began positioning himself for a run against the eventual Democratic candidate, Michael Dukakis.  [xii] He was in an exceptionally strong position. Inflation had plummeted from 13.5 percent in 1980, the last year of the Carter administration, to about 4 percent in 1988. The price of oil now fluctuated between $15 and $20 a barrel, less than half its peak in the early eighties.  Gas was so cheap that Detroit auto manufacturers were reveling in the success of a new kind of car called the minivan, the precursor of the gas-guzzling SUV.
American participation in both the Iran-Iraq War and the Afghanistan War, taking place simultaneously, did not register at all on the radar screen of the American electorate. By contrast, the Vietnam War had led to more than fifty thousand American deaths, endless coverage on the nightly news, and a powerful antiwar movement that affected the course of national politics. To be sure, there were hundreds of thousands of deaths in each conflict. But these were wars by proxy, and in the United States, American participation was virtually invisible. Osama bin Laden was unknown to the American people. Only those few who followed the Afghanistan War closely might be aware that he had achieved a nearly heroic status among Islamic militants. As for Saddam Hussein, he was widely seen as a heavy-booted but reliable American ally in the fight against both the Soviets and militant Islamic fundamentalism. There was no domestic political pressure to change American foreign policy in the Middle East.
It might appear that the Saudis' role in the Iran-Iraq War was confined to their shared interest with the United States in protecting Saudi oil fields and participating in a few covert operations. But in fact they performed another function that was both highly secretive and utterly essential. BCCI had played a key role in American operations in Iraq since the early eighties, when CIA director William Casey met every few months at the Madison Hotel in Washington, D.C., with Hasan Abedi, the bank's founder.  Though Abedi was Pakistani, increasingly BCCI had become a Saudi operation with major investors such as Kamal Adham and Ghaith Pharaon. In fact, in the spring and summer of 1986, Khalid bin Mahfouz, the Saudi banker who had gone to Texas in the seventies, spent nearly $1 billion to become BCCI's biggest shareholder.
Because it offered many services not available at Citibank or Chase, such as providing phony documentation and letters of credit to facilitate the purchase of weapons,  BCCI was the bank of choice for illegal arms sales to Saddam Hussein's regime in Iraq as well as other CIA covert operations.
To understand BCCI, it is helpful to think of the institution as something other than merely a bank. Time once described it as "a vast, stateless, multinational corporation that deploys its own intelligence agency, complete with a paramilitary wing and enforcement units, known collectively as the Black Network."  The bank maintained relations with foreign countries through its own "protocol officers" and traded such huge amounts of commodities like grain, rice, coffee, and, of course, oil that it became a major factor in international markets.
In short, it was everything William Casey had ever dreamed of. "What [BCCI founder] Abedi had in his hand [was] magic -- something [Saudi intelligence chiefs] Kamal Adham or even Prince Turki didn't have," said a BCCI official. "Abedi had branches and banks in at least fifty third-world countries. The BCCI people ... were on a first-name basis with the prime ministers, the presidents, the finance ministers, the elite in these countries -- and their wives and mistresses."
If Casey wanted to know a political leader's secrets, the official continued, Abedi could tell Casey "how much he's salted abroad and how much money he gives to his girlfriend."  Meanwhile, the bank created a template with which to finance covert operations all over the world for an international network of terror. As a senior U.S. investigator put it, "BCCI was the mother and father of terrorist financing operations."  Not only were many of these BCCI deals illegal, at times they obscured the U.S. goal of solidifying its position in the Middle East.
Meanwhile, as the Iran-Iraq War continued, even Saddam's most brutal atrocities could not weaken U.S. support of Iraq, in part because the Iran-contra scandal had stirred a deep Saudi concern. The Saudis asserted that in selling arms to Iran the United States was not doing enough to support its ally Iraq, so the United States redoubled its efforts.
In March 1988, Saddam Hussein dropped chemical bombs on Halabja, an Iraqi town in Iranian-held territory, killing five thousand of his own people, Iraqi Kurds.  [xiii] "It was life frozen," said an Iranian photographer who came upon the scene. "Life had stopped. It was like watching a film and suddenly it hangs on one frame. It was a new kind of death to me." 
U.S. intelligence sources told the Los Angeles Times that the poison gas was sprayed on the Kurds from U.S. helicopters, which had been sold to Iraq for crop dusting.  The Halabja attack was condemned throughout the world and was later used as a reason by President George W. Bush to invade Iraq in 2003.
According to Peter W. Galbraith, the senior adviser to the Senate Foreign Relations Committee who exposed Saddam's gassing of the Kurds, two men who were key players in the Reagan Bush era and later became principal figures in George W. Bush's administration helped kill the Prevention of Genocide Act, a bill that would have imposed sanctions on Iraq for its genocidal campaign. The bipartisan bill passed the Senate unanimously just one day after it was introduced. But thanks to Colin Powell and Dick Cheney, it never became law. "Secretary of State Colin Powell was then the national security adviser who orchestrated Ronald Reagan's decision to give Hussein a pass for gassing the Kurds," Galbraith wrote. "Dick Cheney, then a prominent Republican congressman, now vice president and the administration's leading Iraq hawk, could have helped pass the sanctions legislation, but did not." 
On August 20, 1988, a cease-fire went into effect between Iran and Iraq. Just five days later, Saddam Hussein again staged poison-gas attacks against his own people in villages in Iraqi Kurdistan. None of this, however, changed the administration's policy.
By the time Bush became president in January 1989, the Iran-Iraq War had ended in a stalemate; there was no longer a reason to arm Saddam. [xiv] Nevertheless, BCCI's role in arming Iraq continued. Arms dealer Sarkis Soghanalian, who sold billions of dollars' worth of weapons to Saddam,  banked there. BCCI regularly loaned billions in short-term, often overnight, loans to the Banca Nazionale del Lavoro, an Italian bank that in turn backed Saddam.
But now that he was president, Bush overlooked BCCI's excesses and actually increased U.S. aid to Saddam in an effort "to bring him into the family of nations."  Incredibly, Bush's policy would facilitate Iraq's development of ballistic, chemical, and even nuclear weapons. Bush implemented it despite repeated warnings from his own administration about Saddam's massive military buildup, human-rights violations, use of chemical weapons, and continued support for terrorism. [xv]
In March 1989, State Department officials told Secretary of State James Baker that Iraq was working on chemical and biological weapons and that terrorists were still operating out of Iraq. In June, the Defense Intelligence Agency sent a Top Secret report to thirty-eight Bush administration officials, warning that it had uncovered a secret military procurement network for Iraq operating all over the world. 
That included the United States. In September 1989, the Defense Department discovered that an Iraqi front company in Cleveland was funneling American technology to Iraq's nuclear weapons program, but the Bush administration allowed the company to operate -- even after the invasion of Kuwait in August 1990, nearly a year later. On September 3, 1989, a Top Secret CIA assessment informed Baker that Iraq had a program to develop nuclear weapons.
In spite of all these warnings, on October 2, 1989, President Bush inexplicably signed a National Security Directive authorizing even closer relations with Iraq, giving Saddam yet more aid. Four days later, James Baker met with his Iraqi counterpart, Tariq Aziz, and promised that the Bush administration would not tighten restrictions on high-technology exports to Iraq. Baker gave these assurances despite the CIA warning he had received the previous month alerting him that some of the "dual-use" technology might be used in Iraq's nuclear weapons development program.
By this time, international bankers had cut off virtually all loans to the Iraqi dictator. But on October 31, 1989, James Baker called the secretary of agriculture, Clayton Yeutter, and pressed for a billion dollars in new agricultural loan guarantees for Iraq. State Department officials were aware that Iraq was diverting some of its dual-use technology to its nuclear weapons program, yet it decided not to tighten export licenses. In January 1990, President Bush waived congressional restrictions on Iraq's use of the Export-Import Bank and in doing so overlooked new evidence that Iraq was testing ballistic missiles and stealing nuclear technology.
All told, the Reagan and Bush administrations ended up providing Saddam Hussein with more than $5 billion in loan guarantees. In the end, American support had enabled the repressive dictator to become a major military force in the Persian Gulf. Saddam had chemical weapons and a nuclear arms program.
There were now a million men in the Iraqi army. Those members of the Bush administration who worried that Shiite revolutionaries would sweep through the Middle East could rest assured that such an event was highly unlikely. The United States had helped build Iraq into the strongest military force in the Middle East. Little did Bush and the Saudis dream that they would soon be at war with the man they had helped create.
[i] Thousands of suspected terrorists were rounded up and jailed, among them Sheikh Omar Abdel Rahman, who, in the wake of the 1993 World Trade Center bombing, was convicted of conspiring to blow up New York City landmarks, and Ayman al-Zawahiri, who became known as one of Osama bin Laden's two top lieutenants.
[ii] The fundamentalist Muslim Brotherhood's history in Egypt dated back to the twenties. For decades it had gone through various periods of acceptance and harassment, as it became increasingly militant.
[iii] Secret agreements between the Saudis and various U.S. presidents dated back to the early postwar era and continued into the twenty-first century. Thanks to a pact between President Harry Truman and King Ibn Saud in 1947, the United States vowed to come to Saudi Arabia's defense if it was attacked. Likewise, in 1963, President Kennedy sent a squadron of fighter jets to protect Saudi Arabia when Egypt's Gamal Abdel Nasser attempted to kill members of the Saudi royal family.
[iv] In late October 1981, four days before the Senate vote, Armstrong prepared an explosive article for the Washington Post asserting that the AWACS sale was just the beginning of a secret $50-billion plan to build surrogate military bases in Saudi Arabia.
But on Friday, October 23, just a few days before Armstrong's article was to run, Pentagon officials called the Post. As General Richard Secord recounted it, they said, "'You know, this guy's preparing this cockamamy story,' You know, 'You've got to give us a break on this. This is crazy,' you know? And that's why the story was published after the vote, not before."
[v] Some of the material in this chapter is adapted from "In the Loop" by Murray Waas and Craig Unger, which appeared in the November 5, 1992, New Yorker.
[vi] Salem bin Laden was said to be involved in this effort.
[vii] In some small measure, support for both Iran and Iraq may merely have been a continuation of a policy started by President Carter. According to classified documents uncovered by Robert Parry, a Washington, D.C., investigative reporter, after meeting with Prince Fahd, Alexander Haig briefed President Reagan in April 1981 that Fahd had explained that Iran was receiving spare parts for U.S. equipment from Israel. Haig's notes had another astonishing assertion: "It was also interesting to confirm that President Carter gave the Iraqis a green light to launch the war against Iran through Fahd." In other words, Haig had been told by the future Saudi king that Jimmy Carter had given clearance for Saddam to invade Iran and begin the Iran-Iraq War. According to former Iranian president Bani-Sadr, even though the United States did not officially have relations with Iraq, the Carter administration used Saudi channels to send Iraq secret information that exaggerated Iran's military weakness. By encouraging Iraq to attack, the United States hoped to set the stage for a solution to the Iranian hostage crisis with a possible arms-for-hostages deal.
[viii] Rumsfeld did raise the issue in his subsequent meeting with Iraqi official Tariq Aziz, but addressing the issue at a lower level was indicative of the administration's priorities.
[ix] Though he was often viewed with suspicion by Reagan conservatives as a "moderate," such perceptions were more a reflection of Bush's roots in the Eastern Establishment than of his own deeply held political convictions. As early as 1964, Bush had endorsed conservative Barry Goldwater for president over the liberal Republican candidate Nelson Rockefeller.
[x] Because of unrelated problems about obtaining insurance, the Aqaba pipeline was never built.
[xi] Ironically, during the Gulf War the United States delivered the same bomb to Iraq through other means. During Operation Desert Storm, the United States dropped more than twelve thousand MK-84s on Iraq.
[xii] One thing that was not easy for Bush during his successful presidential campaign in 1988 was his relationship with his longtime friend James Baker, who confided that when he traveled with Bush, he was at times left playing the role of the "goddamn butler." "Do you think I enjoyed leaving the office of secretary of treasury, being fifth in line to the presidency, to come over here to be called a handler?" he said. When he saw his picture on the cover of Time, under the headline "The Year of the Handlers," he told his aides he felt like retching.
[xiii] Various accounts have blamed the Iranians for the gas or have suggested that both Iran and Iraq were using chemical weapons at Halabja. But according to Joost R. Hiltermann in the International Herald Tribune, the U.S. State Department instructed its diplomats to blame Iran as well to mute the condemnation of Iraq for using chemical weapons. "The deliberate American prevarication on Halabja was the logical outcome of a pronounced six-year tilt toward Iraq. ... Sensing correctly that it had carte blanche, Saddam's regime escalated its resort to gas warfare, graduating to ever more lethal agents. Because of the strong Western animus against Iran, few paid heed. Then came Halabja. Unfortunately for Iraq's sponsors, Iran rushed Western reporters to the blighted town. ... In response, the United States launched the 'Iran too' gambit. The story was cooked up in the Pentagon, interviews with the principals show. A newly declassified State Department document demonstrates that United States diplomats received instructions to press this line with United States allies ... the UN Security Council['s] choice of neutral language (condemning the 'continued use of chemical weapons in the conflict between the Islamic Republic of Iran and Iraq' and calling on 'both sides to refrain from the future use of chemical weapons') diffused the effect of its belated move. Iraq proceeded to step up its use of gas until the end of the war and even afterward."
[xiv] According to Hadi Qalamnevis, director general of the Statistics and Information Department at the Islamic Revolution Martyrs Foundation, 204,795 Iranians lost their lives in the Iran-Iraq War, including 188,015 military and 16,780 civilians. Earlier, Mohsen Rafiqdust, the former head of the Iranian Revolutionary Guard Force, estimated that 400,000 were wounded during the war. According to Iranian health officials, about 60,000 Iranians were exposed to Iraqi chemical-weapons attacks during the war. More than 15,000 war veterans suffering from chemical-weapons syndrome reportedly died in the twelve years after the end of the Iran-Iraq War, according to Abbas Khani, the head of the Legal Office for War Veterans.
[xv] In May 2003, after the Iraq War, the magnitude of Saddam's crimes became more apparent when mass graves were found throughout the country. According to columnist Ureib Al-Rintawi in the Jordanian daily Al-Dustour, the remains of over fifteen thousand Iraqis were found on the outskirts of the city of Basra, making "the story of Halabja seem like a minor episode in the bloody game experienced by the Iraqi people under Saddam Hussein." Films were later discovered that showed the execution of victims by remote control with explosives stuffed into their pockets, followed by executioners applauding as the victims flew into the air. Columnist Hazem Saghiya wrote in the Arabic-language London daily Al-Hayat that the number of those murdered by Saddam was between 1 million and 1.5 million, and Arab observers began to say that Saddam's atrocities were on the level of the mass murders that took place in the killing fields of Cambodia under Pol Pot.
1. "Looking for Answers: Egypt," PBS Frontline, www.pbs.org/wgbh/pages/frontline/shows/terrorism/egypt/ .
2. U.S. Department of State, Patterns of Global Terrorism, 2001, May 2002, http://www.library.nps.navy.mil/home/tgp/hamas.htm .
3. Don Rothberg, Associated Press, July 18, 1980.
4. Murray Waas and Craig Unger, "In the Loop," New Yorker, November 2, 1992, p. 64ff.
5. Walter Pincus, "Secret Presidential Pledges Over Years Erected U.S. Shield for Saudis," Washington Post, February 9, 1992, p. A 20.
6. The entire cost of the package has sometimes been reported as $8.5 billion.
7. Bob Woodward, The Commanders, p. 200.
8. Elsa Walsh, "The Prince: How the Saudi Ambassador Became Washington's Indispensable Operator," New Yorker, March 23, 2003, p. 48.
9. Rory O'Connor, writer and producer, "The Arming of Saudi Arabia," PBS Frontline #1112, February 16, 1993.
11. One of the chief beneficiaries of the AWACS deal was the Bechtel Corporation, of which Reagan's secretary of state, George Shultz, and secretary of defense, Caspar Weinberger, had served as president and general counsel, respectively.
12. O'Connor, "The Arming of Saudi Arabia."
15. "Al Salaam Slow Down," Middle East Defense News, April 19, 1993.
16. O'Connor, "The Arming of Saudi Arabia."
18. Robert Baer, "The Fall of the House of Saud," Atlantic Monthly, May 2003, p.60.
19. Wayne King with reporting by Jeff Gerth and Wayne King, "Private Pipeline to the Contras: A Vast Network," New York Times, October 22, 1986, p. A 1.
20. Walsh, "The Prince," p. 48.
21. Waas and Unger, "In the Loop."
25. Theodore Draper, A Very Thin Line, p. 77.
26. Jane Mayer, "The House of bin Laden," New Yorker, November 12, 2001, www.newyorker.com/fact/content/011112fa_FACT3 .
27. Patrick Tyler, "Officers Say US Aided Iraq in War Despite Use of Gas," New York Times, August 18, 2002, p. 1.
28. Waas and Unger, "In the Loop"; Robert Parry, "Saddam's Green Light," consortium News, www.consortiumnews.com/archive/xfile5.html ; and Dilip Hiro, The Longest War.
29. Richard Sale, "Saddam Key in Early CIA Plot," UPI, Apri1 10, 2003.
30. Adel Darwish, Unholy Babylon, pp. 201-8.
31. F. Gregory Gause III, "Iraq and the Gulf War: Decision-Making in Baghdad," University of Vermont, www.ciaonet.org/casestudy/gaf01/#note22 .
32. Said Aburish, The Rise, Corruption and Coming Fall of the House of Saud, p. 52.
33. Elaine Sciolino, "Threats and Responses: The Iranians; Iraq Chemical Arms Condemned, but West Once Looked the Other Way," New York Times, February 13, 2002, p. A18.
34. Tyler, "Officers Say US Aided Iraq in War Despite Use of Gas," p. 1.
35. Alan Friedman, Spider's Web, p. 25.
36. Before the new administration took office -- in fact, the day after the November 1980 election Iraq began reaching out to Bush, with Iraqi deputy foreign minister Ismat Kittani, a good friend of Bush's from his days at the United Nations, flying especially to the United States to congratulate the vice president-elect and send him flowers.
37. Friedman, Spider's Web, p. 4.
38. "Iraq Use of Chemical Weapons," unclassified memo from Jonathan Howe to the secretary of state, November 1, 1983, National Security Archives, www.gwu.edu/~nsarchiv/NSAEBB/NSAEBB82/iraq24.pdf.
39. "Iraqi Use of Chemical Weapons," from Jonathan T. Howe and Richard Mur- phy to Lawrence Eagleburger, November 21,1983, National Security Archives, www.gwu.edu/~nsarchiv/NSAEBB/NSAEBB82/iraq25.pdf.
40. "U.S. Documents Show Embrace of Saddam Hussein in Early 1980s Despite Chemical Weapons," National Security Archives, www.gwu.edu/~nsarchiv/NSAEBB/NSAEBB82/press.htm.
41. Joyce Battle, ed., Shaking Hands with Saddam Hussein: The U.S. Tilts toward Iraq, 1980-1984 (National Security Archives Electronic Briefing Book no. 82, February 25, 2003), www.gwu.edu/~nsarchiv/NSAEBB/NSAEBB82/index.htm.
42. Dana Priest, "Rumsfeld Visited Baghdad in 1984 to Reassure Iraqis, Documents Show," Washington Post, December 19, 2003. Documents were originally obtained by the National Security Archives.
43. "Measures to Improve U.S. Posture and Readiness to Respond to Developments in the Iran-Iraq War," National Security Decision Directive (NSDD) 139 of April 5, 1984, National Security Archives, www.gwu.edu/~nsarchiv/NSAEBB/NSAEBB82/iraq53.pdf.
44. Dean Foust and John Carey, "A U.S. Gift to Iraq: Deadly Viruses," Business Week, September 20, 2002, www.businessweek.com/bwdaily/dnflash/sep2002/nf20020920_3025.htm.
45. Ibid. After the Gulf War, a Senate investigation determined that the United States allowed the export of a wide range of disease-producing and poisonous biological material to Iraq during the eighties, thanks to licensing by the Department of Commerce of "dual-use" exports that could be used for chemical and biological warfare. According to the investigation, among the approved sales to Iraq was the often fatal anthrax bacterium; the botulinum toxin, which causes vomiting, constipation, thirst, general weakness, headache, fever, dizziness, double vision, dilation of the pupils, and paralysis of the muscles involving swallowing; and Histoplasma capsulatum, which can lead to pneumonia and enlargement of the liver and spleen and is often fatal; see Donald W. Riegle Jr. and Alphonse M. D'Amato, " A Report of the Committee of Banking, Housing and Urban Affairs with Respect to Export Administration, US Chemical and Biological Warfare-Related Dual Use Exports to Iraq and Their Possible Impact on the Health Consequences of the Persian Gulf War with Respect to May 25, 1994," www.gulflink.osd.mil/medsearch/FocusAreas/riegle_report/report/report_s01.htm#Chapter%201.%20Iraqi%20Chemical%20and%20Biological%20Warfare%20Capability.
46. Richard Ben Cramer, What it Takes, p. 15.
47. Waas and Unger, "In the Loop."
51. Herbert S. Parmet, George Bush, p. 292.
52. Joe Conason, "The George W. Bush Success Story," Harper's, February 2000.
53. Waas and Unger, "In the Loop."
54. Bob Woodward, Veil, p. 397.
55. Waas and Unger, "In the Loop."
56. On May 20,1985, Fuller wrote a Special National Intelligence Estimate (SNIE), a closely held memo that was circulated to the president. The memo became the basis for renewed arms sales to Iran and the ensuing Iran-contra scandal.
57. Waas and Unger, "In the Loop."
67. Woodward, The Commanders, p. 203.
68. Waas and Unger, "In the Loop."
69. Maureen Dowd and Thomas Friedman, "The Fabulous Bush & Baker Boys," New York Times, May 6, 1990, sec. 6, p. 34; and Sidney Blumenthal, "I, Baker," New Republic, November 2, 1992, p.17.
70. "World Oil Market and Oil Price Chronologies: 1970-2002," Energy Information Administration, Department of Energy, www.eia.doe.gov/cabs/chron.html.
71. The BCCI Affair: A Report to the Committee on Foreign Relations, United States Senate, by Senator John Kerry and Senator Hank Brown, December 1992, 102nd Cong., 2nd Sess. Senate Print 102-140. NB: This December 1992 document is the penultimate draft of the Senate Foreign Relations Committee report on the BCCI Affair. After it was released by the committee, Senator Hank Brown, reportedly acting at the behest of Henry Kissinger, pressed for the deletion of a few passages, particularly in chapter 20, "BCCI and Kissinger Associates." As a result, the final hard-copy version of the report, as pub- lished by the Government Printing Office, differs slightly from the committee's soft-copy version at www.fas.org/irp/congress/1992-rpt/bcci/llintel.htm.
72. Jonathan Beaty and S. C. Gwynne, The Outlaw Bank, p. 316.
73. Jonathan Beaty and S. C. Gwynne, "Not Just a Bank; You Can Get Anything You Want Through BCCI," Time, September 2, 1991, p. 56.
74. Peter Truell and Larry Gurwin, False Profits, pp.133-34.
75. Douglas Farah, "Al Qaeda's Road Paved with Gold," Washington Post, February 17, 2002, p. A 1.
76. Joost Hiltermann, "America Didn't Seem to Mind Poison Gas," International Herald Tribune, January 17, 2003; and Lee Stokes, "Iran Asks for UN Probe of Chemical Warfare," UPI, April 23, 1988.
77. Jeffrey Goldberg, "Wartime Friendships," New Yorker, April 14, 2003, p. 30.
78. Stuart Auerbach, "1.5 Billion in U.S. Sales to Iraq: Technology Products Approved up to Day before Invasion," Washington Post, March 11, 1991, p. A 1.
79. Peter W. Galbraith, "The Wild Card in Post-Saddam Iraq," Boston Globe Magazine, December 15, 2002.
80. The BCCI Affair, Senate Print 102-140.
81. Waas and Unger, "In the Loop."