While there is no evidence that George Bush, then vice president, knew of the covert efforts to arm Saddam Hussein, several sources say Bush was a key behind-the-scenes proponent of a broader change of policy in which the U.S. would tilt toward favoring Iraq in its war against Iran. Reagan, Bush, and other policymakers feared a military victory by the Ayatollah Khomeini, and viewed Saddam as a bulwark against the fundamentalist Islamic fervor Khomeini was attempting to spread throughout the Mideast. After he was elected president, Bush intensified efforts to develop closer business, diplomatic, and intelligence ties between Iraq and the United States.
At the operational center of much of the clandestine policy to militarily strengthen Iraq was Sarkis Soghanalian, the controversial Miami arms dealer considered by many law enforcement officials to be the largest private weapons merchant in the United States, and one of the top in the world. Soghanalian, a Lebanese national who maintains a waterfront home on Hibiscus Island in Miami Beach, administers a vast international business network from his offices at Pan Aviation, his air cargo company, located at the northern edge of Miami International Airport. His weapons brokerage, United Trade International, reportedly sells more than one billion dollars in arms each year, bringing profits, Soghanalian claims, of more than ten million dollars annually. For many years Soghanalian has enjoyed a close working relationship with Saddam Hussein's military apparatus. And while that relationship has been extremely profitable, it has also led to serious legal trouble. Today Soghanalian faces federal criminal charges stemming from his efforts to sell armaments to the man President Bush has compared to Adolf Hitler.
Attempts to secretly arm Saddam Hussein began in the early years of Ronald Reagan's first term as president. Reports were filtering back to the State Department from the U.S. Embassy in Amman that Jordan's King Hussein was pressing for the U.S. to militarily assist Iraq, which was suffering serious reverses in its war with Iran. The Ayatollah's forces had leveled many of Iraq's major oil facilities and were laying siege to Basra, Iraq's second largest city. King Hussein, an ally of Iraq, urged the U.S. to find some way of helping Saddam prevent a full and complete victory by Iran.
Shortly thereafter, William Eagleton, the U.S. charge d'affaires in Baghdad (the senior U.S. diplomat in Iraq), recommended to his superiors that the Reagan Administration reverse its policy of neutrality and allow shipments of U.S. arms to Iraq through third countries. Officials throughout the Reagan Administration supported the policy recommendation.
But others had reservations. To carry out Eagleton's plan, the U.S. would have to lift its weapons embargo against Iraq, something Congress certainly would never allow. An alternative was to help arm Iraq secretly, without lifting the embargo, without informing Congress, and in circumvention of the law. The Arms Export Control Act prohibits the transfer of U.S. weapons to embargoed nations via third countries. Those countries that legally import arms from the U.S. pledge before the sale is made that they will not transfer the weapons to another country without official, written approval from the U.S. government. The law also prohibits all U.S. citizens - including government officials - from arranging arms sales to one nation with the intention of transferring them to an embargoed country such as Iraq. To do so would implicate the participants in a conspiracy to violate the law.
Still, Eagleton pressed his argument, although he did not advocate, as his superiors did, conducting such activities in violation of the law. In October of l983, Eagleton cabled his superiors with this recommendation: "We can selectively lift restrictions on third-party transfers of U.S. licensed military equipment to Iraq." Later, in the same highly classified cable, he suggested that "we go ahead and we do it through Egypt."
High-level U.S. intelligence sources now say the Reagan Administration adopted Eagleton's recommendation to arm Saddam through third countries, but ignored his warning to stay within the limits of the law. Instead administration officials chose to proceed without lifting or changing the terms of the embargo against Iraq, and despite the fact that some of the transactions appear on their face to have violated the Arms Export Control Act. Further, the new secret policy directly contradicted what the administration was publicly telling Congress and the American people.