How War Starts: As With North Korea, U.S. Was Worried About Nuclear Weapons in Iraq

Iraqi Army
Iraqi Army's 53rd Brigade participate in a live ammunition training exercise with coalition forces trainers at Taji military base north of Baghdad, Iraq. Reuters Pictures

Newsweek published this story under the headline "Public Enemy No. 1" on April 9, 1990. Newsweek is republishing the story.

He calls himself a Knight of the Arab Nation. His detractors call him a bloodthirsty tyrant—the Butcher of Baghdad. Saddam Hussein rules Iraq with an iron hand inside a steel glove, backed by a million-man Army and a legion of informers, assassins and torturers. Saddam, as he is known throughout the Middle East, is utterly ruthless in the pursuit of glory for himself and his country. He has not hesitated to use poison gas on enemies both foreign and domestic. He is building an arsenal of ballistic missiles that could enable him to strike at his many foes in the Middle East, including Israel and Iran. And last week his minions were caught in the act of buying electronic components that have one most likely use: to detonate nuclear bombs.

Saddam's purchasing agents were entrapped in a sting operation run by U.S. and British undercover investigators. Charges brought in both countries accused the Iraqis of trying to buy illegally electronic capacitors from a California manufacturer, which promptly informed U.S. authorities. Iraq denied that it was building a bomb, and Saddam brushed off the embarrassment of being caught so publicly. He claimed that "enemies of the Arabs" were trying to hinder Baghdad's "march of progress" by blocking high-tech exports to Iraq. In fact, the alleged capacitor purchase was a chicken-feed deal: a $10,490 item on an Iraqi military shopping list that has run into the billions in recent years.

After surviving a decade-long war with Iran, Saddam has emerged as the most powerful man in the Middle East—and potentially far more troublesome that Libyan leader Muammar Kaddafi, Washington's favorite bugbear. His regime's gruesome human-rights abuses, as well as his growing supply of deadly weapons and his evident willingness to use them, might qualify him as America's Public Enemy No. 1 in the region. But unlike the erratic Libyan, Iraq's president does not support terrorism, and he has even been useful to the West, if only as a bulwark against militant Iran. And the well-armed Saddam is far less vulnerable than Kaddafi militarily, which may explain why Washington has not tried to stop him with anything more than hand-wringing rhetoric.

Growing challenge: Last week's sting came at a time of rising military tensions in the Middle East. Israel, which is widely assumed to have nuclear weapons already, faces a growing challenge from Arabs playing catch-up. The Bush administration said last week that the March 14 fire in Libya's chemical-weapons plant at Rabta was not as serious as originally thought—and may even have been set by the Libyans as a ruse. Libya also has developed an in-flight refueling capability that brings Israel within range of its fighter-bombers. In recent weeks, there have been unconfirmed reports that China plans to break its assurances to Washington and sell more missiles to customers in the Middle East. Iraq, meanwhile, has built new launchers that for the first time give some of its missiles stable firing platforms within range of Tel Aviv or Damascus. The Iraqis also have built probably the largest poison-gas-manufacturing capability in the Third World.

Most Western experts believe that the Iraqis are at least five years away from building a nuclear weapon (although the Pentagon fears they may be closer than that). In 1981 Iraq's nuclear program was severely set back when Israeli warplanes bombed the Osirak reactor near Baghdad. The Iraqis salvaged 27 pounds of enriched uranium from Osirak, enough to be processed into one bomb. But because Iraq has signed the nonproliferation treaty, that supply can be inspected by the International Atomic Energy Agency. So a separate nuclear-weapons program apparently has been started. Baghdad is believed to be scrounging for parts and equipment to build and underground gas centrifuge plant, which produces enriched uranium. Picking up available components in no particular order, Iraq's huge military purchasing network in Europe and the United States also has been shopping for the electronic devices that would be used to trigger the uranium core of a nuclear bomb.

Investigators say Iraq's main military purchasing agency in Europe was a concern called Europmac, which had an office in the London suburb of Thames Ditton and purported to deal in frozen French fries. The concern was run by a man named Ali Ashour Daghir, 49, who has both Iraqi and British citizenship and was identified by U.S. sources as an Iraqi intelligence officer. the U.S. indictment unsealed last week quoted a former British employee of Euromac, Michael Brian Hand, who was not charged with anything, as saying that the company "had done billions of dollars of business in the procurement of materiel on behalf of…Iraq's war effort." During most of the Iran-Iraq war, which ended in August 1988, the United States did not object to Baghdad's military purchases; in fact, Washington helped Saddam's war effort by supplying information on Iranian troop movements gained by U.S. spy satellites. The British government, which knew all about Euromac, was happy to have Iraq's main purchasing office on British soil.

In September 1988, according to the indictment, Euromac contacted a company called CSI Technologies in San Marcos, California, north of San Diego. The Iraqis wanted to buy capacitors, devices that store electricity and deliver it in a single jolt. Their specifications were very particular. They wanted coaxial, high-voltage, low-inductance capacitors designed to withstand altitude and vibration, among other things. "I immediately came to the conclusion that they would be used for a nuclear warhead," CSI president Jerry Kowalsky told Newsweek. Capacitors can be used in many other devices, such as lasers or the explosive mechanisms used to separate rocket stages. But the Iraqis were asking for precisely the same kind of capacitors "as those used in the detonation of nuclear warheads," said the U.S. indictment. The unlicensed export of such devices is illegal, and Kowalsky informed U.S. customs Service officials in San Diego.

The case was handled by undercover agent Danied Supnick. A 38-year-old Brooklynite, he is a former music major who claims no technical expertise. "I don't know how to operate a computer," Supnick told Newsweek. But he had considerable experience investigating high-tech smuggling. Posing as a CSI executive, Supnick sat in on meetings with the Iraqis. They never admitted that the capacitors would be used in bombs. But in May 1989, according to the indictment, Daghir's assistant, a Frenchwoman named Jeanine Speckman, identified the "end user" of the devices as Al Qaqaa, an Iraqi military-procurement agency.

No payoff: According to the indictment, the key negotiation occurred last Sept. 11, when Kowalsky and Supnick met at the Cavendish Hotel in London with Daghir, Speckman and two Iraqi engineers. At one point, Daghir spoke to a colleague in Arabic. "You'll see," he said, according to a translation of the tape recording, "all Americans are stupid, naive." When the Iraqis described their specifications for the capacitors, Supnick remarked that what they wanted sounded like nuclear triggers. "They didn't say yes or no," Kowalsky remembers. At first, the Iraqis maintained that the devices would be used in lasers; later, according to the indictment, they said the capacitors were "intended to be used for an 'aerospace' application." Daghir was so eager to close the deal, Supnick says, that he announced he would pass up the kickback that is customary in many Arab transactions. "We don't want you to include a single dollar for us," Daghir was quoted as saying.

The Iraqis apparently thought it was the Americans who were crooked. "They assumed, like a lot of foreigners, that American business people will do anything for a buck," says Kowalskyk. The next day Speckman suggested to Supnick that the capacitors be labeled for use in "computer-room air-conditioning units," the indictment says. Later on, Supnick recalls, Daghir asked him if the devices could actually be used for such a purpose. "Yeah," Supnick says he replied, "If you want to nuke your air-conditioning unit."

It was at the September 11 meeting, the indictment said, that the Iraqis first broached the subject of also buying krytrons, high-speed switches that detonate explosions by releasing the electricity stored in capacitors. Supnick told Daghir that CSI does not make krytrons, but he said he could obtain them elsewhere. Unlike the $ 10,490 capacitor sale, further deals with the Iraqis promised to be lucrative. The Customs Service said Daghir dangled before the Americans the prospect of doing "millions of dollars in business."

The Customs Service obtained some inoperable krytrons, in case they might be needed for the sting. In the end, however, CSI's first shipment of goods to Daghir consisted only of capacitors—40 that could be used in nuclear warheads and 45 that were suitable for other military purposes. When the shipment reached London, British authorities replaced the nuclear-capable capacitors with inoperable ones. Last Wednesday, as Daghir was about to board an Iraqi Airlines flight to Baghdad, he, Speckman and four alleged accomplices were arrested, and the capacitors were seized from a nearby warehouse.

Although the Iraqis will not admit to making nuclear weapons, they don't apologize for doing whatever they think is necessary to defend themselves. They point out that Israel was caught five years ago in an illegal purchase of krytrons from the United States and had to return the devices. "It's unfair to talk about Iraqi chemical weapons or nuclear weapons and ignore Israel's nuclear capability," argues an official in Baghdad. "We will continue to buy the sophisticated weapons we cannot produce ourselves," he says. And while Iraq's current posture seems to be primarily defensive, it is willing to use doomsday devices that would give most nations pause. During the Persian Gulf war, Iraq employed chemical weapons to stop the attacking Iranian forces. And in 1988 Saddam's warplanes killed as many as 5,000 dissident Kurdish tribesmen, including many women and children, in a poison-gas attack on the Iraqi village of Halabja.

Investment advice: "Saddam Hussein is the 800-pound-gorilla of the Middle East right now," says a senior U.S. official. "He's going to do just what he wants to do, and there isn't anybody to stop him." Recently Saddam has turned a bit unfriendly toward Washington. In a February speech he urged his fellow Arabs to switch their investments from America to the Soviet Union and Eastern Europe in order to combat Israel's influence in Washington.

Washington has protested Saddam's human-rights abuses and last week denounced the capacitor deal. But as Iraq transforms itself into a regional superpower, with the biggest and by far the best army in the Arab world, Saddam is invulnerable to the kind of punitive or preemptive actions that Washington has taken against Kaddafi from time to time. "Nobody's going to be able to repeat what Israel did to the Osirak reactor," says a U.S. military analysts. "Iraq's industrial structure is too dense; the plants are too dispersed, and the key ones are too well protected." Instead, says a senior administration official, "the policy is, if you can't destroy Saddam, embrace him." Together with such Arab allies as Egypt, Jordan and Saudi Arabia, Washington wants to draw Iraq into a web of friendly relationships. "The hole is that, in time, Saddam will value these relationships sufficiently to preserve them by keeping his actions within bounds," says the U.S. official. Of course, the danger in snuggling up to an 800-pound gorilla is that eventually he may want to roll over.