THE PALACE OF MIRRORS

By Bruce W. Nelan

For a man in a box, Saddam Hussein manages to find an amazing amount of wiggle room. He is walled in by economic sanctions and no-fly zones and international inspectors, but he still pops out with one ploy after another calculated to thwart the U.N. and inflate his image in the Arab world. Like a stage magician, he fills his act with grand gestures and hoopla, but on close inspection the show can be seen for what it is: illusion.

Last week, with on-and-off help from his friends in the U.N. Security Council, Saddam produced a flurry of prestidigitation that was defiant and seemingly conciliatory at the same time. He demanded an end to U.N. inspections and sanctions in six months, threatened again to shoot down the U-2 reconnaissance plane that periodically photographs his key installations and then invited foreign diplomats and scholars to visit his presidential palaces as "guests" (the same term he used for his hostages before the Gulf War). But of course, he added, the expert inspectors of the U.N. Special Commission must stay out.

America's allies often scold the U.S. for demonizing Saddam and needlessly personalizing the confrontation, but there is no question that he has become much more than an irritant. He has withstood all the sanctions the U.N. could pile on him, and thumbs his nose at the idea of being bombed again. His callousness seems to know no bounds. When UNICEF announced last week that a million Iraqi children have suffered from malnutrition under seven years of the embargo, Saddam acted to make their plight worse. He said he was uninterested in renewing an arrangement that allows Iraq to sell $2 billion worth of oil every six months to buy food and medicine. Instead, he demands that all sanctions end.

The U.S. is continuing to build up its forces, mainly air power, in the gulf region but shows no eagerness to use them. How, then, can Saddam be forced to open his doors to the inspectors searching for his hidden arsenal of poison and germs? As Richard Butler, head of the Special Commission, and Defense Secretary William Cohen both stressed last week, the issue is not just Iraq. It is how the world will try to control the spread of weapons of mass destruction for decades to come.

The U.N. inspectors were at work again in Iraq last week, busy getting a fix on what mischief had been done during their three weeks off the job. They were probing warehouses and factories but made no effort to penetrate any of the "presidential-residential sites" or the many other facilities where they had been denied entry in the past. The debate has homed in on Saddam's "palaces"; there are dozens of them--some vast compounds, according to Bill Clinton, as big as the District of Columbia--and the Iraqis sometimes pin that label on any facility they want to keep closed. In fact, many other areas, including the bases and barracks of the intelligence services and the Republican Guard, are suspected of harboring materials that Iraq promised to give up under the truce agreement of 1991.

The Iraqis seem determined to keep talking about buildings and compounds associated with Saddam. That makes it easier for them to stake their claims to sovereignty and security. With great flourishes last week, Baghdad said it was inviting diplomatic representatives from the 20 countries taking part in the Special Commission and five from each of the 15 members of the Security Council. They could visit the palaces and stay "a week, a month, to see the facts," said the Iraqi News Agency. Of course, sleight of hand followed. Foreign Minister Mohammed Saeed al-Sahhaf quickly barred any of the U.N. inspectors from accepting the invitation. "Those sovereign sites," he said, "are from the very beginning completely out of Iraq's work" with the Special Commission. "They are immune."

No, they are not, says Rolf Ekeus, who headed the commission until last summer and is now Sweden's ambassador to the U.S. On June 22, 1996, Ekeus and Iraqi Deputy Prime Minister Tariq Aziz signed an agreement guaranteeing that U.N. inspectors would have "immediate, unconditional and unrestricted access" to all sites they wanted to inspect. The accord does contain a paragraph that calls for respecting Iraq's sovereignty and territorial integrity, but Ekeus says this was only a repetition of formal language in the 1991 truce agreement.

In an interview with TIME last week, Ekeus explained how he planned to implement the agreement with Aziz on all "sensitive sites," a plan he outlined in writing to the Security Council. First, he said, the inspectors would seal the entrances and exits of the palace or building and put a helicopter overhead to keep watch. Then they would summon a Cabinet-level Iraqi official to the scene. That would be done, Ekeus says, to prevent the Iraqis from claiming that inspectors were kept out of the site by uninformed, low-level military people. Then the inspectors were to go in, first with a team of four, look at everything, and call in more experts if they uncovered anything suspicious.

This elaborate plan to ease Saddam's sensitivities didn't work. Inspectors were blocked repeatedly at such sites in violation of the agreement. Ekeus says he did not target presidential compounds deliberately in searches for weapons and documents but could not avoid them. "My policy was to go where the trail led us," he said, and "we were led by our analysis that they were using presidential compounds." In fact, says Ekeus, Baghdad's present preoccupation with the palaces is "a clear trick." The prohibited items (mostly chemical and biological weapons and records of their production) are transportable. They can be hidden for weeks at a palace, then hauled by truck to a school, a barracks, an office. "We were interested in the material," says Ekeus. "The moment you start to focus on buildings, the focus is wrong."

That is good advice, but all the buildings must be open for inspection or Iraq will win the shell game. Says a senior White House official: "The inspectors must be permitted to do their jobs and must have unconditional and unfettered access." So what will the U.S. and the other members of the Security Council do to enforce their rules?

If it were up to the Russians, it seems, very little. Early in the week, Russian diplomats staged an unsuccessful effort to force through the Security Council a statement that Iraq had cooperated with the inspectors on nuclear weapons and long-range missiles and therefore deserved a reward. Just before that, President Boris Yeltsin had spent 40 minutes on the phone with Clinton arguing for a time limit on inspections in Iraq. Clinton turned him down and, worried that Yeltsin may not be getting the straight story from Foreign Minister Yevgeni Primakov, an old friend of Saddam's, fired off a long written message detailing Iraq's violations of the inspection regime.

The Russians may also be helping Iraq outside the diplomatic arena. Retired Colonel Victor Baranets, who served as press secretary to former Russian Defense Minister Igor Rodionov, believes Russia has "secretly supplied Iraq with several billion dollars worth of weapons and spare parts" since sanctions have been in place. He also thinks Moscow bought Baghdad's agreement to allow the U.N. inspectors to return to work two weeks ago with pledges of more supplies and full-scale military cooperation after sanctions are lifted.

"It was hardly a secret to the top Soviet army brass and political bosses," Baranets told TIME, "that the U.S.S.R. assisted Iraq in developing its chemical and bacteriological weapons. According to some data, several extremely well-paid Russian chemical-warfare experts still work in Iraq under assumed names." When sanctions first went into effect, says Baranets, the Russian government shut off shipments to countries on the U.N. embargo list. Later, "controls weakened and slackened, while economic considerations took over the political ones. As of the second half of 1993, Russia resumed sending major military supplies to the Middle East. They used the old way of supplying weapons and spare parts through third countries."

In Washington, officials at the White House and Pentagon say this comes as news to them. Yes, they agree, some relatively small shipments of military supplies have reached Iraq, but nothing that would amount to billions of dollars. "We're unaware of any big stuff going in," says an official. "It is probably impossible to prevent small leakages," he says, "but we don't think it's a major problem."

The major problem remains how to coerce Saddam. It does not appear that the U.S. has made up its mind on that. American ships and planes are coiled up in the gulf, ready to spring, but the Pentagon has been putting out mixed signals on the use of force. "This is a long-term project," said Secretary Cohen, and could first involve more pressure. "It might be a tightening of further sanctions," Cohen said. He called military action "a last option," but if it is needed, "you can be reasonably assured it will not be a pinprick." "No more pinpricks," echoed Marine General Anthony Zinni, who heads the U.S. Central Command in the gulf. The things that matter most to Saddam, Zinni suggested, are his Republican Guard forces and his command and control systems. During recent talks with leaders in the region, he said, they told him to "go after the things that matter most, the things that keep him in power."

In private, most Arab leaders are giving the advice Zinni reported. They assure top American officials that they would support strong military action if it was aimed at forcing Saddam to capitulate to U.N. disarmament demands or at driving him out of power. But there is another side to the message: if the U.S. fails to do either of those things, the Arab world will have to make the best of his survival and find a way to live with him.

After all the public theater on both sides last week, the terms of the confrontation did not change. If Saddam was still in his box, Clinton was still in his quandary. Saddam wins if he manages to keep the inspectors out of his "sovereign sites." The U.S. loses if it cannot bring the anti-Iraq coalition back together, at least inside the Security Council. Without it, any "last option" military action by the U.S. appears remote.

--Reported by Dean Fischer and Mark Thompson/Washington and Yuri Zarakhovich/Moscow

With reporting by DEAN FISCHER AND MARK THOMPSON/WASHINGTON AND YURI ZARAKHOVICH/MOSCOW