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...also began to push for loan guarantees from the Federal Export-Import Bank, which helps American companies sell products abroad by offering loan guarantees. Documents made public by Gonzalez show that in December 1983, Under Secretary of State Eagleburger wrote a secret letter urging bank chairman William Draper III to open a line of credit for Iraq, though most of the world's financial institutions had stopped lending to Baghdad and the Export-Import Bank's own analysts had concluded that Iraq could not be counted on to repay...

Author: /time Magazine | Title: Did Bush Create This Monster? | 6/8/1992 | See Source »

...Carolina Representative Charlie Rose, who chairs a House agriculture subcommittee, is looking into why the Agriculture Department's program, designed to help foreign nations purchase American farm goods, approved most of the loan guarantees. "These loans not only permitted Iraq to feed its people," complains another House Democrat, Henry Gonzalez of Texas, "they freed up scarce foreign exchange that was used by Iraq to build up its military arsenal...

Author: /time Magazine | Title: Did Bush Create This Monster? | 6/8/1992 | See Source »

...Gonzalez chairs the House Banking Committee, which last week resumed hearings into whether the Administration is withholding information about U.S. policy toward Iraq. One matter before the committee involves a Justice Department investigation into charges that, in exchange for kickbacks and other payoffs, officials at the Atlanta branch of one of Italy's largest banks, Banca Nazionale del Lavoro, made $4 billion in illicit loans to Iraq. Those include $350 million in defaulted loans backed by Agriculture Department guarantees. Christopher Drogoul, former manager of the Atlanta office, is expected to plead guilty this week to charges of fraud and money...

Author: /time Magazine | Title: Did Bush Create This Monster? | 6/8/1992 | See Source »

...long list of Administration officials has already appeared before the Gonzalez committee to admit that the effort to woo Iraq was a flop. "I have said 15 times today that it didn't work," Deputy Secretary of State Lawrence Eagleburger acknowledged wearily at the end of one session. But Administration spokesmen have also denied they were subject to undue pressure to favor Iraq. The combative Gonzalez has moved to counter their claims by reading into the Congressional Record a cloak of secret documents, mostly concerning White House efforts to secure the loan guarantees, which have become the subject of lengthy...

Author: /time Magazine | Title: Did Bush Create This Monster? | 6/8/1992 | See Source »

...paper trail emanating from the Gonzalez hearings depicts a long, costly courtship of Saddam. In its early stages, during Ronald Reagan's first term, it was intended to serve a plausible policy assumption: by helping Iraq in its war against Iran, the U.S. would counter Iranian influence in the Middle East while encouraging Baghdad to moderate its own policies. In 1982, three years after Jimmy Carter placed Iraq on the State Department's list of nations supporting terrorism, Ronald Reagan removed Iraq from the list, reopening the way for U.S. aid. The Reagan Administration moved quickly to provide Iraq with...

Author: /time Magazine | Title: Did Bush Create This Monster? | 6/8/1992 | See Source »

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