WASHINGTON — In the spring of 1989, a CIA officer approached the president of a small engineering firm in Alabama and quizzed him about a carbide-tool manufacturing facility the company was building at an Iraqi government installation southwest of Baghdad.
In the fall of that year, a Customs Service agent and an Agriculture Department criminal investigator visited the firm, XYZ Options Inc. in Tuscaloosa, and posed a similar set of questions to its president, William H. Muscarella.
"In both instances, I told the government what we were doing," said Muscarella. "I gave them blueprints and told them everything about the plant. They knew everything."
By the fall of 1989, U.S. authorities suspected that Iraq intended to use the plant as part of its ambitious weapons program, according to newly obtained records. Yet, while the government blocked the export of a key piece of machinery, it apparently did nothing to discourage construction of the $14-million plant by withholding export licenses for other components, which were shipped to Iraq.
When Iraq invaded Kuwait in August, 1990, the plant was virtually complete and capable of turning out military goods as well as consumer products, according to Muscarella.
After the Gulf War, the military use was confirmed. U.N. inspectors hunting for Iraqi weapons facilities discovered the carbide factory was part of Iraq's main nuclear-weapons complex. After determining that the factory had been used in the effort to develop a bomb, the inspectors blew up the plant, U.N. documents show.
Iraq's ability to obtain the carbide facility with U.S. knowledge illustrates again how Saddam Hussein was able to engage in a massive prewar military buildup by exploiting the Bush Administration's attempts to influence him by allowing Baghdad to acquire U.S. technology.
"The Bush Administration supplied hardware and equipment to Iraq by applying the least-stringent-possible evaluation of whether the real purpose was military instead of civilian," says Peter D. Zimmerman, a senior fellow at the Center for Strategic International Studies here who has been studying Iraq's attempt to develop a nuclear weapon.
An internal White House document prepared after earlier Times stories and obtained by the newspaper Thursday asserts that the Administration maintained strict controls over exports of technology to Iraq. The memo blamed Democrats in Congress for loosening export controls to Iraq and similar countries.
