Iraq Won’t Let Americans Out; Baghdad Masses More Troops : Gulf crisis: State Dept. says 580 U.S. citizens ‘are stuck’ in Iraq and another 3,000 in occupied Kuwait. U.N. declares annexation ‘null and void.’

The Bush Administration said Thursday that Iraq has sent word that most Americans in Iraq and Kuwait cannot leave and may be held indefinitely, raising the specter of a painful new complication for the U.S. effort in the Persian Gulf.

Additionally, the Pentagon confirmed that 50,000 more Iraqi troops are gathering in southern Iraq, apparently preparing to bolster forces in Kuwait, as newly arrived U.S. troops took up defensive positions in Saudi Arabia. The American forces are as close as seven miles to the Kuwaiti border.

As Iraq showed signs of digging in, the U.N. Security Council unanimously declared the annexation of Kuwait “null and void.” It called on all countries and organizations to refuse to recognize Baghdad’s claim on its tiny neighbor and demanded that Iraq “rescind its actions purporting to annex Kuwait.”

Meanwhile, State Department officials said they are growing increasingly concerned about 580 Americans in Iraq and 3,000 more in occupied Kuwait.

“They are stuck,” Richard Boucher, a State Department spokesman, said of the marooned Americans. “. . . It’s bad news that the airports are not open and borders are closed.”

Only a relative handful of U.S. diplomats and American citizens on short-term visitors’ visas will be permitted to depart, according to officials, who said that one vehicle of departing embassy personnel was turned back at Iraq’s border with Jordan.

Thirty-eight Americans remain in Baghdad’s Rashid Hotel, where they have been detained since Monday. A 10-year-old California girl, Penelope Nabokov, who was released from the hotel into the custody of the U.S. Embassy on Wednesday, remains at the embassy while U.S. officials try to arrange for her safe passage out of the country, officials said.

The ominous notice that most foreigners will be held indefinitely and the appearance of fresh Iraqi troops along Kuwait’s northern border came as U.S. intelligence officials watched Iraqi forces digging defensive positions on Kuwait’s border with Saudi Arabia. Pentagon officials said their actions suggest that an invasion of Saudi Arabia may not be imminent.

“They seem to be in a defensive posture,” Pentagon spokesman Pete Williams said. “But nonetheless, Iraqi forces are still capable of an offensive action.”

As the Mideast crisis entered its second week, diplomats worked feverishly to find a way out of the standoff. Among other actions internationally:

Arab leaders postponed until today a critical summit meeting in Cairo aimed at finding a peaceful resolution--possibly an all-Arab force to act as a border buffer between the Saudis and Americans on one side, and the Iraqis on the other. Representatives of Iraqi President Saddam Hussein are among those slated to attend.

Pentagon officials confirmed a “gathering” of Iraqi troops along Iraq’s border with Turkey. Secretary of State James A. Baker III, in Ankara, told Turkish leaders they could depend on their North Atlantic Treaty Organization allies in any showdown with its neighbor.

Iraq’s trade and oil routes were virtually sealed off as British and French warships joined American ships gathered in the gulf to enforce sanctions against Iraq. In London, the government said it is sending a squadron of Tornado fighters to Saudi Arabia and a squadron of Jaguar fighters to the gulf region to help fend off any Iraqi attack.

The Soviet Union denounced Iraq’s annexation of Kuwait, but said it would not take part in any multinational force against Baghdad outside the U.N. umbrella.

The U.N. vote denouncing the annexation, the third such action taken this week, was 15 to 0. In its third meeting since Iraq’s invasion of Kuwait on Aug. 2, it demanded immediate and unconditional Iraqi troop withdrawal from Kuwait.

“We cannot allow sovereign state members of the United Nations to be swallowed up,” U.S. Ambassador Thomas R. Pickering told the council.

Pickering emphasized that the U.S. presence in the area is strictly defensive, under provisions of the U.N. Charter, and intended to help protect Saudi Arabia.

In other action, Finland was chosen Thursday as chairman of a Security Council committee set up to monitor U.N. economic sanctions and an arms embargo imposed on Iraq to force its withdrawal from Kuwait.

Meanwhile, thousands of U.S. servicemen dug into positions inside Saudi Arabia and awaited the arrival of thousands more in the coming weeks. In the United States, the Army’s 24th Infantry Mechanized Division based in Ft. Stewart, Ga. announced it was formally on alert and readied its tanks and troops to be sent to Saudi Arabia.

The Pentagon operations even extended to Tennessee and Wisconsin, where local Air National Guardsmen were hurriedly called from their civilian jobs and prepared to help fly U.S. troops and gear the 5,000 miles to Saudi Arabia.

Two days into the operation the Pentagon has dubbed “Desert Shield,” White House spokesman Marlin Fitzwater said the costly overseas deployment would force the Pentagon to exempt military personnel accounts from potential budget cuts under the Gramm-Rudman deficit-reduction formula.

While most lawmakers continued to support the deployment of U.S. forces, Congress’ inability to forge a budget compromise with the White House has raised concerns that the federal government could face automatic spending cuts of as much as $100 billion by Oct. 1. At the same time, officials said that the potential costs of operating a large military force in the Persian Gulf indefinitely made it increasingly unlikely that such automatic cuts would be enforced.

Pentagon officials said that the cost of Operation Desert Shield, even if not substantially escalated, could easily reach that of the United States’ invasion of Panama and subsequent operations--about $400 million.

But while President Bush indicated concerns about the financial cost of the Saudi operation, he has indicated he has committed to drawing a line in the sand, protecting vital economic and strategic interests and Americans in the Middle East.

The fear for American lives in Kuwait and Iraqi clearly increased with unsettling news and events Thursday. Eight diplomats from the U.S. Embassy in Baghdad were expected to travel to Jordan by road on Thursday. But when they arrived at the border, Iraqi officials prevented their crossing, although they called it just a “delay,” Jordanian officials said. American officials say that the government of Saddam Hussein had earlier given permission for the partial evacuation of the embassy.

“The point is, the Iraqis say they are being allowed to leave, but they aren’t being allowed to leave. Our only interest is in getting them out. The best way to do that is to keep our cool,” Fitzwater said.

A senior Administration official said he was not prepared to call any of the Americans held in Iraq “hostages” because “there’s no indication they have been taken with any particular purpose in mind. You are a hostage for something.”

In Paris, French President Francois Mitterrand said the foreigners were being held as “prisoners,” and said his government was very concerned about its estimated 450 citizens in Kuwait and Iraq. “They are being detained. They cannot leave either Kuwait or Iraq. So you can say they are prisoners,” Mitterrand told a news conference.

“It’s up to us to help them,” he added, saying he is ready to send a senior official to Baghdad to negotiate his countrymen’s freedom.

While the dangers for those citizens appeared to mount, Iraqi officials made ominous threats against U.S. military forces. Officials in Baghdad said the U.S. force, which is expected to mount beyond 50,000 men, could be used to invade Iraq.

Saying that any such move “will be answered decisively,” Iraq’s ambassador to Greece suggested the Iraqis would unleash poison gas on any attacking American troops.

As the intentions of Iraqi troops remained ambiguous, however, the Pentagon raced to build on U.S. troops in Saudi Arabia, where British aircraft and support crews will soon join them. The next 2 to 3 days will be critical, said officials. With new troops departures slated for the coming days, the initially skimpy U.S. force will begin to grow to a size that would give Saddam Hussein second thoughts about attacking, they said.

“There’s much more to come” over the next several days and possibly weeks, said Pentagon spokesman Pete Williams. “This is an operation that is going to continue for several days--one might say many days,” he added.

But the Pentagon, citing Saudi sensitivities, remained mum on how many forces are in Saudi Arabia and which U.S. troops are expected to arrive. Even so, that confusion may help to deter an Iraqi advance, said one Pentagon official.