Arab Leaders Were Turned Off by Iraqis’ Tough Talk : Summit: They were prepared to make concessions to ease tense situation. But Baghdad was having none of it.

A number of Arab leaders arrived at last week’s emergency summit meeting prepared to offer Iraqi President Saddam Hussein substantial incentives for pulling out of Kuwait, including cash payoffs and loan credits, increased control of a disputed oil field and a face-saving way to withdraw his forces, sources close to the talks said Saturday.

But negotiations were cut off even before they began when the Iraqi delegation, furious about Saudi Arabia’s summoning of a U.S. defensive force, began denouncing the Saudi leaders as “traitors” and “American agents.” The Iraqis said secret documents seized from the Kuwaiti Foreign Ministry proved that Kuwait had been plotting with the CIA against Iraq, the sources said.

“The Iraqis refused everything. They were very tough, savage. Even the formalities they didn’t take,” said one Egyptian familiar with the discussions. “Usually in these things, you talk in terms of ‘Your Excellency,’ politeness, that sort of thing. That was all out.”

A deeply divided Arab League, racked with dissent over U.S. intervention in the conflict, emerged from the meeting with a resolution supported by only slightly more than half of its members--and an ongoing public opinion battle at home over whether the belligerent Iraqi president is a dangerous villain or a national hero.

“The battle is now over the Arab masses,” Egyptian diplomat Tahseen Bashir said after Hussein called, on the day of the summit, for Arabs to rise up against foreign intervention and the wealthy oil sheiks who he said have plundered the Arab nations’ wealth and left most Arabs in poverty.

Some Arabs appear to be ready to heed the call. On Friday in Amman, Jordan, hundreds of Muslim militants declared holy war on the United States and urged Jordan to send troops to fight for Iraq. Thousands more demonstrated Saturday in Sana, Yemen, in front of the embassies of the United States, Saudi Arabia and Egypt, expressing support for Iraq’s Hussein.

At the same time, hundreds of Egyptians have applied in recent days at the Kuwaiti Embassy in Cairo as volunteers to join popular resistance forces against the Iraqi invasion.

“We can say that the Iraqis are building a kind of coalition, not necessarily among governments but within factions and within the public itself,” said Abdel Monem Said, a senior Egyptian political analyst.

Hussein, he said, has begun to win over to his side Arab nationalists, such as Libyan leader Moammar Kadafi, who dream of a single Arab nation with no interior borders, and radical Muslim fundamentalists who opposed Iraq’s 1980-88 war with Iran but who see Hussein as a vehicle to destabilize the existing Arab order. In addition, the disfranchised of the Arab world, such as members of the Palestine Liberation Organization, see Hussein as a moving train to hitch onto at a time when most other roads seem blocked.

On top of all of this, analysts say, is the failure of moderate political forces to resolve the long-running Palestinian problem and an economic crisis that has ground down the Arab world from the Persian Gulf to the Mediterranean.

The economic crunch has become particularly acute in the last three years. It makes more and more struggling Arabs in places such as Jordan and Sudan ready to believe Hussein when he says that the problems were the fault of “oil emirs” such as Kuwait’s ruling family.

For all those reasons, in addition to the general desire to resolve the crisis, several Arab leaders were prepared to offer Hussein substantial concessions to withdraw his forces from Kuwait, according to sources close to last week’s summit discussions.

Among the inducements under discussion, they said, were forgiveness of Iraq’s multibillion-dollar war debt to Kuwait, a cash settlement of Iraq’s claim that Kuwait illegally pumped $2.4-billion worth of crude oil from wells along its disputed border with Iraq, perhaps even “some advantage” in control of the disputed Rumaila oil field that extends beneath the territories of both countries.

Although Arab governments have been virtually unanimous in demanding the return to power of the exiled Kuwaiti emir, Sheik Jabbar al Ahmed al Sabah, there was even some discussion before Friday’s emergency meeting of leaving the sheik in exile, pending the scheduling of elections in Kuwait, according to two sources. Arab leaders believe that the emir would probably prevail in such elections, the sources said.

Egypt, which was less inclined to placate Hussein, was the leader in discussions of a pan-Arab peacekeeping force that would replace the Iraqi troops in Kuwait and then withdraw to the Iraqi-Kuwaiti border to serve as a buffer force.

Egypt also led a bloc of harder-line countries that were insisting on the kind of strong resolution finally adopted by 12 of the 20 Arab League leaders at the meeting. That resolution strongly condemns Iraq’s takeover of Kuwait, implicitly supporting Saudi Arabia’s call for outside military intervention and calling for the deployment of Arab troops to hold off any more aggression from Iraq.

Some conference sources said there might have been much wider support for the resolution if it had not been for the section endorsing non-Arab military intervention--an issue that proved to be the most divisive of the meeting.

Even Libya, several sources said, favored the pullout of Iraqi troops from Kuwait and the restoration of the emir’s government, but Libya’s Kadafi refused to have anything to do with supporting a role for U.S. military forces, according to one source close to the talks.

Libya voted against the resolution, as did the Palestine Liberation Organization and Iraq. The five other holdouts--Algeria, Yemen, Jordan, Sudan and Mauritania--either abstained or expressed “reservations.” Tunisia did not send a representative to the meeting.

In many senses the summit meeting was a success, even if it did not achieve a compromise solution to the crisis or unanimous support for a course of action, because it “forced everyone to admit that it was indeed an Arab problem that had to be dealt with,” said one Western diplomat who closely followed the deliberations. The diplomat continued:

“It at least forced everyone to confront the issue, and in many ways, it kind of frees Egypt up now to pursue its own policies separate from the league, having done its duty by calling a summit.”

Bashir, the Egyptian diplomat, said diplomacy as an option has not necessarily been exhausted, even with the harsh summit resolution and Egypt’s subsequent decision to dispatch troops to Saudi Arabia.

“I think all of them realized at this stage that a deal was very difficult to reach,” he said. “So, they concentrated instead on tightening the noose. They’re still hoping that this might produce in weeks or months a frame of mind for Saddam Hussein to negotiate.”