News ANALYSIS : Events Moving Crisis in Gulf Closer to War

Over the past 48 hours, two fundamental shifts have taken place in the Persian Gulf crisis that are beginning to push the Bush Administration--whether it likes it or not--inexorably closer to direct military action against the regime of Iraqi President Saddam Hussein.

Among many people in and close to the American government, the betting is reluctantly but increasingly on war.

The first shift is the abrupt expansion of the original challenge for U.S. forces in the region. Initially deployed only to defend Saudi Arabia and indirectly help compel an Iraqi retreat from Kuwait, they must now contend with the plight of thousands of Americans and other foreigners trapped in Iraq and Kuwait.

After 11 years of hostage crises that have traumatized a nation and challenged two presidencies, U.S. analysts say, the Bush Administration cannot easily endure protracted captivity and the threat of Iraqi violence for so many Americans.

The second shift is a recognition that some of the Administration’s original calculations about what would happen after it sent in troops have proved wrong: Hussein’s political popularity has increased rather than declined throughout much of the Arab world, oil prices have risen rather than steadied, the U.S. stock market has plummeted rather than climbed. And international sanctions on Iraq may take months, not the hoped-for weeks, to have significant effect.

As a result of these changes, the bold U.S. decision to stand up to the dictator of Iraq no matter how long it took has become dramatically harder to sustain. In the view of at least some experts, President Bush’s original strategy of holding the line militarily while economic sanctions worked their slow will has become untenable.

“It’s very obvious that the Administration is preparing for war,” said Judith Kipper, a Mideast specialist at the Brookings Institution. “I don’t think Bush wants it, but the Administration realizes that it now can’t wait to squeeze Iraq economically as it’s too fraught with dangers of what Saddam Hussein can do--with hostages and in whipping up the masses.

“We are now pursuing an assertive policy because, regrettably, the military option seems to be all we’ve got,” Kipper added.

The most likely scenario for triggering open conflict, private military analysts and regional experts believe, is some variation of the 1964 Gulf of Tonkin incident in Vietnam or the 1986 Gulf of Sidra crisis in Libya.

In those cases, many historians have concluded, the United States encouraged provocation to justify military action it had already planned. But whether escalation is planned or not, the heightened political pressure on the Administration is seen as squeezing its flexibility on the use of military force.

Two incidents between U.S. forces and Iraq since Friday are likely to be only the beginning, experts suggest.

One involves reports that U.S. warplanes “locked on” their attack radar when they spotted Iraqi planes apparently still outside Saudi airspace. The other was the firing of warning shots at two Iraqi tankers.

“I see a much harder line coming from the Administration that manifested itself with the locking on of Iraqi fighters by American warplanes and the firing at Iraqi tankers,” said Ken Katzman, a former CIA Mideast analyst now at Defense Systems Inc. “It’s these kinds of things that get conflicts started.”

After the U.S. Navy opened fire to warn away the Iraqi tankers Saturday, Baghdad labeled the incidents “an act of war.”

Iraqi President Hussein’s five-point “peace initiative” on Sunday did little to increase hopes of a diplomatic resolution, even though it included an offer to negotiate the future of Kuwait “as an Arab issue” with other Arab states.

U.S. officials also are not optimistic about separate mediation attempts by Jordan’s King Hussein and the efforts of Arab League envoys to find a peaceful formula to end both the current gulf hostage situation and the Iraqi occupation of Kuwait.

And despite the Administration’s public affirmation that the international embargo is the main U.S. response, sanctions are increasingly seen as problematic, Administration sources acknowledge.

The loophole of humanitarian aid is likely to be used to allow Iraq to import foodstuffs, especially now that foreign lives are also at stake. And, ironically, the pinch is also hurting the United States.

“The mood has shifted from one of confidence that we would win a long, drawn-out conflict because sanctions would hurt Saddam to a mood that time may well be on his side, mainly because of his political popularity and because oil markets are not proceeding as calmly as was anticipated,” said Henry Schuler, a Mideast specialist at the Center for Strategic and International Studies.

“There was a serious miscalculation by the United States about the impact of a boycott on Kuwaiti and Iraqi oil,” he said.

“The Administration felt there was lots of surplus-producing capacity around the world and it would somehow come on the market to dampen a price escalation--and spill over on a recession and (on) interest rates. I think the (officials) believed their own propaganda. It was never valid,” Schuler added.

Saudi Arabia’s announcement Saturday that it will pump an additional 2 million barrels of oil a day, enough to compensate for half the production lost to world markets from Kuwait and Iraq, has bolstered hopes within the Administration that the economic decline over the past two weeks will be reversed.

Nevertheless, “the Administration is beginning to realize that there’ll be much more pain felt more quickly in the industrialized world as a result of sanctions than will be felt in Iraq,” said Schuler.

“At first the Administration was willing to sit it out. Now they want to get it over with. The plot has not unraveled as they planned.”

As American troops finish the bulk of their deployment over the next 10 days and the last major pieces of armament arrive in Saudi Arabia by mid-September, U.S. military analysts outside the government predict a rising number of “incidents” that will precipitate a confrontation. “As undesirable as it is, some form of war seems unavoidable,” lamented one expert.

The restrictions on 3,800 Westerners in Iraq and 9,000 in Kuwait have simultaneously increased the difficulty and potential cost of military action and immeasurably heightened the pressure on the Administration to resolve the crisis, U.S. experts contend.

The prospect of Americans indefinitely held hostage and possibly positioned around military and strategic installations to prevent U.S. air strikes may eventually turn public opinion against the Administration, experts say.

“This raises the stakes politically for the President. These people are not like the hostages in Iran and Lebanon. This is not an issue of ideology. This is just a crass insurance policy, holding innocent civilians,” Kipper said.