Bush Says 3,000 Americans Are Hostages and Warns Iraq : Gulf crisis: ‘America will not be intimidated,’ he declares. Hussein is held responsible for the safety of U.S. citizens. Baghdad gives Kuwait embassies 5 days to close.

Abandoning all diplomatic euphemisms, President Bush declared Monday that the 3,000 Americans detained in Iraq and Kuwait “are, in fact, hostages” and that he holds the Iraqi government of Saddam Hussein responsible for their safety.

“America will not be intimidated” by Iraq’s tactics, Bush said in a forceful address, made to a cheering Veterans of Foreign Wars convention audience, that escalated the rhetorical exchange in the 19-day crisis with Iraq and explicitly provided a direct and human U.S. link to the events unfolding in the Middle East.

The speech was a blunt response to the Iraqi government’s pronouncement Sunday that the Americans and other Westerners trapped in the two countries would be freed only if U.S. and allied forces were withdrawn from Saudi Arabia and the economic blockade spearheaded by the United States were lifted.

Up to that point, the Administration had been willing to characterize the Americans only as “detainees” or “restrictees” to avoid further hardening the stalemate over their fate.

“When Saddam Hussein specifically offers to trade the freedom of those citizens of many nations he holds against their will in return for concessions,” Bush declared, “there can be little doubt that whatever these innocent people are called, they are, in fact, hostages.

“And I want there to be no misunderstanding,” he continued. “I will hold the government of Iraq responsible for the safety and well-being of American citizens held against their will.”

In Baghdad on Monday, the Hussein government also held to a stern posture, announcing that foreign embassies in occupied Kuwait must close within five days and transfer operations to their missions in Baghdad. Failure to comply, said the official Iraqi news agency, would cost embassy personnel in Kuwait their diplomatic immunity, which protects them from arrest.

“It’s unacceptable,” Bush replied in response. But he did not say what he would do.

State Department officials disclosed two hours after Bush’s speech that Iraqi authorities had taken as many as 14 Americans away from hotels in Kuwait city and “relocated” them.

“We do not know where they are at this time,” State Department spokesman Richard Boucher said, as concern mounted about the Hussein government’s threatened placement of foreign nationals in quarters at defense facilities to deter possible U.S. attacks.

Although refusing to specify actions being considered by his Administration as the confrontation escalates, the President did issue a terse hint about the use of military force against ships that attempt to breach the U.N.-sanctioned economic embargo of Iraq.

“Well, just watch; you just watch and see,” he told reporters aboard Air Force One. U.S. Navy warships have been shadowing two Iraqi tankers, apparently loaded with Kuwaiti oil, as they made their way out of the Persian Gulf. The tankers have ignored warning shots and orders to halt.

Bush had planned for more than a month to interrupt his 25-day vacation at his home in Kennebunkport, Me., to speak to the VFW convention. But the developments in Iraq and Kuwait added new urgency to an address originally planned to focus on broad defense issues.

Sunday evening in Washington, officials said, the President met with national security advisers and discussed the tone of the address and the way of referring to the trapped Americans. Although concerned about raising the stakes or recognizing a new bargaining chip for Hussein, Bush concluded that the direct approach was necessary and gave final approval to the speech draft including the word hostage on Monday morning.

Bush denied that he was turning up the heat, telling reporters aboard Air Force One as he flew to a Republican fund-raising luncheon in Rhode Island: “It’s a recognition of the fact that now demands are being made for the release of people. And that, I think, is the definition of hostages.”

The demands, he said, were “totally unsatisfactory to most countries in the world” and “can’t stand.”

A White House official, speaking on condition of anonymity, said the recognition of the hostage element would have no actual impact on the United States’ dealings with Iraq. He said Washington’s policy of refusing to make deals with hostage-takers would continue but that U.S. officials would still talk with the Iraqi ambassador in Washington--without making offers in exchange for the hostages’ freedom.

Appearing before an audience of approximately 7,000 in the half-filled Baltimore Arena, the President used his speech to argue that the sudden crisis in the Persian Gulf dictates the need to maintain a strong defense, in the face of efforts to trim military spending in the post-Cold War period.

“Make no mistake: To prevent aggression--to keep America militarily prepared--I will oppose the defense budget-slashers who are out of tune with what America needs to keep freedom secure and safe,” he said.

But even more, Bush sought to lay out bedrock principles behind the massive deployment of U.S. troops over the past week and to equate the effort of Washington and its allies in Operation Desert Shield to that of World War II and the campaign against Nazi dictator Adolf Hitler.

“August, 1990, has witnessed what history will judge one of the most crucial deployments of allied power since World War II,” Bush said, adding: “Half a century ago, the world had the chance to stop a ruthless aggressor and missed it. I pledge to you: We will not make that mistake again.”

Bush underscored that theme later at the luncheon in North Kingstown, R.I., saying the world faces “a man of evil standing against human life itself.”

“It was not with passionate haste, but with a heavy heart, that I had to commit our troops to Saudi Arabia,” the President told the Republicans. “I took this action . . . out of the moral responsibility, shared by so many committed nations, to protect our world from fundamental evil.”

While lashing out verbally at Hussein, the Administration stressed that it was continuing diplomatic efforts to deal with the crisis. Bush spoke by telephone Monday with British Prime Minister Margaret Thatcher, President Turgut Ozal of Turkey and, for 30 minutes, with French President Francois Mitterrand. France on Sunday ordered ships to the Persian Gulf region, to stand by to use force if required to back up the economic and military embargo against Iraq.

At the State Department, Boucher said U.S. officials met during the weekend with Iraqi authorities in Kuwait city. “We have protested the treatment of foreigners there,” he said.

He said the 14 Americans who were rounded up by Iraqi authorities were part of a large group of foreigners led away from the Regency Palace Hotel and the Kuwait International Hotel in Kuwait city. The group also reportedly includes 82 British citizens.

That development brings to as many as 49 the number of Americans who appear to be under direct Iraqi detention.

Boucher indicated that Iraqi authorities have refused to allow U.S. diplomats to meet with detained Americans and continue to prevent about 3,000 other Americans in Iraq and Kuwait from leaving those countries.

Boucher said U.S. officials in both Iraq and Kuwait are trying to keep in touch with Americans there through phone calls, visits by embassy officials, Voice of America and British Broadcasting Corp. reports, and through a “warden” system. Under that system, U.S. diplomats regularly check with specific Americans who themselves keep in touch with other, larger groups of Americans.

Despite Bush’s decision to characterize the people as hostages, Boucher said the State Department will continue to withhold the names of the 3,000 Americans. Officials have justified the policy as a means of protecting the privacy of hostage families that do not wish to be publicly identified.

The order to close the embassies in Kuwait city follows a similar order issued Aug. 9, one week after Iraqi forces invaded Kuwait and quickly took over the small oil-rich Persian Gulf sheikdom.

At that time, defiant foreign capitals, still recognizing the exiled Kuwaiti government, refused. The Iraqi regime insists that its Aug. 8 annexation of Kuwait, declared illegal by the U.N. Security Council the next day, eliminated the right of foreign countries to maintain embassies in Kuwait city.

Sixty-four countries maintain diplomatic relations with the Kuwaiti government, but not all have full embassies. Diplomats from the banned embassies have continued efforts to keep in touch with their expatriate communities and in many cases have taken nationals into the safety of embassy grounds. A Manila report Sunday said that the Philippines Embassy was jammed with immigrant maids and laborers and that sickness had broken out.

Stephanie McGehee, 37, an Associated Press photographer in Kuwait who escaped over the Saudi border Friday, said she twice found shelter in embassies, which she would not identify, before making the run for the border in a 13-car convoy. The Leucadia, Calif., woman reached Bahrain on Saturday.

On Monday, Baghdad radio warned Iraqis against sheltering foreigners there. “Hosting a foreigner in an Iraqi’s place of residence is considered a flagrant violation of the law for which the severest punishment will be given,” the broadcast said.

The estimated 2,500 Americans trapped in Kuwait have purposefully ignored Iraqi demands that they report to designated hotels. A small number have made the risky flight for the Saudi border, the women often cloaked in Arab chadors to hide their Western features.

Times staff writers Nick B. Williams Jr. in Bahrain and John Broder and Jim Mann in Washington contributed to this story. More on Gulf Crisis

STRATEGY--The U.S. positions troops capable of launching forays into Kuwait. But officials say an attack is unlikely. A6

AMERICANS IN JORDAN--The State Department advised Americans to leave Jordan, where public opinion favors Iraq. A6

ECONOMIC RIPPLE--In different ways, oil-rich countries and their poorer neighbors are paying a price for unrest in the Persian Gulf. D1

STOPPING HUSSEIN--Is the tightening embargo against Iraq enough to stop Saddam Hussein, and if so, how long will it take? H1

GULF WATCH: Day 19 A daily briefing paper on developments in the crisis Diplomatic Front: President Bush for the first time referred to the 3,000 Americans trapped in Iraq and Kuwait as “hostages”--a move that analysts said could be a step toward justifying direct military action against Iraq.

The State Department advised U.S. citizens to leave Jordan--a step that some observers interpreted as a further indication that the White House is considering military action.

Fourteen Americans, along with other foreigners, were taken from hotels in Kuwait and moved to an undisclosed location. Baghdad said it has placed Americans and other Westerners on Iraqi military bases to deter any bombings. Military Front: The Pentagon dispatched a squadron of radar-eluding Stealth fighters to Saudi Arabia. The Pentagon also said it was seeking 800 military physicians and nurses to fill the slots of those sent to the Middle East.

The United Arab Emirates broke a longstanding tradition and allowed the United States to base 16 cargo aircraft on Emirates soil. The move sets up the Emirates as a potential target if Iraq continues its aggression. Trade Front: U.S. warships continued to track two Iraqi tankers they intercepted over the weekend but held their fire awaiting instructions from the Pentagon. Officials said Washington was seeking a strengthened mandate from the United Nations to enforce the ban.

In New York, the Bush Administration failed in its initial bid to persuade the U.N. Security Council to broaden its mandate for enforcing the worldwide Iraqi trade embargo.Crisis Indicators:

U.S. troops deployed (estimate) 35,000

Iraqi troops in Kuwait (estimate) 160,000

Americans being held in Iraq and Kuwait: 3,000

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