No Reward for Iraq on Hostages, Bush Pledges : Policy: The President takes a tough line at a White House ceremony for seven freed U.S. captives.

President Bush adamantly declared Thursday that he will offer Iraqi President Saddam Hussein no reward for letting the hostages go. “Hell, no. Not one thing,” he said.

At a White House ceremony welcoming seven of the Americans freed from Iraq and Kuwait, Bush added: “You don’t reward a kidnaper. You don’t reward somebody that has done something that he shouldn’t have done in the first place.”

Asked whether he’d be able to defuse the tension over the Persian Gulf, he replied, “one way or another, we will.”

A senior White House official, meanwhile, said Iraq’s refusal to receive Secretary of State James A. Baker III until Jan. 12 throws into question whether talks will take place at all between Baker and Iraqi President Saddam Hussein in Iraq and between Iraqi Foreign Minister Tarik Aziz and Bush in Washington.

Baker had once called the talks the “last, best chance” to avert war.

The immediate result is that the visit by Aziz to Washington, which Iraq had hoped would take place next Monday, is almost certain to be postponed unless a last-minute agreement is reached. The Bush Administration has said it will not schedule the foreign minister’s visit until the dates for a follow-up trip to Baghdad by Baker have been approved.

“We’re getting beyond the point where it (the Aziz visit) can happen on Monday,” the senior White House official said.

At the White House, Bush spent about an hour with the seven recently freed Americans. Four of them had been held as “human shields” at Iraqi military sites, two had been in hiding in Kuwait and one had taken refuge at the U.S. Embassy in Kuwait city.

Their visit reflected a shift in the President’s approach to the hostage issue. Until all who wished to leave were allowed to do so, Bush had avoided making them the center of attention.

After the last U.S.-chartered evacuation flight took off--a flight that carried U.S. Ambassador W. Nathaniel Howell III and all other diplomats from the U.S. Embassy in Kuwait--Bush not only met with hostages but solicited their advice.

“I want you to just let your hair down. If we’re screwing something up, I want you to tell me,” he told his visitors as he sat with them in the White House Cabinet Room.

But what he heard in the private meeting was an endorsement of his policies and, if anything, encouragement to make sure that Hussein is contained, according to several hostages who spoke to reporters afterward.

The President “assured us the situation will be taken care of,” said Antonio Mireles, a civil engineer from Annandale, Va., who had been employed by the Kuwaiti government when Iraq invaded the neighboring sheikdom Aug. 2. He was given refuge in the U.S. Embassy compound.

Ralph Montgomery, a veteran of 17 years in the Middle East, said he told Bush that Hussein “cannot be allowed to continue to operate in this way. Something must be done. If we don’t do it now, there is going to be a festering.”

“If we don’t bring this man to a stop, a year or two from now the whole world will be in flames,” said Montgomery, an architect from Indian Rocks Beach, Fla., who will be 57 on Christmas Eve. He said he hid with his son-in-law, a teacher at the American school in Kuwait, and was protected by Palestinian neighbors.

The others who visited with Bush were Bill Rodebush of Oklahoma, John Cole of Texas, Glenn Coleman of Massachusetts, Ernest K. Alexander of Pennsylvania and Robert Hanby of Ohio.

“We now believe all the Americans who wanted to depart have done so,” said White House Press Secretary Marlin Fitzwater.

But the celebration over the freedom of Americans has been tempered by concerns that the talks between the United States and Iraq may fizzle.

At the center of the debate is Iraq’s insistence that Hussein can find no time to meet with Baker until Jan. 12. The Administration believes that is too close to the Jan. 15, 1991, deadline the U.N. has set for Iraq to withdraw from Kuwait.

The Administration has been holding out for a meeting between Dec. 20 and Jan. 3.

The senior White House official observed of Hussein: “He can see John Connally. He can see Muhammad Ali on 10 minutes’ notice. Are you telling me he doesn’t have an hour (to see Baker)?” Connally, the former treasury secretary, and Ali, the former boxing champion, made private trips to Baghdad to appeal successfully for hostage releases.

“I think he’s playing games. He wants to get it tied up so we get past the 15th,” said the official, who spoke on the condition of anonymity. “It’s another of his ploys.”

Asked whether the set of meetings will actually take place, he said, “you have to question whether it will.

“I’m inclined to think there will be a meeting, but we’ll have to see,” he added.

Iraq’s reluctance to schedule a meeting with Baker and Hussein in the period sought by the United States has caught the Administration by surprise, the official acknowledged.

“It’s not inconceivable that the President’s offer for direct contacts was interpreted by (Hussein) as us blinking” in the showdown between Washington and Baghdad, the official said. If this is the case, he added, it may be the result of Hussein having wide access to information about the United States’ policy through the news media but lacking the assistants who can correctly interpret it for him.

At the same time, he said, Hussein is seeking ways to convince the United States’ partners in the alliance arrayed against him that progress is being made.

“My sense is he’s got a bag of things to do, and the hostages’ release was one step to get people to say, ‘Hey, there’s progress going on.’ ”