COLUMN ONE : Iraq’s Plan: Faith, Hope and Deals : As sanctions’ bite deepens, Baghdad offers trade pacts and uses religion to send a message--lift the embargo or risk Muslim fundamentalism. For the first time, the world seems ready to listen.

It will rise from a lake formed by the waters of the immortal Tigris River, a huge, white dome suspended among eight rocket-like minarets. To be built on one of the airports bombed by the United States during the Persian Gulf War, it looks like a floating space station.

Its destination: paradise.

“Yesterday, we flew out of this airport to visit the world in jet planes. Tomorrow, we will fly from this place on a journey the modern jet cannot reach. It is a journey of the soul to its creator,” say the architects of “A Mosque That Floats On Water,” envisioned as the largest mosque on Earth and Saddam Hussein’s rocket ship to destiny.

The Iraqi president drew the design himself and two months ago imposed a ban on private building, to free materials for the imminent seven-year construction of the mosque and other government projects.

In Iraq, struggling under the most severe international economic sanctions in modern history--sanctions whose bite after four years is beginning to draw blood--a grand new mosque would seem an odd investment in a future well beyond the reach of United Nations resolutions.

Yet Baghdad’s message to the world these days--as its envoys jet around the globe offering compromise, cooperation and even the unusual prospect of Iraq joining the Middle East peace process with Israel--comes with a subtle reminder. The Iraqi president, who has outlasted an American president (children play hopscotch on George Bush’s grimacing tile face on the floor of the Rashid Hotel), a British prime minister and countless other allied leaders, may be demolishing his missiles and drawing in his belt, but he still has the God card--and the world’s second-largest oil reserves.

All over the Iraqi capital, billboards portray the president in full military dress, kneeling on a prayer rug with his hands raised in supplication. Government television breaks for prayers five times a day and features long lectures by religious sheiks. In recent weeks, public alcohol sales have been banned, and the government has implemented strict Islamic punishments--for thieves sentences range from hand amputations to death for repeat offenders--specified in the holy Koran.

The moral is only too clear: Lift the embargo and Iraq is more ready to be a player than at any time since its disastrous invasion of Kuwait four years ago. Leave it and risk pushing Iraq, for years a wall against the march of radical Islam from neighboring Iran, into the arms of Muslim fundamentalism.

It is a carefully calculated strategy in a country where the rise of any opposition, religious or secular, is quickly quashed. But for the first time, and perhaps for reasons of its own, the world seems ready to listen.

Trade delegations--from France, Canada, Britain, Switzerland, Italy, Germany, Brazil, Austria, Turkey, Asia, all over the world--are flooding into Baghdad at the rate of two a month. Even U.S. companies, banned by American law from any business dealings in Baghdad, are sending feelers, drawn by the lure of multibillion-dollar deals Iraq is offering for signature now to those who support lifting the sanctions.

The memoranda of agreement, some of which are worth $1 billion each, according to the Iraqi trade minister, will bind Iraq to signing contracts once the sanctions are lifted. U.S. companies, he said, are bidding for a share of Iraqi business through European or Middle Eastern branches to get around the U.S. trade ban.

Late last month, Jordan and Turkey joined in a public call for immediate lifting of the embargo--whose effects have ravaged their own economies--and France, China and Russia, a majority of the permanent members of the U.N. Security Council, are leaning toward a review of Iraq’s case. Then, Turkey quietly reopened its border with northern Iraq.

“One day or another, these sanctions will go,” Iraq’s information minister, Hamad Youssef Hammadi, said in an interview. “Because there is a lot of pressure now on the American Administration. The American Administration does not want to admit failure, but it is cornered.”

Iraq, whose senior diplomats have spent the last several weeks on a whirlwind tour of Arab, European and Asian capitals, has emerged confident that the back of the embargo will be broken by spring: if not by Security Council action, then by simple non-observance, like water pouring over a shaky dam.

“Even if it comes to the worst case, a vote in the Security Council, and the U.S. uses the veto, the others will not comply. Politically, maybe. But not technically,” Hammadi said. “If the U.S. uses the veto, the British or the French or the Russians will say, ‘This embargo is not a council action, it is an American action.’ They will deal with Iraq, even if there is an American boycott.”

The United States has repeatedly expressed opposition to any easing of the sanctions, noting that Iraq still has not accepted its border with Kuwait, nor has it eased its human rights violations, especially against Shiite Muslims in the south, who are seeing their villages burned and their leaders arrested in a government campaign to wipe out the opposition.

Moreover, U.S. officials ask why the sanctions should be lifted just when they are beginning to work. America’s ambassador to the U.N., Madeleine Albright, has repeatedly expressed fears that Iraq will simply resume its building of illegal weapons once the embargo is lifted.

But with the sudden rush of international economic interest in Iraq, it is hard to find anyone outside the United States and Britain, which has supported the U.S. stand though somewhat less enthusiastically, who seriously disagrees with Iraq’s upbeat expectations.

“Saddam now, even though his circles are drawn in much closer and tighter, is probably more secure than he’s been in the last three years,” said one Western diplomat. “These sanctions tend to be more and more of an American policy. They’re a knee-jerk reaction where it makes it look to the domestic constituency like Washington is doing something, but they really don’t achieve their intended purpose. . . . There’s no way you can keep down for long a country of 18 million people with the second-largest oil reserves on Earth.”

Yet for all its bravado, Baghdad is a wounded capital. And the rest of the country is even worse.

The planning minister was fired recently after he officially estimated annual inflation at 24,000%, but the reality is that the Iraqi dinar only four years ago bought $3. Now, $1 is worth more than 600 dinars, and about 7 million Baghdadis who live on fixed incomes are trying to make it on their old salaries. A typical schoolteacher can buy two chickens with his or her monthly earnings. An engineer can buy a tray of 30 eggs and have 25 dinars left over.

The government has kept the country alive by offering a ration package of rice, flour, oil, sugar, tea, soap, toothpaste, baby formula, razor blades and matches to every family for next to nothing. But beyond this subsistence, life becomes impossible for all but the rich who can buy on the black market.

Farmers, disgusted with low government price supports, quit growing tomatoes; they disappeared from the market until two weeks ago, when subsidies were raised. So did potatoes. Cucumbers are a rare delicacy except in well-to-do homes and luxury hotels, where for $200 a night, foreign guests must plead for toilet paper, sugar and milk for tea (poured out grudgingly and then snatched away).

Butter? No. The vinaigrette the menu advertises with the seasonal salad? No. Tomatoes for the salad? No. Aspirin? Sorry. A telephone call to neighboring Jordan? Possibly tomorrow. To Egypt? No.

Officially, the international sanctions allow food and medicine to be shipped freely into Iraq. Yet with billions of dollars frozen in overseas bank accounts and no way of selling its oil, the government says it doesn’t have enough money to buy food and medicine. The ration program alone is costing about $1 billion a year. Foreign diplomats say Iraq undoubtedly has billions of dollars in hidden assets it could still tap, but even those, many say, appear to be draining--or the government is simply choosing not to spend them.

Either way, life in Baghdad is a depressing grind for almost everyone.

The Friday morning flea market downtown has stretched to cover an entire street and two adjacent thoroughfares. Old trousers, china dug out from the dining room, mixers, sunglasses and old telephones cover the makeshift stalls--anything anybody found in a closet to help buy food for the next month.

Hadija Jamaam sits grimly on the sidewalk, leaning on the family television set. It is the only thing the family has to sell. “I don’t have any money. If I had money, I wouldn’t sell my TV set,” she says. “I have eight children; what can we do? We eat tomatoes (when they are available) and bread. Please, can’t someone break these sanctions and tell people that we are suffering?” But then she sighs. “God will help,” she predicts. “God will never leave his Muslim believers in such a situation for long.”

At the Qadissiyah Hospital in Saddam City--a suburb to which many residents fled after two wars in Basra--10-year-old Rana Naji lies on a dirty bed in the emergency room, her eyes rolled back into her head. She has been unconscious for more than a day, and her mother sits hunched on the floor beside her bed.

“She was eating lunch yesterday and fainted for no reason. She hasn’t woken up since,” said the woman, Sadia Kata. “She was eating rice and salt, nothing more. The doctors have seen her and think there is blood poisoning, but there is no medicine.”

Iraqi officials estimate that the child mortality rate has quadrupled since the sanctions began in August, 1990, with about 400,000 children dead of malnutrition and disease. An estimated 12,300 Iraqis have died in the past two months as a result of food and medicine shortages, including 9,434 children younger than 5 who were victims of diarrhea, pneumonia and malnutrition-related diseases, according to a Health Ministry report issued last month.

There is no way of verifying the government’s claims, but a visit to the Qadissiyah Hospital pharmacy is telling. Its entire stock on a recent day consisted of a plastic tray divided into sections, several of them empty. Today, there is medicine for nausea and treatment of dust allergies and a few other ailments.

There are two vials of hydrocortisone. There is no medicine for other allergies, asthma, diarrhea or nerves. (The Valium disappears fast). There are no antibiotics.

“Daily we face many difficulties in our duties toward the patient, from the door of the hospital to this room, and day after day, the difficulties increase,” said Dr. Nassir Zubaydi, head of the cardiac care unit.

“If you look at the charts for any of these patients, you will see a prescription and the notation, ‘Drug is absent.’ We force ourselves to change the types of medication, and instead of using the best or the second best, we use the fourth or the fifth best. The site of humanity is the hospital, but we find ourselves in a position to do nothing for them, and finally we discharge them to die.”

The city is becoming more dangerous. The crime rate has doubled since the end of the Gulf War, and not only among the populace. The government recently had to rein in the secret police, who were conducting random house searches and seizing whatever caught their fancy. Police and officials of the ruling Baath Party were visiting shop owners, seeking protection money. New punishments under Islamic law imposing death on repeat robbers have encouraged some thieves to simply slaughter all witnesses.

“A few months ago, something started happening we couldn’t understand,” said a young Baghdad mother. “A child, anywhere from 3 to 6, would be kidnaped, and then someone would call and say, ‘If you want your child back, bring 10,000 dinars to this place.’ They would go to the place with the money, and they would find only a bag, with a string on top. Inside it would be the child’s head, his legs, his arms. This happened three or four times.”

The kidnapers didn’t show up for the money? “No,” she said, shaking her head. Why not? She shrugged.

In times like these, is it any wonder that more people are going to the mosques? That more women are wearing Islamic head scarves? That fundamentalist groups such as the Shiite Al Dawaa, and even a few Saudi-sponsored Wahabi Islamic groups, are again being heard from?

The government’s overwhelmingly pious response over the past two months is officially designated the National Religious Belief Campaign. Privately, officials admit that its basics--banning public consumption of alcohol, adopting Sharia (Islamic law) punishments (four thieving hands were amputated in the past month), displaying Hussein in various postures of worship, the Grand State Mosque--are intended to nip in the bud any wave of Islamic fundamentalism.

“The National Religious Belief Campaign concentrates on the main concepts of religious belief, but not on the fundamentalism. This has made both sects (of Iraqi Muslims) surprised, because they cannot understand this campaign, which concentrates not on the political concepts, but on the concepts of belief,” said a senior Iraqi official.

But analysts here believe the new religious campaign is very much political and that its audience is as much the international community as the Muslims of Baghdad.

“They’re using it both as propaganda and leverage,” said one foreign diplomat. “See what sanctions are doing to us? We are coming closer and closer to fundamentalism. Cornering us, you will achieve another Iran.”

The Speaker of Iraq’s Parliament, Saadi Mahdi Saleh, said encouraging religion in Iraq is a way of feeding the public’s patience and readiness for sacrifice.

“Hard or difficult circumstances make man seek God’s help,” he said. “You in the West are driving the region toward this kind of practice, because when unjust pressure is put upon societies, those societies cannot answer back the way they would like to, and then they will go to God and pray. When unjust pressure comes, religion becomes stronger, and as a conclusion it would end up declaring jihad against those who are practicing these unjust deeds.”

Murphy was recently on assignment in Baghdad.