NEWS ANALYSIS : For Bush and Hussein, the Argument Is Over Who Will Rule in the Mideast

After President Bush’s final ultimatum on Friday, the Gulf War has come to the brink of the “mother of battles,” with the United States and Iraq locked in an impasse, despite six months of diplomatic efforts to find a compromise.

On the surface, the issue is deceptively simple: Who owns Kuwait? Even as he has offered to withdraw his army, Iraqi President Saddam Hussein said he had every right to seize the emirate in August. President Bush insists that Hussein admit that he had no such right.

But the inflexibility on both sides reflects an underlying factor that has distinguished the Gulf crisis from the beginning: For both Hussein and Bush, this argument is really over much larger questions--who will rule the Middle East and what kind of power will count most in the post-Cold War world?

Those are issues that far transcend immediate questions of how long Iraq’s withdrawal should take and whether Baghdad should pay damages to the emir of Kuwait.

Perhaps more important, they are issues that touch the core ambitions of the two men who seem to be about to hurl their armies into battle.

For Hussein, the conquest of Kuwait was only part of a drive to become the paramount leader of the Arab world. That ambition appears to have driven the Iraqi leader to risk martyrdom, for a humiliating retreat from Kuwait would mean the end of his historic dream.

For Bush, the struggle against Hussein has become a vehicle not only for restoring a balance of power in the Gulf, but also for establishing a “new world order,” a global framework for peace and stability. If the U.S.-led coalition does not win convincingly in Kuwait, Administration officials say, it will send the wrong lesson to “other Saddams.” It will also rob Bush of his most treasured foreign policy achievement--the assembly of a new kind of international alliance.

The result is an irreconcilable conflict of principle between Baghdad and Washington, a deadlock that has resisted every attempt at compromise, even after five weeks of relentless attacks on Iraq by the allied air forces.

“There is no other course but the one we have chosen, except the course of humiliation and darkness, after which there will be no bright sign in the sky or brilliant light on Earth,” Hussein proclaimed in his radio address on Thursday. “They want us to surrender. Of course, they will be disappointed.”

Bush laid out his view of the stakes three weeks ago, in a speech on the parade ground at Ft. Stewart, Ga.: “When we win--and we will--we will have taught a dangerous dictator and any tyrant tempted to follow in his footsteps that the United States has a new credibility, and that what we say goes, and that there is no place for lawless aggression in the Persian Gulf and in this new world order that we seek to create.”

G. Henry M. Schuler, a former diplomat now with the Center for Strategic and International Studies here, observed: “These are two equally stubborn men. The reason diplomacy did not work is because they’re both so sure they’re right.

“Saddam is not as Machiavellian and devoid of reason as he’s been painted,” Schuler said. “He’s clearly wrong, but he thinks he’s got right and justice on his side. . . . He sincerely believes that there was a conspiracy of the United States and Kuwait to destroy Iraq, and therefore he sees what he did as a response to provocation.

“And George Bush is every bit as certain that (Iraq’s invasion of Kuwait) was unprovoked aggression. Both are equally sincere in their views.”

Both men also have maintained a clear-eyed view of their ultimate goals.

On Thursday, as his foreign minister was flying to Moscow with an offer to withdraw, Hussein repeated his bottom line of principle: “Kuwait is part of Iraq and was annexed (in spite of) a conspiracy to partition and weaken the Arab nation.”

Even while offering to withdraw his troops, Hussein resisted any settlement that would explicitly recognize Kuwait’s right to exist as an independent sovereign state--or force him to admit that he had been wrong to invade.

“It’s hard to understand why he’s so obdurate, given the fact that he has shown a great deal of flexibility in the past,” said Christopher van Holland, a former U.S. ambassador in the Middle East. Hussein compromised with Iran, his local archrival, several times during the 1970s and 1980s, Van Holland noted.

But in none of those cases was Hussein forced to surrender on the uncompromising terms demanded by Bush and the other members of the anti-Iraq coalition.

“It appears that he would prefer to go down to defeat, if necessary, than be seen to surrender,” Van Holland said. “He may well see his place in history now as standing up to the forces of the West, not only for the Iraqis but for the Arab masses.”

By the same token, Bush’s goal of establishing a new world order--and establishing its first set of precedents in the Persian Gulf--has driven him to reject any settlement that might “save face” for Hussein.

In the words of a senior Administration official, “We want to humiliate him.”

“There’s got to be a way to put the Iraqis on the spot, so that they will not be tempted in any way to restage the adventure they did last August,” explained Richard W. Murphy, a former assistant secretary of state for the Middle East. “There’s got to be a way to politically humiliate Saddam in front of his people for what he did.”

Also, the experience of war--and the sudden focus of U.S. interest on Hussein’s depredations after years of inattention--have strengthened Bush’s resolve to cut the Iraqi leader down to size.

The President has told aides, friends and the presiding bishop of his Episcopal church of his revulsion at the human rights abuses reported from occupied Kuwait by Amnesty International, although they matched a long pattern of similar abuses inside Iraq itself.

As a result of the war, a Bush aide said, U.S. officials “have finally woken up to the danger a guy like this can pose. . . . It’s been an eye-opener to a lot of people, even in our own government, how big an army this guy had built.”

Another result has been the gradual escalation of U.S. war aims--from forcing Iraq to withdraw from Kuwait, to destroying Hussein’s nuclear- and chemical-weapons plants, to encouraging Iraqis to overthrow him.

Formally, however, the Administration decided early in the war not to expand its declared aims beyond what the United Nations had demanded--the withdrawal of Iraqi troops from Kuwait, the restoration of the emirate’s government and the payment of reparations--despite suggestions that the goal of Hussein’s ouster should be added.

That tactic paid off on Friday. When Hussein offered to withdraw under an Iraqi-Soviet plan that specified six conditions, Bush could point to the U.N. resolutions as inviolable.

“Any conditions would be unacceptable to the international coalition and would not be in compliance with U.N. Security Council Resolution 660’s demand for immediate and unconditional withdrawal,” Bush said.

That unchanging position enabled Bush to bring the other members of the coalition, and even the Democratic leaders of Congress, along with him.

Indeed, it enabled Secretary of State James A. Baker III to inform Soviet Foreign Minister Alexander A. Bessmertnykh as early as Tuesday what the U.S. response to the Soviet peace initiative would be.

The only change in the U.S. conditions, White House Press Secretary Marlin Fitzwater said, was a small gesture toward compromise: Bush softened his deadline for the completion of an Iraqi withdrawal to seven days, instead of the originally proposed four.