Shaking Hands: Iraqi President Saddam Hussein greets Donald Rumsfeld, then special envoy of President Ronald Reagan, in Baghdad on December 20, 1983
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By the summer of 1983 Iran had been reporting Iraqi use of using chemical weapons for some time. The Geneva protocol requires that the international community respond to chemical warfare, but a diplomatically isolated Iran received only a muted response to its complaints
[Note 1]. It intensified its accusations in October 1983, however, and in November asked for a United Nations Security Council investigation.
The U.S., which followed developments in the Iran-Iraq war with extraordinary intensity, had intelligence confirming Iran's accusations, and describing Iraq's "almost daily" use of chemical weapons, concurrent with its policy review and decision to support Iraq in the war
[Document 24]. The intelligence indicated that Iraq used chemical weapons against Iranian forces, and, according to a November 1983 memo, against "Kurdish insurgents" as well
[Document 25].
What was the Reagan administration's response? A State Department account indicates that the administration had decided to limit its "efforts against the Iraqi CW program to close monitoring because of our strict neutrality in the Gulf war, the sensitivity of sources, and the low probability of achieving desired results." But the department noted in late November 1983 that "with the essential assistance of foreign firms, Iraq ha[d] become able to deploy and use CW and probably has built up large reserves of CW for further use. Given its desperation to end the war, Iraq may again use lethal or incapacitating CW, particularly if Iran threatens to break through Iraqi lines in a large-scale attack"
[Document 25]. The State Department argued that the U.S. needed to respond in some way to maintain the credibility of its official opposition to chemical warfare, and recommended that the National Security Council discuss the issue.
Following further high-level policy review, Ronald Reagan issued National Security Decision Directive (NSDD) 114, dated November 26, 1983, concerned specifically with U.S. policy toward the Iran-Iraq war. The directive reflects the administration's priorities: it calls for heightened regional military cooperation to defend oil facilities, and measures to improve U.S. military capabilities in the Persian Gulf, and directs the secretaries of state and defense and the chairman of the Joint Chiefs of Staff to take appropriate measures to respond to tensions in the area. It states, "Because of the real and psychological impact of a curtailment in the flow of oil from the Persian Gulf on the international economic system, we must assure our readiness to deal promptly with actions aimed at disrupting that traffic." It does not mention chemical weapons
[Document 26].
Soon thereafter, Donald Rumsfeld (who had served in various positions in the Nixon and Ford administrations, including as President Ford's defense secretary, and at this time headed the multinational pharmaceutical company G.D. Searle & Co.) was dispatched to the Middle East as a presidential envoy. His December 1983 tour of regional capitals included Baghdad, where he was to establish "direct contact between an envoy of President Reagan and President Saddam Hussein," while emphasizing "his close relationship" with the president
[Document 28]. Rumsfeld met with Saddam, and the two discussed regional issues of mutual interest, shared enmity toward Iran and Syria, and the U.S.'s efforts to find alternative routes to transport Iraq's oil; its facilities in the Persian Gulf had been shut down by Iran, and Iran's ally, Syria, had cut off a pipeline that transported Iraqi oil through its territory. Rumsfeld made no reference to chemical weapons, according to detailed notes on the meeting
[Document 31].
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http://www.gwu.edu/~nsarchiv/NSAEBB/NSAEBB82/