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To say that the US was allied with Saddam is an oversimplification. We were never Saddam's allies.

Saddam's Iraq was, during the Cold War, a defacto member of the Warsaw Pact. His army was trained and equipped and advised by the Soviets, as was his intelligence service. This relationship continued up to and including the recent Gulf War 2, where he had the services of retired Russian generals. The charges that the US created and armed Saddam were never true, his armament was and is Russian. That part of it that is not Russian, at least in the most recent conflict, was French.

Our policy toward him initially was to woo him away from the Soviet camp, as we had done with the Egyptians. Considerations of his personal moral character were quite secondary to the primary need to pry him away from the Soviets. That is one dynamic in play in the late eighties and early nineties. Of course he was a bad guy, what pro-Soviet dictator wasn't?

The second issue was the need to contain Iran following the fall of the Shah, a self-inflicted crisis if ever there was one. This is evidence if more were ever needed that children should not be trusted with foreign policy. In this our relation to Saddam was cynical, and owed to the need to protect our base in Saudi Arabia. By this I am not referring to a specific military base, but to the fact that Saudi Arabia itself was an important base all during the Cold War for off-the-books enterprises, not to mention its value in resolving balance of trade issues by buying tons of military equipment they could never use, just at the right time, year after year.

In short, we were not Saddam's ally, we were Riyadh's ally. At that time, I think it safe to say, we saw Riyadh not as simply an ally, but as an extention of "us". They had not yet found or revealed foreign policy ambitions of their own, they seemed well pleased to serve as our surrogate, and to provide our public servants with well-remunerated retirement packages.

This is why we backed Saddam so firmly against Iran, but the moment he became a threat to Riyadh he was dropped so quickly his head spun. I doubt he saw it coming.

It is important to note that he had opened his oil industry to US companies prior to the invasion of Kuwait. Bechtel was tooling up to execute a mega-project there at Iraq's invitation. This is probably why April Glaspie's response was not stronger, we had a lot at stake there at the time.

Note, though, that she did not give Saddam a green light. She said very clearly that the US expected a peaceful solution. But we had an invitation to begin operating in Iraq's oil industry, which came in spite of our obviously cynical role in the Iran-Iraq War, where we rather openly played both sides against the middle.

Note also that had we accepted Saddam's invasion of Kuwait, that we would have had access to Kuwait's industry and Iraq's both. It is my impression that Saddam was surprised that we would turn on him with so much at stake for us. If we were driven only by oil-greed, he would have been right. But although we are not immune to commercial considerations, they are never the only considerations with us.

By opposing him, we shut lost access to his oil industry for a decade.

It is instructive to look with open eyes at our dealings with Saddam during the eighties. We closed our eyes to what we knew about him, because other issues were at stake. But following the invasion of Kuwait, and the subsequent massacres in the south and in the north, we could and did no longer ignore what we knew. This is the difference between us and, say, the French and Germans. We were willing to woo him away from the Soviets, and to use him against Iran. We could ignore his slaughters when we were in no position to do anything about it anyway. We could no longer ignore them, though, in the aftermath of his invasion of Kuwait, and when the massacres were committed almost within sight of our forces. That is when we established the no-fly zones, a weak response if ever there was one. Had we been true to our principles, or if we were truly venal, we would have occupied the north and the south and grabbed the oil 10 years ago. Instead we left the oil in the hands of our enemy, a rather odd response if commerce were all-important.