LONDON- If the war with Slobodan Milosevic is now in abeyance it is, perhaps, to remind us that only temporarily were we allowed to forget that the one with Saddam Hussein continues. The bombing never stopped; neither do the sanctions.

The one important thing always to recall when discussing what next to do about Saddam Hussein is what President Bill Clinton has said more than once: that the UN arms inspectors found and destroyed more Iraqi weapons of mass destruction than were destroyed during all the days of intensive bombardment during the days of the Gulf War. Briefly put, most of the work of disarming Iraq has now been done. The UN inspectorate may not have been a perfect fool-proof system but it was pretty good. Nothing that existed before, in the annals of warfare, short of total military occupation, had such a record of success in disarming a nation.

If there are still horrors to unearth – – stocks of nuclear, chemical and biological weapons, as the doubters sometimes suggest, they are 1) primitive 2) have no feasible means of delivery other than aircraft which are relatively easy to track and shoot down, or by hand.

Yet the West seems preoccupied with re-establishing the presence of the UN inspectorate which was partly withdrawn, partly thrown out, in the course of a row with Iraq at the end of last year over the terms of access and allegations (which turned out to be largely true) about the use of the inspectorate as a cover for American intelligence operations.

Thus today Iraq goes unexamined, free, if that is the desire, to build for itself what arms it is able.

This is why the new British/Dutch draft resolution tabled yesterday with U.S. support in the UN Security Council is something of a milestone, but also, once examined, more of an historic curiosity, in the evolving tussle with Saddam Hussein. It promises a “suspension:” of sanctions in exchange for full cooperation on a new system of inspections. And, most important, in a major change in U.S./British policy, it would not demand the removal of Saddam Hussein before sanctions can be terminated. In short, it replaces what was only stick with a medium sized carrot. Its flaw is that the carrot is probably too small. Still, for both the U.S. and Britain it is a major departure, one that if it had come sooner might well have avoided the present impasse.

But, for now, Saddam holds a better hand than his antagonists. In return for sanctions, which hurt his people rather than him, and for some limited bombing which is so insignificant it rarely makes more than a line in the papers, he is free of the troublesome inspectors. No one knows if he is hatching some wicked ploy that will turn the tables on the West – – a simple suitcase nuclear bomb that he can have smuggled into New York or London. The very thought should be enough to turn the stomachs of western leaders, but they seem unruffled. The truth is Saddam is well aware of the massive retaliation that such a provocation would unleash. Which only underlines that real deterrence never lay with the inspectorate, but with the might of western military power.

This raises the question – – why do Washington and London insist on maintaining the full panoply of economic sanctions? Over 500,000 Iraqi children have died as a result. If we want to talk about “body counts” it is the West that is guilty of using “weapons of mass destruction”. Yet for all the brutality of sanctions they have not worked to undermine Saddam’s popularity. Sanctions have merely served to build antipathy towards the West.

It is now time to cut back sanctions without a quid pro quo on the inspections front. That cat is well and truly out of its bag and no policy, short of a new Gulf War, will persuade Saddam to put it back in. The only sanction that is important to retain is the one that prohibits the purchase of military equipment and dual-use technology. And, of course, Iraq must continue to pay into the UN Gulf War compensation fund.

A policy to be effective needs to have unanimity of support in the Security Council. At present US/British policy meets with a hostile reception in Moscow and Beijing and a frosty one in Paris. The Arab states, for their part, although they have no love for Saddam, feel totally out of sync with the sentiments that govern policy in Washington and London.

But if policy is recast to focus on an arms embargo there is a chance of success. Iraq’s military power is in tatters after the Gulf War; it has no airforce or navy to speak of and its tank strength has been cut dramatically for want of spares. Unless it can buy arms from outside, Iraq can threaten no one.

Continuation of the old policy will only entrench a failed posture. A new policy will be seen as a dynamic break with the past, one that boldly suggests that Washington and London are working to alleviate the suffering of the Iraqi people, a concern that somehow seems to have got lost along the way.

This is not appeasement. This is narrowing containment so that it concentrates on what is most doable and most vital, making sure that Saddam can never build an armoury that Ronald Reagan, Margaret Thatcher and Francois Mitterand with their neurotically, competitive arms sales enabled him to build before.

Foreign affairs columnist, film-maker and author

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