Under that agreement, Iraq promised to give up its non-conventional arms and the means to manufacture them. Sanctions would be lifted only when a UN Special Committee (Unscom) certified that Iraq had no more weapons of mass destruction. What followed is very similar to the German reaction to the treaty of Versailles in 1919. Germany was forced to agree partial disarmament - no tanks, airports, heavy artillery, poison gas or general staff - and to pay financial reparation. Iraq likewise agreed to give up its long-range missiles and chemical weapons, as well as its plans to make nuclear and biological weapons.
The parallel between Iraq and Germany breaks down when it comes to the severity of the punishment inflicted on the two countries. The sanctions imposed on Iraq in 1990 were unprecedented. The UN Security Council had only twice before voted for such an embargo, against Rhodesia and South Africa. In effect, sanctions laid Iraq under economic siege of a kind not seen before outside warfare.
It is this which makes Saddam Hussain's decision to end co-operation with Unscom and demand its restructuring so serious. It is difficult to see how he, or any Iraqi government, can go back to an endlessly prolonged inspection process, which continues regardless of the impact of sanctions.
These have been devastating. The Iraqi economy has suffered far worse damage from the embargo than Germany did from bombing in 1942-45. The reason is simple enough. A modern economy depends on a constant supply of electricity and water. Its health depends on the continuous disposal of sewage. This is what distinguishes the economies of this century from the Middle Ages.
But over eight years Iraq has gradually returned to a pre-industrial age because its plants are not maintained or repaired. The electricity supply is breaking down and is only 40 per cent of what it was in 1990.
In the main children's hospital in Baghdad this week I saw one ward where 10 new Japanese incubators with computerised controls had just been delivered. Premature babies were lying in them, but the doors of the incubators could not be closed because the air conditioning in the hospital had failed. The manufacturers of the incubators had never imagined that their equipment would be used when the temperature in a hospital was 49C.
In 1995 the UN Security Council thought it could feed the Iraqi population, but still keep cash out of the hands of the Iraqi government by putting forward its oil-for-food plan. Iraq would sell oil, but the oil revenues would be placed in a French bank and all spending would be under the control of the UN.
It has not worked. Oil-for-food was agreed in 1996. In March this year a survey of Iraqi children under five carried out by Unicef showed that 27 per cent suffer from chronic malnutrition, 9 per cent from acute malnutrition and 24 per cent are underweight. Before sanctions the chief health risk to Iraqi children was obesity, so sanctions are damaging the health of 60 per cent of Iraqi children.
The only effective way of ending this suffering is to end sanctions. Denis Halliday, the head of the UN humanitarian mission in Iraq resigned last month in frustration at the failure of the Security Council to recognise that its policy had failed. He points out that food aid is not enough if people have to drink contaminated water because the power station and the water and sewage plants have not been repaired for eight years. The small amounts of money allocated by the UN are dwarfed by the scale of the problem.
It is this economic and social crisis which is the driving force in the present confrontation between Iraq and the UN. It is this which makes it more than a diplomatic skirmish. In essence Iraq will allow monitoring of existing sites and facilities by the UN to continue, but not new inspections. It is difficult to see these being resumed without Baghdad being given concrete assurances about a bid for the end of sanctions.
Mr Butler's surprise at his abrupt dismissal stems from his failure to realise that Unscom can no longer behave as it did in the first half of the 1990s. The original ceasefire terms with Iraq, embodied in a UN Security Council resolution, were extracted under the threat of invasion.
The last confrontation between the UN and Iraq, stretching over four months from last November, showed that the Gulf war alliance no longer existed. Apart from Kuwait none of the Arab states were prepared to support America and British military action against Iraq.
The US was paying the price of its policy immediately after the Gulf war. Iraq said this week that sanctions were aimed at overthrowing the Iraqi government. But this is not quite true. It was aimed rather at ensuring a "weak Saddam". This is what Tony Lake, the former US National Security Adviser, called "chipping Saddam in his box". If he was overthrown then the US wanted him replaced by somebody very similar. It did not want a revolution which might benefit Iran or lead to an independent Kurdistan.
This policy had the unfortunate effect that Saddam and the Iraqi state was kept weak, by targeting the living standards of the Iraqi people. This was never obvious to the outside world because Saddam and his government were so demonised and so demonisable. It is also easy to rouse international public opinion against anybody possessing or seeking to possess a terror weapon such as VX nerve gas or anthrax spores.
Yet Iraq had possessed these weapons in far greater quantities in the Gulf war than it does now and had not used them. The reason was the threat of retaliation. There is no particular reason why Iraq's remaining biological and chemical weapons should not be dealt with by deterrents from the US and Britain allied to the south Gulf states.
The truth is that all states in the region are now acquiring weapons of mass destruction. Of the three states to the east of Iraq, two, India and Pakistan, have nuclear weapons, and one, Iran, has mustard and nerve gases. Of the three states to the west of Iraq only Jordan has no such weapons. Syria has poison gas and the missiles to deliver it. Israel has at least 80 nuclear devices as well as rockets and advanced fighter-bomber aircraft which can reach anywhere in the Middle East.
Any chance of preventing such weapons spreading throughout the region probably disappeared when the international community allowed Iraq to use mustard and sadin and Tabun nerve gases against the Iranians in the Iran-Iraq war. It was the first time they had been used on a mass scale in conventional war since 1918. Some 50,000 Iranians still suffer from mustard gas poisoning.
Mr Butler himself did not help earlier this year when he said Iraq could devastate Tel Aviv. The Israeli government did not believe it, but it touched off a popular panic. This underlined the effectiveness of the threat of non conventional weapons to governments in the region thinking of acquiring them.
Mr Butler's failure was not to see that the casualties from Iraq's remaining non-conventional weapons are potential, while the casualties of sanctions are quite real. Infant mortality has quintupled since 1990. No government in Iraq is going to co-operate with inspectors while sanctions continue. To imagine that it might is to institutionalise the present crisis.
The only alternative to a new agreement on sanctions and non-conventional weapons with Iraq is a renewal of the Gulf war which the US and Britain showed in February that they do not want.Reuse content