Mr Rumsfeld’s 90-minute meeting with Saddam, preceded by a warm handshake which was captured on film, heralded a US policy under Presidents Ronald Reagan and George Bush Sr of courting the Iraqi leader as an ally throughout the 1980s.

The strategy, seen as a bulwark against the Islamic fundamentalism of Iran, was so obsessively pursued that Washington stepped up arms supplies and diplomatic activity even after the Iraqis had gassed Kurds in northern Iraq in March 1988, according to the records.

A National Security Directive of November 1983 stated that the US would do “whatever was necessary and legal” to prevent Iraq from losing its war with Iran.

Mr Rumsfeld, who was a private citizen at the time, was chosen by Mr Reagan as a special envoy to the Middle East. He met Saddam on December 20 and told him that Washington was ready for a resumption of full diplomatic relations, according to a State Department report of the meeting.

The policy was followed with such vigour over the next seven years that on July 25, 1990, only one week before Saddam invaded Kuwait, the US Ambassador to Baghdad met Saddam to assure him that President Bush “wanted better and deeper relations”.

The extraordinary lengths to which successive US Administrations went to befriend Saddam, while ignoring his use of chemical weapons against Iranian troops and his own people, was highlighted in The Washington Post yesterday. It is a timely reminder of American involvement in the creation of Saddam’s arsenal as the current President Bush, who has repeatedly cited Saddam’s possession of chemical and biological weapons as a reason for disarming him, prepares for a possible US-led invasion of Iraq.

To prevent Iraqi defeat in the Iran-Iraq war, which was started by Iraq and lasted from 1980 to 1988, the Reagan Administration began supplying Saddam with battlefield intelligence on Iranian troop movements.

By the end of the decade, Washington had authorised the sale to Iraq of numerous items that had both military and civilian applications. These included poisonous chemicals and biological viruses, among them anthrax and bubonic plague.

A 1994 investigation by the Senate Banking Committee disclosed that dozens of biological agents were shipped to Iraq in the mid-1980s under licence from the US Commerce Department, including strains of anthrax. Anthrax has been identified by the Pentagon as a key component of Saddam’s biological weapons programme.

The Commerce Department also approved the export of insecticides to Iraq, despite suspicions that they were being used for chemical warfare.

In November 1983, a month before Mr Rumsfeld’s first visit to Baghdad, George Shultz, the Secretary of State, was given intelligence reports showing that Iraqi troops were resorting to “almost daily use of CW (chemical weapons) against the Iranians”.

But the Reagan Administration, already committed to wooing Baghdad, turned a blind eye to the reports. In February 1982, despite objections from Congress, the State Department had already removed Iraq from its terrorism list.

Mr Rumsfeld recently said that he had, at the December 1983 meeting, “cautioned” Saddam about the use of chemical weapons. That claim does not tally with a declassified State Department note of his meeting. A Pentagon spokesman later said that Mr Rumsfeld issued the caution to Tariq Aziz, the Iraqi Foreign Minister.

According to an affidavit sworn by Howard Teicher, a former National Security Council official during the Reagan Administration, the US “actively supported the Iraqi war effort by supplying the Iraqis with billions of dollars of credits, by providing military intelligence and advice to the Iraqis, and by closely monitoring third-country arms sales to Iraq to make sure Iraq had the military weaponry required.”

Mr Teicher said that William Casey, the former CIA Director, used a Chilean front company to supply Baghdad with cluster bombs.

The Iraqi Air Force began using chemical agents against Kurdish resistance forces in northern Iraq in late 1987, provoking outrage on Capitol Hill, particularly after the now infamous March 1988 attack on the Kurdish village of Halabja.

But, in September 1988, Richard W. Murphy, the Assistant Secretary of State, wrote in a memo addressing Saddam’s use of chemical weapons: “The US-Iraqi relationship is . . . important to our long-term political and economic objectives. We believe that economic sanctions will be useless or counterproductive to influence the Iraqis.”

The present President Bush has repeatedly cited Saddam’s use of chemical weapons “against his own people” as justifying “regime change”.

David Newton, a former US Ambassador to Baghdad, told the Post: “Fundamentally, the policy was justified. We were concerned that Iraq should not lose the war with Iran, because that would have threatened Saudi Arabia and the Gulf.

“Our long-term hope was that (Saddam’s) Government would become less repressive and more responsible.”

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