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In all, American taxpayers spent an estimated $2 billion to cover Iraqi loan defaults. The US deployed hundreds of thousands of ground troops to the Persian Gulf and launched an air and ground war to drive Iraq out of Kuwait, hence starting the Gulf War. Throughout the course of the war, US forces managed to destroy most of the Iraqi infrastructure knowing that the reconstruction expenses would be high. On February 22, 1991, President Bush announced a cease-fire in the Gulf War and reinstated the dictator of Kuwait.
The arming of Iran came in two parts: the Arms for Hostages scandal in which the US government helped arm Iran in exchange for the release of kidnapped persons in several Arab nations; and the Iran Contra scandal in which the funds from the Arms for Hostages scandal were illegally diverted to aid the contras in Nicaragua in their bloodbath against the Nicaraguan government. Arms for Hostages Following the ouster of the Shah of Iran in 1979, the US banned trade with Iran and dissolved diplomatic relations with the new government.
Gonzalez outlined how the BNL was working alongside the US Department of Agriculture’s (USDA) Commodity Credit Corporation (CCC) and the Export-Import Bank (Eximbank), both of which provided Iraq with guarantees and insurance backed by US taxpayer dollars (totaling around $6 billion) despite Iraq’s history of delinquencies and nonpayment of loans. Following the guarantees from the US government, the BNL worked alone to 20 America and the New American Century provide additional loans amounting to billions of dollars to Iraq against US laws and regulations.