Only problem is that a complete fabrication with no base in fact. The US had ties with Pakistani Intellegence who had ties with the Mujahadeen. The "US intellegence community" had no such ties with either the muhahadeen or Saddam that the Neo-isolations routinely claim. It a completely made up Internet myth or, in short, just another Leftist lie.
See my previous post re: the Mujahadeen and bin Laden’s CIA “ties.”
As far as Saddam and the Baathists... CIA veteran Miles Copeland (who organized Operation Ajax) and former NSC staffer Roger Morris have talked extensively about how the Baath Party was a tool in Iraq going back to the late ‘50s with Qasim. And needless to say, the CIA was feeding both sides intel in the Iran-Iraq war from Saudi AWACS. More brilliant interventionism. Here’s a quote from April Glaspie, who was ambassador to Iraq in 1990 during a meeting with Saddam and Tariq Aziz:
“But we have no opinion on the Arab-Arab conflicts, like your border disagreement with Kuwait. I was in the American Embassy in Kuwait during the late ‘60s. The instruction we had during this period was that we should express no opinion on this issue and that the issue is not associated with America. James Baker has directed our official spokesmen to emphasize this instruction. We hope you can solve this problem using any suitable methods via Klibi (Chedli Klibi, Secretary General of the Arab League) or via President Mubarak. All that we hope is that these issues are solved quickly.”
Of course, Saddam was a moron and a glorified hitman and didn’t realize there’s a difference between diplomacy and reality. In any event, here’s some interesting reading for you.
http://www.washingtonpost.com/wp-srv/politics/documents/glaspie1-13.pdf?sid=ST2008040203634
http://www.chss.montclair.edu/english/furr/glaspie.html