SECRETARY of State James Baker, looking anew for peace in the Middle East, was reminded before he set out how difficult the search would be. He could not visit one of the most important parties, Iran. History, politics, and national interest stood in the way, and not only for the United States. Iran has enormous potential for good or ill. It is by far the largest nation in the Gulf region, with more people than all the Arab states of the peninsula put together. It holds the entire northern shore of what is, after all, the Persian Gulf. Brought to its knees by the eight years of war that followed invasion by Iraq's Saddam Hussein in 1980, Iran is now recovering and rebuilding. Saddam's new war in the Gulf has been good for Iran. Its old enemy, Iraq, is a basket case. Saddam, wanting Iranian neu trality in the second war, gave back what little he had won in the first. And the Iranians have certainly made Iraq pay through the nose for the food and consumer goods they have smuggled past the United Nations embargo. Kuwait's oil production is devastated; Iran's is going up. Trade is increasing and Tehran's international stature is growing. Britain has resumed relations, the Salman Rushdie affair quietly shelved. The Soviet Union, the great, menacing bear, now has no appetite for conquest.
In the normal calculus of geopolitics, the US would reach out to Iran. It has done so before, in the reign of the Shah. President Richard Nixon saw Iran then as the "regional influential" which would keep the Russians out of the Gulf and maintain order. He sold Iran the most modern weapons (for the money it amassed by jacking up the price of its oil). He and President Jimmy Carter gave the Shah political support until his megalomania sawed off the limb on which he sat. The consequence was revolution and descent into medieval religious fanaticism.
The mullahs, the clergy who seized power under Ayatollah Ruhollah Khomeini, made the US the "Great Satan," overran the American Embassy and held its staff hostage for 444 days of taunting humiliation. Washington replied by freezing billions of dollars in Iranian assets, imposing a near-total ban on imports from Iran and forbidding the sale of weapons; although President Reagan showed his own vulnerability in the hostage affair by selling arms to Tehran in a lurid diplomatic tragicomedy.
All this - and more - is outstanding between Washington and Tehran. Iranian leaders occasionally hint at a deal in which the US would unfreeze money and the Iranian-controlled mobsters in Lebanon would release the American and other Western hostages they still hold. Washington, perceiving any such bargain as political suicide, is not tempted. Normalization of relations will take time and great care, particularly in finding a solid basis of mutual interest.
THE prospect is not hopeless. Tehran shows signs of greater realism and fading fanaticism. President Ali Akbar Rafsanjani appears to have outmaneuvered and sidelined his extremist adversaries. They wanted Iran to join Saddam Hussein in his "holy war" against the West. Rafsanjani, with public support, did not budge from neutrality. And, toward the end, he chimed in with the US, openly demanding what President Bush was only suggesting - that Saddam and his Baath party step down or be destroyed by the peop le of Iraq.
The Iranians are still paranoid about a US military presence in the Gulf and blame the Saudis for it. The two share other grievances. Tehran has accused the Saudi monarchy of being not only corrupt and illegitimate but also of defiling the sacred Islamic shrines of Mecca and Medina in its custody. In 1987, Iranian "pilgrims" to Mecca, reportedly paramilitary troops, started a political riot in Mecca during the Haj, the great pilgrimage, that killed more than 400 people. Tehran tried to incite Shiite Mus lims in Saudi Arabia's northeastern province to rebellion. On the other hand, Saudi money has been spent widely to counter Iranian influence. And the two collided openly in Afghanistan, backing opposing factions of the guerrilla movement.
Saudi Arabia and Iran have moved more quickly than expected to restore diplomatic relations but are no more likely to leap into each other's arms than are Washington and Tehran. Yet, each side has something to offer the other. Right now, that is best expressed in the dilemma that there will be no regional security system in the Gulf without Iran and that Iran cannot join it without playing the game.