Of course everyone knew that Saddam Hussein had used chemical weapons. Saddam Hussein used WMD with the full permission of the Reagan administration.
Shaking Hands with Saddam Hussein
But the US government knew that Saddam Hussein's WMD capabilities were severely diminished after the 1991 Gulf War.
Iraq and Weapons of Mass Destruction
So intelligence was fixed by the Bush administration after 9/11 to justify a preemptive invasion of Iraq.
U.S. Intelligence and Iraq WMD
You do have a quote where Reagan, or any member of his Administration gave "full permission" to Saddam to use WMD's don't you?