Well, back in 1999, that is:

There was a time not long ago when the conventional wisdom skewed heavily toward a Saddam-al Qaeda links. In 1998 and early 1999, the Iraq-al Qaeda connection was widely reported in the American and international media. Former intelligence officers and government officials speculated about the relationship and its dangerous implications for the world. The information in the news reports came from foreign and domestic intelligence services. It was featured in mainstream media outlets including international wire services, prominent newsweeklies, and network radio and television broadcasts.

Newsweek magazine ran an article in its January 11, 1999, issue headed "Saddam + Bin Laden?" "Here's what is known so far," it read:

“Saddam Hussein, who has a long record of supporting terrorism, is trying to rebuild his intelligence network overseas -- assets that would allow him to establish a terrorism network. U.S. sources say he is reaching out to Islamic terrorists, including some who may be linked to Osama bin Laden, the wealthy Saudi exile accused of masterminding the bombing of two U.S. embassies in Africa last summer.”

....NPR reporter Mike Shuster interviewed Vincent Cannistraro, former head of the CIA's counterterrorism center, and offered this report:

“Iraq's contacts with bin Laden go back some years, to at least 1994, when, according to one U.S. government source, Hijazi met him when bin Laden lived in Sudan. According to Cannistraro, Iraq invited bin Laden to live in Baghdad to be nearer to potential targets of terrorist attack in Saudi Arabia and Kuwait....Some experts believe bin Laden might be tempted to live in Iraq because of his reported desire to obtain chemical or biological weapons. CIA Director George Tenet referred to that in recent testimony before the Senate Armed Services Committee when he said bin Laden was planning additional attacks on American targets.”

By mid-February 1999, journalists did not even feel the need to qualify these claims of an Iraq-al Qaeda relationship. An Associated Press dispatch that ran in the Washington Post ended this way: "The Iraqi President Saddam Hussein has offered asylum to bin Laden, who openly supports Iraq against Western powers."

Where did journalists get the idea that Saddam and bin Laden might be coordinating efforts? Among other places, from high-ranking Clinton administration officials.

In the spring of 1998 -- well before the U.S. embassy bombings in East Africa -- the Clinton administration indicted Osama bin Laden. The indictment, unsealed a few months later, prominently cited al Qaeda's agreement to collaborate with Iraq on weapons of mass destruction. The Clinton Justice Department had been concerned about negative public reaction to its potentially capturing bin Laden without "a vehicle for extradition," official paperwork charging him with a crime. It was "not an afterthought" to include the al Qaeda-Iraq connection in the indictment, says an official familiar with the deliberations. "It couldn't have gotten into the indictment unless someone was willing to testify to it under oath." The Clinton administration's indictment read unequivocally:

“Al Qaeda reached an understanding with the government of Iraq that al Qaeda would not work against that government and that on particular projects, specifically including weapons development, al Qaeda would work cooperatively with the Government of Iraq.”

UPDATE: More here.

ANOTHER UPDATE: This issue's controversy in an election year is somewhat muted by the fact that John Kerry agrees with the president' position...