The "wormhole" device was the technological loophole by BensEye

Now this might get a little complicated but I'll try to make it as short and to the point.

I think there was always a loop. One way or another, the island has always been destroyed by jughead (whether Jack set it off, or someone let the timer run out in the hatch). This always flashed whoever was on the island to their other timeline before they arrived to the island.

However, Widmore and Eloise (who we can assume were in love in the 1977's, and thus each others constants), both had crazy encounters that changed their lives on the island. Eloise shot her son Faraday and Widmore met a mysterious time-traveler in John Locke. This would explain Widmores interest in Locke pre-Oceanic flight (having Abaddon visit him and tell him to go on a walkabout).

Alright, so since Widmore and Eloise are each other's constants, they constantly remember some of the things from the past loops (but like Desmond, it's only flashes). But as time and time again they keep going through, it becomes clearer to them that they have to harness the power of the island.

So Widmore (who regularly made trips off the island) decided to exploit the power of the island for his own profit (the healing abilities, time travel, etc.) That is why he is so rich. With his money, he funded The DHARMA initiative, to learn more about the power of the island.

Widmore sent Desmond to the island (because Desmond ALWAYS went to the island, and always FAILED to hit the button), until Widmore sent in the variable, Locke, who took over the button pushing until he convinced Desmond to turn the fail-safe key. The fact that Desmond turned the fail-safe key, exposing him to large amounts of radiation (and surviving) made Desmond special.

Now Widmore can finally complete his plan. So he recreates that electromagnetic event with science (the island's flashes = faith, widmores artificial flashes = science), and now Desmond had the ability to travel between timelines, and this is why Eloise said "For the first time in a long time I don't know what is going to happen". Widmore probably told her "I found the loophole...finally".