Iran-Contra

Reagan's Scandal and the Unchecked Abuse of Presidential Power

Malcolm Byrne

• Publisher: University Press of Kansas
• Year: 2014
• Print ISBN: 9780700625901
• eBook ISBN: 9780700620364
• Topic: History
• Subtopic: Political Biographies
• Index: History

Choice Outstanding Academic Title

Everything began to unravel on October 5, 1986, when a Nicaraguan soldier downed an American plane carrying arms to “Contra” guerrillas, exposing a tightly held U.S. clandestine program. A month later, reports surfaced that Washington had been covertly selling arms to Iran (our sworn enemy and a state sponsor of terrorism), in exchange for help freeing hostages in Beirut. The profits, it turned out, were going to support the Contras, despite an explicit ban by Congress.

In the firestorm that erupted, shocking details emerged, raising the prospect of impeachment, and the American public confronted a scandal as momentous as it was confusing. At its center was President Ronald Reagan amid a swirl of questions about illegal wars, consorting with terrorists, and the abuse of presidential power.

Yet, despite the enormity of the issues, the affair dropped from the public radar due to media overkill, years of legal wrangling, and a vigorous campaign to forestall another Watergate. As a result, many Americans failed to grasp the scandal’s full import.

Through exhaustive use of declassified documents, previously unavailable investigative materials, and wide-ranging interviews, Malcolm Byrne revisits this largely forgotten and misrepresented episode. Placing the events in their historical and political context (notably the Cold War and a sharp partisan domestic divide), he explores what made the affair possible and meticulously relates how it unfolded—including clarifying minor myths about cakes, keys, bibles, diversion memos, and shredding parties.

Iran-Contra demonstrates that, far from being a “junta” against the president, the affair could not have occurred without awareness and approval at the very top of the U.S. government. Byrne reveals an unmistakable pattern of dubious behavior—including potentially illegal conduct by the president, vice president, the secretaries of state and defense, the CIA director and others—that formed the true core of the scandal.

Given the lack of meaningful consequences for those involved, the volume raises critical questions about the ability of our current system of checks and balances to address presidential abuses of power, and about the possibility of similar outbreaks in the future.

1

Raising the Contras

The new foreign policy team that came to Washington under Ronald Reagan in 1981 viewed Central America with alarm, seeing the hand of Moscow as the principal agitator behind the recent growth in indigenous support for leftist political movements in the region. The president soon focused on the Nicaraguan Contras as the keystone of his policy to roll back international communism. After taking care of his top priority—gaining congressional approval of the Republican domestic legislative agenda—he turned to the task of obtaining congressional funds to help the rebels’ assault against the ruling Sandinistas. Standing in the way was U.S. public opinion. Most voters simply did not share the sense of dire threat the administration saw emanating from the tiny republics of Central America. Many also feared that the new administration, which made no bones about its support for U.S. intervention in Vietnam, might be tempted to try again closer to the homeland. Congress was split on the issue. In 1981, the Republicans took over the Senate for the first time since 1953, but the Democrats held firm in the House. Although many Democrats endorsed the Contras, and others would waffle under White House pressure, the president was never able to build a consistent base of support in Congress for his aid program.

As this chapter will show, the president made a deliberate decision to turn to clandestine operations as a way to achieve provocative goals with a minimum of controversy. Going covert provided official deniability for U.S. political and paramilitary involvement in the region, which reduced the risk of escalating international tensions and drawing the Soviets into the picture. It also allowed the White House to avoid costly political disputes on Capitol Hill or with the public. As events unfolded, however, efforts to keep a lid on administration activities routinely failed. Thus, a pattern developed that would set the stage for the Contra side of the scandal. As Congress repeatedly uncovered evidence of White House or CIA deception, its members approved more restrictive legislation. In turn, the administration, rather than trying to come to political terms with the Democrat-led opposition, simply took the policy deeper underground.

Defining the Issue

When Reagan entered office on January 20, 1981, he fully subscribed to the age-old Washington view of Latin America as a region of special significance—even privilege—for the United States. “I wasn’t the first president concerned about conspiracies and machinations by distant powers in the western hemisphere,” Reagan wrote in his memoir. “Since 1823, when our fifth president enunciated the Monroe Doctrine, the United States has stood firmly against interference by European nations in the affairs of the Americas.”¹ Reagan’s formulation typified his predecessors’ impulse to conflate U.S. interests with those of its neighbors. By the early 1980s, the threat was no longer Western European imperialism but Soviet-inspired communism, which the new president defined as the source of many of the world’s evils.

Even before entering the White House, Reagan had sounded alarms about Central America and the Caribbean. In early 1979, he warned the Caribbean was “rapidly becoming a Communist lake in what should be an American pond.” Yet the United States, he added, “resembles a giant afraid to move.”² Years later, he would explain why U.S. citizens should have worried more about the crisis he saw in Central America. Aside from “the fact that Americans have always accepted a special responsibility to help others achieve and preserve the democratic freedoms we enjoy,” the United States needed to prevent Moscow from creating more satellites like Cuba, which were “a potential jumping off spot for terrorists.” If “so-called ‘wars of national liberation’” continued, then Soviet subversion “would spread into the continent of South America and North to Mexico.” This would threaten the free flow of vital resources and trade through the region and create the prospect of a massive influx of refugees and illegal immigrants into the United States. Left unchecked, the United States itself would be in peril: “As I was told that Lenin once said: ‘Once we have Latin America, we won’t have to take the United States, the last bastion of capitalism, because it will fall into our outstretched hands like overripe fruit.’”³

Evidence from Soviet officials and archives brought to light since the collapse of the USSR indicates that by the 1980s the Kremlin saw Latin America more as an opportunity to distract the United States than as a target of aggression.⁴ Nevertheless, so powerful was the image of a “clear and present danger” in Reagan’s mind that he maintained it even after he left the White House eight years later, despite the momentous changes that had occurred in the Soviet Union under the “new thinking” of Mikhail Gorbachev. By his own admission, Reagan recalled the Lenin quote in public “often,” even though no one has ever located any such statement about Latin America in Lenin’s writings.⁵

The first priority of Reagan’s policy strategists in 1981 was to fulfill an ambitious domestic agenda—building up the U.S. military, cutting taxes, balancing the budget, and winnowing social programs. Unexpected events during the first year pushed the Central America issue further down the road, among them the end of the Iran hostage crisis on inauguration day, the March assassination attempt against the president, the “Solidarity” crisis in Poland beginning that summer, and the air traffic controllers’ strike in August. But before long, the struggle for hearts and minds in the U.S. backyard captured Reagan’s attention.

Although Nicaragua became the epicenter of that struggle, El Salvador was where policy makers first turned their sights. As Reagan admonished his advisors, “We can’t afford a defeat. El Salvador is the place for a victory.”⁶ The country’s small size, roughly one-fifth the area of Nicaragua, was immaterial. The urgency it represented was as the next apparent target of Soviet/Cuban-backed international communist expansion. A U.S.-supported junta, recently installed, faced an insurgency by leftist guerrillas under the umbrella of the Farabundo Marti National Liberation Front (FMLN). In fall 1980, with President Carter still in office, U.S. intelligence had picked up evidence of Soviet bloc arms shipments entering the country by way of Cuba and Nicaragua. Just ten days before Reagan’s inauguration, the guerrillas launched a “final offensive” with evident encouragement from Managua. The assault failed utterly, but Carter decided Nicaragua’s conduct required a response—a cutoff in economic aid and a threatened rupture of diplomatic relations. The Sandinistas took steps to curb support for the FMLN, shutting down the rebels’ clandestine Radio Liberación, operating from Nicaraguan territory. But by then the Reagan administration had taken office.

Reagan’s first secretary of state, the blustery Alexander Haig, wasted little time discrediting Carter’s emphasis on human rights and his minimizing of the East-West struggle. Haig had previously served as NATO supreme commander, which heightened his sensitivity to the threat of Soviet power. Immediately upon taking office he declared himself the “vicar” of the president’s foreign policy and set out to put his stamp on the administration’s new approach. The unbridled growth of the Soviet military, he announced, had posed serious threats from Europe to Afghanistan to Latin America. Of “utmost concern” was the “unprecedented” resort to “risk-taking” by Moscow in the Western Hemisphere—partly through the “Cuban proxy”—which provided significant support for terrorists. “International terrorism,” he promised, “will take the place of human rights” in U.S. foreign policy.⁷ Fellow hard-liners were happy to support Haig’s offensive. Jeane Kirkpatrick, the new UN ambassador, affirmed the Soviet Union was the ultimate threat and stressed that the Western Hemisphere was its most vulnerable target. “Central America,” she said, “is the most important place in the world for the United States today.”⁸

Haig pressed his views within the administration. At an early NSC meeting, he warned Central America was “in turmoil” but added “these countries could manage if it were not for Cuba. Cuba exploits internal difficulties in these states by exporting arms and subversion.” As for Nicaragua, “We probably have enough evidence on hand about Nicaraguan support for El Salvadoran revolutionaries to cut off aid to Nicaragua.” The new CIA director, William Casey, backed up Haig’s point. “There have been 100 planeloads of arms from Cuba over the past 90 days. The Nicaraguans can’t be ignorant of that.” Reagan followed the discussion with evident engagement. At a key juncture in the meeting, he posed the questions that would substantially shape the first phase of his administration’s policy toward El Salvador and Nicaragua: “How can we intercept these weapons? How can we help?”⁹

That same month, February 1981, the State Department produced a white paper alleging “definitive evidence” of “clandestine military support given by the Soviet Union, Cuba, and their Communist allies” to “Marxist-Leninist guerrillas” in El Salvador. Many of the arms, the report charged, came through Cuba and Nicaragua in a “textbook case of indirect armed aggression by Communist powers through Cuba.”¹⁰

Released by the department’s Bureau of Public Affairs, the white paper was the administration’s first attempt to sell its plan of attack against “communist subversion” in the region to the U.S. public. The evidence, in some respects, was accurate. Internal State Department records from the time make it clear the United States had discovered a connection through Nicaragua and had made “very strong demarches” to the Sandinista National Liberation Front (FSLN).¹¹ Newly opened files from the Soviet bloc, particularly the East German Stasi archives, confirm at least small-scale arms and equipment deliveries.¹² The pitch failed, however, and the report itself came under fire for exaggerating Havana’s and Moscow’s roles and labeling Soviet-backed aggression the root cause of the region’s troubles while short-shrifting the problems of economic upheaval and nationalism.

Haig’s high-pitched rhetoric generated unease within certain quarters of the administration—turning to outright alarm when he proposed the United States might mount a blockade around Cuba.¹³ Some senior officials, including Vice President George H. W. Bush and Secretary of Defense Caspar Weinberger, had absorbed lessons from Vietnam about the consequences of incurring military commitments abroad without clear, attainable goals and broad public support. They preferred quieter alternatives. White House political advisors also rejected Haig’s ideas as dangerous distractions from the president’s domestic agenda. Both points of view were supported by opinion polls, during the presidential campaign and afterward, that showed military involvement in Central America was a losing issue for the Republicans.¹⁴ Haig’s high-stakes campaign was shelved in favor of a less obtrusive approach.

Choosing Weapons

After the White House had achieved most of its first-year legislative goals, attention began to shift to hot spots such as Nicaragua. Nicaragua was “an absolute foreign policy focus of the Reagan Administration,” according to diplomat Harry Shlaudeman. “Nothing was more important, except the Soviet Union itself.” But beneath the surface sharp disagreements emerged over both the ends of U.S. policy and the means of attaining them. Shlaudeman recalled “great frictions” punctuated by cabinet meetings “where literally people were shouting at one another. The emotions involved were tremendous.”¹⁵

These disputes often reflected the organization of policy making under Reagan. The president put great stock in a “cabinet government” model he defined as follows: “Surround yourself with the best people you can find, delegate authority and don’t interfere as long as the overall policy that you’ve decided upon is being carried out.”¹⁶ The catch was Reagan rarely followed through in monitoring whether his aides were properly implementing his orders. He also was reluctant to wade in when senior advisors squabbled. His abrogation of a meaningful management role, particularly in policy areas where he was not deeply engaged, encouraged the strong personalities in his administration to push their own agendas at the expense of cooperation and consensus or risk being outmaneuvered by their colleagues.

In foreign policy, this dynamic became more pronounced just one year into the administration. Reagan’s initial plan was to invest primary policy-making authority in his secretaries of state and defense, with the national security advisor assuming a coordinating role. Richard V. Allen, who first occupied the latter post, was not part of the president’s inner circle and lasted less than a year before being replaced by Judge William P. Clark, a longtime friend of Reagan’s from his years as governor of California. Clark broke the mold of neutral coordinator by trading on his close personal ties and far greater access to the president than either Haig or Weinberger enjoyed. Clark’s approach made it easier for his successors, Robert McFarlane and John Poindexter, to be more assertive in defining and implementing policy.

Sharp ideological differences also naturally led to policy disagreements, especially over the Contras. Those officials, usually within the State Department, who sought a broader approach to Central America that included negotiations with the Sandinistas typically confronted skepticism and distrust from hardliners. U.S. diplomats in the field were also split. In Managua “the embassy was quite divided,” one former ambassador recalled. “It was [a] very difficult situation actually because there was always tension as we talked about policy choices.”¹⁷ The same situation held among NSC staff members, whose rivalry with the State Department for policy control would continue throughout the Reagan presidency. Shlaudeman described the antagonism as “crazy—the whole business was crazy. You could see some of what later became Iran-Contra in this NSC staff.”¹⁸

A dominant figure in this drama was Casey. Passed over for the job he really wanted—Haig’s—Casey became the director of central intelligence (DCI) after Reagan assured him of cabinet rank—highly unusual for the position. As the president’s former campaign manager he, too, was an old and trusted ally, adding to his influence. A former Office of Strategic Services (OSS) officer, corporate lawyer, and head of the Securities and Exchange Commission under Nixon, Casey had extensive experience in both government and intelligence. He looked older than his sixty-eight years but had enormous energy and focus and was determined to reinvigorate the CIA after the scandals and operational cutbacks of the 1970s. He was also a resolute cold warrior. Sharing Haig’s animosity toward Moscow, he nevertheless understood politics imposed limits on conspicuous activity, and he was perfectly positioned to promote more low-profile ways to advance the administration’s agenda in Central America.

By late February, barely five weeks after the inauguration, Casey placed a broad-gauged plan on the president’s desk. It called for a “regional effort to expose and counter Marxist and Cuban-sponsored terrorism, insurgency, and subversion in El Salvador, Nicaragua, Guatemala, Honduras, and elsewhere” working either “directly or in cooperation with foreign governments.” The NSC met to consider the proposal on February 27. Even Haig inclined toward it after hearing from the department’s counselor, McFarlane, that it amounted to a “very worthwhile beginning” the secretary should “welcome and support.”¹⁹ Above all, it offered the promise of pushing back the communist tide, as the Reagan presidential campaign had pledged to do. But it also had the advantage of locating the battle below the public radar, both in the region and at home. Reagan understood Washington’s allies in Central America would object to overly aggressive measures led by the United States. “I never considered sending U....

Table of contents

• Cover Page
• Title Page
• Contents
• Foreword by Bruce Riedel
• Preface: Settings for the Scandal
• Acknowledgments
• Introduction
• 1. Raising the Contras
• 2. Coping with Iran
• 3. Taking over the Covert War
• 4. TOW Missiles to Tehran
• 5. Quid Pro Quos
• 6. HAWKS
• 7. Tightening the Reins on the Contras
• 8. A Neat Idea
• 9. Air Contra
• 10. Road to Tehran
• 11. Meltdown
• 12. Blowback
• 13. The Early Cover-Up
• 14. Congress Steps In
• 15. The Independent Counsel
• Conclusion
• Notes
• Selected Bibliography
• Index
• Back Cover