Iran-Contra: A Post-Mortem

Seven years after the scandal broke, the Independent Counsel’s final report will
offer a comprehensive body of evidence on the widespread corruption of politics,
policy and power in Washington, D.C. If ever the constitutional democracy of the
United States is overthrown,” argues political “historian Theodore Draper, the
Iran-Contra affair has given us “a better idea how this is likely to be done.”‘
At the heart of Iran-Contra-the Reagan Administration’s arms-for-hostages deals
in the Mid- dle East, and the use of the profits to resupply the Contras in
Nicaragua-was an assault on the Constitu- tion through the extensive abuse of
presidential power. This, rather than the diversion of funds from one operation
to the other, is what made Iran-Contra a major and dangerous scandal. In
December, 1986, when a federal-court panel appointed Judge Lawrence Walsh as
independent counsel to investigate the Iran-Contra operations, the magnitude of
the scandal was not yet apparent. The Reagan Administration had requested a
special prose- cutor to deflect charges that U.S. officials were engaged in a
Watergate-style cover-up of their illicit conduct. The White House had
successfully defined Iran-Contra as being simply about the diversion of funds,
which the President, of course, denied knowing anything about. After seven years
of Congressional inquiries, the diligent investigation of the Office of the
Independent Counsel (OIC), and the trials of National Security Council (NSC)
functionary Lt. Col. Oliver North, NSC Advisor Admiral John Poindexter, and
Central Intelli- gence Agency (CIA) operative Clair George, a far Peter Kornbluh
and Malcolm Byrne are co-editors of the National Security Archive documents
reader, The Iran-Contra Scandal: The Declassified History, recently published by
the New Press. uglier picture of systemic governmental corruption has emerged.
The scandal went far beyond the “dis- dain for the law, pervasive dishonesty and
inordinate secrecy” identified by the Congressional Iran-Contra committees in
1987.2 Iran-Contra, we now know, encompassed impeachable offenses, including a
cal- culated assault by the executive branch on the checks and balances of the
U.S. Constitution, a conscious undercutting of U.S. interests in regional peace
and security, the corruption and obstruction of justice, covert manipulation of
the public debate over key foreign-policy issues, as well as personal graft and
larceny. Now, with the conclusion of Walsh’s meticulous investigation and the
pending release of his final report, the scandal passes into the annals of U.S.
political history. How this complex and controversial affair is understood in
years to come, and what impact-if any-it will have on the future conduct of U.S.
national-security operations, depend on the lessons the public and the powers-
that-be draw from Walsh’s findings. At close to 2,000 pages-almost three times
the length of Congress’ 1987 report-Walsh’s long- awaited study is the most
definitive record of Iran- Contra. Divided into chapters on the national-
security agencies that played key roles in the scandal, the report details the
illicit conduct of more than two dozen policymakers and operatives from the CIA,
NSC, Pentagon, State Department and, above all, the White House. Walsh brings to
light the hitherto hid- den roles of important players such as CIA Director
William Casey, Attorney General Edwin Meese, and VOL XXVII, No 3 Nov/DEc 1993 29
VOL XXVII, No 3 Nov/DEC 1993 29REPORT ON CORRUPTION Defense Secretary Caspar
Weinberger, and dispels any doubt about the complicity of Ronald Reagan and
George Bush. Walsh’s report will also provide the most definitive record of the
official cover-up of those operations–a whitewash that culminated in President
Bush’s pardon of Weinberger and others on Christmas Eve, 1992. “The Iran-Contra
cover-up, which has continued for more than six years, has now been completed,”
Walsh stated in reponse to Bush’s actions. “It demonstrates that powerful people
with powerful allies can commit serious crimes in high office-deliberately
abusing the public trust-without consequence.”3 The cover-up now extends to an
attempt to suppress the report itself. Walsh’s report was due to be released
this September, but publication has been delayed because of stalling tactics by
lawyers for those named in the report-including Ronald Reagan, Oliver North and
Donald Gregg-who now argue that Walsh’s findings will unfairly besmirch the
reputations of their clients. Indeed, the report is likely to sully individuals
as well as political institutions by providing the most comprehensive body of
evidence ever published on the widespread corruption of politics, policy and
power in Washington, D.C. he work of the Independent Counsel was made more
difficult by the Congressional response to the Iran-Contra operations. In the
aftermath of the scandal, Congress, the institution most vic- timized by the
executive branch’s illegal conduct, and a presumed ally of the OIC, undermined
its own investigation, as well as Walsh’s subsequent prose- cutions.
Congressional negligence included a refusal to enforce the 1984 Boland Amendment
banning aid to the Contras, the granting of immunity to North and Poindexter
over Walsh’s bitter objections, and the Senate decision to confirm CIA Deputy
Director Robert Gates as CIA director in 1991, after he was almost indicted on
charges relating to Iran-Contra. Congress played particularly fast and loose
with its own investigation of the scandal, limiting it in both time and range,
and failing to follow critical informa- tion on both President Reagan and Vice-
President Bush. Sabotaged by political cowardice, committee members decided
early on not to pursue evidence of White House criminality all the way into the
Oval Office, because, they argued, “the country didn’t need another Watergate.”
They overlooked quid pro quo arrangements made with third countries that pro-
vided material support to the Contras; the conceal- ment of important evidence
such as the personal notes of Caspar Weinberger and George Bush; and above all,
the extent of Bush’s knowledge and role in the Iran-Contra operations. The lax
investigation enabled the White House to sustain the massive cover-up that, we
now know, may have altered the outcome of the 1988 presidential election [see “A
Compromised Election,” p. 33]. The Congressional investigation cast an Orwellian
pall over the scandal, turning villains into heroes, and criminality into
patriotism. Rather than a major inquiry into the crimes of state, the
Congressional hearings became a televised advertisement for the zealotry of the
scandal’s perpetrators. Oliver North began his testimony as an obscure NSC
staffer, and finished as a certified political celebrity. He has now parlayed
national recognition into $20 million in cam- paign contributions to run for
office. In perhaps the most dramatic measure of the scandal’s corruption of U.S.
politics, the man who personifies the scandal, and who might well be in prison
for shredding evidence, obstructing justice and committing perjury, could become
the next Senator from Virginia. NACI[A REPORT ON THE AMERICAS 30REPORT ON
CORRUPTION he Reagan Administration’s obsession with overthrowing the
Sandinistas perverted all other aspects of U.S. foreign policy in Central Ameri-
ca. Examples abound of how White House efforts to sustain the Contra war
undermined other ostensible staples of U.S. foreign policy in the Western Hemi-
sphere, including human rights, economic develop- ment, and regional stability.
But perhaps the most dra- matic example of this debasement of U.S. policy
priorities concerns the war on drugs. Much has been written about the overlap of
drug smuggling and Con- tra operations on the ground in Central America. “It is
clear,” the Kerry Committee concluded in its report, Drugs, Law Enforcement and
Foreign Policy, “that individuals who provided support for the Contras were
involved in drug trafficking, the supply network of the Contras was used by
drug-running organizations, and elements of the Contras themselves knowingly
received financial and material assistance from drug traffickers.” 4 Far more
important, however, is the evi- dence that at the highest levels of the Reagan
White House, U.S. officials were willing to cut deals with major drug
traffickers. “For Every Quid There is a Quo,” reads a cryptic note on White
House stationery discovered by OIC investigators among Caspar Weinberger’s
papers. Indeed, Walsh’s prosecutions produced extraordinary documentation and
testimony on schemes of U.S. bribery, blackmail and coercion of third countries
assisting in the Contra resupply operations-behavior described by Theodore
Draper as “an anthology of practices so shady that they could not be revealed
without shame.” 5 One of most egregious quid pro quo arrangements was with
Panama’s military leader, General Manuel Noriega, whose drug-smuggling
activities were long known to U.S. officials. On August 23, 1986, two months
after the New York Times ran a front-page story, “Panama Strong Man Said to
Trade in Drugs, Arms and Illicit Money,” Oliver North received a call from
Noriega who asked him to meet with an interme- diary to discuss a deal.
According to a recently declas- sified computer memorandum from North to
Poindex- ter, his boss at the NSC-obtained by the National Security Archive
through a Freedom of Information Act (FOIA) lawsuit-Noriega proposed that “in
exchange for a promise from us to ‘help clean up his image’ and a commitment to
lift our ban on [military] sales to the Panamanian Defense Forces [Noriega
would] undertake to ‘take care of’ the Sandinista lead- ership for us.” “I told
the messenger that such actions [assassina- tions] were forbidden by our law,”
North reported to Poindexter, and the emissary then offered Noriega’s “numerous
assets in place in Nicaragua” for major acts of sabotage. “The proposal seems
sound to me,” North advised, “and I believe we could make the appropriate
arrangements with reasonable OPSEC [operational security] and deniability.” 6
With authorization from Poindexter and Secretary of State George Shultz, North
met with Noriega in London on September 22, 1986 to discuss these oper- ations.
North’s personal notebooks-obtained from the OIC by the National Security
Archive through another FOIA lawsuit-show that the two men talked about
targeting Nicaragua’s airport, telephone system and port facilities for
destruction. These acts of eco- nomic terrorism, North informed his colleagues,
“will cost us about a million.'” 7 After returning from London, North reported
that Noriega would “try to take immediate actions against the Sandinistas.” But
neither the actions nor the pay- ments ever took place. Within eight weeks, the
Iran- Contra scandal broke and Noriega’s key patrons fell VOL XXVII, No 3
Nov/DEc 1993 31REPORT ON CORRUPTION from positions of power. Without his
protectors, Nor- iega was transformed overnight from an anti-Commu- nist
collaborator into a drug-trafficking enemy of U.S. interests, subsequently
becoming the target of George Bush’s cynical military invasion, “Operation Just
Cause.” The Reagan Administration showed even less hesi- tation striking deals
with international terrorists. As a presidential candidate in 1980, Ronald
Reagan got a lot of mileage out of talking tough against terrorism, particularly
the Iranian-backed variety. But once the string of kidnappings of Americans
began in Beirut in March, 1984, the substance behind the rhetoric evapo- rated.
“Operation Staunch,” launched in 1983 to keep other countries from arming Iran
in its war with Iraq, lost its moral impetus. The Secretary of State’s desig-
nation of Iran as a sponsor of international terrorism in January, 1984 was
rendered meaningless. And the President’s actions flew in the face of his own
macho declarations-typified by his June 1985 statement that “the United States
gives terrorists no rewards. We make no concessions. We make no deals.” 8 U.S.
policy suffered in a variety of ways when it became known that the Reagan
Administration had agreed to sell arms to Iran in return for the release of
hostages. Foreign governments on the receiving end of U.S. entreaties not to
sell arms to Iran had ample reason to be incensed. Washington’s Arab allies in
the Persian Gulf demanded reassurances of support against the Ayatollah,
prompting the United States to take on a potentially dangerous responsibility in
the bloody Iran-Iraq War-the reflagging and escorting of Kuwaiti tankers in the
Gulf. Worst of all, U.S. military assistance to Iran and its neighbors in the
region, including Iraq and Afghanistan, may have given Sad- dam Hussein the
perception that he had a green light to invade Kuwait, thus precipitating the
Gulf War. That same assistance may have also trained Muslim fundamentalist
forces whose members were later tied to this year’s World Trade Center bombing.
As much as the goals of U.S. foreign policy were compromised by Iran-Contra, the
threat to the U.S. Constitution was even greater. Toward the end of their
report, the House and Senate investigating committees took umbrage at the Reagan
Administration’s efforts to raise from other nations the funds which Congress
had explicitly denied. “This clandestine financing operation undermined the
powers of Congress as a coequal branch and subvert- ed the Constitution,” the
authors argued. “To permit the President and his aides to carry out covert
actions by using funds obtained from outside Congress undermines the Framer’s
belief that ‘the purse and the sword must never be in the same hands.”‘ U.S.
national-security operatives’ use of funds from coun- tries such as Saudi Arabia
and Iran to finance and field an army, and fight a war without Congressional
appropriations or public knowledge, represented the most serious danger of all.
As Congress concluded, “That is the path to dictatorship.” 9 Having recognized
the gravity of the threat, howev- er, Congress failed to act on it. In their
final report, the Iran-Contra committees concluded that the scan- dal “resulted
from the failure of individuals to observe the law, not from deficiencies in
existing law or in our system of governance.”‘1 The report recom- mended only
minor adjustments to the official system of conducting and reporting covert
operations. Only a few of these recommendations were actually incorpo- rated
into the 1988 Intelligence Oversight Act. Predictably, bald presidential abuses
of power con- tinued in the aftermath of the scandal. In November, 1987, leaders
of the Iran-Contra committees, Senators Daniel Inouye and Warren Rudman,
gullibly declared that “the White House pledged to cooperate with this
investigation and it did.”” Meanwhile, Reagan Administration officials were
conducting a major cover-up of events which may have changed the course of U.S.
history. This withholding of critical evidence, Walsh would later charge,
“radically altered the official investigations and possibly fore- stalled timely
impeachment proceedings against Pres- ident Reagan and other officials.”’12 oth
the Reagan and Bush White Houses used the power of the executive office to
undermine the judicial branch of government and block prosecutions of key U.S.
officials. In the case of the CIA’s station chief in Costa Rica, Joseph
Fernandez, for example, internal CIA memoranda show that his own agency
considered him guilty of lying to the Rea- gan-appointed Tower Commission about
the illegal Contra resupply operations. “If Fernandez knowingly and willfully
made false statements to the Tower Commission, as we believe he did, he was in
violation of the U.S. code,” states an April 1987 CIA inspector general’s
report. 1 3 Yet the CIA, with Bush’s support, aborted Fernandez’ trial on
perjury charges by refus- ing to declassify what Walsh called “fictional
secrets,” including the well-known existence of CIA stations in Honduras,
Guatemala and El Salvador. Similarly, the CIA refused to declassify documents on
Middle East operations necessary for Walsh’s prosecution of wrongdoing
surrounding the sale of arms to Iran and the transfer of profits to the Contra
war. In the end, nobody could be prosecuted for misconduct relating to the core
issue of the scandal-the diversion itself. This rampant obstruction of justice
culminated in the presidential pardons of December 24, 1992. Bush’s eleventh-
hour move prevented the January 5, 1993 trial of Caspar Weinberger which would
have exposed the cover-up and those, including Bush, who participated in it.
“President Bush cannot escape the appearance that he wished to avoid the public
airing of facts about Iran-Contra that would have occurred at trial,” Walsh
charged in a report to Congress last February. With his pardon, Walsh stated,
Bush had “frustrate[d] the exposure and orderly prosecution of executive branch
wrongdoing,” and “manifest[ed] an absolute disdain for the rule of law.”’14 The
Independent Counsel’s exhaustive efforts to apply the law against government
corruption commit- ted in the name of national security have largely failed to
establish a legal deterrent to such crimes in the future. Morever, since the
scandal, Congress has taken no substantive steps to protect itself from further
assaults on its constitutional turf. To be sure, the Rea- gan/Bush era is now
over. But from Vietnam to Iraq- gate, these repeated foreign-policy debacles
demon- strate that regardless of who occupies the Oval Office, the national-
security system has the capacity to regen- erate the legal, political and moral
abuses of the past. If and when it is released, Judge Walsh’s authorita- tive
catalog of the Iran-Contra affair will render the verdict of history. As the
most in-depth expos of the national-security state ever drafted, the report
presents a window of opportunity to significantly reform the Cold War
institutions that have been responsible for scandal after scandal over the last
half century. Effec- tive legal and political constraints, and strict govern-
ment accountability will only become a reality, how- ever, if there is a
resurgence of public indignation toward official abuses, and a demonstration of
Con- gressional courage to change the system. Unfortunate- ly, in the seven
years since the Iran-Contra scandal broke, such indignation and courage have
been notably absent from the body politic.
Iran-Contra: A Post-Mortem
1. Quoted from “Foreword,”
Peter Kornbluh and Malcolm Byrne, The Iran-Contra Scandal: The Declassified
History (New York: The New Press, 1993), p. xi. 2. See Report of the
Congressional Committees Investigating the Iran-Contra Affair with Supplemental,
Minority, and Additional Views, November 1987, 100th Cong. 1st sess., 1987. The
majority report is 492 pages long. The “supplemental, minority and additional
views” stretch the report to 690 pages. 3. Walsh’s response to the Bush pardon
is reprinted in Kornbluh and Byrne, The Iran-Contra Scandal, p. 377. 4. See the
U.S. Senate, Subcommittee on Narcotics, Terrorism and International Operations,
“Drugs, Law Enforcement and Foreign Policy,” April 13, 1989, section on the
Contras. 5. Theodore Draper, “Revelation of the North Trial”, New York Review of
Books (August 17, 1989), p. 59 6. This computer memo from North to Poindexter
was declassified pursuant to a National Security Archive lawsuit on electronic
memoranda generated during the Iran-Contra operations. It is captioned
“Nicaragua,” and dated August 23, 1986 at 3:52 p.m. 7. North’s notes on his
meeting with Noriega are published in Kornbluh and Byrne, The Iran-Contra
Scandal, p. 119. 8. New York Times, July 1, 1985. 9. See Report of the
Congressional Committees Investigating the Iran-Contra Affair, p. 39. 10. Report
of the Congressional Committees Investigating the Iran- Contra Affair, p. 433.
11. Report of the Congressional Committees Investigating the Iran- Contra
Affair, p. 637 12. Kornbluh and Byrne, The Iran-Contra Scandal, p. 378. 13. This
CIA inspector general’s report is dated April 24, 1987. It was declassified
pursuant to a FOIA lawsuit filed by the American Civil Liberty Union’s Center
for National Security Studies. 14. See Walsh, “Fourth Interim Report to
Congress,” February 8, 1993, p. 76.