Reagan’s Underworld

1.

The most telling parts of the Tower Commission’s report are not to be found in the report itself—which leaves many questions open—but in the appendixes. These quote abundantly from interviews held by the special review board, from documents written by the White House staff, and from the messages Colonel Oliver North and Admiral Poindexter sent each other on the “PROF System”—“an interoffice mail system run through an IBM main frame computer and managed by the White House Communications Agency for the NSC.”

The reader might expect to find recreated the heavy atmosphere of “the presidency”—in which officials carefully weigh the risks of different policies as they face crises involving life and death. But he will search in vain for any coherent, extended argument for one policy or another. Instead he finds himself in an unusually implausible James Bond movie, or in a Middle Eastern souk where buyers and sellers haggle about prices, or in the middle of a low-level mafia scam. Indeed, many of the episodes have the flavor of a popular comic strip that ran in France before the Second World War and described the antics of a small gang of rogues, Les Pieds Nickelés. The main difference, aside from the stakes, is that the White House rogues are altogether lacking in charm.

The Tower Commission concludes that “the arms transfers to Iran and the activities of the NSC staff in support of the contras are case studies in the perils of policy pursued outside the constraints of orderly process.” Much of what it reports, under two severe headings, “A Flawed Process” and “Failure of Responsibility,” is convincing and important. Before the Tower Commission’s work was done, Theodore Draper had already reached similar conclusions, in his article “Reagan’s Junta.”¹ But the emphasis on “process” has the effect of diverting attention from the actual policies followed, whose nature and persistence explain many of the peculiarities of what can barely be called a process. This is the subject of the present article. The “failure of responsibility” is, as the report makes clear, largely the President’s. But it goes well beyond the defects of his “management style,” and is best understood when one considers both the beliefs and character and the patterns of behavior that Reagan developed long before he became president. This will be the subject of a second article.

The shift in America’s policy toward Iran came in two stages. First, in 1985, the Reagan administration authorized Israel to sell weapons to Iran, in the hope that the sale might lead to the release of American hostages as well as prepare for a strategic rapprochement with Iran. In 1986, the US decided to sell weapons to Iran directly. Six transactions—three Israeli and three American ones—are described by the report’s charts (B, 174–185),² and from the accompanying documents a pattern emerges.

First, the US government relied to an extraordinary degree on two different, but dubious, “intermediaries.” The first and most durable was the Iranian Manucher Ghorbanifar, described by one former CIA official as having been an agent of SAVAK, the Shah’s dreaded secret police. He appears throughout the documents as allied with, used by (or using), the Israeli Amiram Nir, adviser on counterterrorism to then Prime Minister Shimon Peres. Ghorbanifar was distrusted by the American agents who knew him, and, on January 11, 1986, he badly failed a polygraph test given to him in Washington by the CIA. (Many of the questions asked him whether he had been deceiving or lying to “us” before.) Nevertheless, he was kept on, and he made arguments for, and accompanied former National Security Adviser Robert McFarlane on, the disastrous trip to Tehran in May 1986.

In the summer of 1986, on the initiative of Richard Secord, a retired general in the secret arms business, the US switched to another go-between, archly described in the report as the “Relative” of a high Iranian official. A footnote identifies him as a man named Tabatabai, who is related to Ayatollah Khomeini. The record shows that the “Relative” was quite skillful in leading North to make plans and proposals that were entirely in Iran’s interest.

Secondly, the NSC relied even more extensively on “private” American citizens who were actually former intelligence officials recruited either to complement public activities or to substitute for them, clearly in coordination with the CIA. Secord and the CIA were both engaged in the third Israeli transaction of 1985 (it turned out to be a fiasco). Secord and the CIA again worked together to resupply the contras in early 1986 (III-23), and North set up, with McFarlane’s approval, a number of nonprofit foundations, (C-5), as well as what he called Project Democracy, a network of secret bank accounts, private communications, “six aircraft, warehouses, supplies, maintenance facilities, ships, boats, leased houses, vehicles, ordnance, munitions…a secret airfield in Costa Rica” (III-23), which worked closely with the CIA (B, 126–127). Some of the people with whom the US dealt as intermediaries were suspected by North and Casey of having made a secret business deal among themselves (B-70)—Ghorbanifar, two Israeli arms salesmen, Yaacov Nimrodi and Adolph Schwimmer, and Michael Ledeen, an NSC “consultant.”

Thirdly, many of the activities described in the report were illegal, or undertaken without authority. The initial authorization for the Israeli shipments did not meet the conditions set by the Arms Export Control Act. A presidential finding of January 17, 1986, “formally approved the Iran initiative as a covert intelligence operation under the National Security Act” (IV-9); this gave legal authority in the US arms transfers, but the notification of Congress “in a timely fashion,” required by the law, never occurred. As for resupplying the contras in 1985 and 1986, this was of course a violation of the Boland Amendment passed by Congress in October 1984. That law specifically forbade direct or indirect military aid to the contras and denied funds for this purpose to the CIA, the Department of Defense, “or any other agency or entity of the US involved in intelligence activities.” The President’s Intelligence Oversight Board ruled that this provision did not apply to the NSC—even though the NSC was clearly “involved” in such activities (C, 1–2).

The commission was hampered by the lack of records on key points. Some may have been destroyed by North, but it is hard to believe that there would have been no other copies available if records of meetings with the President had been kept. The commission found repeatedly that such meetings left no other traces than the frequently divergent recollections of the participants—the President proved to be particularly vague, or contradictory, or forgetful. At the two meetings held with Shultz, Weinberger, and Casey, on December 7, 1985, and January 7, 1986, no minutes appear to have been taken, and no decision to have been made (III, 10–11). Meese told the Tower Commission that at the meeting of January 7, he did not want anything on paper because the subject was too sensitive (B-61). The crucial authorization of Iran arms sales of January 17, 1986, was adopted without the participation of Casey, Weinberger, or Shultz.

The lack of serious preparation at a high level explains in part the comedy of errors of the Tehran meeting—when McFarlane discovered that the deal he thought had been agreed on was not at all what the Iranians had in mind—and the extravagant promises of yet more arms by North to the “relative” in two meetings at Frankfurt in October 1986. The report blames Shultz and Weinberger for having merely “distanced” themselves from a policy they opposed, Casey for having failed to warn the President about the risks, and Donald Regan for not insisting on “an orderly process” (IV-11).

The evidence of the administration’s ineptitude is so flagrant it is sometimes hard to believe. Was the President telling the truth when he “told the Board that he had not been advised at any time during this period [1985] how the plan would be implemented” (III-13)? The same question can be asked about his claim that he was not “advised of the downside risks if the NSC staff ran the operation.” It is not surprising that, according to North, those “primitive, unsophisticated” Iranians with whom he dealt “have not the slightest idea of what is going on in our government or how our system works”: Who could? (B-35). Weapons kept being delivered even though no hostages were released (III-14). Two hostages were released later—one after the failure at Tehran, clearly so that a connection so useful to Iran would not be broken, and one after the Frankfurt meetings. But many more were taken, or kept. “Repeatedly, Lt. Col. North permitted arms to be delivered without the release of a single captive” (IV-7). Indeed, his eagerness to supply the Iranians now in the hope of future compensation reminds one of the Vichy regime’s policy of meeting or even anticipating German demands, in the hope of eventual concessions to French sovereignty.

There is also evidence of much deception within the administration. Shultz seems to have been lied to several times by Poindexter and by Casey (III-15). McFarlane, according to the report, was misled by North and Casey into expecting too much from the Tehran meeting (III-16), and by Poindexter, who told him that State and Defense approved the trip (B-100). Poindexter instructed North to keep Shultz ignorant of the financing of the contras, and Casey ignorant of some of North’s activities (C-10). After the first revelations of the scandal, the NSC staff concocted several chronologies that were highly misleading in their attempt to protect the President by showing him even less involved than he was. Although the commission sometimes equivocates about the President’s responsibility, in fact, the record, for all its uncertainties, shows that Reagan was frequently briefed and gave his assent to what was being planned with respect to Iran. After the Tehran meeting McFarlane reported to him—“The President didn’t comment really, but that was not untypical,” McFarlane said (B-127). Before the Frankfurt meeting, Reagan “considered the new Iranian interlocutor” at his morning briefing on September 9, 1986 (B-152).

Congress was obviously kept out of everything—it was kept in the dark about Iran, and it “may have been actively misled” about the contras (III-21). McFarlane’s denials of any wrongdoing on the part of the NSC, addressed to two members of the House in August and September 1985 (C-6), are proof of a deliberate deception of Congress. Certainly, the Congress was not told that the ambassador to Costa Rica defined his mission there as the opening of a second front for the contras (C-12)—the airstrip being “essentially [his] initiative.” Elliot Abrams, the assistant secretary of state for Latin America, clearly knew about this, even though both he and Casey denied knowing about North’s private network (C-14).

2.

It is too easy to say that such incompetence and illegality result from the President’s “style” of leadership and from the mediocrity of many of his officials—a combination that had already occurred during his first term as governor of California. One has to go deeper.

In the first place, the Iranian affair itself results from another combination: that of the President’s concern about the hostages and of his, and his administration’s, obsession with the “Soviet peril.” The Israeli requests to sell arms to Iran in July and August 1985 came shortly after the President’s humiliating demonstration of impotence at the time of the hijacking of TWA flight 847 in June 1985. Whatever his own retrospective denials (part of a lifelong pattern), Reagan persuaded his aides that his main interest, in the opening to Iran, was the release of the hostages (III-11, B-119, D-5). The Iranians seem to have understood this perfectly well, for their own purposes (B-119). Having so often asserted the need not to yield to terrorists and to states that sponsor terrorism, Reagan had to find, or to be given, a cover that would convince him that there was a higher cause.

Two arguments were provided, from the depths of the bureaucracy. The main one concerned the need to help Iran wake up to, and guard itself against, the Soviet danger—a point made in a Special National Intelligence Estimate of May 20, 1985, prepared by members of the CIA and of the NSC. They suggested encouraging friendly countries to sell arms to Iran (both Shultz and Weinberger, but not Casey, scathingly condemned this document).

The second idea, pushed by Ghorbanifar and Amiram Nir, was that there were elements within the Iranian government interested in better relations with the US, elements whose power would be increased by American arms shipments. Both ideas were incorporated in the Poindexter memo that served as the basis for the presidential finding of January 17, 1986 (B-58ff). This helped the President distinguish “between selling to someone believed to be able to exert influence with respect to the hostages and dealing directly with kidnappers…. Only the latter would ‘make it pay’ to take hostages” (III-13).

Multiple self-deceptions were built into this “policy.” Officials like McFarlane, who argued that there were strategic, anti-Soviet reasons to sell arms, appear to have closed their eyes to the obvious realities—that the Iranians, who are fully aware of the Soviet presence all around them, but also of the lack of any imminent danger, do not need to be paid in arms in order to be vigilant, and that the weapons were going, not to a faction, but to the Iranian government and army, for use in the war against Iraq, not on the borders with the Soviet Union. North, in one memo, actually presented the sale of TOW antitank missiles as a deterrent against Moscow (B-88).

Nor did McFarlane want to acknowledge the truth: that the negotiations were in effect a bargain about arms-for-hostages, the more strategic or geopolitical aspects being described as premature by the Iranians (whose task was facilitated by the gung-ho activism of North). The obsession with the Soviet Union was, of course, a constant concern both of earlier National Security Councils, and of the Reagan administration. In the case of Iran, it led to the same trap into which General Haig’s quest for a “strategic consensus” against Moscow in the Middle East had fallen when the Israelis had exploited the American obsession in order to gain a free hand for the invasion of Lebanon, and the Arabs had made it clear that they were more worried by Israel than by Moscow.

As for the President’s self-deceptions, in addition to the one about the rationale of the entire affair, there was another—about the degree of control exerted by America’s Iranian interlocutors over the terrorist groups holding the American hostages. Finally the notion that we were dealing with “moderates” was of course a farce. As Nir told Vice-President Bush in Israel on July 29, 1986 (in a briefing that may well have been far more detailed than any the Vice-President had ever received about the whole sequence of events from within the US government), “we are dealing with the most radical elements…. We’ve learned they can deliver and the moderates can’t” (B-146). McFarlane’s opinion notwithstanding, “incompetence” and “paranoia” were not Iranian monopolies (B-101).

In the second place, the Iranian affair demonstrated something that worried Bush—“the extent to which the interests of the United States ‘were in the grip of the Israelis”‘ (B-144). The report devotes only four paragraphs (IV-12) to the role of the Israelis—and the fourth rightly says that the US government “is responsible for its own decisions.” But the entire report gives a very disturbing picture of the symbiosis between the two governments, and of the opportunities for manipulation this provides not to the stronger (but clumsy) senior partner, but to the weaker (and more tightly run) junior one.

The Israeli government bought American good will by offering to send advisers to train the contras (C-9), and to deliver to the contras arms captured from the “Soviet bloc” (B-156), and perhaps even by suggesting the diversion of funds from Iran to the contras (III-20). Israel’s interests, especially in the Iran-Iraq war (or rather, the Israeli government’s evaluation of Israel’s interests) were not the same as America’s. Indeed the Israeli government’s policies toward Iran and Iraq have not seemed particularly well judged. But through private intermediaries such as Ledeen or Israeli arms dealers, and through public officials such as Nir, the Peres government was able to get the US exactly where it wanted and was even able to monitor American activities: Nir went to Tehran with McFarlane, pretending he was an American member of the delegation. After Ghorbanifar was dropped as a “zestful liar” (B-53) and Nir himself became suspect in Washington, Nir still got Poindexter and North to promise that Israel would remain involved (B-154).

The report points out that the Israeli proposals of July-August 1985 were never evaluated by American intelligence. Indeed, Poindexter’s memo for the finding of January 17, 1987, presents the policy as an Israeli plan “to bring about a more moderate govt. in Iran” (B-58); pressure for further arms deliveries, after the Tehran fiasco, came not only from Ghorbanifar but from Nir (B-150). George Ball, a few years ago,³ had warned about the dangers of excessive military intimacy between the US and Israel. The damage that leaks about the sale of American arms to Iran could do among America’s Arab friends was obviously of little concern to the Israelis, as Shultz had once pointed out (B-43).

This Israeli hold on US policy is a direct result of American policy: not, primarily, of America’s legitimate concern for Israel’s survival and security, but of America’s excessive reliance on Israel as an anti-Soviet bastion and ally for the defense of the Middle East against an unlikely Soviet invasion or against Soviet subversion (which Israel’s policy toward the Palestinians and Syria actually facilitates). It also results from America’s failure to act energetically, after the Egyptian-Israeli peace treaty of 1979, in order to resolve the Palestinian issue—either because of the priority given to the administration’s anti-Soviet “strategic consensus,” in 1981, or because of a complacent acceptance of the status quo, following the fiasco of the Reagan Middle East plan of September 1982 and the American debacle in Lebanon. A strong domestic lobby supporting the Israeli government makes a change in policy all the more difficult.

In the third place, it was obviously the Reagan administration’s policy to support the contras with “lethal shipments” whatever Congress may have tried to do to stop them. The operations undertaken by North were known by Poindexter and McFarlane (who makes a casuistic distinction between offering North information and advice, and helping him in obtaining weapons [C-9]). Casey must have been involved, since the CIA provided bank accounts in Switzerland for the funds diverted from the arms sales to Iran, and CIA agents in Central America provided “information” to the contras (C-8); and North thought of turning the assets of Project Democracy over to the CIA (C-10). It was to McFarlane that North wrote for help after the “private” plane carrying Eugene Hasenfus was shot down, and Hasenfus captured, in Nicaragua (B-166). North’s appeal mentions that “RR” was briefed about “this plan” before leaving for Reykjavik. He had earlier speculated that Reagan “knows why he has been meeting with several select people to thank them for their ‘support for Democracy’ in CentAm” (C-14). North, Abrams, and Ambassador Tambs all went into action when the government of Costa Rica threatened to close down the airstrip (C-13).

Behind the cause of “democracy,” American policy in Nicaragua, as earlier in Vietnam, has oscillated among a variety of different objectives—ranging from the overthrow of the Sandinistas to mere “pressure” to oblige them to negotiate with their neighbors—while resorting to crude military and subversive actions that are most unlikely to meet any of the alleged goals. It may well be that the coming congressional investigations will uncover a far deeper direct involvement of the President in the illegal activities of 1985–1986; but no such involvement was really necessary: here, there was a unity of purpose within the administration.

3.

Finally, and most disturbingly, the report brings to light, but fails to draw sufficient attention to, three different, connected, and lasting features of American foreign policy—features that have been particularly prominent in the Reagan administration, but that certainly appeared long before it. The first is a characteristic of the process of decision. The report states that “in the case of the Iran initiative, the NSC process did not fail, it simply was largely ignored” (IV-10). But if the national security adviser failed to “raise this issue,” it was because in this case the President did not want the adviser to conform to the NSC “model” that the report recommends as the best for the future—a model to which after 1961 (when the adviser became visible and important) only Brent Scowcroft ever conformed: that of a competent, expert coordinator, impartial, trusted by the “NSC principals” (such as the secretaries of state and defense), non-manipulative, and close to the President. The “model” proposed by the commission retrospectively condemns both Kissinger and Brzezinski. In the Iranian affair, Reagan turned to McFarlane and Poindexter because he could not count on Shultz.

The “model” proposed by the report is admirable, but it works best, paradoxically, when the secretary of state is powerful and close to the President—as Kissinger was during the brief Scowcroft period. The coexistence of two personalities in charge of foreign affairs is likely to lead either to some form of chaos (as in the Haig period) or to the decline of one or the other, and it provides the President with the permanent temptation to play with his adviser at the expense of the secretary of state. It is not surprising that members of the NSC staff, dealing with Iran, had in mind Kissinger’s secret trip to China (B-109).

The report also blames the “NSC principals” and the White House chief of staff for having raised no questions, and failing to reexamine the policy once it “did not meet expectations”; it condemns Poindexter and Casey for having failed to investigate the diversion of funds to the contras, and to inform the President. But in recent years, the difference between a cabinet government such as England’s and the American presidential one has meant increasingly that not only officials such as the head of the NSC staff but cabinet members consider themselves beholden to the President, and put loyalty to him above every other consideration. Cyrus Vance’s resignation on a point of principle was an exception.

As long as Shultz and Weinberger enjoyed the President’s confidence, they were not going to quit over an issue about which Reagan obviously felt strongly: they were merely going to “distance” themselves. (In exchange for their loyalty to him, they demanded and got a public statement of his loyalty to them, designed to cleanse them of the suspicion that the report had cast upon them.) In the matter of the contras, Poindexter and Casey may have thought that the diversion of funds, and the preservation of another kind of distance—between Reagan and the operation—was the best way of serving him, the law notwithstanding. There is something seriously wrong in this conception of loyalty; but it is not new, and even antedates Watergate.

A second feature could be called the imperial impulse, or nostalgia. What Arthur Schlesinger named the imperial presidency grew along with the expansion of American power around the world. The Reagan administration gave itself the mandate of stopping what it saw as the decline of American power, and of reversing it wherever possible. But the fact is that no previous administration has been willing to “liquidate” American power; at times, events forced a retreat, particularly in world economic affairs, or when a revolution such as the one in Iran left the US with no card to play, or when an absurdly conceived gamble was lost, as in Vietnam. Whatever Kissinger may have said about the limits on American power, he was not a champion of letting go. Whatever the Vance wing of the Carter administration may have desired, neither Brzezinski nor Carter was a herald of retreat. The US, after all, supported Somoza far too long, and tried hard to find an alternative to the Sandinistas.

In Central America, it has been particularly difficult for American bureaucrats, for the foreign policy establishment, and even for the public (remember the polls over the Panama Canal negotiations) to accept the equivalent of decolonization. The Reagan administration, within the limits set not by law but by the public’s hostility to the protracted engagement of American armed forces, has tried to preserve and to tighten America’s grip on the external and domestic policies of Central American countries. The Grenada expedition was popular. Congress has supported US policy in El Salvador, and has not much objected to the transformation of Honduras and (to a lesser extent) Costa Rica into American bases. One could say that domestic developments in the small and poor nations of that part of the world (as distinct from the establishment of Soviet bases) should not be seen as direly threatening the US. But this idea has not found overwhelming favor and the administration has used every sort of exaggeration and deception to discourage it.

Iran was never an American colony or protectorate, but it had been seen as the prize “influential” ally in the Persian Gulf during the long reign of the Shah—who kept his throne thanks to US covert operations. There are, in the annexes of the Tower report, many traces of nostalgia for the days of military and intelligence cooperation between Washington and Tehran. Before the Israeli initiatives of July–August 1985, CIA officials, NSC staff members, and Casey himself responded to a kind of atavistic impulse to try to restore the cozy, old, overt and covert relationship—based on the Soviet peril—in the belief that the Khomeini regime would be merely a parenthesis (B-6, 8, 10).

Donald Regan, getting “a little bit personal,” told the board that as head of Merrill Lynch he had opened an office in Tehran, and had “close connections” there in the days of the Shah. “I believed in that country and I thought that that country had quite a future”; therefore, we had to make an “effort to sometime be a player in that country’s future” (B-64).

It may well be that the difference between wisely doing nothing that would foreclose a resumption of friendly relations with a nonterrorist Iranian government in the future, and foolishly feeding the present government’s war machine, was provided not only by the plight of the hostages (after all, official policy was that arms deals were an incentive to hostage taking) but by the unwillingness to treat the end of Iranian dependency as final—a feeling once again “stroked” by the Israelis, according to the Poindexter memorandum of January 6, 1986 (B-58).

The third feature is a dangerous and proliferating result of the other two. It is the lure and the lore of covert operations and secret agents. Reading the appendices to the report, one gets the impression of peeping into the activities of a network of aging little boys, with often dirty little secrets, a longing for the big league, and genuine delight in action for action’s sake. We are still in the universe of Graham Greene’s The Quiet American (except that some of Reagan’s men weren’t quiet enough, as various warnings to North by Poindexter and McFarlane indicate). Covert action has held its fascination with presidents as different as Kennedy and Eisenhower: Like the latter, Reagan has tried to combine overt prudence and covert daring.

The great attractiveness of covert operations for presidents is, of course, freedom—from the public, the press, Congress, and most of the bureaucracy. They have been seen as the indispensable instrument for preserving every empire and hegemony—a cheap way of influencing internal trends and forces, of playing favorites, of punishing foes, of gaining occult control. Casey’s enthusiasm went back to his days in the OSS. North comes out as the perfect example of the secret agent who both runs amok and gets the congratulations of his bosses for his way of keeping “a semblance of integrity and gumption to US policy” (B-78), even though that policy, both in Nicaragua and in Iran, only serves to prolong and to multiply killings. (One never senses in the report any concern for lives other than those of the American hostages.) But the network extends beyond government employees to former CIA officials and hired foreign agents, all engaged in the kinds of operations North set up. When he asked McFarlane, in March 1986, whether he ought to return to the Marine Corps, the former national security adviser suggested that North be assigned to McFarlane’s office at the Center for Strategic and International Studies in Washington as a fellow, and “continue to work on the Iran account as well as to build other clandestine capabilities” (B-82).

Theodore Draper concluded his article by stating that “without the support of our democratic structure backed up by popular approval, a president will end up the leader neither of a superpower nor of a democracy.”⁴ The question that needs to be addressed is that of the compatibility of American democracy with an underworld of spooks that no agency, and certainly not Congress, has been able to control. If one weighs the successes achieved by the members of this underworld against their disasters and fiascoes abroad, and the bad habits of illegality, deception, and dishonesty they foster at home, one can only deplore the growth of such practices and services, and the misuse of the funds at their disposal. The subtle or not too subtle ways they choose to fight the Soviet KGB or other Soviet instruments of subversion have led us to resemble our adversary, or to indulge in the abuses of past autocracies that our system is supposed to check or prevent. To argue, as some have, that we have a choice between being a democracy and being a great power, is false. In foreign affairs, democracy is, at times, a handicap, and, more often, a great force. Whether the foreign policy of the United States will in the future be guided by, and carried out according to, democratic principles is the underlying question posed by the Tower report and the Iran-contra affair itself.