Iran–Contra affair

• 1. Introduction

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  In November 1986, a small Lebanese magazine called Ash-Shiraa published a story that detonated across the world. The United States, which had been publicly campaigning to stop all arms sales to Iran, had been secretly selling weapons to that very country. Worse still, the proceeds were being funneled to rebel fighters in Nicaragua in direct violation of a law Congress had passed and President Ronald Reagan himself had signed.

  The Iran-Contra affair was a political scandal that pulled three threads at once: a secret arms pipeline to a nation designated a state sponsor of terrorism, a covert funding scheme for a guerrilla war Congress had explicitly banned, and a cover-up that reached into the cabinet and possibly to the president himself. How did a White House persuade itself that all of this was legal? Who actually ran the operation? And what happened to the people who were caught?

  Those are the questions this documentary will follow, from the moment Reagan took office in January 1981 to the Christmas Eve pardons of 1992 that Lawrence Walsh, the independent counsel, said completed the cover-up.

• 2. Two Forbidden Wars

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  Ronald Reagan inherited two foreign-policy problems the moment he was sworn in on the 20th of January 1981. Iran had seized 66 American hostages in November 1979, and a U.S. arms embargo had been in place ever since. Nicaragua was governed by the left-wing Sandinista party, and Reagan made overturning that government a central goal from his first days in office.

  The arms embargo on Iran carried an embarrassing structural flaw. A secret study conducted on the 21st of July 1981 by senior Reagan officials concluded that Iran could simply buy American-made spare parts from other countries, while the embargo left an opening for the Soviet Union to step in as Iran's arms supplier. The study's conclusion was that the U.S. should start selling arms to Iran as soon as it was politically possible.

  Nicaragua posed a different constitutional collision. Congress passed a series of laws known as the Boland Amendments between 1982 and 1984 to restrict U.S. support for the Contra rebels waging guerrilla war against the Sandinistas. The second Boland Amendment, which took effect on the 3rd of October 1984, went further than the earlier versions, barring any U.S. intelligence agency or entity from spending money to support military or paramilitary operations in Nicaragua.

  Reagan responded to that prohibition with a direct order: the National Security Council was to keep the Contras together, in his words, "body and soul, no matter what Congress voted for." The question of whether the NSC fell within the Boland Amendment's reach became the central legal dispute of the scandal. Most constitutional scholars said it did. The Reagan administration said it did not.

• 3. The Arms-for-Hostages Machine

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  Manucher Ghorbanifar, an expatriate Iranian arms dealer, first put the exchange on the table: sell weapons to Iran, and Iran would lean on Hezbollah to free seven Americans held in Lebanon. In early July 1985, historian Michael Ledeen, serving as a consultant to National Security Adviser Robert McFarlane, approached Israeli Prime Minister Shimon Peres about brokering the deal.

  Israel had its own reasons to keep the Iran-Iraq War running; it preferred the two countries preoccupied with each other. The arrangement that took shape had Israel ship U.S. weapons to Iran through Ghorbanifar, with the U.S. reimbursing Israel afterward. On the 20th of August 1985, the first official shipment moved: 96 TOW antitank missiles. A second delivery of 408 TOW missiles followed on the 14th of September 1985, and one day later Reverend Benjamin Weir was released.

  Defense Secretary Caspar Weinberger opposed the entire enterprise from the start. On his copy of McFarlane's draft directive proposing the Iran opening, Weinberger scrawled that it was "almost too absurd to comment on" and compared it to inviting Libyan leader Muammar Gaddafi to Washington for "a cozy chat." Secretary of State George Shultz asked how the U.S. could possibly sell arms to a country it had designated a state sponsor of terrorism just months earlier, in January 1984. Only CIA Director William J. Casey backed the plan.

  Reagan was briefed on the proposal on the 18th of July 1985 and again on the 6th of August 1985. At that second meeting, Shultz warned him that the U.S. was "just falling into the arms-for-hostages business." Reagan approved it anyway. The Americans convinced themselves they were nurturing a moderate Iranian faction headed by Akbar Hashemi Rafsanjani, the speaker of the Majlis, whom they believed could succeed Khomeini and restore ties with Washington. British journalist Patrick Brogan described Rafsanjani, nicknamed "the Shark," as a man of great charm and formidable intelligence whose motives in the affair remain completely mysterious.

• 4. Oliver North and the Enterprise

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  On the 4th of December 1985, Robert McFarlane resigned as National Security Adviser and was replaced by Admiral John Poindexter. That same day, Oliver North, a military aide to the NSC, put forward a plan with two significant additions: the arms would be sold directly to Iran at a markup rather than routed through Israel, and a portion of the proceeds would flow to the Contras.

  North proposed a markup of $15 million. Arms broker Ghorbanifar layered on a 41-percent markup of his own. Poindexter authorized the plan without notifying Reagan. The network they built was called "the Enterprise," headed by retired Air Force officer turned arms dealer Richard Secord. It was outwardly a private operation, but in fact was controlled by the NSC.

  The scheme quickly accumulated mishaps. A planned funding contribution from Brunei was derailed when North's secretary, Fawn Hall, transposed the digits of North's Swiss bank account number. A Swiss businessperson found an unexpected $10 million in their account and alerted authorities; the money was eventually returned with interest. In May 1986, McFarlane led a secret U.S. delegation to Tehran in an Israeli plane carrying forged Irish passports. The group arrived with a Bible bearing a handwritten inscription from Ronald Reagan and, according to one participant, a cake baked in the shape of a key. McFarlane was infuriated to find he had been given access only to what he called "third and fourth level officials" and not to any decision-makers. After four days, the mission went home having accomplished nothing.

  In August 1986, the Americans established a new Iranian contact: Ali Hashemi Bahramani, the nephew of Rafsanjani and an officer in the Revolutionary Guard. North arranged for Bahramani to make a secret midnight visit to the White House for a guided tour. During meetings that followed in West Germany, the two men discussed not only arms sales and hostages but also how to overthrow President Saddam Hussein of Iraq and install what North called "a non-hostile regime in Baghdad." At a session in Frankfurt in October 1986, North passed along Reagan's reported assessment of Saddam Hussein in language too direct for a diplomat to repeat.

• 5. Exposure and Cover-Up

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  On the 3rd of November 1986, the Lebanese magazine Ash-Shiraa published the story of the weapons deal. The leak traced to Mehdi Hashemi, a senior official in the Islamic Revolutionary Guard Corps. Some accounts attributed the original tip to Syrian President Hafez al-Assad, who had received it from a Syrian agent in Tehran. A separate account, attributed to an unnamed former U.S. military officer by journalist Seymour Hersh, suggested the exposure was orchestrated by Arthur S. Moreau Jr., the assistant to the chair of the U.S. Joint Chiefs of Staff, out of concern the operation had grown uncontrollable.

  Ten days after the story ran, on the 13th of November 1986, Reagan appeared on national television from the Oval Office. He maintained that the U.S. had not traded arms for hostages. Between 21 and the 25th of November, North destroyed or hid large volumes of NSC documents. During his 1989 trial, Hall testified that she had helped North alter and shred official documents, and that she smuggled classified material out of the Old Executive Office Building by concealing it in her boots and dress. According to reporting by The New York Times, enough documents were fed into a government shredder to jam it.

  North also testified during that trial that he witnessed Poindexter destroy what may have been the only signed copy of a presidential finding that would have authorized CIA participation in the November 1985 Hawk missile shipment. On the 25th of November, Attorney General Edwin Meese publicly admitted that profits from the Iran arms sales had been used to fund the Contras. That same day, Poindexter resigned and Reagan fired North. Poindexter was replaced by Frank Carlucci on the 2nd of December 1986.

  CIA Director William Casey was hospitalized for a stroke. Journalist Bob Woodward reported that Casey had admitted in February 1987 to knowing about the diversion of funds. Casey's wife said he was unable to communicate at that point. On the 6th of May 1987, Casey died, the day after Congress began public hearings. Independent Counsel Lawrence Walsh later noted that the documentary evidence of Casey's direct knowledge was thin; the only witness linking Casey to early knowledge of the diversion was North himself.

• 6. Investigations and Verdicts

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  Reagan himself appeared before the Tower Commission on the 2nd of December 1986. The commission, composed of former Senator John Tower, former Secretary of State Edmund Muskie, and former National Security Adviser Brent Scowcroft, had been announced by Reagan on the 25th of November and formally constituted on the 1st of December. It interviewed 80 witnesses, including Ghorbanifar and Saudi billionaire Adnan Khashoggi, one of the key middlemen in the arms deals.

  The 200-page Tower Report, delivered on the 26th of February 1987, found no evidence that Reagan knew the full extent of the programs, particularly the diversion of funds. It heavily criticized Reagan for failing to supervise his subordinates. The commission was the first presidential body ever to review the National Security Council.

  In January 1987, Congress launched its own investigation. The Democratic-controlled Congress issued its report on the 18th of November 1987, stating that if the president did not know what his advisers were doing, he should have, and holding him ultimately responsible. On the question of Reagan's direct knowledge, the report acknowledged that the destruction of documents by Poindexter, North, and others, combined with Casey's death, left the record incomplete.

  U.S. Deputy Attorney General Lawrence Walsh had been appointed independent counsel in December 1986. His office investigated several dozen people. Eleven convictions resulted, though some were later vacated on appeal. Oliver North was convicted of accepting an illegal gratuity, obstruction of a congressional inquiry, and destruction of documents, but a federal court overturned those convictions on appeal, finding his Fifth Amendment rights may have been compromised by use of his immunized public testimony. John Poindexter was convicted on five counts; that ruling was also overturned, by the same 2-to-1 vote of the same court panel. The only defendant to serve a prison sentence was Thomas G. Clines, a former CIA officer, who earned nearly $883,000 helping to run the Enterprise and was convicted of tax offenses; he served 16 months.

• 7. The Pardons and Their Price

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  On the 24th of December 1992, after losing the presidential election to Bill Clinton, George H. W. Bush pardoned five convicted or indicted officials: Elliott Abrams, Duane Clarridge, Alan Fiers, Clair George, and Robert McFarlane. He also pardoned Caspar Weinberger, who had not yet stood trial on two counts of perjury and one count of obstruction of justice. Attorney General William P. Barr advised on those pardons, particularly the one for Weinberger.

  Reagan's approval rating had dropped from 67% to 46% in November 1986, the largest single-month drop for any U.S. president in history according to a New York Times/CBS News poll. The nickname critics had given him, "the Teflon President," proved apt; his ratings eventually recovered.

  Walsh said in response to the pardons that "the Iran-Contra cover-up, which has continued for more than six years, has now been completed." His final report was submitted on the 4th of August 1993. Walsh noted a pattern of "deception and obstruction" by Bush, Weinberger, and other senior Reagan administration officials, and suggested that in issuing the pardon, Bush appeared to be preempting evidence that would have come out during the Weinberger trial that could have implicated Bush himself.

  Bush's own diary entry dated the 5th of November 1986 had described him as one of "the few people that know fully the details" of the hostage situation. Yet in a live CBS News interview in January 1988, when pressed on the claim that he had been "out of the loop," Bush clarified: "No operational role." Walsh later wrote his account of the investigation, titled Firewall: The Iran-Contra Conspiracy and Cover-Up, a title that captured the wall of silence his office spent years trying to penetrate.