TIME: Almanac 1993/TIME Almanac 1993.iso/time/caps/87/87capcon.2

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                J+                                                            ╚June 1, 1987

IRAN-CONTRA

But What Laws Were Broken?


In the face of damaging Iran-contra testimony, the White House
shifts its strategy


When Ronald Reagan admitted two weeks ago that he had discussed
contributions to the Nicaraguan contras with King Fahd of Saudi
Arabia in 1985, news reports suggested that the President had
knowingly contravened the Boland amendment. Or so it seemed to
White House Aide Thomas Griscom, who marched into the office of
Chief of Staff Howard Baker. Said Griscom:  "At some point
you've gotta say whoa!"

At the start of last week Baker did. Though Reagan claims that
Fahd offered his contra contribution voluntarily, Baker asserted
that the President would have been within his rights to ask for
the money outright. "I've been absolutely astonished to hear
people say that it was illegal for...the President to solicit
funds for the contras," the chief of staff declared on NBC's
Meet the Press. The Boland amendment, he said, "never mentioned
the President."

Baker's remarks signaled a surprising new White House strategy
in coping with what has emerged as a central question posed by
Congress's hearings about the Iran-contra affair:  Did Ronald
Reagan violate U.S. law?  Reagan and his aides have begun freely
admitting that he was deeply involved in encouraging private
support for the contras during the period when the Boland
amendment barred "direct or indirect" U.S. aid. But they argued
that the amendment simply did not apply to the President--and
if it had, it would have been unconstitutional.

Hints of such a defense had surfaced briefly in the past but
were quickly submerged by the President's insistence that he had
been only dimly aware of what his lieutenants had been doing to
aid the contras. Once the congressional hearings started,
however, that pretense could not be maintained. Witness after
witness described what appeared to be clear violations of the
Boland amendment and indicated that Reagan had been deeply
involved in the efforts to help the contras.

This new "Yes, but it wasn't illegal" tack is part of a broader
White House attempt to shift the focus on the Iran-contra drama.
As long as Reagan and other top officials were pleading
ignorance, each new disclosure about their ties to Oliver
North's secret contra-supply network qualified as a front-page
headline. Now the Administration is stipulating that it did
indeed support the contra cause but that this was well within
the bounds of the shifting congressional restrictions that
existed between 1983 and 1986. Thus the very real moral and
political questions about a secret policy that was clearly
designed to thwart the boland amendment has temporarily given
way to a trickier legal dispute:  Exactly what did that
amendment and other laws forbid, and to whom did they apply?

The Boland amendment went through several congressional rewrites
(see below). Originally is forbade any expenditures "for the
purpose of overthrowing the government of Nicaragua." Then it
placed a $25 million limit on air to "military or paramilitary
operations in Nicaragua." The most restrictive version, in
effect from October 1984 to December 1985, stated that "no funds
available" to the CIA, the Defense Department or any "entity of
the U.S. involved in intelligence activities" could be used
"directly or indirectly" to support the contras.

The White House claims the amendment placed only one restriction
on the President: he could not use money available to those
agencies to help contras. Otherwise he was free to do pretty
much anything he pleased--encourage private donations or
contributions from other countries, for example. Any other
reading of the amendment, Reagan supporters asserted, would
unconstitutionally restrict the president's power to conduct
foreign policy.

Lloyd Cutler, who was counsel to President Carter, argues that
"normally a statute that mentions other executive agencies but
not the President explicitly is interpreted as not applying to
him." But critics protest that this would put the President
above the law. Says Harvard Law Professor Laurence Tribe:
"Congress's control over the purse would be rendered a nullity
if the President's pocket could conceal a slush fund dedicated
to purposes and projects prohibited by the laws of the U.S."
Democratic Congressman Edward Boland observed that if Reagan
wanted to claim exemption from the amendment, he should have
done so when it was enacted. Instead, Boland noted, Reagan
signed the bill without any public comment.

Did the Boland amendment apply to the National Security Council?
The White House contends that the NSC does not fit the
definition of an "entity engaged in intelligence activities."
A secret opinion by the President's Intelligence Oversight
Board took this approach in 1985. Former Watergate Prosecutor
Philip Lacovara agrees that if Congress intended the amendment
to apply to "other than those persons connected with official
intelligence agencies, it could and should have said so." But
many experts agree with Tribe that NSC officials were clearly
"acting as intelligence agents." Even Robert McFarlane
testified that it was his "common-sense judgment" that the law
applied to the NSC, which he headed.

Did the law forbid Administration solicitation from other
countries or private individuals of funds to buy arms for the
contras? By specifying that "no funds available" could be used,
the Boland amendment seemed to prohibit such a ruse. Assistant
Secretary of State Langhorne Motley told Congress in 1985 that
the Administration interpreted the law to prohibit "soliciting
and/or encouraging other countries to contribute funds." He
said, "We have refrained from doing that." In fact it was being
done--without his knowledge, says Motley.

Private U.S. citizens who donated to the cause described how
North and others would give a strong pep talk about the needs
of the contras and then leave it to private fund raisers like
Carl Channell to ask directly for donations. Republican Senator
Warren Rudman described it as a "one-two punch." According to
William O'Boyle, a New York City oil investor who testified last
week, he was told by North that as a Government employee he
could not directly ask for donations. But Joseph Coors, a
Colorado brewing-company executive, testified that in January
1986 North did personally ask him for $65,000 to buy a plane for
the contras.

Did the ban on "indirect" expenditures apply to funds used to
pay the salaries of Government officials who helped the contras?
During the debate over his amendment in 1984, Boland emphasized
the point: "It clearly prohibits any expenditure, including
those from accounts for salaries." If he is right, the
disclosures that various Government employees--most notably
North and Assistant Secretary of State Elliott Abrams--spent
time coordinating support for the contras would pretty clearly
point to a violation of the law.

Independent Counsel Lawrence Walsh seems to be pursuing a
strategy designed to get around the murkiness of the Boland
amendment and the fact that it carries no criminal penalties.
Besides seeking indictments charging such specific crimes as
obstruction of justice, perjury and misuse of Government funds,
Walsh may tie many defendants together in a broader conspiracy
case, arguing that the individual overt acts were committed in
pursuit of a larger scheme to evade the will of Congress.
Engaging in such a conspiracy would be a felony punishable by
five years in prison.

Despite disagreements over the Boland amendment's provisions,
it seems clear enough that Congress intended to shut off for a
period any kind of U.S. Government aid to the contras. Last
week's testimony turned up new specific acts that show how the
law was intentionally circumvented and probably violated
outright by Government officials. Among the acts:

--Robert Owen, at the time a private citizen volunteering his
services to North, made a trip to Costa Rica in 1985 to select
a site for an airfield from which arms could be flown to the
contras. He testified that he was met and shown around by a CIA
agent who helped him choose the location. The CIA was barred
at the time from such activities.

--In February 1986 Owen made two more trips to Costa Rica. Owen
by then had a $50,000 contract from the State Department to help
in the delivery of "humanitarian" aid to the contras, which was
permitted at the time. But he testified that on one trip he
also helped deliver "lethal equipment" to the rebels, which was
still banned.

Assistant Secretary of State Abrams is scheduled to testify June
2 and can expect tough grilling. Retired Army Major General
John Singlaub testified that Abrams last March had "concurred
in" his soliciting of contra contributions from two countries
(Taiwan and South Korea) and had promised to send a "signal"
that Singlaub had the Government's blessing. Later, said
Singlaub, Abrams told him that solicitation of one country,
apparently Taiwan, would be handled at the "highest level."
Singlaub took that to mean "someone in the White House."  Abrams
disputes parts of this account.

The Boland amendment is far from the only statute that may have
been violated by Government officials involved in the
Iran-contra affair. Indeed, almost every day of the
congressional hearings brings to light at least a hint of
illegalities going beyond Boland. Some examples:

--In a March 1985 memo to Robert McFarlane, then National
Security Adviser, North described proposed deliveries of $8
million worth of weapons and ammunition to a Central American
country, known to be Guatemala. He enclosed "end-user
certificates" attesting that the weapons would be used in that
country. Actually, the memo made clear, "all shipments will
be...turned over to" the contras. This plan seems to violate
the Arms Export Control Act.

--North told Congress last June, under oath, that he barely knew
Owen. In fact, as Owen's testimony to the congressional
iran-contra investigators establishes, the two had been working
together closely for two years. At the end of his testimony,
Owen read a paean canonizing his mentor. Sample line:  "...at
crude altars in the jungle, candles burn for you."

--Contra Leader Adolfo Calero testified that he gave North
$90,000 in traveler's checks in 1985, supposedly to assist in
the rescue of U.S. hostages held in Lebanon. Investigators,
however, disclosed last week that North had cashed $2,000 worth
and spent some in stores near his home. He bought, among other
things, two snow tires for $100. Senator Rudman, using sarcasm
to make the point that the money was not spent for any public
purpose, asked Calero "when was the last time it snowed in
Nicaragua." The contra leader allowed that it does not snow in
Nicaragua. It would be a crime for North to accept compensation
from a non-Government source.

This week the congressional committee will hear from Albert
Hakim, an Iranian-born businessman who worked on both the Iran
arms deal and the contra-arms network. Meanwhile, David Kimche,
a former official of the Israeli Foreign Ministry who has been
identified as the originator of a plan to sell U.S.-made weapons
to Iran, successfully resisted an attempt by Walsh to compel him
to testify before a grand jury.

But the question regarding the President's duties under the law
is sure to remain the major focus. Underlying the dispute over
Boland's technicalities is a far more sweeping provision.
Article I of the Constitution obliges the President to "take
care that the laws be faithfully executed."  At the very least,
that would seem to have required Reagan to launch a careful
study of what was forbidden by Congress under the Boland
amendment and to insist that his aides abide by the results.
So far there is no evidence that any such review was ever
undertaken.

Legally, that failure is probably not punishable. But the
moral point remains. The Boland amendment may be foolish or
even disastrous policy. Nonetheless, for all the ambiguities
of its changing versions, it is the law, and the Constitution
gives the President no latitude to choose which laws he will
honor.


---------------------------------------------------------------
Boland: Honored in The Breach

DEC. 1982 to DEC. 1983

The law:  no funds may be used by the "CIA or the Department of
Defense" to support military activities for "overthrowing the
Government of Nicaragua."

Activities:  CIA and Pentagon initiate plan, "Operation
Elephant Herd," to transfer equipment to contras. -CIA steps up
covert activity in Nicaragua, mounting a series of bombing
attacks. -CIA writes and distributes a "psychological
operations" manual telling how to assassinate local Sandinista
officials. -Network of former U.S. military personnel,
coordinated by CIA, begins supplying contras with weapons from
air base in El Salvador.

DEC. 1983 to OCT. 1984

The law:  not more than $24 million of the "funds available to
the Central Intelligence Agency, the Department of Defense, and
any other agency or entity of the United States involved in
intelligence activities" may be spent to support military
operations in Nicaragua.

Activities:  Pentagon exempts $12 million of "surplus" military
equipment from the $24 million cap. -Saudis begin sending
contras $1 million a month. -McFarlane authorizes North to plan
private funding for the contras. -CIA mines Nicaragua's
harbors. -CIA borrows planes from Pentagon and then loans them
to contras at no cost. -After setbacks in Congress, Reagan
instructs McFarlane to fund the contras "any way you can."

OCT. 1984 to DEC. 1985

The law:  "no funds available" to the CIA, Defense Department
or "any other agency or entity of the United States involved in
intelligence activities" can be spent to support, "directly or
indirectly, military or paramilitary operations in Nicaragua."

Activities:  Reagan instructs aides to help contras "hold body
and soul together." -North and Secord begin full-scale "private"
contra fund-raising and military-supply operation. -Bush and his
adviser Donald Gregg meet with Felix Rodriguez (alias Max
Gomez), a former CIA agent, who later takes job as liaison to
Secord's contra-supply operation at air base in El Salvador.
-Gregg and Rodriguez discuss problems of contra-supply
operation. -Reagan meets with King Fahd, and Saudi Arabia
increases contra subsidy to $2 million a month. -Carl Channell,
working in tandem with North, solicits private donations that
are spent on contra arms. -North, Reagan, Elliott Abrams and
William Casey discuss contra contributions with private donors.
-North funnels private donations into Swiss bank accounts
controlled by Secord and contra leaders. -Interagency group
including Abrams, North and a CIA official instructs Ambassador
to Costa Rica Lewis Tambs to help contras open a southern
front. -Reagan calls Honduran President, persuading him to
release blocked weapons shipment bound for contras.

DEC. 1985 to OCT. 1986

The law:  same ban on military assistance, but "humanitarian
aid, communications support, intelligence sharing" permitted.

Activities:  Robert Owen assists in delivery of "lethal aid" to
contras. -Abrams agrees to assist Singlaub solicit funds from
Taiwan and south Korea (later, Abrams tells him they would
instead be solicited "at the highest level"). -Sultan of Brunei
deposits $10 million to Swiss bank after account number is
supplied by Abrams from North (number confused, and money goes
to Swiss shipowner). -North threatens cutoff of U.S. aid to
Costa Rica when its President protests secret airstrip. -CIA
Deputy Director Robert Gates is told that profits from Iran
arms sales diverted to the contras. -North-Secord supply network
ends with downing of Eugene Hasenfus' plane.

--By George J. Church. Reported by Hays Gorey and Barrett
Seaman/Washington

---------------------------------------------------------------
The Roosevelt Precedent

The forces of democracy were in mortal peril and Congress was
intransigent, so a courageous President bent the law in the
cause of freedom. Ronald Reagan and the contras?  No, it was
Franklin Roosevelt's decision to provide Britain with 50 overage
destroyers during the desperate summer of 1940. The destroyer
deal helped discourage Hitler from invading England; small
wonder that Reagan's defenders now cite it as a precedent to
justify secret efforts to skirt the Boland amendment.

There are, to be sure, some parallels. F.D.R. was hamstrung by
a congressional ban on gifts of military equipment to foreign
nations. But Roosevelt put together the destroyer deal with an
openness totally at odds with the actions of Oliver North and
Richard Secord. The plan was debated in a full Cabinet meeting.
Even though he was in the midst of a hard-fought re-election
campaign, Roosevelt felt compelled to consult Wendell Willkie,
his G.O.P. rival. In cooperation with Winston Churchill, the
Administration constructed a legal loophole:  trading the
destroyers for military bases in Newfoundland, Bermuda and the
West Indies. While the matter was still being debated, a legal
brief supporting the President's position was published in the
New York TImes. Roosevelt also wrote a personal letter
justifying the swap to Senator David Walsh, the leading
congressional foe of aid to Britain. In the letter F.D.R. cited
a questionable historical analogy of his own:  Thomas
Jefferson's bold action in negotiating the Louisiana Purchase
without consulting Congress.