The Iran-Contra affair is not one scandalous incident, but rather two covert operations started under Reagans administration. In the beginning, these two operations were independent of each other, but eventually became linked though funds received from the sale of arms to Iran for hostages and then given to the Contras fighting to overthrow a Marxist government in Nicaragua. The scandal began with Nicaraguan politics. After the Marxist Sandinista regime took over Nicaragua in 1979, the government was faced with a growing communist threat to US interest in Central America.
When President Reagan took office in 1981, he was vehemently determined to halt the spread of communism, especially in Central America (Arnson 1989, 8). Seeking to bolster US prestige and military power, Reagan took a tough stand against communism in the Western Hemisphere. In Nicaragua, he gave the Central Intelligence Agency the approval to help organize and aid a group of Contrarevolucionarios or Contras who were in opposition to the Sandinista regime (Arnson 1989, 6).
Congress, unwilling to fight in another countrys war after the devastating loss in Vietnam, began restricting the use of government funds for rebel guerrillas in Central America. The CIA, concerned that soon Congress would cut off the funding for their program, began to stockpile arms for the contras (Walsh 1997, 18). Their fears were realized when Congress enacted the second Boland Amendment which stated:
No funds available tot he Central Intelligence Agency, the Department of Defense, or any other agency or entity of the United States involved in intelligence activities may be obligated or expended for the purpose of which would have the effect of supporting, directly or indirectly, military or paramilitary operations in Nicaragua by any nation, group, organization, movement, or individual (Arnson 1989, 167-8). The Reagan administration interpreted the Boland Amendment as not covering the activities of the National Security Council (NSC).
The NSC was established in 1947 with the explicit purpose of advising the President on all matters relating to national security. Beginning with the Eisenhower administration, the NSC was given a small staff that ultimately grew and turned into a vital arm of the presidency. As years went by, the NSC staff began controlling the policy-making output of both State and Defense Department, as well as the activities of the CIA (Draper 1991, 11). When the CIA was banned from acting in Nicaragua by the second Boland amendment, President Reagan surreptitiously bypassed Congress and employed his NSC staff instead.
National Security Council staffer Oliver North became the central coordinator supplying aid to the Contras. After Reagans reelection in 1984, he began an additional covert operation. This time, it was the effort to release seven American hostages being held in Lebanon by a radical Islamic group called the Hezbollah. The operation included trading arms for hostages, which clearly violated the Arms Export Control Act, the National Security Act, and stated US policy not to deal with terrorists (Walsh 1997, 3). Iran, in the middle of a war with Iraq, was desperate for weapons.
Many Iranians approached US officials offering t help free the hostages in Lebanon in exchange for arms. National Security Adviser Robert McFarlane was approached by Israeli intermediaries and was persuaded to ask the President about negations with the Iranians. Reagan approved a shipment of 96 wire-guided anti-tank missiles to be delivered to Iran on August 30, 1985, and another 408 to be delivered on September 14. After the secret exchange of these weapons, the Iranians released only one hostage. In an effort to release more hostages, a second large shipment of weapons was to take place in November.
The Israeli aircraft intended to ship the weapons could not fly directly to Iran. The plan was to fly to a European air base, transfer the cargo to another plane and then fly to Iran, but they were not able to obtain the necessary clearance to do so. From that point on, Oliver North began arranging for CIA planes to carry the shipment of weapons to Iran (Walsh 1997, 5). The President then decided to drop the Israelis as middlemen and negotiated the direct sale of arms from the United Stated to Iran. HE also decided to keep these actions secret from Congress.
North subsequently began selling the Iranians missiles at marked up prices. He negotiated low purchase price with the Department of Defense and the surplus funds were then used to pay for aid to the Contras (Walsh 1997, 20). Two unrelated incidents that revealed Iranian and Contra covert operations occurred within one month of each other. On October 5, 1986, Sandinista troops shot down an airplane carrying ten thousand pounds of ammunition and weapons being sent to the Contras who were fighting in northern Nicaragua.
The only surviving crewmember, Eugene Hassenfus, was captured and confessed his role in an American covert operation to aid the Contras. He was also found crying the business card of a US official who was integral to the arms deal (Arnson 1989, 199). The second incident occurred on November 3, 1986. A Lebanese magazine, Al Shiraa, published a story that exposed the United States sale of arms to Iran in exchange for hostages. This story was picked up by the news media not only in the United States but also throughout the world, as was confirmed by the speaker of the Iranian parliament (Walsh 1997, 8).
The connection to these two events was confirmed domestically when Edwin Meese, Counselor to the President and Attorney General, announced that money from the sale of weapons to the Iranians had been given to the Contras in their struggled against the Sandinistas. It was though this revelation that the world was informed of the greatest scandal since Watergate. The President of the United States had authorized and knowingly deceived Congress about two major international operations, both of which were illegal. The Iran-Contra Affair remains a disgrace in the history of American policy and tarnished the Reagan presidency.