Minority Report Representative Dick Cheney of Wyoming Representative William S Broonttield of Michigan Representative Henry J Hyde of Illinois Representative Jim Cottrter of New Jersey Representative Bil MeCollum of Florida Representative Michael DeWine of Ohio House Seieet Committee to investigate Covert Army Transactions with tree of Senator James McClure of Idaho Senator l JIrrin Hatch of Utah Members Seiet t Cmnmittee on Sert'et to firm tutti the Opposition 431 Assmitue Minumj nausef Robert W Genzman alumna Ifmnrin' I'mmsm Kenneth R Buck Mummy - Reward Drrermr Bruce Fein Associate Staff Represenlmi f' Brmim eid Representan Represen ii re Cm Representative Ht'f nHmn Representative De Wine Associate Staff Ssuumr J'nh'ffun Senator Han-h Minority Staff Thomas R M'eriry Stu Director Geurge W Van leve Chief Minority Counsef Richard J Lean Deputy Chief Minority Cnunse Edimrf riter Michael Minority Eterm ire Assistant Mully W Tully Minnri Sm Assisram Margaret W Dillenburg House of Representatives Steven K Berry Dal id 3 Addington Diane S Dnrnan Dennis E Teti Tina L Westhy Nicholas P Wise Senate Jack Gerard Dee Ben sun 432 Table of Contents Part Chapter I Part II Chapter 2 Chapter 3 Chapter 4 Part Chapter 5 Chapter 6 Chapter 7 Part IV Chapter 8 Chapter 9 Chapter 10 Part Chapter 1 Chapter 12 Part VI Chapter 13 Part VII Chapter 14 Part Introduction The Foreign Affairs Powers of the Constitution and the Iran-Contra Affair The Foreign Affairs Powers and the Framers Intentions The President s Foreign Policy Powers in Early Constitutional Historyr Constitutional Principles In Court Nicaragua Nicaragua The Context The Boland Amendments Who Did What to Help the Democratic Resistanoe Iran The Iran Initiative Iran The Legal Issues The Diversion Disclosures and Investigations The Disclosure and the Uncovering The NSC's Role in Investigations Putting Congress House in Order The Need to Patoh Leaks Recommendations Recommendations Appendixes 433 437 457 463 or 483 489 501 519 539 549 56 567 53'5 533 Part Introduction Chapter 1 Introduction President Reagan and his staff made mistakes in the Iran-Contra Affair c It is important at the outset however to note that the Presi- dent himself has already taken the hard step of acknowledging his mistakes and reacting precisely to correct what went wrong He has directed the National Security Council staff not to engage in covert Operations He has changed the procedures for notifying Congress when an intelligence activity does take place Finally he has installed people with seasoned judgment to be White House Chief of Staff National Security Adviser and Director of Central Intelligence The bottom line however is that the mis- takes of the Iran-Contra Affair were just that mistakes in judgment and nothing more There was no constitutional crisis no systematic disrespect for the rule of law no grand conSpiracy and no Administration- wide dishonesty or coverup In fact the evi- dence will not support any of the more hys- terical conclusions the Committees Report tries to reach No one in the government was acting out of corrupt motives To understand what they did it is important to understand the context within which they acted The decisions we have been investigating grew out of Efforts to pursue important U S inter- ests both in Central America and in the Middle East compassionate but disproportionate concern for the fate of American citizens held hostage in Lebanon by terrorists in- cluding one CIA station chief who was killed as a result of torture See Our View of the Iran-Contra Affair below at 442 ff legitimate frustration with abuses of power and irresolution by the legislative branch and An equally legitimate frustraticun with leaks of sensitive national security secrets coming out of both Congress and the execu- tive branch Understanding this context can help explain and mitigate the resulting mistakes It does not explain them away or excuse their having happened The Committees Report and the Ongoing Battle The excesses of the Committees Report are reflections of something far more profound Deeper than the specifics of the Iran-Contra Affair lies an underlying and festering insti- tutional wound these Committees have been unwilling to face In order to support rhetor- ical overstatements about democracy and the rule of law the Committees have rested their case upon an aggrandizing theory of Con- gress foreign policy powers that is itself part of the problem Rather than seeking to heal the Committees hearings and Report betray an attitude that we fear will make matters worse The attitude is particularly regretta- ble in light of the unprecedented steps the President took to cooperate with the Com- mittees and in light of the actions he already has taken to correct past errors A substantial number of the mistakes of the Iran-Contra Affair resulted directly from an ongoing state of political guerrilla warfare over foreign policy between the legislative and executive branches We would include in this category the excessive secrecy of the Iran initiative that resulted from a history 43 Chapter I and legitimate fear of leaks We also would include the approach both branches took toward the so-called Boland Amendments Congressional Democrats tried to use vague- ly worded and constantly changing laws to impose policies in Central America that went well beyond the law itself For its own part the Administration decided to work within the letter of the law covertly instead of forcing a public and principled confrontation that would have been healthier in the long run Given these kinds of problems a sober examination of legislative-executive branch relations in foreign policy was sorely needed It still is Judgments about the Iran-Contra Affair ultimately must rest upon one's views about the preper roles of Congress and the President in foreign policy There were many statements during the public hearings for example about the rule of law But the fundamental law of the land is the Constitu- tion Unconstitutional statutes violate the rule of law every bit as much as do willful violations of constitutional statutes It is es- sential therefore to frame any discussion of what happened with a proper analysis of the Constitutional allocation of legislative and executive power in foreign affairs The country s future security depends upon a modus vivendi in which each branch recognizes the other s legitimate and consti- tutionally sanctioned Sphere of activity Con gress must recognize that an effective foreign policy requires and the Constitution man- dates the President to be the country s for- eign policy leader At the same time the President must recognize that his preemi- nence rests upon personal leadership public education political support and interbranch comity Interbranch comity does not require Presidential obsequiousness of course Presi- dents are elected to lead and to persuade But Presidents must also have Congressional support for the tools to make foreign policy effective No President can ignore Congress and be successful over the long term Con- gress must realize however that the power of the purse does not make it supreme 438 Limits must be recognized by both branches to protect the balance that was intended by the Framers and that is still needed today for effective policy This mutual recognition has been sorely lacking in recent years Why We Reject the Committees Repon Sadly the Committees Report reads as if it were a weapon in the ongoing guerrilla war- fare instead of an objective analysis Evi- dence is used selectively and unsupported inferences are drawn to support politically biased interpretations As a result we feel compelled to reject not only the Committees conclusions but the supposedly factual narrative as well We always knew of course that there would be differences of interpretation We had hoped at the start of this process how- ever to arrive at a mutually agreeable state- ment of facts Unfortunately that was not to be The narrative is not a fair description of events but an advocate's legal brief that arrays and selects so-called facts to t pre- conceived theories Some of the resulting narrative is accurate and supported by the evidence A great deal is overdrawn specu- lative and built on a selective use of the Committees' documentary materials The tone of the Report flows naturally from the tone of the Committees televised hearings We feel strongly that the decision to air the hearings compromised some intelli- gence sources and methods by broadcasting inadvertent slips of the tongue But one thing television did do successfully was lay bare the passions that animated too much of the Committees work Who can forget the mas- sive displays of travelers' checks being shown to the country to discredit Col North s character weeks before he would be given a chance to reply' l Or the j'accuse atmosphere with which witnesses were con- fronted beginning with the rst week's pros- ecutorial confrontation with General Secord as Members used the 1witnesst s as objects for lecturing the cameras These tactics had Chapter I little to do with factfinding or with a careful review of policies and institutional processes But we shall not dwell on the hearings at this stage The reSpected constitutional scholar John Norton Moore has written an excellent article about them We have at- tached the article The Iran-Contra Hear- ings and Intelligence Oversight in a Democ- racy along with other material Professor Moore sent the Committees as an appendix to our Report Suffice it to say that we agree with Moore completely We mention the hearings now only to note that the same spirit not surprisingly has dominated the written Report Our reasons for rejecting the Committees Report can best be understood by sampling a few of its major conclusions By presenting these examples we hepe to alert conscien- tious readers whether they agree with our interpretations or not to take the narrative with a very large grain of salt Regrettably readers seeking the truth will be forced to wade through a mass of material to arrive at an independent judgment The President s Knowledge of the Diversion The most politically charged example of the Committees misuse of evidence is in the way it presents the President s lack of knowledge about the diversion that is the decision by the former National Security Adviser Admiral John Poindexter to au- thorize the use of some proceeds from Iran arms sales to support the Nicaraguan demo- cratic Resistance or Contras This is the one case out of thousands in which the Commit- tees instead of going beyond the evidence as the Report usually dees refused instead to accept the overwhelming evidence with which it was presented The Report does grudgingly acknowledge that it cannot refute the President s repeated assertion that he knew nothing about the diversion before At- torney General Edwin Meese discovered it in November 1986 Instead of moving for- ward from this to more meaningful policy questions however the Report seeks with- out any support to plant doubts We will never know what was in the documents shredded by Lt Col Oliver L North in his last days on the NSC staff the Report says Of course we will not That same point could have been made however to cast un- supported doubt upon every one of the Re- port s own conclusions This one seems to be singled out because it was where the Presi- dent put his own credibility squarely on the line The evidence shows that the President did not know about the diversion As we discuss at length in our chapter on the subject this evidence includes a great deal more than just Poindexter s testimony Poindexter was cor- roborated in different ways by the Presi- dent s own diaries and by testimony from North Meese Commander Paul Thompson formerly the General Counsel and former White House Chief of Staff Donald Regan The conclusion that the President did not know about the diversion in other words is one of the strongest of all the infer- ences one can make from the evidence before these Committees Any attempt to suggest otherwise can only be seen as an effort to sow meritless doubts in the hope of reaping a partisan political advantage The Idea for the Diversion and the Use of Israeli Evidence In the normal course of the narrative s hun- dreds of pages the lack of objectivity stems more from the way it selects and makes questionable inferences from a scarcity of evidence rather than a deliberate decision to ignore what is available This becomes most obvious when we see a witness dismissed as being not credible for one set of events and then see the same witnesses uncorroborated testimony become the basis for a major set of assertions about other events If these flip- flops could be explained by neutral rules of evidence or if they were random we could treat them more But something quite different seems to be at work here The nar- rative seems to make every judgment about the evidence in favor of the interpretation 439 Chapter 3 that puts the Administration in the worst possible light Two examples involving North will make the point clearly The rst has to do with when he rst got the idea for a diversion North testi ed that he rst got the idea for diverting some of the Iran arms sale pro- ceeds to the Contras from Manucher Ghor- banifar at a London hotel meeting in late January 1986 1 He acknowledged that the subject of using the residuals to replenish Israeli weapon supplies and for related oper- ations came up in a discussion with Amiram Nir an Israeli of cial in late December or early January North speci cally said how- ever that the Nir conversation had nothing to do with the Contras 2 The Committees also received a chronolo gy from the Israeli Government however that claimed North told Israeli supply of - cials in New York on December 6 that the Contras needed money and that he intended to use proceeds from the Iran arms sales to get them some When North was asked about the December 6 meeting he reiterated that he did not recall discussing the Contras with anyone involved in the Iran initiative before the late January meeting with Ghor- banifar 3 The Committees Report has used the Is- raeli chronolOgY and the timing of North s alleged December 6 conversation to suggest that the idea of gaining funds for the Nicara- guan Resistance was an important consider- ation that kept the Iran arms initiative alive more than a month before the President signed the Finding of January l7 The prob- lem with making this important inference is that we have no way of knowing whether the Israeli chronology is accurate It may be but then again it may not The Government of Israel made its chronology available to the Committees fairly late in our investiga- tions and consistently refused to let key Is raeli participants give depositions to the Committees' counsel We have no quarrel with the fact that Israel or any other sovereign nation may refuse to let its of cials and private citizens 440 be subject to interrogation by a foreign legis- lature The United States no doubt would do the same But we do object vehemently to the idea that the Committees should use unsworn and possibly self-serving informa- tion from a foreign government to reject sworn testimony given by a U S of cial particularly when the U S of cial s testimo- ny was given under a grant of immunity that protected him from prosecution arising out of the testimony for any charge except perju- ry Even if North did mention the Contras to the Israeli supply of cials in early Decem- ber however the inference made from the timing would be unfair The Committees have no evidence that would give them any reascm to believe that anyone other than North even considered the Contras in con- nection with the Iran arms sales before the January Finding Poindexter speci cally tes- ti ed that he rst heard of the idea when North asked him to authorize it in Febru ary 4 North testi ed that he rst mentioned the idea to the Director of Central Intelli- gence William J Casey at about the same time in late January or early February after the post- nding London meeting 5 More im- portantly North and Poindexter both testi- ed that no one else in the U S Government was told about a diversion before this time What that means is that the diversion cannot possibly have been a consideration for people at the policymaking level when the President decided to proceed with the Iran initiative in January Off-the-Shelf Privately Funded Covert Operations Paradoxically the Committees seem to have had no dif culty swallowing North's testi- mony that Director Casey intended to create a privately funded off-the-shelf covert oper- ations capability for use in a variety of un- foreseen circumstances IS This is deSpite the fact that two peOple close to Casey at the CIA Deputy Director of Central Intelli- gence John M McMahon and Deputy Di- rector for Operations Clair George both denied Casey would ever have countenanced such an idea My experience with Bill Casey was absolute said George He would never have approved it 7 We have to concede the possibility of course that Casey might have discussed such an idea Speculatively with North with- out mentioning it to others at the As with so many other questions we will never know the answers with certainty Casey s terminal illness prevented him from testifying between December 1986 and his death in May 1987 Nevertheless it is interesting to note how much the majority is willing to make of one uncorroborated disputed North statement that happens to suit its political purpose in light of the way it treats others by North that are less convenient for the narrative s thesis The Allegation of Systematic Cover-up The Report also tries to present the events of November 1986 as if they represent a sys- tematic attempt by the Administratioo to cover up the facts of the Iran initiative The reason for the alleged coverup it is suggest ed was to keep the American people from learning that the 1985 arms sales were ille- gal There can be no question that the Admin- istration was reluctant to make all of the facts public in early November when news of the arms sales first came out in a Lebanese weekly It is clear from the evidence that this was a time when covert diplomatic dis- cussions were still being conducted with Iran and there was some basis for thinking more hostages might be released We consid- er the Administration s reticence in the early part of the month to have been completely justi able However as November 1986 wore on Poindexter and North did falsify the docu- mentary record in a way that we find de- plorable The outstanding fact about the late 'We use the word speculatively here because North tusti ed at the same time as he introduced the idea that it never was put into effect Chapter I November events however is that Attorney General Meese understood the importance of getting at the truth Working on a very tight schedule Meese and three others from the Department of Justice managed to uncover the so called diversion memorandum and reported it to the President The President immediately removed Poindexter and North from the NSC staff Shortly afterwards he asked for an Independent Counsel to be ap- pointed appointed the Tower Board and supported the establishment of select Con- gressional investigative committees to which he has given unprecedented cooperation The Committees Report criticizes Meese for not turning his fact- nding operation into a formal criminal investigation a day or two earlier than he did In fact the Report strongly tries to suggest that Meese either must have been incompetent or must have been trying to give Poindexter and North more time to cover their tracks We consider the rst of these charges to be untrue and the second to be outrageous We shall show in a later chapter that Meese worked with the right people and the right number of them for a national security fact-finding in- vestigation Whatever after-the-fact criticism pe0ple may want to make it is irreSponsible to portray the Administration in light of Meese s behavior as if it were interested in anything but learning the truth and getting it out as quickly as possible The Rule of Law Finally the Committees Report tries almost as an overarching thesis to portray the Administration as if it were behaving with wantOn disregard for the law In our view every single one of the Committees' legal interpretations is open to serious ques- tion On some issues particularly the ones involving the statutes governing covert oper- ations we believe the law to be clearly on the Administration s side In every other case the issue is at least debatable In some such as the Roland Amendment we are con- vinced we have by far the better argument In a few others such as who owns the 441 Chapter I funds the Iranians paid Gen Richard Secord and Albert Hakim we see the legal issue as being close During the course of our full statement we shall indicate which is which What the Committees Report has done with the legal questions however is to issue a one-sided legal brief that pretends the Ad- ministration did not even have arguments to make As if that were not enough the Report tries to build upon these one-sided assertions to present a politicized picture of an Administration that behaved with contempt for the law If nothing else would lead readers to view the Report with extreme skepticism the adversarial tone of the legal discussion should settle the matter Our View of the Iran-Contra Affair The main issues raised by the Iran-Contra Affair are not legal ones in our opinion This opinion obviously does have to rest on some legal conclusions however We have summarized our legal conclusions at the end of this introductory chapter The full argu ments appear in subsequent chapters In our view the Administration did proceed legally in pursuing both its Contra policy and the Iran arms initiative We grant that the diver- sion does raise some legal questions as do some technical and relatively insubstantial matters relating to the Arms Export Control Act It is important to stress however that the Administration could have avoided every one of the legal problems it inadvertently encountered while continuing to pursue the exact same policies as it did The fundamental issues therefore have to do with the policy decisions themselves and with the political judgments underlying the way policies were implemented When these matters are debated as if they were legal and even criminal concerns it is a sign that interbranch intimidation is replacing and de- basing deliberation That is why we part company not only with the Committees Re- port s answers but with the very questions it identi es as being the most significant 442 There are comm0n threads to what we think went wrong with the Administration s policies toward Central America and Iran Before we can identify those threads how- ever we will give a very brief overview of the two halves of the Committees investiga- tions For both halves we begin with the context within which decisions were made describe the decisions and then offer some judgments After taking the parts separately we will then be in a position to talk about commonalities Nicaragua The Nicaraguan aspect of the Iran-Contra Affair had its origins in several years of bitter political warfare over U S policy toward Central America between the Reagan Administration and the Democratic House of Representatives The United States had supported the Sandinistas in the last phase of the dictatorial regime of Anastasio Somoza and then gave foreign aid to Nicara- gua in 1979 and 1980 the rst years of San- dinista rule By 1980 however the Sandinis- tas had shed their earlier democratic re- former dnguise and begun to suppress civil liberties at home and export revolution abroad As a result the United States sus- pended all aid to Nicaragua in the closing days of the Carter Administration During the early years of the Reagan Ad- ministration the Soviet Union and its allies dramatically increased their direct military support for Nicaragua and their indirect sUpport through Nicaragua of Communist guerrillas in El Salvador The Reagan Ad- ministration decided to provide covert sup- port for the Nicaraguan democratic Resist- ance in late 1981 and Congress agreed By late 1982 however Congress adOpted the rst of a series of so-called Boland Amend- ments prohibiting the CIA and Defense Department from spending money for the purpose of overthrowing the Government of Nicaragua or provoking a military exchange between Nicaragua and Honduras The House voted for this limitation by a margin of 411 0 in large part because every- one understood that the Administration could continue to support the Resistance as long as the purpose of the support was to prevent the revolution from being exported to El Salvador This approach left many unsatis ed Some within the Administration wanted a broader attack on the Sandinista regime Some within Congress wanted to end all support for the Contras and begin moving back toward the l9't9 80 policy of providing economic assist- ance to the Sandinistas Neither side of the policy debate was politically strong enough to prevail Instead during the course of the next several years Congress and the Admin- istration compromised on a series of am- biguous formulas Meanwhile the Soviet buildup acceler- ated and Sandinista support for the insur- gents in El Salvador continued In May 1983 the House Intelligence Committee chaired by Representative Edward P Boland reported It is not popular support that sustains the insurgents in El Salvador As will be discussed later this insurgency depends for its lifeblood arms am- munition nancing logistics and com mand-and-control facilities upon out- side assistance from Nicaragua and Cuba This Nicaraguan-Cuban contri- bution to the Salvadoran insurgency is long standing It began shortly after the overthrow of Somoza in July 19379 It has provided by land sea and air the great bulk of the military equipment and support received by the insurgents 3 Despite this nding House Democrats succeeded in late 1933 in limiting appropri- ated support for the Resistance to an amount intentionally calculated to be insuf cient for the full fiscal year The funds ran out by late spring or summer 1984 By October the most stringent of the Boland Amendments had taken effect Paradoxically Congress 1983-85 decisions came in a context in Chapter which it was continuing to pass laws that accused the Sandinistas of violating the non- aggression provisions of the charter of the Organization of American States a viola- tion that the OAS charter says calls for a response by other member nations including the United States Actions By the late spring of 1984 it became clear that the Resistance would need some source of money if it were to continue to survive while the Administration tried to change public and Congressional opinion To help bridge the gap some Administration of cials began encouraging foreign governments and U S private citizens to support the Contras NSC staff members played a major role in these efforts but were speci cally ordered to avoid direct solicitations The President clearly approved of private benefactor and third-country funding and neither he nor his designated agents could constitutionally be prohibited from encouraging it To avoid po- litical retribution however the Administra- tion did not inform Congress of its actions In addition to encouraging contributions the North with varying degrees of authorization and knowledge by National Se- curity Advisers Robert C McFarlane and Admiral John Poindexter Helped coordinate or facilitate actions taken by private citizens and by certain U S Despite the fact that the Committees announced that their hear- ings were to be neither pro-Contra nor anti-Contra the fact is that the Committees staff left no stone unturned in its efforts to obtain information that might be politlcally damaging to the Resist- ance even if irrelevant to the Committees' mandates The Commit tees investigators reviewed major portions if not all of the Con- tras' financial records met with witnesses who alleged the Resist- ance was involved in terrorism or drug-running investigated the nancial conduct of the NHAO program and so on The fact ts however that the Committees received no credible evidence of misconduct by the Resistance It comes as little surprise of course that the Committees majo ty d0es not explicitly acknowledge this To give but one example of the Committees ndings investigators produced a detailed memorandum concerning allegations of drug running and concluded that the allegation had no substance This memorandum was included in the Committees record and is re- printed as Appendix to the Minority Repon For this reason suggestious that the Committees have not investigated such matters and other Committees of Congress should ought to be seen for what they are political harassment by Congressional opponents of the Resistance 443 Chapter Government officials to direct money arms or supplies from private US citizens or for- eign governments to the Nicaraguan Resist- ance Pr0vided the Resistance with expert military judgment or advice to assist in the resupply effort and Together with others in Government provided the Resistance with intelligence in- formation that was useful in the resupply effort Poindexter and North testified that they both believed these activities were legally permis- sible and authorized They also said that the President was kept generally informed of their coordinating role The President has said however that he was not aware of the NSC staff s military advice and coordination Because the Boland Amendment is an ap- propriations rider it is worth noting that there is no evidence that any substantial amounts of appropriated taxpayer funds were used in support of these efforts In addition the NSC staff believed as we do that the prohibition did not cover the NSC 9 At no time in other words did members of the President s staff think their activities were illegal Nevertheless the NSC staff did make a concerted effort to conceal its actions from Congress There is no evidence however to suggest that the President or other senior Administration of cials knew about this con- cealment Judgments The effort to raise foreign government and private funds for the Resistance raised about $35 million between mid-1984 and mid- 1986 virtually all of it from foreign coun- tries In addition the much discussed and unauthorized diversion orchestrated by North and Poindexter contributed about $3 8 milliOn more Without this support accord- ing to uncontroverted testimony the Com- mittees received there can be no question that the Resistance would have been annihi- lated In other words the support clearly did make an important strategic difference in the 2 years it took the Administration to per- 444 suade Congress to reverse its position The short-term bene ts of the effort are therefore undeniable The long-term costs however seem not to have been adequately consid- ered We do believe for reasons explained in the appendix to this introductory chapter and in our subsequent chapters on Nicara- gua that virtually all of the NSC staff s ac- tivities were legal with the possible excep- tion of the diversion of Iran arms sale pro- ceeds to the Resistance We concede that reasonable people may take a contrary view of what Congress intended the Boland Amendments to mean But we also agree with a letter from Prof John Norton Moore which appears as Appendix to our Report that to the extent that the amendment was ambiguous well recognized principles of due process and separation of powers would require that it be interpreted to protect Ex- ecutive Branch flexibility 1 Notwithstanding our legal opinions we think it was a fundamental mistake for the NSC staff to have been secretive and decep- tive about what it was doing The require- ment for building long-term political support means that the Administration would have been better off if it had conducted its activi- ties in the open Thus the President should simply have vetoed the strict Boland Amendment in mid-October 1934 even though the Amendment was only a few paragraphs in an approximately 1 200 page- long continuing appropriations resolutiOn and a veto therefore would have brought the Government to a standstill within 3 weeks of a national election Once the President decid- ed against a veto it was self-defeating to think a program this important could be sus- tained by deceiving Congress Whether tech- nically illegal or not it was politically fool- ish and counterproductive to mislead Con- gress even if misleading took the form of artful evasion or silence instead of overt mis- statement We do believe firmly that the NSC staff s deceits were not meant to hide illegalities Every witness we have heard told us his concern was not over legality but with the fear that Congress would respond to com- plete disclosure with political reprisals prin- cipally by tightening the Boland Amend- ments That risk should have been taken We are convinced that the Constitution protects much of what the NSC was doing particularly those aspects that had to do with encouraging contributions and sharing infor- mation The President's inherent constitu- tional powers are only as strong however as the President s willingness to defend them As for the NSC actions Congress could con- stitutionally have prohibited it would have been better for the White House to have tackled that danger head on Some day Con- gress decision to withhold resources may tragically require US citizens to make an even heavier commitment to Central Amer- ica perhaps one measured in blood and not dollars The commitment that might elimi- nate such an awful future will not be forth- coming unless the public is exposed to and persuaded by a clear sustained and princi- pled debate on the merits Iran The Iran arms sales had their roots in an intelligence failure The potential geopolitical importance of Iran for the United States w0uld be obvious to anyone who looks at a map Despite Iran's importance the United States was taken by surprise when the Shah fell in 19719 because it had not developed an adequate human intelligence capability there Our hearings have established that essentially nothing had been done to cure this failure by the mid-1980 s Then the United States was approached by Israel in 1985 with a proposal that the United States acquiesce in some minor Israeli arms sales to Iran This propos- al came at a time when the United States was already considering the advisability of such sales For long term strategic reasons the United States had to improve relation- ships with at least some of the currently im- portant factions in Iran The lack of adequate intelligence about these factions made it im- portant to pursue any potentially fruitful cp- Chapter 1 portunity it also made those pursuits inher- ently risky U S decisions had to be based on the thinnest of independently verifiable information Lacking such independent intel ligence the United States was forced to rely on sources known to be biased and unreli- able Well aware of the risk the Administration nonetheless decided the opportunity was worth pursuing The major participants in the Iran arms affair obviously had some common and some conflicting interests The key questi0n the United States had to ex- plore was whether the US and Iranian lead- ership actually felt enough of a common in- terest to establish a strategic dialogue Actions To explore the chance for an Opening the President agreed rst to approve Israeli sales to Iran in 1985 and then in 1986 to sell U S arms directly The amounts involved were meager The total amount including all of the 1985 and 1986 sales combined consisted of 2004 TOW antitank missiles l8 HAWK antiaircraft missiles and about 200 types of HAWK Spare parts There was a strong division of opinion in the Administration about the advisability of these arms sales a division that never abated Unfortunately this served as a pretext for Poindexter s decision not to keep the Secre- taries of State or Defense informed about the detailed progress of the negotiations between the United States and Iran One reason for the failure to inform appears to have been a past history in which some Administration officials may have leaked sensitive informa- tion as a way to halt actions with which they disagreed Poindexter s secretive incli- nations were abetted by Secretary Shultz who all but invited Poindexter not to keep him informed because he did not want to be accused of leaking They also were abetted by Secretary Weinberger who like Shultz was less than vigorous about keep- ing himself informed about a policy he had good reason to believe was still going for- ward 44s Chapter 1 The rst deals with the Iranian Govern- ment were flawed by the unreliability of our intermediary Manucher Ghorbanifar For all of his unreliability however Ghorbanifar helped obtain the release of two U S hos- tages and did produce high Iranian of cials for the rst face-to face meetings between our governments in 5 years At those meet- ings one of which was held in Tehran in May 1986 US of cials sought consistently to make clear that we were interested in a long-term strategic relationship with Iran to oppose the Soviet Union s territorial inter- ests As concerned as the President had become personally for the fate of the hos- tages including the Beirut station chief William Buckley who was repeatedly tortured until he died the hostages were always presented in these negotiations as ob- stacles to be overcome not as the reason for the initiative But Ghorbanifar appeared to have misled both sides and the Iranian offi- cials seemed to be interested only in weap- ons and in using the hostages for bargaining leverage After the Tehran meeting the United States was able to approach a very high Ira- nian of cial using a Second Channel ar- ranged by Albert Hakim and his associates There is little doubt about Hakim s business motives in arranging these meetings there is equally little doubt that this channel repre scnted the highest levels of the Iranian Gov- ernment Discussions with this channel began in the middle of 1986 and continued until December They resulted in the release of one further hostage and US officials expect- ed them to result in scrne more Perhaps more importantly these discussions appear to have been qualitatively different from the ones conducted through the First Channel arranged by Ghorbanifar and included some talks about broad areas of strategic coopera tion As a result of factional in ghting inside the Iranian Government the initiative was exposed and substantive discussions were suspended Not surprisingly given the nature of Iranian politics the Iranian Government 446 has publicly denied that significant negotia- tions were underway Congress was not in- formed of the Administration s dealings with Iran until after the public disclosure The failure to disclose resembled the Carter Ad- ministration s similar decisions not to disclose in the parallel Iranian hostage crisis of 1979- 81 President Reagan withheld disclosure longer than Carter however by about 11 months to 6 Judgments The Iran initiative involved two govern- ments that had sharp differences between them There were also very sharp internal divisions in both Iran and the United States about how to begin narrowing the differ- ences between the two countries In such a situation the margin between narrow failure and success can seem much wider after the fact than it does during the discussions While the initial contacts developed by Israel and used by the United States do not appear likely to have led to a long-term relationship we cannot rule out the possibility that nego- tiations with the Second Channel might have turned out differently At this stage we never will know what might have been In retrospect it seems clear that this initia- tive degenerated into a series of arms for hostage deals It did not look that way to many of the US participants at the time Nevertheless the fact that the negotiations never were able clearly to separate the long- term from the short-term issues confirms our instinctive judgment that the United States should not have allowed arms to become the currency by which our country s bona tides were determined There is no evidence that these relatively minor sales materially altered the military balance in the Iran-Iraq war However the sales damaged U S credibility with our allies making it more dif cult among other things for the Administration to enforce its preexisting efforts to embargo arms sales to Iran The decision to keep Congress in the dark for 11 months disturbs all Members of these Committees It is clear that the Reagan Ad- Chapter 1 ministration simply did not trust the Con- gress to keep secrets Based on the history of leaks we shall outline in a later chapter it unfortunately had good reason to be con- cerned This observation is not offered as a justi cation but as an important part of the context that must be understood- To help remove this concern as an excuse for future Administrations we are proposing a series of legislative and administrative recommenda- tions to improve both Congress and the ex- ecutive branch s ability to maintain national security secrets and deter leaks Diversion The lack of detailed information-sharing within the Administration was what made it possible for Poindexter to authorize the di- version and successfully keep his decision to do so from the President We have already indicated our reasons for being convinced the President knew nothing about the diver sion The majority Report says that if the President did not know about it he should have We agree and so does the President But unlike some of the other decisions we have been discussing the President cannot himself be faulted for this one The decision was Admiral Poindexter's and Poindexter s alone As supporters of a strong Presidential role in foreign policy we cannot take Poin dexter s decision The Constitution strikes an implicit bargain with the President in return for getting signi cant discretionary power to act the President was supposed to be held accountable for his decisions By keeping an important decision away from the President Poindexter was acting to undercut one feundation for the discretionary Presi- dential power he was exercising The diversion also differs from the basic Nicaragua and Iran policies in another im- portant reSpect we can nd nothing to justi- fy or mitigate its having occurred We do understand the enthusiasm North displayed when he told the Committees it was a neat idea to use money from the Ayatollah who was helping the Sandinistas to support the Contras But enthusiasm is not a suf cient basis for important policy decisions Even if there were nothing else wrong with the di- version the decision to mix two intelligence operations increased the risk of pursuing either one with predictably disastrous reper- cussions Unlike the Committees majority we be- lieve there are good legal arguments on both sides of the question of whether the proceeds of the arms sales belong to the US Govern- ment or to Secord and Hakim For that reason we think it unlikely under the cir- cumstances that the funds were acquired or used with any criminal intent Nevertheless the fact that the ownership seems unclear under current law does not please us We do believe that Secord and Hakim were acting as the moral equivalents of US agents even if they were not US agents in law The diversion has led some of the Com- mittees Members to express a great deal of concern in the public hearings about the use of private citizens in covert operations in settings that mix private pro ts with public benefits We remain convinced that covert operations will continue to have to use pri- vate agents or contractors in the future and that those private parties will continue to operate at least partly from profit motives If the United States tries to limit itself to deal- ing only with people who act out of purely patriotic motives it effectively will rule out any dealing with most arms dealers and foreign agents In the real world of international politics it would be foolish to avoid working with people whose motives do not match our own Nevertheless we do feel troubled by the fact that there was not enough legal clarity or accounting controls placed on the Enterprise by the NSC The Uncovering It is clear that of cials of the National Secu- rity Council misled the Congress and other members of the Administration about their activities in support of the Nicaraguan Re- sistance This occurred without authorization 44 Chapter I from outside the NSC staff It is also clear that the NSC staff actively misled other Ad- ministration of cials and Congress about the Iran initiative both before and after the rst public disclosure The shredding of docu- ments and other efforts at covering up what had happened were also undertaken by NSC staff members acting on their own without the knowledge consent or acquiescence of the President or other major Administration of cials with the possible exception of Casey In the week or two immediately after the Iran initiative was disclosed in a Lebanese weekly the President did not tell the public all that he knew because negotiations with the Second Channel were still going on and there remained a good reason for hoping some more hostages might soon be released Once the President learned that not all of the relevant facts were being brought to his at tention however he authorized the Attor- ney General immediately to begin making inquiries Attorney General Meese acted properly in his investigation pursuing the matter as a fact- nding effort because he had no reason at the time to believe a crime had been committed Arguments to the contrary are based strictly on hindsight In our opin- ion the Attorney General and other Justice Department of cials did an impressive job with a complicated subject in a short time After all it was their investigation that un- covered and disclosed the diversion of funds to the Contras Common Threads The different strands of the Iran-Contra Affair begin coming together in the most obvious way on the level of personnel Both halves of the event were run by the NSC specifically by McFarlane Poindexter and North With respect to Nicaragua the Roland Amendment just about ruled all other agencies out of the picture With re- spect to Iran the other parts of the executive branch from the State and Defense Depart- ments to the CIA seemed more than happy to let the NSC be in charge 448 It is ironic that many have looked upon these events as signs of an excessively pow- erful NSC staff In fact the N805 roles in the Iran and Nicaragua policies were excep- tions rather than the rule The Reagan Ad- ministration has been beleaguered from the beginning by serious policy disagreements between the Secretaries of State and De- fense among others and the President has too often not been willing to settle those disputes de nitively The press accounts written at the time Poindexter was promoted to ll McFarlane's shoes saw his selection as a decision to have the National Security Ad- viser play the role of honest broker with little independent power 11 This image of the NSC lasted almost until the Iran arms initiative became public Poindexter was seen as a technician chosen to perform a techni- cal job not to exercise political judgment 12 Once the NSC had to manage two oper- ations that were bound to raise politically sensitive questions it should have been no surprise to anyone that Poindexter made some mistakes It is not satisfactory howev- er for people in the Administration simply to point the nger at him and walk away from all responsibility For one thing the President himself does have to bear personal responsibility for the people he picks for top of ce But just as it would not be appropri- ate for the ngers to point only at Poin- dexter neither is it right for them only to point to the top Everyone who had a stake in promoting a technician to be National Security Adviser should have realized that meant they had a responsibility to follow and highlight the po- litical consequences of Operational decisions for the President Even if the Cabinet of - cials did not support the basic policy they had an obligation to remain engaged if they could manage to do so without constantly rearguing the President's basic policy choice Similarly Chief of Staff Donald Regan may not have known or had reason to know the details of the Iran initiative or Contra resup- ply effort But he should have known that North's reSponses to C0ngressi0nal inquiries generated by press reports were too impor- tant politically to be left to the peeple who ran the NSC staff The discussion of personnel ultimately gets around to the importance of political judg- mem We can be more precise about what that means however if we consider the common threads in the decisions we have already labelled as mistakes These have in- cluded The President s decision to sign the Boland Amendment of 1984 instead of veto- ing it The President's less-than-robust defense of his of ce's constitutional powers a mis- take he repeated when he acceded too read- ily and too completely to waive executive privilege for our Committees investigation The NSC staff s decision to deceive Congress about what it was doing in Central America The decision in Iran to pursue a covert policy that was at odds with the Administra- tion s public expressions without any warn- ing signals to Congress or our allies The decision to use a necessary and con- stitutionally protected power of withholding information from Congress for unusually sen- sitive covert operations for a length of time that stretches credulity Poindexter s decision to authorize the diversion on his own and nally Poindexter and North s apparent belief that covering up was in the President s polit- ical interest We emphatically reject the idea that through these mistakes the executive branch subverted the law undermined the Constitu- tion or threatened democracy The Presi- dent is every bit as much of an elected repre- sentative of the people as is a Member of Congress In fact he and the Vice President are the only officials elected by the whole Nation- Nevertheless we do believe the mis- takes relate in a different way to the issue of democratic accountability They provide a good starting point for seeing what both sides of the great legislative-executive branch divide must do to improve the way the lGov- ernment makes foreign policy Chapter 1 Congress Congress has a hard time even conceiving of itself as contributing to the problem of democratic accountability But the record of ever-changing policies toward Central America that contributed to the NSC staff s behavior is of a frequently re- curring problem When Congress is narrow- ly divided over highly emotional issues it frequently ends up passing intentionally am- biguous laws or amendments that postpone the day of decision In foreign policy those decisions often take the form of restrictive amendments on money bills that are open to being amended again every year with new and equally ambiguous language replacing the old This matter is exacerbated by the way Congress year after year avoids pass- ing bills before the scal year starts and then wraps them together in a governmentwide continuing resolution loaded with amendments that cannot be vetoed without threatening the whole Gov- ernment's Operation One pmperly democratic way to amelio- rate the problem of foreign policy inconsist- ency would be to give the President an up- portunity to address the major differences between himself and the Congress cleanly instead of combining them with unrelated subjects To restore the Presidency to the pesition it held just a few administrations ago Congress should exercise the self-disci- pline to split continuing resolutions into sep arate appropriation bills and present each of them individually to the President for his signature or veto Even better would be a line-item veto that would permit the Presi- dent to force Congress to an override vote without jeopardizing funding for the whole Government Matters of war and peace are too important to be held hostage to govern- mental decisions about funding Medicare or highways To describe this legislative hos- tage taking as democracy in action is to turn language on its head 44s Chapter 1 The Presidency The Constitution created the Presidency to be a separate branch of government whose occupant would have substantial discretion- ary power to act He was not given the power of an 18th century monarch but nei- ther was he meant to be a creature of Cen- gress The country needs a President who can exercise the powers the Framers intend- ed As long as any President has those powers there will be mistakes It would be disastrous to respond to the possibility of error by further restraining and limiting the powers of the of ce Then instead of seeing occasional actions turn out to be wrong we would be increasing the probability that future Presidents would be unable to act de- cisively thus guaranteeing ourselves a per- petually paralyzed reactive and unclear for- eign policy in which mistake by inaction would be the order of the day If Congress can learn something about democratic responsibility from the Iran Contra Affair future Presidents can learn something too The Administration would have been better served over the long run by insisting on a principled confrontation over those strategic issues that can be debated publicly Where secrecy is necessary as it often must be the Administration should have paid more careful attention to consulta- tion and the need for consistency between what is public and what is covert Inconsist- ency carries a risk to a President s future ability to persuade and persuasion is at the heart of a vigorous successful presidency A President s most important priorities the ones that give him a chance to leave an historic legacy can be attained only through persistent leadership that leads to a lasting change in the public s understanding and opinions President Reagan has been praised by his supporters as a communicator and criticized by his opponents as an ideologue The mistakes of the Iran-Contra Affair iron- ically came from a lack of communication and an inadequate appreciation of the impor- tance of ideas During President Reagan's terms of of ce he has persistently taken two 450 major foreign policy themes to the American peOple a strong national defense for the United States and support for the institu- tions of freedom abroad The 1984 election showed his success in persuading the people to adOpt his fundamental perSpective The events since then have threatened to under- mine that achievement by shifting the agenda and refocusing the debate If the President s substantial successes are to be sustained it is up to him and those of us who support his objectives to begin once again with the task of democratic persuasion Afterward Summary of Legal Conclusions Nicaragua The main period under review during these investigations was October 1984 through 0c- tober 1986 During this period various ver- sions of the Boland Amendment restricted the expenditure of appropriated funds avail- able to agencies or entities involved in intel- ligence activities from being spent directly or indirectly to support military or paramilitary Operations in Nicaragua In August 1985 the State Department was authorized to spend $27 million to provide humanitarian assist ance to the Nicaraguan democratic Resist- ance In December 1985 the CIA was au- thorized to spend funds specifically appropri- ated to provide communications equipment and training and to provide intelligence and counterintelligence advice and information to assist military operations by the Resistance On October IS I936 $100 million in direct military support for the Contras was made available for fiscal year 193 Our under- standing of the effect of these prohibitions rests on both statutory and constitutional in- terpretations I The Constitution protects the power of the President either acting himself or through agents of his choice to engage in whatever diplomatic communications with other countries he may wish It also protects the ability of the President and his agents to Chapter 1' persuade US citizens to engage voluntarily in otherwise legal activity to serve what they consider to be the national interest That includes trying to persuade other coun- tries to contribute their own funds for causes both countries support To whatever extent the Boland Amendments tried to prohibit such activity they were clearly unconstitu- tional 2 If the Constitution prohibits Congress from restricting a particular Presidential action directly it cannot use the appropria- tion power to achieve the same uneonstituw tional effect Congress does have the power under the Constitution however to use ap- propriations riders to prohibit the entire US Government from spending any money in- cluding salaries to provide covert or overt military support to the Contras Thus the Clark Amendment prohibiting all US sup- port for the Angolan Resistance in 1976 was constitutional Some members of Congress who supported the Boland Amendment may have thought they were enacting a prohibi- tion as bread as the Clark Amendment The speci c language of the Boland Amendment was considerably more restricted however in two respects By limiting the coverage to agen- cies or entities involved in intelligence activities Congress chose to use lan- guage borrowed directly from the In- telligence Oversight Act of 1980 In the course of settling On that language in 1980 Congress deliberately decided to exclude the National Security Council NSC from its coverage At no time afterward did Congress indi- cate an intention to change the lan- guage's coverage The NSC therefore was excluded from the Boland Amendment and its activities were therefore legal under this statute The Boland prohibitions also were limited to spending that directly or indirectly supported military or para- military operations in Nicaragua- Under this language a wide range of intelligence-gathering and political support activities were still permitted and were carried out with the full knowledge of the House and Senate Intelligence Committees Virtually all if not all of the activities examined by these Committees occurred after the De cember 1985 law authorized intelli- gence sharing and communications support and were fully legal under the terms of that law If the NSC had been covered by the Boland Amendments most of Oliver North s activity still would have fallen outside the prohibitions for reasons stated in and above Iran The Administration was also in substantial compliance with the laws governing covert actions throughout the Iran arms initiative 1 It is possible to make a respectable legal argument to the effect that the 1985 Israeli arms transfers to Iran technically vio- lated the terms of the Arms Export Control Act AECA or Foreign Assistance Act FAA assuming the arms Israel transferred were received from the United States under one or the other of these statutes However Covert transfers under the Na- tional Security Act and Economy Act were understood to be alternatives to transfers under the AECA and FAA that met both of these latter acts es- sential purposes by including provi- sions for Presidential approval and Congressional notification The requirement for US agree- ment before a country can retransfer arms obtained from the United States is meant to insure that rctransfers con- form to US national interests In this case the Israeli retransfers occurred with Presidential approval indicating that they did so conform 451 Chapter 1 The Israeli retransfer and subse- quent replenishment made the deal es- sentially equivalent to a direct us sale with Israel playing a role funda- mentally equivalent to that of a mid- dleman Since the United States could obviously have engaged in a direct transfer and did so in 1986 whatever violation may have occurred was at most a minor and inadvertent techni- cality 2 A verbal approval for covert transac- tions meets the requirements of the Hughes- Ryan Amendment and National Security Act Verbal approvals ought to be reduced to writing as a matter of sound policy but they are not illegal 3 Similarly the President has the consti- tutional and statutory authority to withhold notifying Congress of covert activities under very rare conditions President Reagan s de- cision to withhold notification was essential- ly equivalent to President Carter's decisions in 1979 1980 to withhold notice for between 3 and 6 months in parallel Iran hostage oper ations We do not agree with President Rea gan s decision to withhold notification for as 452 long as he did The decision was legal how- ever and we think the Constitution man- dates that it should remain so If a President withholds noti cation for too long and then cannot adequately justify the decision to Congress that President can expect to pay a stiff political price as President Reagan has certainly found out Diversion We consider the ownership of the funds the Iranians paid to the SecordJ Iakim Enter- prise to be in legal doubt There are re- spectable legal arguments to be made both for the point of view that the funds belong to the 1 1 8 Treasury and for the contention that they do not If the funds do not belong to the United States then the diversion amounted to thirdscountry or private funds being shipped to the Contras If they did belong to the United States there would be legal questions although not technically Boland Amendment questions about using U S -owned funds for purposes not specifi- cally approved by law The answer does not seem to us to be so obvious however as to warrant treating the matter as if it were criminal Endnotes 1 North Test Hearings 100-1 Part 1 Nil 37' at p 106 7 10f37 at 295 915 Vol 11 71 141417 at pp 164 65 1d Vol 1 7 10 87295 Poindexter Test Hearings 100-3 71 115137 at p 35 North Test Hearings 100 7 Part I 1 33 87 at p 139 North Test Hearings 100 7 Part 1 at p 140 George Test Hearings 100 11 8 6 31 at p 172 See also McMahon Dep at 3 3 3 US House of Representatives Permanent Select Com- mittee on Intelligence Report to Accompany HR 2760 Amendment to the Intelligence Authorization Act for FiSCal Year 1983 May 13 1933 p 2 germ-bun Chapter 1 9 McFarlane may be an arguable exception See chapter 1 below ll John Norton Moore letter to Brendan Sullivan July 1 198 p 2 reprinted along with other Moore material at the end of our separate views 11 See for example Primus l aren and Poindexler New York Times editorial December o 1935 Mary Belch- er White House shift realigns in uence in foreign policy more clout likely for State Defense The Washington Times December S 1985 p l 12 Leslie H Gelb How the New Admiral at the White House Fares New York Times September 23 1986 p 24 453 Part Ii The Foreign Affairs Powers of the Constitution and the Iran-Contra Affair Chapter 2 The Foreign Affairs Powers and the Framers Intentions Judgments about the Iran-Contra Affair ultimately must rest upon one s views about the proper roles of Congress and the President in foreign policy There were many statements during the public hearings for example about the rule of law But the fundamental law of the land is the Constitution Unconstitutional statutes violate the rule of law every bit as much as do willful violations of constitutional statutes It is essential therefore to frame any discussion of what happened with a proper analysis of the Constitutional allocation of legislative and executive power in for- eign affairs One point stands out from the historical record the Constitution s Framers expected the President to be much more than a minister or clerk The President was supposed to execute the laws but that was only the beginning He also was given important powers independent of the legislature s and these substantive ly were focuSed on foreign policy Our analysis will cover three chapters The first will be about the debates in and around the Constitu- tional Convention of 178 and will show the particu- lar importance of what Alexander Hamilton called energy in the executive in this policy arena The second reviews historical examples It shows that throughout the Nation s history Congress has accept- ed substantial exercises of Presidential power in the conduct of diplomacy the use of force and covert action which had no basis in statute and only a gen- eral basis in the Constitution itself The third consid- ers the applicable court cases and legal principles Taken together the three chapters will show that much of what President Reagan did in his actions toward Nicaragua and Iran were constitutionally pro- tected exercises of inherent Presidential powers How- ever unwise some of those actions may have been the rule of law cannot permit Congress to usurp judg- ments that constitutionally are not its to make It is true that the Constitution also gives substantial for- eign policy powers to Congress including the power of the purse But the power of the purse which forms the core of the majority argument is not and was never intended to be a license for Congress to usurp Presidential powers and functions Some of the statutes most central to the Iran-Contra Affair contain a mixture of constitutionally legitimate and illegit- imate prohibitions By the end of the three chapters we will be in a position to start sorting them out Necessary and Proper and the Invitation to Struggle In order to sort out constitutional from unconstitu- tional exercises of power however one rst must have a basis or a set of principles to guide the sorting It is a commonplace to note that foreign policy was meant to be shared between the branches The two branches respective powers clearly were meant to overlap somewhat with each branch having different means for addressing parallel policy issues This overlap led the respected Presidential scholar Edward S Corwin to describe the Constitution as an invitation to struggle for the privilege of directing American foreign policy 1 But to acknowledge the existence of a struggle is a far cry from seeing the Constitution as if it permits any branch to go after another's powers without bounds The boundless view of Congressional power began to take hold in the 1970's in the wake of the Vietnam War The l972 Senate Foreign Relations Committee's report recommending the War Powers Act and the 197 4 report of the Select Committee on Intelligence Activities chaired by Senator Frank Church and known as the Church Committee both tried to support an all but unlimited Congressional power by invoking the Necessary and Proper clause That clause says Congress may make all Laws which shall be necessary and proper for carry- ing into Execution the foregoing legislative Powers and all other Powers vested by this Constitution in the Government of the United States or in any De- partment or O icer rhereo The argument of these two prominent committees was that by granting Con- gress the power to make rules for the other depart- ments the Constitution meant to enshrine legislative supremacy except for those few activities explicitly reserved for the other branches 2 One must ignore 200 years of constitutional history to suggest that Congress has a vast reservoir of im- plied power whose only limits are the powers expt't'cir- iy reserved to the other branches It seems clear for example that Congress could not legislate away the Supreme Court s power of judicial review even 457 Chapter 2 though judicial review is not mentioned explicitly in Article The same applies to the Presidency The Necessary and Proper clause does not permit Con- gress to pass a law usurping Presidential power A law negating Presidential power cannot be treated as if it were necessary and proper for carrying Presi- dential powers into Execution To suggest other- wise would smack of Orwellian Doublespeak The issue for this investigation therefore is not whether Congress and the President both have a le- gitimate role in foreign policy Clearly both do Rather the question is how to interpret the powers the two branches were given All three of the Gov- ernment s branches were given both express and im- plied powers Congress does not have the authority to arrogate all of the implied power to itself What we need to determine is whether these implied powers all fall into an unde ned war zone or whether there are theoretical and historical principles that allow one to decide when powers are more properly exercised by one branch or another Separation of Powers One commonly held but mistaken view of the separa tiOn of powers sees its whole function as having been preventive Justice Louis D Brandeis for example wrote that the doctrine of separation of powers was adepted by the Convention of 1187 not to promote ef ciency but to preclude the exercise of arbitrary power 3 His statement has been accepted in some Congressional quarters as if it holds the force of con ventional wisdom but it misses half of the historical truth The fallacy of Brandeis' statement becomes appar- ent when one considers the defects of the U S Gov- ernment before the Constitution The Constitutional Convention among other things was taking the exec utive from being under the legislature s thumb not the legislature front being under the executive s After suffering through the Articles of Confederation and various state constitutions that had overcompensated for monarchy the 173 delegates wanted to empower a government not enfeeble it Brandeis was partly right to point out that the Framers did not want power to be used arbitrarily and that checks and balances were among the means used to guard against arbitrariness But the principles underlying separation had to do with increasing the Government's power as much as with checking it 5 For the Government to overcome the Articles problems the executive and judiciary had to act di- rectly upon citizens throughout the far-flung new nation As Charles Thach said in his classic study the delegates' chief concern was thus to secure an executive strong enough not one weak enough 5 The delegates did not want a monarchy but felt they had no reason to fear such a threat as long as Ment- bers of Congress retained their independent political 458 connection to the people The problem was to make sure the other branches were not drawn to use James Madison s word into the legislature s vortex 7 Constitutional Convention The need for a strong Executive was not seen or articulated clearly at the beginning of the Constitu- tional Convention by all of the delegates On June I in the rst debate on the subject Connecticut s ROger Sherman said he considered the Executive magistracy as nothing more than an institution for carrying the will of the Legislature into effect 3 For that reason Sherman supported the original Virginia Plan s provisions for the of ce As submitted on the rst day of the convention s substantive business on May 29 these included election by the legislature no reeligibility for reelection and a short list of powers The Presidency grew considerably in stature be- tween June 1 and September 17 the convention's last day The leading strong Executive proponents includ- ing James Wilson of and Gouverneur Morris of New York persuaded their colleagues to borrow key provisions from the New York State Constitution whose independently powerful governor stood out from the much weaker executives in the other states By the time the convention had nished the Presidency like the governorship of New York was to be uni ed in one person who had an electoral base independent from the legislature s who was al- lowed to run for reelection and who was given a quali ed veto over legislative bills With those changes in place the delegates insured that the Presi- dency would not be the subservient clerkship original- ly envisioned by Sherman The President s enumerated powers were not dis- cussed until the second half of the Constitutional Con- vention For a week after the July 16 Great Compro- mise on legislative representation the delegates debat- ed the Presidency without reaching nal conclusions On July 26 they recessed to let a Committee of Detail work on a draft Constitution At this point the convention had only given the President the power to enforce laws appoint of cers and exercise a quali ed veto over legislation The Committee of Detail's report of August 6 listed speci c powers for all three branches signi cantly expanding the ones for the President To the ones listed on July 26 the committee added the ability to recommend legislation to receive ambassadors to communicate with other heads of slate and to act as commander in chie g Beyond these powers however the committee did not yet see the President as being preeminent in for- eign policy Reflecting the stake that small state dele- gates felt they had in the Senate the cOmmittee gave the Senate the power to make treaties and appoint Chapter 2 ambassadors and judges and gave the full Congress the power to make war Over the next several weeks all of these foreign policy decisions were modi ed to increase the Presi- dent's power On August I'l Mr Madison and Mr Gerry moved to insert striking out Con- gress s power to make' war leaving the Executive the power to repel sudden attacks 1 This sentence is sometimes read by advocates of Congressional power as if the President was to be left only with the power to repel sudden attacks 11 The next sentence muddies this interpretation substantially however Roger Sherman the same delegate who was so suspi- cious of Executive power said he would oppose the change because he interpreted it to mean the Presi- dent was being given the power to commence war Oliver Ellsworth joined Sherman s reasoning and Madison s notes much skimpier for September than earlier made George Mason's remarks inscruta tiile l2 The motion was adopted but an honest reading of these contradictory interpretations compels the con- clusion that the scope of Executive power on this point was not settled The President clearly was being given some discretion to use force without a declara- tion of war but how much would have to be worked out in subsequent practice The treaty power was debated on August 23 but left unresolved 13 On September 4 a Committee of Eleven reported a provision that said the President by and with the advice and consent of the Senate shall have power to make Treaties and he shall nomi- nate and by and with the advice and consent of the Senate shall appoint ambassadors other public Min isters judges and other of cers not otherwise provid- ed for in the Constitution The votes of two-thirds of the Senators present were to be needed to ratify a treaty The provision for treaties was adopted with little recorded debate on September 7 James Wilson did move to require rati cation to be shared by the House of Representatives but the motion was defeat- ed l lO after Sherman said the necessity of secrecy in the case of treaties forbade a reference of them to the whole Legislature '5 The delegates reduced the two-thirds requirement for advice and consent to a simple majority for treaties of peace but reversed themselves the next day As with the war power shifting the power to make treaties away from the Senate clearly was meant to expand the President's role this time to take the lead in international negoti- ations This expansion would parallel the President s sole authority to receive ambassadors and his author- ity to nominate ambassadors with advice and consent of the Senate Once again however the exact scope of the relationship implied by the treaty power was left to be worked out in practice The Federalist Analysis of Political Principles Although the convention left a great deal unsettled that does not mean the Framers considered the distri- bution of foreign policy powers to he unimportant Problems of security and diplomacy were among the dominant preoccupations of the men who met at Philadelphia wrote one legal scholar and rst among their arguments for Union 1 John Jay's four papers on foreign affairs come rst in the Federalist and more than half of the papers in one way or another involve national security or foreign policy In fact one of the main differences between Federalists and Anti-Federalists during the whole ratification period turned on the Federalists insistence that a strong national government was needed to meet for- eign threats So the issues were aired at some length If we begin with the discussions about governmen- tal institutions that were not speci cally focused on foreign policy we can see that there were some prin- ciples underlying the way powers were allocated to the various branches of government There was some overlap to be sure Unless these departments be so far connected and blended as to give each a constitu- tional controul over the others Madison wrote in Federalist No 43 no checking or balancing could occur But the core of each branch's power cen- tered upon tasks it was supposed to be best suited to perform The primary concern the Framers had for the Con- gress was to create a body whose members naturally concerned with the immediate concerns of their own districts would be encouraged to debate and deliber- ate in the name of the national interest 1 If delibera- tion was the key word for designing the legislature energy the ability to act was the central concept for the Presidency In describing the delegates decision to have a single Executive and a numerous legislature Alexander Hamilton wrote They have with great propriety considered energy as the most necessary quali cation in the former and have regarded this as most applicable to power in a single hand while they have with equal propriety considered the latter as best adapted to deliberation 23 The need for an effective foreign policy it turned out was one of the main reasOns the country needs an energetic government according to Alexander Hamilton in Federalist Nos 22 and 23 Madison made the same point in No 37 Energy in Government is essential to that security against external and internal danger and to that prompt and salutary execution of the laws which enter into the very definition of good Government 23 The relevance of these observations about the government is power is that the Framers saw energy as being primarily an executive branch charac- terl tlc 459 Chapter 2 Energy is the main theme of Federalist No 70 energy in the executive is a leading character in the definition of good government It is said to be im- portant primarily when decision activity secrecy and diSpatch were needed These features are essen- tial to the protection of the community against for- eign attacks In the conduct of war the energy of the executive is the bulwark of national securi- ly 24 But war was not the only aspect of foreign policy described as being more appropriate for the executive than legislative branch The actual conduct of for- eign negotiations the arrangement of the army and navy the direction of the operations of war these and other matters of a like nature constitute what seems to be most properly understood by the adminis- tration of government 25 On negotiations Hamilton went further to say that the Executive is the mostji't agent for foreign negotiations 2'5 In all of the quotations above the Federalist was not treating powers as if they were randomly distrib- uted Separated powers are not separated arbitrar- ily writes one constitutional scholar 27 They are divided on principle and not according to the pru- dential considerations of the moment concludes an- other The responsibilities given each branch were the ones most suited to its composition Activities requiring discussion and deliberation formed the heart of the legislature s job those calling for decision activity secrecy and dispatch were the heart of the Executive s The distribution of these characteristics among the branches would not by itself settle a dis- pute over the separation of powers One could not for example challenge the existence of Congressional intelligence committees by saying that the Federalist called secrecy more of an Executive than a legislative trait The analysis does show however that the Framers had solid reasons for placing the deployment and use of force but not declarations of war togeth- er with negotiations intelligence gathering and other diplomatic communications but not treaty rati- fication at the center of the President's foreign policy 450 powers The principles underlying this distribution of powers should therefore be respected in constitutional interpretation except where there are compelling rea- sons to suppose the Framers intended a different result We would be remiss if we failed to note that Feder- alist No T0 gave two reasons for supporting unity in the Executive So far our discussion has concentrated on the rst the need for energy in the Executive No government democratic or otherwise could long sur- vive unless its Executive could respond to the uncer- tainties of international relations But energy in the Executive seemed frightening to some peOple To them the Federalists made two responses The rst was that the Executive could not maintain a standing army equip a navy or engage in a large-scale use of force without spending appropriated funds provided and controlled by the I Congress i30 The second was that an independent single Execu- tive in addition to being more energetic would also be more responsible politically It would be much easier to hold one person accountable than a commit- tee 31 In other words giving the President some inde- pendent inherent power was not seen as being un- democratic The President and Congress both were considered to be representatives of the peeple The Cengress produced a more fitting result when the primary need was to moderate internal factional de- mands through discussion and deliberation before pro- ducing general rules But foreign policy is dominated by case-by case decisions not general rulesmoderate internal pressures through de- liberation but to respond to external ones quickly and decisively For these kinds of situations multiple bodies like Congress are inherently unable to accept blame or responsibility for mistakes Thus de- spite majority s contentions to the contrary put- ting such decisions in the hands of the Congress was considered to be less democratic than giving them to the President because there would be no way for the people to hold any one person accountable for a legis- lative decision Chapter 2 Chapter 2 Minority 1 Edward S Corwin The President Of ce and Powers 1957 p 111 2 US Senate 92d 2d Sess Committee on For eign Relations War Powers 5 Rept 92 606 to accompany S 2956 1972 p 16 and U S Senate 94th Cong 2d Sess Select Committee to Study Governmental Operations With Respect To Intelligence Activities Final Report Foreign and Military Intelligence S Rept 94 755 1976 Book I p 3 3 Myers v United States 272 U S 52 293 I926 4 See For example U S Senate 94th Cong 2d 5e53 Select Committee to Study Governmental Operations With Respect To Intelligence Activities Final Report Foreign and Military Intelligence S Rept 94-755 1926 Book I p 31 5 See for example Loois Fisher President and Con- gress Power and Policy 1972 at 3 would not go so far as to claim that the framers search for administrative effi- ciency and their adeption of a separate executive for that purpose represents the whole truth Still it is at least half the truth See also L Fisher The Efficiency Side of Separated Powers 5 JOurnal of American Studies 113 1971 6 Charles C Thach Jr The Creation of the Presidency tarts 1739 1923 p Alexander Hamilton James Madison and John Jay The Federalist Jacob Cooke ed 1961 No 43 p 333 Hereafter cited as Federalist 8 Max Farrartd The Records of the Federal Convention of 1'23 4 vols Vol I p 65 Hereafter cited as Farrand 9 Farrand II 135 10 Farrand II 318 II US Senate 92d Cong 2d Sess Committee on For- eign Relations War Powers S Rept 92 606 to accompany S 2956 1972 P 4 12 Farrand II 318 19 13 Farrand II 392 94 l4 Farrand II 498 99 IS Farrand II 538 16 Farrand 11 541 549 Eugene V Rostow Great Cases Make Bad Law The War Powers Act 50 Texas LRev 833 345 1972 13 Nathan Tarcov1 The Federalists and Anti-Federalism on Foreign Affairs 14 Teaching Political Science Politics in PerSpective 33 Fall 1986 I9 Federalist No 43 at 332 William R Davie made the same point in the North Carolina ratifying convention It is true the great Montesquieu and several other writers have laid it down as a maxim not to be departed from that the legislative executive and judicial powers should he sepa- rate and distinct But the idea that these gentlemen had in view has been misconceived or misrepresented An absolute and complete separation is not meant by them It is impossi ble to form a government on these principles Jonathan Elliot ed The Debates in the Several States on the Adep- tion of the Federal Constitution 5 vols 1838 Vol IV 121 20 See Ann Stuart Diamond The Zenith of Separation of Powers Theory The Federal Convention of 173 Pub lius Summer 1973 at 51 21 Michael J Malhin Congress During the Convention and Rati cation in L Levy and D Mahortcy eds The Constitution A History of its Framing and Rati cation M Malbin Factions and Incentives in Cengress 36 The Public Interest 91 1937 22 Federalist No 70 at 472 23 Federalist No 3 at 233 24 Federalist No 70 at 421 22 426 25 Federalist No 72 at 486 87 26 Federalist No 75 at 505 emphasis added 27 Gary J Schmitt Separation of Powers Introduction to the Study of Executive Agreements 27 The American Journal oi Jurisprudence 114 I 15 1932 28 Glen E Thurow Presidential Discretion in Foreign Affairs 7 Vanderbilt of Int'l L 71 75 I923 29' Federalist No 64 at 435 30 Federalist No 26 at 168 No 41 at 273-74 We dis-cuss the Constitutional limits on the appropriations power as a tool of foreign policy in the next chapter 31 Federalist No 70 at 476 77 461 Chapter 3 The President s Foreign Policy Powers in Early Constitutional History Our review of the Constitutional Convention conclud- ed that the original document left a great deal to be worked out in practice The Federalist does not change this conclusion It does give us a theoretical basis however for seeing that the subsequent histori- cal development of the President s foreign policy powers was no aberration This is evident in the early development of diplomatic power in presidential de- ployments of force and in the use of secret agents for intelligence and covert activities Diplomacy The major uncertainties affecting the President s abili- ty to hold the initiative in negotiations and diplomatic communications were settled early The President s role as the sole organ 1 of international communica- tions was asserted unequivocally on October 9 I789 when George Washington answered a letter that the King of France had addressed to the President and Members of the General Congress by saying that the task of receiving and answering such letters has tied volved upon me Washingmn s interpretation was not based on the explicit words of Article Con- rming this assertion the Senate twice rejected mo- tions to request the President to communicate mes- sages on behalf of the United States 2 The related issue of whether the President may be required to give all requested information to Congress arose in a variety of foreign policy contexts during the Washington Administration According to Abra- ham Sofaer s de nitive study of the rst forty years practice under the Constitution WashingtOn repeated- ly asserted and Congress just as repeatedly accepted a presidential right to withhold information the Presi- dent thought should be kept secret In 1794 for exam- ple the Senate requested copies of the correSpond- ence between our ambassador to France and the French Republic Attorney General William Bradford wrote that it is the duty of the Executive to with- hold such parts of the said correspondence as in the judgment of the Executive shall be deemed unsafe and improper to be disclosed Washington s response to the Senate clearly indicated that he was withhold- ing some material but the Senate took no further action 3 A year later the Senate asked President Washing- ton for John Jay s negotiating instructions and dis- patches relating to the controversial Jay Treaty the rst truly signi cant treaty COmpieted under the new Constitution 4 The issue here had to do not with the President s right to be the sole negotiator of treaties but with what information Congress could insist on after the fact as a matter of right Despite some advice to the contrary within his cabinet Washington decided to give all requested information to the Senate Thomas Jefferson Washington s Secretary of State made it clear later however that he considered the decision to have been a matter of political pru- dence rather than an acquiescence in a Senatorial right of advance consultation 5 When it was time for the House to consider imple- menting legislation for the Jay Treaty Washington refused the same information an action that pro- voked more than 300 pages of debate in the Annals of Congress The President said he was refusing the re- quest because the House had no role in ratifying trea- ties The Cabinet however had also discussed a second reason for refusing to answer the President s inherent power to decide what could with safety be shared In a subsequent House debate James Madison argued that the President should not be allowed to judge what was in the House s power but supported the idea that the President could withhold papers if in his judgment it might not be consistent with the interest of the United States at this time to disclose In other words Madison was saying that each branch was the proper judge of its own constitutional powers According to Sofaer the debate showed that members widely shared the view that the Presi- dent had discretion to decline to furnish information requested Only one member claimed that the House had an absolute right to obtain information it sought 5 In addition to negotiating treaties and sharing in- formation about them with Congress there was a major dispute during the Washington Administration about subsequent interpretation and implementation After war broke out between France and England in 1793 WashingtOn decided to issue his famous Procla- mation of Neutrality Public sentiment was in favor of having the United States support France a course 463 Chapter 3 that arguably would have been consistent with a 1778 Treaty of Alliance between the United States and France Washington was convinced however that taking sides in the war would be disastrous He took the position that it was up to him as President to interpret the country's treaty obligatiOns when he felt those obligations did not require him to ask Congress for a declaration of war For eight months Washing- ton implemented his policy without asking Congress to convene for a special session One of the truly remarkable aSpects of the decision was that in addition to its assertion of the President's unilateral power to set policy Washington claimed that he could use military force if necessary to pre- vent violations of the policy outside the United States by privateers and by people who helped out t them and that he could treat violations within the United States as criminal acts under the common law Al- though unrelated concerns about common law crimes and the dif culty of winning jury convictions led to the rst Congressional Neutrality Act there was never any doubt about Washington's authority to en- force his policy of neutrality abroad Washington s proclamation also occasioned one of the great public debates over executive power in the Nation s history About two and a half months after the proclamation Hamilt0n published the rst of a series of papers under the pseudonym of Pacificus The main constitutional issue of the day was whether Congress' power to declare war carried with it the power to declare peace or to determine whether U S treaty obligations with France required supporting that country in its war with England Hamilton argued that these powers must of necessity belong to the Executive Department 1r His reasoning was as follows It appears to be connected to that department in various capacities as the organ of intercourse be- tween the Nation and foreign Nations as the interpreter of the National Treaties in those cases in which the Judiciary is not competent that is between Government and Government as that Power which is charged with the Execution of the Laws of which treaties form a part as that Power which is charged with the application of the Public Force That view of the subject is so natural and obvi ous- so analogous to general theory and prac- tice that no doubt can be entertained of its just- ness unless such doubt can be deduced from particular provisions of the Constitution At this point lamilton turned his attention to the texts of Articles and II and particularly to the general clauses introducing each of thent The second Article of the Constitution of the United States section lst establishes this general 464 Proposition That The EXECUTIVE POWER shall be vested in a President of the United States of America The same article in a succeeding Section pro ceeds to designate particular cases of Executive Power It would not consist with the rules of sound construction to consider this enumeration of par- ticular authorities as dcrogating from the more comprehensive grant contained in the general clause further than as it may be cuttpied with express restrictions or quali cations Be- cause the dif culty of a complete and perfect speci cation of all the cases of Executive author- ity would naturally dictate the use of general terms and would render it improbable that a specification of particulars was designed as a sub stitute for those terms when antecedently used The different mode of expression employed in the constitution in regard to the two powers the Leg- islative and the Executive serves to con rm this inference In the article which grants the legisla tive powers of the Governt the expressions are All Legislative powers herein granted shall be vested in a Congress of the United States in that which grants the Executive Power the expres- sions are as already quoted The EXECUTIVE shall be vested in a President of the United States of America The general doctrine then of our constitution is that the EXECUTIVE POWER of the Nation is vested in the President subject only to the excep- tions and which are expressed in the instrument This mode of construing the Constitution has indeed been recognized by Congress in formal acts upon full consideration and debate The power of removal from of ce is an important instance Thomas Jefferson Washington s Secretary of State joined the other members of the Cabinet in supporting the President's proclamation He became Upset how- ever at Pacb iczts' arguments for executive power and urged his friend James Madison to write a reply The results were published under the pseudonym of To see the laws faithfully executed constitutes the essence of the executive authority But what relation does it have to the power of making treaties and war that is of determining what the laws site be with regard to other nations By whatever standard we try this doctrine it must be condemned as no less vicious in theory than it would be dangerous in practice Chapter 3 Whence can the writer have borrowed it There is but one answer to this question The power of making treaties and the power of declaring war are roya prerogatives in the British gGlJ'E' tm ' t and are accordingly treated as execu- tive prerogatives by British commentators 3 Interestingly a letter Madison wrote to Jefferson shows that he was extremely reluctant to take on the task On an earlier occasion when he was support- ing the removal power Madison had described the executive power in terms much closer to Hamilton s The constitution affirms that the executive power shall be vested in the president Are there excep tions to this pr0position Yes there are The con- stitution says that in appointing to of ce the senate shall be associated with the president unless in the case of inferior of cers when the law shall otherwise direct Have we in Congress a right to extend this exception I believe not If the constitution has invested all the executive power in the president I venture to assert that the legislature has no right to diminish or modify his executive authority 2 Whatever one may want to say about Madison s narrow construction of Presidential power in the role of Hefvtditts there can be little doubt that the history of the years and decades immediately following Washington's assertions of broad power developed more along lines envisioned by Pacrficus Sofaeris review of the Washington administration ended by observing that the framework for executive-congres- sional relations developed during the rst eight years differs more in degree than in kind from the present framework 13 At least as important as the rst eight years however was the fact that this framework was maintained by Jefferson and his successors despite their public identi cation during the years the Feder- alists held power with the Hatvr'dr'us view of the Presi- dency One constitutional dispute early in the Jefferson Administration was over the Louisiana Purchase What would the party whose adherents had insisted on a Senate role in negotiating the Jay Treaty say about the President s power to negotiate the Pur- chase Jefferson's Secretary of State Albert Gallatin supported the Louisiana Purchase by saying that the purchase eventually would have to be rati ed by treaty and that its negotiation therefore belonged to the President under the Constitution Jefferson did not embrace Gallatin's constitutional argument Instead the President decided to go through with the Pur- chase without abandoning his view that the IConstitu- tion severely limited the President by asserting an inherent extraconstitutional prerogative power for the Executive that was more sweeping than anything rr-ozs to Hamilton had ever put forward Jefferson justi ed his decision this way A strict observance of the written law is doubt- less one of the high duties of a good citizen but it is not the highest The laws of necessity of self-preservation of saving our country when in danger are of higher obligation To lose our country by a scrupulous adherence to written lawt would be to lose the law itself absurdly sacri cing the end to the means 1 One of the remarkable aspects of Jefferson s asser tion is the stark way in which it poses a fundamental constitutional issue Chief Executives are given the responsibility for acting to reSpond to crises or emer- gencies To the extent that the Constitution and laws are read narrowly as Jefferson wished the Chief Ex- ecutive will on occasion feel duty bound to assert monarchical notions of prerogative that will permit him to exceed the law Paradoxically the broader Hamiltonian ideas about executive power by being more attuned to the realistic dangers of foreign policy seem more likely to produce an Executive who is able and willing to live within legal bound- aries Thus the constitutional construction that on the surface looks more dangerous seems on reflection to be safer in the long run After Jefferson the notion of executive prerogative was put on the shelf Instead Jeffersonian Presidents began asserting Hamiltonian ideas about executive power Although we will discuss the use of force separately below Sofaer s comment on the post-Jef- fersonians bears quotation here Although Presidents during this period claimed no inherent authority to initiate military actions Madison departing from the theory of the Helvi- dius papers and particularly Monroe secretly used their powers in ways that could have been justi ed only by some sweeping and vague claim such as the right to use the armed forces to advance the interests of the United States The reason such inherent presidential power was exercised in this period and later was not mysterious The exercise grew out of the character of foreign policy and of the offices the Constitution had created As Gary Schmitt put it in an article about Jefferson To some extent the enumerated powers found in Article II are deceiving in that they appear un- derstated By themselves they do not explain the particular primacy the presidency has had in the governmental system since 1739 What helps to explain this fact is the presidency's radically dif- ferent institutional characteristics especially its unity of of ce Because of its unique features it enjoys as the framers largely intended the ca- pacity of acting with the greatest expedition se- 465 Chapter 3 crecy and effective knowledge As a result when certain stresses particularly in the area of foreign affairs are placed on the nation it will natural- ly rise to the forefront These stresses are particularly evident when it is time to use force or engage in secret diplomacy or covert actions We close this section on diplomacy by relating it to some of the issues of the Iran-Contra investigation Some Members of these Committees seem to have taken the positions 1 that Congress can require the President to notify it whenever the President prepares or begins to conduct secret negotiations or covert Operations whatever the circumstances and or 2 that Congress may constitutionally use its appropria- tions power to prohibit certain forms of commUnica- tion between the President or the President's employ- ees in the White House and State Department and other governments or private individuals We consid- er negotiations and communications with foreign gov- ernments or individuals to be Presidential powers pro- tected by the Constitution without reservation They fall comfortably within precedents established during the Washington Administration which have never been successfully challenged since The constitutional validity of withholding information about sensitive covert operations involves additional considerations that will be discussed separately later Use of Force We do not intend to turn this report into an argument about war powers We have no doubt that we dis- agree with some of our esteemed colleagues on this issue but there is no point in getting sidetracked Nevertheless we consider it important to say some- thing about the power Presidents traditionally have exercised under the Constitution to use force with and without prior congressional authorization This history clearly supports our basic contention that the Constitution expected the President to be much more than a clerk It will also provide a context for discuss ing the less drastic projections of U S power that t under the rubric of covert action In its 191'3 hearings on the War Powers Resolution the House Foreign Affairs Subcommittee on National Security Policy and Scienti c Developments pub- lished a list of l99 US military hostilities which occurred abroad without a declaration of war The five declarations of war in the Nation s history were for the War of 1812 Mexican War Spanish-American War World War I and World War II The list was a revision of one Published the year before in a law review article by LT Emerson m Of the 199 listed actions only 8 could be said under any stretch of the imagination to have been initiated under prior legisla- tive authority The 81 included Sl undertaken under treaties many of which left substantial room for inter- 466 pretation In addition many of the remaining actions were undertaken with only the vaguest statutory au- thority President Jefferson's ve-Year campaign against the Barbary States for example was justi ed by the claim that Congress' general decision to pro- vide a navy carried with it the authority to deploy the navy whereever the President wished including a theater in which the President had every reason to expect hostilities The point here is not to quibble about the 81 occa- sions the subcommittee described as having had prior congressional authorization Rather it is to show that the list made every effort to include all examples for which some kind of prior congressional authorization could arguably have been claimed That leaves an extremely conservative number of 118 other occasions without prior legislative authorization What follows is a sampler of the 118 actions taken solely on execu- tive authority The descriptive language below is paraphrased from the subcommittee exhibit cited above ln I810 Governor Claiborne of Louisiana on the sole order of the President used troops to occupy disputed territory east of the Mississippi During the First Seminole War lSl -lS US forces invaded Spanish Florida on two occasions In the rst action they dEstroyed a Spanish fort In the second they attacked hostile Seminole Indians occu- pying Spanish posts believed to have served as havens President Monroe assumed re5ponsibility for these acts In 1818 the USS Ontario landed at the Colum bia River and took possession of Oregon which was also claimed by Russia and Spain In 1844 President Tyler deployed forces to pro- tect Texas against Mexico anticipating Senate ap- proval of a treaty of annexation The treaty was later rejected ln 1846 President Polk ordered General Scott to occupy disputed territory months before a declaration of war The troops engaged in battle when Mexican forces entered the area between the Nueces and Rio Grande Rivers The ghting occurred three days before Congress acted ln 1853 54 Commodore Matthew C Perry led an expedition to Japan to negotiate a commercial treaty Four hundred armed men accompanied Perry and landed with him at Edo Bay in July 1853 where he stayed ten days after being told to leave He then sailed south and took possession of the Bonin Islands In March 1854 he returned to Edo Bay with 10 ships and 2 000 men He landed with 500 men and signed a treaty after a six-week campaign The whole cam- paign was on executive authority In late 1865 General Sherman was sent to the Mexican border with 50 000 troops to back up the protest made by Secretary of State Seward to Napole- on that the presence of 25 000 French troops in Mexico is a serious concern The troops remained until February 1866 when Seward demanded a de nite date for French withdrawal and France com- plied a-ln 1869 71 President Grant sent a naval force to the Dominican Republic to protect it from invasion while the Senate considered a treaty of annexation The Senate rejected the treaty but the naval force stayed in place for months afterwards -Between and 1915 US forces were put ashore on 29 different occasions to protect American lives or interests in places as diverse as Hawaii Mexico Egypt Korea Argentina Chile Nicaragua China Colombia Panama Dominican Republic Syria Abyssinia Morocco Honduras Turkey and Haiti Between 19l5 and 1934 the United States placed Haiti under US military and nancial administration The occupation was sanctioned by a treaty rati ed by the Senate in February 1916 but the first months of the occupation were on Executive authority February 1917 President Wilson asked Con gress for authority to arm US merchant vessels Congress refused and Wilson acted on his own au- thority to provide the ships with guns 1918 20 after signing the Armistice for World War 1 US trOOps participated in Allied anti-Bolshe vik military actions in Russia Between 1926 and 1933 5 000 US troops were in Nicaragua at the request of the government during the period of Sandino's attempted revolution Con gressional Democrats opposed President Coolidge s decisions but did not question his authority On September 3 1940 President Roosevelt in- formed Congress that he had agreed to deliver a flotilla of destroyers to Great Britain in return for a series of military bases on British soil along the West- ern Atlantic ln April l94l after the German invasion of Den- mark the US Army occupied Greenland under agreement with local authorities The action appears to have been contrary to an express congressional limitation On July 7 194 US troops occupied Iceland Congress was noti ed the same day but was not con sulted in advance The Reserves Act of 1940 and the Selective Service Act of 1940 both provided that US troops could not be used outside the Western Hemi- Sphere By July 1941 President Roosevelt had ordered 15 warships to convoy supplies sent to Europe to protect military aid to Britain and Russia By Septem- ber the ships were attacking German submarines In July 1946 during an Italian Yugoslav border dispute in the Trieste area President Truman ordered U S Naval units to the scene After the Yugoslavs shot down US transport planes in August Truman ordered US troops and air forces to be augmented Chapter 5' Five thousand US troops remained in Trieste as late as 1943 Betwcen 1943 and 1960 US forces were de- ployed to evacuate protect or be ready to protect US lives in or near Palestine China Egypt Indone sia Venezuela and Cuba In October 1962 President Kennedy ordered a naval quarantine of Cuba during the Cuban Missile Crisis On April 24 1965 a revolt broke out in the Dominican Republic and on April 28 President John- son sent American troops The announced purpose was to protect American lives At the peak of the action 21 500 US troOps were in the Dominican Republic An Inter-American Peace Force began ar- riving on May 2 and stayed through the year On September 17 1970 King Hussein of Jordan moved against the Palestine Liberation Organization Syria sent 300 tanks across the Jordanian border and President Nixon ordered the United States Sixth Fleet to deploy off the Lebanese-Israeli coast The United States apparently was prepared to intervene to pre- vent Hussein's overthrow Syrian tanks began with- drawing on September 22 and Hussein and PLO leader Yassir Arafat agreed to a cease-fire on Septem- ber 25 As should be obvious from all of these examples Presidents from the earliest history of the United States have not limited themselves to a Roger Sher- man-like limited conception of their job Neither have they felt as they have deployed force without con- gressional authorization that their actions had to be limited to hot pursuit repelling attacks or protecting American lives Until recently the Congress did not even question the President s authority The relevance of these repeated examples of the extensive use of armed force therefore is that they indicate how far the President s inherent powers were assumed to have reached when Congress was silent and even in some cases where Congress had prohib- ited an action We shall show later that most of the Reagan Administration s actions in Central America in fact were not covered by statute They therefore fall constitutionally under the heading of unauthor- ized but also unprohibited actions As shown above Presidents historically have had not only the power to negotiate and communicate but also to deploy force overtly sometimes for major campaigns in- volving signi cant losses of life without Congres sional approval The Reagan Administration did not even come remotely close to this level of activity in its support of the democratic resistance in Nicaragua Intelligence and Covert Actions We end this review of historical precedent with a brief overview of intelligence and covert actions au thorized by past Presidents That history begins in the 46 Chapter 5 earliest days of the Nation As Representative Hyde mentioned during Admiral Poindexter s testimony on July the Cominental Congress which did not have a separate executive branch set up a Commit- tee of Secret Correspondence made up of Benjamin Franklin Robert Morris Benjamin Harrison John Dickinson and John Jay On October I lTlti Frank- lin and Morris were told that France would be will- ing to extend credit to the revolutionaries to help them buy arms They wrote Considering the nature and importance of the above intelligence we agree in opinion that it is our indispensable duty to keep it a secret from Congress As the court of France has taken measures to negotiate this loan in the most cau- tions and secret manner should we divulge it immediately we may not only lose the present bene t but also render the court cautious of any further connection with such unguarded people and prevent their granting other loans of assist- ance that we stand in need of 20 In a subsequent chapter on leaks we shall discuss the methods this committee used to protect secrets some of which should be revived today The Federalist also recognized the important role intelligence might play under the new Constitution Federalist No 64 about treaties was written by Jay an experienced diplomat as well as a former member of the Committee on Secret Correspondence He said It seldom happens in the negotiation of treaties of whatever nature but that perfect secrecy and immediate dispatch are sometimes requisite There are cases when the most useful intelligence may be obtained if the person possessing it can be relieved from apprehensions of discovery Those apprehensions will operate on those persons whether they are actuated by mercenary or friendly motives and there are doubtless many of both descriptions who would rely on the secrecy of the President but who would not con de in that of the Senate and still less in that of a large popular assembly The convention have done well therefore in so disposing of the power of making treaties that although the President must in forming them act by the advice and consent of the senate yet he will be able to manage the business of intelligence in such manner as pru- dence may suggest 21 Beginning with George Washington almost every President has used special often private individuals appointed for missions by the President without Senate con rmation to help gain the intelligence about which Jay wrote and to engage in a broad range of other activities with or against foreign countries The first such agent was Gouver- neur Morris who was sent to Great Britain in I789 to 468 explore the chances for opening normal diplomatic communications 22 At the same time Britain sent a private agent to the United States who communi- cated outside normal channels through Secretary of Treasury Alexander Hamilton instead of through the Francophilc Secretary of State ThOmas Jefferson 23 Washington s agents were paid from a secret serv- ice fund he was allowed to use at his discretion without detailed accounting The early examples that are most interesting for these investigations are ones in which the President used his discretionary power to authorize covert ac- tions Covert action is an inexact term generally recognized to include covert political action covert propaganda intelligence deception and covert para military assistance In the period of l810 12 for ex- ample Madison used agents to stimulate revolts in East and West Florida that eventually led to an overt Congressionally unauthorized military force to gain U S control over territories held by a country with which the United States was at peace Even more telling however is the following example from the Madison Administration Madison in 1810 sent Joel R Poinsett secretly and without Senate approval to South America as an agent for seamen and commerce Poinsett did some commercial work but he broadly con strued instructions from Secretaries of State Smith and Monroe and worked intimately with revolutionary leaders in Argentina and Chile suggesting commercial and military plans helping them obtain arms and actually leading a division of the Chilean army against Peruvian loyalists Nothing in Poinsett's instructions speci cally au- thorized these activities But he had kept the ad- ministration advised of most of his plans and re- ceived virtually no directions for long periods of time and no orders to refrain in any way from aiding the revolutionaries Poinsett was given broad leeway to advance the republican cause without any commitment from the admin- istration He was told to write in code and all his important communications were withheld from Congress 25 In other words Poinsett made Oliver North look like a piker In l843 President Tyler secretly sent Duff Green to Great Britain to engage in secret propaganda ac- tivities relating to the 1 3 5 desire to annex Texas At one point Green had a letter published in a newspa- per without using his own name This raised a furor among members of Congress several of whom der manded to know his identity Because Green was paid out of the President's contingency fund Congress made the fund an issue during the subsequent adminis- tration of President Polk Polk refused to disclose his expenditures in a statement that openly acknowledged Chapter 3 they were being used for more than intelligence gath- e ng In no nation is the application of such funds to be made public In time of war or impending danger the situation of the country will make it neces sary to employ individuals for the purpose of obtaining information or rendering other important services who could never be prevailed upon to act if they entertained the least apprehension that their names or their agency would in any contin- gency be revealed One early example of a covert action brought to an end through a leak is described in Edward Sayle's article on the history of intelligence President Pierce as Polk made extensive use of agents and covert action One of the mast inno- vative plans was to acquire Cuba from Spain Spain had refused to part with the troublesome island and a scheme was devised to force them to sell It called for cooperative European money-lenders to call in their loans to the Span ish Crown pressuring Madrid to sell Cuba to the United States as a means to raise the needed cash The plan went well until leaked to the New York Herald Examples like these are legion During the coun- try s first century Presidents used literally hundreds of secret agents at their own discretion Congress did give the President a contingency fund for these agents but never specifically approved or was asked to approve any particular agent or activity In fact Congress never approved or was asked to approve covert activity in general The Presidents were simply using their inherent executive powers under Article II of the Constitution For the Congresses that had ac- cepted the overt presidential uses of military force summarized in the previous section the use of Execu- tive power for these kinds of covert activities raised no constitutional questions Conclusion Presidents asserted their constitutional independ- ence from Congress early They engaged in secret diplomacy and intelligence activities and refused to share the results with Congress if they saw fit They unilaterally established US military and diplomatic policy with respect to foreign belligerent states in quarrels involving the United States and in quarrels involving only third parties They enforced this policy abroad using force if necessary They engaged US troops abroad to serve American interests with- out congressiOnal approval and in a number of cases apparently against explicit directions from Congress They also had agents engage in what would common- ly be referred to as covert actions again without Congressional approval In short Presidents exercised a broad range of foreign policy powers for which they neither sought nor received Congressional sanc- tion through statute This history speaks volumes about the Constitu- tion s allocation of powers between the branches It leaves little if any doubt that the President was ex- pected to have the primary role of conducting the foreign policy of the United States Congressional ac- tions to limit the President in this area therefore should be reviewed with a considerable degree of skepticism If they interfere with core presidential for- eign policy functions they should be struck down Moreover the lesson of our constitutional history is that doubtful cases should be decided in favor of the President 469 Chapter 3 Endnotes 1 This phrase commonly used in contemporary debates over the President's foreign policy powers originated in Alexander Hamilton's Paci eus papers was used by John Marshall in a House floor debate in 1 5100 and then reap- peared in the Supreme Court case of US v Tamas-Wright See Alexander Hamilton Papers H Syrett ed Vol XV pp 32-33 1969 113' Annals of CongreSS 613 1300' US v Caress-Wright Export Corp 299 US 304 319 20 1936 2 Abraham D Sofaer War Foreign Affairs and Consti tutional Power 19715 p 94 3 Sofaer at 83 35 4 Gary Sehmitt Executive Privilege in J Bessette and J 'I'ulis eds The Presidency in the Constitutional Order 1931 154 137 1 33 5 Thomas Jefferson Writings 10 vols Paul L Ford ed 1892 99 Vol 1 p 294 cited in Gary Schmitt Jefferson and Executive Power Revisionism and the Revolution of 1800 17 Publius 2 15 1987 6 This debate is analyzed by Sofaer at 85-93 The Madi- son quotation is at 87 and the Sofaer quotation is at 33 7 Hamilton Papers33-40 Hamilton s reference is to the extensive debate in the First Congress in the bill establishing the Department of State that resulted in a close vote rejecting the idea that Senate advice and consent should be needed to remove people from office whose appointment had depend- ed upon Senate con rmation 10 James Madison Writings G Hunt ed 1906 V1 149-50 11 Id at 138 39 12 As quoted in Edward S Corwin The President's Control of Foreign Relations 1917 at 29 13 Sofaer at 127 14 Jefferson Writings Vol 9 p 2'19 15 Sofaer at 328 lb- Schmitt Jefferson and EneCutive Power at 23 n 29 US House of Representatives Committee on Foreign Affairs 93rd Cong Sess War Powers Hearings Before the Subcommittee on National Security Policy and Scientif- ic Developments Exhibit II pp 323-376 19713 18 LT Emerson War Powers Legislation '14 53 83419 1922 19 Hearings July 17 pp 205 0 20 Revolutionary Diplomatic Correspondence of the United States October I 1776 21 Federalist No 64 at 434 35 emphasis in the original 22 US Senate 94th Cong 2d Seas Select Committee to Study Governmental Operations With Respect To Intelli- gence Activities Final Report Foreign and Military Intelli- gence S Rept 94 255 1976 Book l 3 34 23 Leonard D White The Federalists A Study in Ad- ministrative History 1789 1301 1948 pp 212 13 24 Stat 128-29 See also L White The Federalists at 343- Sayle Historical Underpinnings at 9 25 Sot aer War Foreign Affairs and the Constitution at 264 65 26 As quoted by Sayle Historical Underpinnings at 15 27 Saylc Historical Underpinnings at to 28 See letter from John Norton Moore to Brendan Sulli- van July 9 198 p 2 reprinted at the end of the minority report Chapter 4 Constitutional Principles In Court The historical examples given in the preceding section point the way toward a proper understanding of the Executive s foreign policy powers as those powers have evolved under the Constitution The assertion by Presidents and the acceptance by Congress of inher- ent presidential powers in foreign policy were the normal practice in American history before the 19705 not an aberration The history therefore creates a strong presumption against any new constitutional in- terpretation that would run counter to the operative understanding in the legislative and executive branches that has endured from the beginning The Supreme Court has used history in just such a presumptive way In the Opinion of the Court in the flexible tariff delegation case of Field v Clark Jus- tice Harlan wrote The practical construction of the ConstitutiOn as given by so many acts of Congress involving similar delegations and embracing almost the entire period of our national existence should not be overruled unless upon a conviction that such legislation was clearly incompatible with the law of the land 1 The point of this quotation is not that historical usage must slavishly be followed Rather it is that historical precedents-especially ones that began almost imme- diately with the support of many who participated in the 1787 Convention carry a great deal of weight in any discussion about what the Constitution was sup- posed to mean in the real world of government The historical examples clearly undermine the posi- tion of the staunchest proponents of Congressional power that Presidents were intended to be ministerial clerks whose only authority except for subjects ex plicitly mentioned in Article ll must come from Con- gress But that still leaves two other possibilities that must be considered when judging the constitutional validity of executive action One is that a particular exercise of presidential power may have been accepta- ble in the past only because Congress had not yet spoken on the subject The other is that at least some exercises of implied power power not explicitly stated in Article are so central to the of ce that they remain beyond the constitutional reach of legisla- tive prohibition The Supreme Court precedents dis- cussed below show that many of the major Iran- Contra actions undertaken by President Reagan his staff and other executive branch of cials fall into the constitutionally protected category The Steel Seizure Case and Inherent Presidential Power Justice Robert Jackson s concurring opinion in the Steel Seizure Case Youngstown Sheet and Tube Co v Sawyer is often used as a basis for outlining the logi- cally possible constitutional relationships between leg- islative and executive power In the case s most famous dictum Jackson wrote We may well begin by a somewhat over-simpli- fied grouping of practical situations in which a President may doubt or others may challenge his powers and by distinguishing roughly the legal consequences of this factor of relativity 1 When the President acts pursuant to an ex- press or implied authorization of Congress his authority is at its maximum for it includes all that he possesses in his own right plus all Con- gress can delegate 2 When the President acts in absence of either a congressional grant or denial of authority he can only rely upon his own independent powers but there is a twilight in which he and Congress may have concurrent authority or in which its distribution is uncertain 3 When the President takes measures incom- patible with the express or implied will of Con- gress his power is at its lowest ebb for then he can rely only upon his own censtitutional powers minus any constitutional powers of Congress over the matter Courts can sustain exclusive presidential control in such a case only by dis- abling the Congress from acting upon the sub- ject 2 The major issues in the Iran-Contra investigation have to do with incidents about which Congress os- tensibly has spoken In other words putting aside 4 Chapter 4 issues of statutory construction to be argued in later chapters they all fall into Jackson s third category the one where presidential power is supposedly at its weakest Even in this category however Jackson conceded that Congress is disabled from interfering with some matters Later in the same opinion Jackson distinguished between situations in which an exercise of power is turned outward as it is in most pure foreign policy matters and those on which it is turned inward as it was in the labor-management dispute involved in the Sieei Seizure Case I should indulge the widest latitude of interpreta- tion to sustain his the President s exclusive func- tion to command the instruments of national force at least when turned against the outside world for the security of our society But when it is turned inward not because of rebellion but because of a lawful economic dispute between industry and labor it should have no such indula genee 3 Jackson's opinion was cited with approval by a unanimous court in Dames Moore v Regan a case that grew out of a claim against Iranian assets frozen by President Carter during the hostage crisis of 1979- 81 4 in the same Dames Moore opinion however Justice Rehnquist was careful to say We attempt to lay down no general guidelines' covering other situa- tions not involved here 5 Immediately after this statement and just before the reference to Jackson Rehnquist also quoted with approval a famous pas- sage from the 1936 case of US v Curios-Wright Export Corp W e are dealing here not alone with an authority vested in the President by an exertion of legisla- tive power but with such an authority plus the very delicate plenary and exclusive power of the President as the sole organ of the federal govern- ment in the eld of international relations a power which does not require as a basis for its exercise an act of Congress but which of course like every other governmental power must be exercised in subordination to the applicable pro- visions of the Constitution 5 Taken together therefore the Sieei Seizure Case Barnes i ifoore v Regan and US v Curriss- Wright stand for the following propositions The President does not have plenary power to do whaIEver he wants in foreign policy Congress does have some legislative powers in the eld However there are some foreign policy matters over which the President is the sole organ of government and Congress may not impinge upon them 472 The Holding of the Curtiss-Wright Decision Before we apply these general constitutional princi- ples to the events in these investigations we should first expand upon the authority of U S v Carriers- Wrigiir That case involved a challenge to a congres- sional resolution that specified criminal penalties to be invoked against arms merchants if the President should determine and proclaim that prohibiting arms sales would promote peace in a conflict in the Chaco in Bolivia Because Congress had passed a resolution specifying what would happen it and only if the President issued a proclamation the case is sometimes dismissed as if its statements con rming inherent pres- idential power in foreign affairs were obirer dicta having no value as precedent This misreading of Curtis's-Wright is based on a mis- understanding of the importance of the main issue of the case in the legal history of the New Deal The Curtiss-Wright Corporation had challenged the law as permitting criminal penalties to be based on an execu- tive action a proclamation that was not guided by clear standards specifying the conditions under which the proclamation should or should not be issued The challenge in other words was that the law involved an excessively broad standardless delegation by Con- gress of its own legislative power Delegation was very much of a live issue at the time of Curios-Wright In the two years before this case the Supreme Court in three separate decisions and for the only three times in the country s history before or since used the concern of excessive stan- dardless delegation to declare some of the main pieces of New Deal legislation to be unconstitutional I Be- cause the joint resolution concerning Bolivia con tained no more precise standards than the ones in the statutes the Court had just overturned there was no way for the Court to uphold the Bolivian resolution without either abandomng its recently adopted tough stance on delegation or somehow distinguishing this case from the others The Court s statements about the President s inherent foreign policy powers there- fore were crucial to its nal decision The differences between the President's and Con- gress s powers over domestic and foreign policy made up the bulk of Justice Sutherland s opinion for the Court in Curtiss- Wright When it came time to show the relevance of these differences for the delegation issue Sutherland used a quotation from Chief Justice Hughes s Opinion of the Court in the rst of the three it has been fifty years since the Supreme Court over- turned an act of Congress solely becauSe of excessive delegation people today tend to overlook the issue's past importance The doctrine remains ll'l the books but In the words of administrative law specialist Kenneth qu Davis It has become a collection of words without practical effect See Kenneth Culp Din-is Admin- istrative Law and Government Ed 1975 at 19 preceding delegation decisions Panama Re ning Co v Ryan In the Panama Re ning case the Court in- validated a major New Deal law the National Indus- trial Recovery Act by saying that the NIRA in volved an excessively broad delegation in order to support the decision however the Court felt that it had to distinguish the NIRA from a string of earlier statutes beginning with the Neutrality Act of 1794 that had been upheld despite seeming to contain simi- larly broad delegations What the Court said in Panama Refining was that the Neutrality Act and the other previously upheld statutes had con ded to the President for the purposes and under the conditions stated an authority which was cognate to the conduct by him of the foreign relations of the government It By saying this the Court was indicating that the lack of inherent and cognate constitutional powers in the sphere of domestic policy meant that the Court should apply a more rigorous delegation standard that it had for foreign policy In Carters-Wright the Court was saying that Presi- dent Roosevelt had his owa inherent power to issue a statement of neutrality in the Bolivian conflict and even use force to implement it abroad just as Wash- ington had in 1794 If the President wanted to go beyond proclamations to impose criminal law sanc- tions on U S citizens for domestic acts however congressional authority would be needed The need for legislation before criminaf sanctions could be imposed for domestic activity in turn brought the delegation issue into play in Curios-Wright the court held that solely because the President is the sole organ of the country s foreign relations Congress does not have to Spell out the conditions under which a Presidential proclamation may invoke criminal sanc- tions with the same precision as it must to meet con- stitutional standards in a case of domestic policy The underlying premises about the President's foreign policy powers thus were essential to the holding in Curios-Wright and have never been challenged or abandoned by subsequent SUpreme Courts Justice Jackson's recognition in Tire Steel Seizure Case that some areas of Presidential authority are beyond Con- gress's reach and the 198 Supreme Court invocation of both Curios-Wright and Jackson in the previously mentioned Dames 3 Moore case make this abundantly clear 'The Supreme Court in an unrelated matter in had held that federal courts could no longer impose criminal penalties based simply on the common law 053 v Hudson 8 Goodwin ll U S Cranch 32 1812 For contrast see Chief Justice Jay s charge to the jury in Her ieidls Case in which Jay stated his reasons why the government could impose a common law criminal sanctions to support President Washington s Neutrality Proclamation ll Fed Cas I099 11393 No 6 360 Chapter 4 The President as the Sole Organ for Diplomacy We have shown that the Constitution gives the Presi- dent some power to act on his own in foreign affairs What kinds of activities are set aside for him The most obvious other than the Commander-in-Chief power and others explicitly listed in Article ll is the one named in Curios-Wright the President is the sole organ of the government in foreign affairs That is the President and his agents are the country s eyes and ears in negotiation intelligence sharing and other forms of communication with the rest of the world This view has a long and until recently unchal- lenged history As was mentioned in the earlier histor- ical section the phrase originated in Alexander Ham- ilton s Panicus papers of 1793 and was used by John Marshall in a House floor debate in ISDU The l860 lower court decision of Durand v described the President as the only legitimate organ of the government to open and carry on correSpondence or negotiations with foreign nations in matters concern ing the interests of the country or of its citizens Justice Jackson also referred to the concept in an Opinion written just four years before the Steel Seizure Case In C St 5 Air Lines v Waterman Corp a case involving a Civilian Aeronautics Board decision to deny an airline a license to serve foreign countries Jackson said Congress may of course delegate very large grants of its power over foreign commerce to the President Citation omitted The President also possesses in his own right certain powers con ferred by the Constitution on him as COmmand er-in-Chief and as the Nation s organ in foreign affairs For present purposes the order draws vitality from either or both sources Finally to complete this brief history the passage from Curios-Wright with the sole organ reference was quoted and reaffirmed in Dame 3 Moore v Regan in 198 The Sole Organ and the Boland Amendments What are the implications for the Iran-Contra investi- gation of characterizing the President as the sole organ of foreign policy For one thing it is beyond question that Congress did not have the constitutional power to prohibit the President from sharing informa- tion asking other governments to contribute to the Nicaraguan resistance or entering into secret negotia- tions with factions inside Iran Such conversations are paradigms of what Chief Justice John Marshall said in v Madison 'l'he President is invested by the Constitution with important political powers in the exercise of which he is to use his own discre 4 3 Chapter 4 tion In addition as Marhury made clear these powers do not stop with the President To make them effective the President may exercise his own discre- tion through agents of his own choice To aid him in the performance of these duties he is authorized to appoint certain of cers who act by his authority and in conformity with his orders In such cases their acts are his acts and whatever opinion may be entertained of the manner in which executive discretion may1 be used stiff there exists and can exist no power to contra that discre- tion The conclusion from this reasoning is that where the heads of departments are the political or con dential agents of the executive merely to execute the will of the president or rather to act in cases in which the executive possesses a consti- tutional or legal discretion nothing can be more perfectly clear than that their acts are only politi- cally examinable 12 What follows from Chief Justice Marshall's Opinion in Marbm'y is that if Congress cannot prevent the President from exercising discretion over a particular matter neither may it prevent the President s personal staff on the National Security Council the Depart- ments of State and Defense the Intelligence Commu- nity or the President's ad hoe personal representa- tives from performing the same tasks on the Presi- dent s orders and in his own name Many if not all of the actions by representatives of the U S government that have been alleged to run counter to the Roland amendments were essentially forms of information sharing and diplomatic commu nication To the extent that such activities by the NSC staff CIA State Department or Defense De- partment were covered by the amendments and we shall argue that many were not we believe the ac- tivities were constitutionally protected against limita- tion by Congress The executive was not bound to follow an unconstitutional effort to limit the Presi- dEnt's powers Protecting American Citizens Abroad One inherent presidential power particularly relevant to the Iranian side of this investigation is the power to protect the lives and interests of American citizens abroad- Our earlier summary of presidential uses of force without prior congressional authorization showed the many occasions for which this was the justi cation One example was left off the earlier list to be used here July 1354 U S Navy Commander George S Hollins demanded reparations from Nicaragua after a LLS official was injured during a riot When he failed 474 to receive satisfaction Hollins ordered his ships to bombard San Juan del Norte otherwise known as Greytown Calvin Durand then sued Hollins in the Circuit Court for the Southern District of New York for damages the bombardment had caused to his prop- erty In its opinion denying Durand's claim the court said As the executive head of the nation the president is made the only legitimate organ of the general government to open and carry on correSpond- once or negotiations with foreign nations in mat- ters concerning the interest of the country er of its citizens It is to him also the citizens abroad must look for protection of person and of proper- ty and for the faithful execution of the laws existing and intended for their protection For this purpose the whole executive power of the country is placed in his hands under the constitu- tion and the laws passed in pursuance thereof Now as it respects the interposition of the executive abroad for the protection of the lives or property of the citizen the duty must of ne- cessity rest in the discretion of the president Acts of lawless violence or of threatened vio- lence to the citizen or his property cannot be anticipated and provided for and the protection to be effectual or of any avail may not infre- quently require the most prompt and decided action The interposition of the president abroad for the protection ofthe citizen must necessarily rest in his discretion and it is quite clear that in all cases where a public act or order rests in execu- tive discretion neither he nor his authorized agent is personally civilly responsible for the conse- quences 13 Several times during the public hearing of these Committees Republican Members referred to the 1863 Hostage Act This act which says that a Presi- dent should take all steps necessary to secure the release of Americans held illegally by a foreign power is discussed later in the section of our Iran chapter about the Americans held hostage in Leba- non Interestingly the Durand v Hot't'ins decision af- firming the President's discretionary power came eight years before the Hostage Act changed a discre- tionary power into an obligation Even without that act the Durand case stands for the proposition that the President has the discretion to take whatever steps may be necessary short of a full scale war to protect American citizens The Supreme Court reiterated this point in its analysis of the privileges and immunities of US citizens in The Siougnter-House Cases Chapter 4 Another privilege of a citizen of the United States is to demand the care and protection of the Federal government over his life liberty and property when on the high seas or within the jurisdiction of a foreign government Of this there can be no doubt H This privilege of citiaenship was speci cally en- dorsed again by the Supreme Court in the 1890 case of In re Wedgie Referring to the President's obligation to take care that the laws be faithfully executed the Court said in the view we take of the Constitution of the United States any obligation fairly and properly inferrible from that instrument or any duty to be derived from the general scOpe of his duties under the laws of the United States is a law within the meaning of this phrase Is this duty limited to the enforcement of acts of Congress or of treaties of the United States according to their express terms or does it in- clude the rights duties and obligations growing out of the Constitution itself our international relations and all the protection implied by the nature of the government under the Constitu- tion 15 In answering its own question the Court referred the 1853 Austrian seizure of Martin Koszta a Hungar- ian native who had declared his intention to become a U S citizen Captain Ingraham trained his ship's guns on an Austrian ship to gain Koszta s release to France during diplomatic negotiations The action met the approval of the country and of Congress who voted a gold medal to Captain Ingraham for his conduct in the affair the Court noted Upon what act of Con- gress then existing can any one lay his finger in sop port of the action of our government in this matter 5 After reviewing these cases Borchard's 1915 trea- tise on protecting citizens abroad concluded Inasmuch as the Constitution vests in Congress the authority to 'declare war and does not cm- power Congress to direct the President to per form his constitutional duties of protecting Amer- ican citizens on foreign soil it is believed that the Executive has unlimited authority to use the armed forces of the United States for the protec- tive purposes abroad in any manner and on any occasion he considers expedient r Quincy Wright s classic l922 treatise on the control of US foreign relations quoted this passage from Bor- chard and endorsed it with the sole qualification that the manner' may not amount to a making of war Underlying Borchard s 1 ti'i right s and the 191h century Supreme Court's interpretation of the President s dis- cretionary power is the Hamiltonian notions in the f rtr'tfficus papers We noted earlier that Hamilton had rested part of his argument on the difference in latt- guage between Article I and II Article I gives Con- gress all legislative powers herein granted but Arti- cle II gave the President all of the executive power without quali cation What the 19th century decisions did in pure HamiltOnian fashion was to look at the inherent character of the executive power and then look to Article I only to see if there were explicit exceptions carved out for Congress When no such exceptions were found the Presidential actions were upheld The Constitutional Limits to Congressional Restrictions All of these court decisions demonstrate that the President was meant to have a substantial degree of discretionary power to do many of the kinds of things President Reagan did in lran and Central America They do not suggest that a President can do anything he wants Congress and President were given differ- ent resources and different modes of influencing the same policy arenas Both President and Congress can sway the US posture toward Nicaragua or lran for example but each have their own characteristic tools to bring to bear on the subject What the Constitu- tional separation of powers protects is not the Presi dent s or Congress's precise sway over particular events That is for the individual occupants of each branch to earn But the Constitution does prevent either branch from using its own powers or modes of activity to deprive the other branch of its central functions The Iranian arms sales for example involved sales of U S assets As such the sales were governed either by the Arms Export Control Act or by the Economy Act and National Security Act These laws clearly affect one method a President may wish to use to protect American lives abroad Nevertheless the con- stitutionality of the legislation seems assured both by Congress s power to regulate foreign commerce Arti- cle I See 8 and perhaps by Congress s power to set rules for disposing of 1 1 8 property More impor- tantly the legislation would withstand constitutional challenge because Congress acted to pursue an explic- it grant of legislative power without undermining or negating the President s equally important inherent power to protect American lives and safety Similarly we grant without argument that Congress may use its power over appropriations and its power to set rules for statutorily created agencies to place significant limits on the methods a President may use to pursue objectives the Constitution put squarely within the executive s discretionary power For exam ple although we shall show later that the Roland amendments as actually written permitted the NSC staff to continue providing certain types of military 475 Chapter 4 and operational advice to the Nicaraguan Democratic Resistance we have no doubt that Congress has the constitutional power to enact a statute that would cut off all military and nancial aid to the Resistance except those that fall under the constitutionally pro- tected rubric of information-sharing and diplomatic communicatimi The question thus is not whether Congress has any power overlapping the President s but what bound- aries the Constitution places on congressional at- tempts to limit the President The most obvious limit is that just as Congress cannot tell the President to do something unconstitutional neither can it impose an unconstitutional requirement as a condition for grant- ing a privilege 20 It therefore may not insist that the President forego some of his constitutionally protect- ed power to get appropriations The most recent major case on this point is the legislative veto deci- sion of INS v Chadian in which the Supreme Court held that Congress cannot demand that the President give up his power to sign or refuse to sign legislative decisions even if the President agreed to the original bill that set up the procedure to bypass the so-called presentment requirement Power of the Purse These basic rules apply to appropriations as much as to any other kinds of laws As Louis Fisher wrote in a 1975 study for the Congressional Research Service the Constitution does not distinguish between appro- priation and authorization 22 One recent court case on this point involved an amendment on a Health Education and Welfare HEW Department appro- priation bill prohibiting the department from using any of its funds including salaries to impose manda- tory school busing plans on local communities to pro- mote racial desegregation The U S Court of Appeals for the District of Columbia ruled in 1980 that in order to preserve the statute s constitutionality it would be construed to prohibit HEW from cutting off federal funds to a school district that refused to imple- ment 1 busing plan The statute could not however constitutionally prohibit HEW from seeking other ways to promote desegregation In addition if HEW believed a particular school district needed busing to enforce the requirements of the Constitution the law could not be read to prohibit HEW from recommend- ing that the Justice Department bring a suit in the federal courts 23 in other words Congress may not use its control over appropriations including salaries to prevent the executive or judiciary from ful lling Constitutionally mandated obligations The implication for the Boland amendments is obvious If any part of the amend- ments would have used Congress s control over sala- ries to prevent executive actions that Congress may not prohibit directly the amendments would be just 476 as unconstitutional as if they had dealt with the sub- ject directly There is one other important way the Constitution circumscribes legislative limitations on the executive To explain the way it works it is easiest to begin with a quotation from the 1893 case of Swaim v U S Congress may increase the Army or reduce the Army or abolish it altogether - but so long as we have a military force Congress cannot take away from the President the supreme command Congress can not in the disguise of rules for the government' of the Army impair the authority of the President as commander in chief The same argument extends by analogy to all of the President's inherent powers under Article 11 Con- gress does not have to create a State Department or an intelligence agency Once such departments are created however the Congress may not prevent the President from using his executive branch employees from serving as the country's eyes and ears in for- eign policy Even if Congress refuses to fund such it may not prevent the President from doing what he can without funds to act as the nation s sole organ in foreign affairs Even the nal report of the Church committee acknowledged this point 35 In the same vein Congress does not have to appro- priate any funds for covert Operations Or it may decide to give funds only for speci ed operations one at a time Since 17'89 however Congress has chosen to give the President a contingency reserve fund for secret agents and operations The existence of such a fund is obviously crucial because without it Congress would have to make individual appropriations for each action and thereby harm the country's ability to respond to breaking events during a scal year with- out compromising the secrecy of the operation Nev- ertheless even though a contingency fund is an essen- tial tool for foreign policy there is nothing in the Constitution requiring Congress to set one up Once Congress makes the decision to establish such a fund therefore it may as a quid pro quo set rules for its use However there are some limits to the rules Con- gress may thereby impose For example Congress may not insist and has never insisted upon giving advance approval to covert operations because such a requirement would be the functional equivalent of a legislative veto Similarly Congress may not condi- tion an authorization or upon any other procedural requirements that would negate powers granted to the President by the Constitution What Congress grants by statute may be taken away by statute But Congress may not ask the President to give up a power he gets from the Constitution as opposed to one he gets from Congress as a condition for getting something whether money or some other good or power from Congress Notifying Congress This observation bears directly on the legal require- ments for notifying Congress Before we explain how another implied powers analogy is in order In the 182 case of Anderson v Damn the Supreme Court upheld Congress s contempt power by nding that even though the power was not explicitly mentioned in the Constitution it was clearly necessary to imple- ment other powers that were There is not in the whole of that admirable in- strument a grant of powers which does not draw after it others not expressed but vital to their exercise not substantive and independent indeed but auxiliary and subordinate The idea is utopian that government can exist without leaving the exercise of discretion some- where Public security against the abuse of such discretion must rest on responsibility and stated appeals to public approbation If there is one maxim which necessarily rides over all others it is that the public functionaries must be left at liberty to exercise the powers which the people have entrusted to them The interests and dignity of those who created them require the exertion of the powers indispensable to the attainment of the ends of their creation as Using this line of reasoning the Court argued that even though courts were vested with the contempt power by statute they would have been able to exer- cise that power without the aid of a statute For the same reason the court held Congress must have in- herent authority to exercise a similar power 2T Later cases tried to circumscribe Congress s contempt power but the power itself was always held to be a necessary adjunct to Congress s legislative functions and therefore to rest on an implied constitutional foundation 23 The argument that a power ntust be implied by the Constitution because it is essential to some other con- stitutional power is what lay behind the claims of President Carter s and President Reagan s Justice De- partments that Congress may not constitutionally re quire the President to give advance notification or even noti cation to a limited number of members within 48 hours of all covert Operations Some oper- ations by their very nature may make noti cation within 48 hours impossible The situations are rare but they clearly exist According to Admiral Stansfield Turner who was the Director of Central Intelligence at the time there were three occasions all involving Iran in which the Carter Administration withheld notification during an ongoing operation By contrast the general counsel has told the House Intelligence Committee Chapter 4 that the Iran arms sales were the only time President Reagan withheld notice during his two terms In the Carter examples noti cation was withheld for about three months until six Americans could be smuggled out of the Canadian Embassy in Teheran As Representative Norman Mineta pointed out in tes- timony following Turner's the Canadian government made withholding notification a condition of their participation 30 Noti cation was also withheld for about six months in two other lranian operations during the hostage crisis Said Turner 1 would have found it very difficult to look a person in the and tell him or her that I was going to discuss this life threatening mission with even half a dozen people in the CIA who did not absolutely have to know- 1 In these situations President Carter thought his constitu- tional obligation to protect American lives could not have been ful lled if he had been required to notify Congress within 48 hours As the Canadian example makes clear the choice is sometimes put on us by people outside U S control between not notifying or not going ahead at all These examples show that the situations under which noti cation may have to be withheld depends not on how much time has elapsed but on the charac ter of the operation itself In the very rare situation in which a President believes he must delay notification as a necessary adjunct to ful lling his constitutional mandate that decision must by its moire rest with the President As the Supreme Court has said In the performance of assigned constitutional duties each branch of the government must initially interpret the Constitution and the interpretation of its powers by any branch is due great respect from the others 32 The President obviously cannot consult with Con- gress about whether to consult Any other conclusion would be logically absurd In some respects requiring notification within a speci c time period might look like other Congres- sional report-and-wait requirements imposed on the executive branch that the Supreme Court has explicit- ly endorsed 33 There is one important difference however The report and wait requirements the Court has upheld have all been in domestic policy matters over which the President has no inherent power to act without statutory authorization In foreign rela- tions Congress can use statutes to deprive Presidents of the means necessary to conduct an effective policy but it cannot use its control over the means to deprive the President of his underlying authority or its essen- tial adjuncts Some people in Congress worry that the power to withhold notification may be abused as we think it was in 1985 86 in the Iron arms sales To avoid abuse Representatives Stokes and Roland have introduced a bill that would require advance notification in most cases and notification within 48 hours for of the rest We are convinced this approach would be un- 47 Chapter 4 constitutional Equally importantly we think it is not needed The constitutional basis for withholding noti cation can only be invoked credibly by its own terms in very rare circumstances A generalized fear that Congress might leak would not by itself suf ce becattse the same fear could be invoked equally for all covert actions and therefore would not be credible The members who think they need new legislation underestimate the political leverage they now have to insure that a President will not abuse his inherent power The oversight rules already in place assure that Congress eventually will find out about any oper- ation Once that happens Congress s control over the purse and its power to investigate give it ample means to exact a severe political price on a President whom it feels has oversIEpped proper bounds The Iran-Contra investigations have made this abundantly clear to President Reagan We cannot believe any future President will miss the point Conclusion The Constitution gives important foreign policy powers both to Congress and to the President Nei 478 ther can accomplish very much over the long term by trying to go it alone The Presidem cannot use the country's resources to carry out policy without con- gressional apprOpriations At the same time Congress can prohibit some actions and it can influence others but it cannot act by itself and it is not institutionally designed to accept political responsibility for specific actions Action or implementation is a peculiarly ex- ecutive branch function The Constitution's requirement for c00pcration does not negate the separation of powers Neither branch can be permitted to usurp functions that belong to the other As we have argued throughout and as the Supreme Court reaffirmed in 1983 the powers delegated to the three branches are functional- ly identifiable 1 The executive branch's functions are the ones most closely related to the need for secrecy ef ciency dispatch and the acceptance by one person the President of political responsibility for the result This basic framework must be pre- served if the country is to have an effective foreign policy in the future Endnotes Field v Clark 143 US 649 691 1892 Youngstown Sheet and Tube Co v Sawyer 343 1 1 5 635-38 1952 id at 645 Dames Moore v Regan 453 US 654 661-62 1931 id at 661 6 id at 661 citing US v Curtiss-Wright Export Corp 299 U S 3041 1936 7 Panama Re ning Co v Ryan 293 US 388 1935 Seheehter Poultry Com v US 2295 13 8 495 1935 Carter v Carter Coal Co 298 1 1 5 238 19361 8 293 13 8 at 422 Emphasis added 9 Durand v Hollins 8 Fed C33 111 112 C-C S D N Y 1860 It-10 4 1861 10 C 8 S Air Lines v Waterman Corp 333 US 103 109-11 1948 emphasis added 11 Marbury v Madison 11 Cranclt 137' 165-66 1803 12 1d at 166 13 8 Fed Cas- at 112 14 Slaughter-House Cases 16 Wall 36 29 1822 15 In re Neagle 135 US l 59 64 1890 16 Id at 64 Borchard The Diplomatic Protection of Citizens Abroad 1915 at 452 18 Quincy Wright The Control of American Foreign Relations 1922 at 30 19 Article IV Sec 3 In this clause the phr SC territory or other property suggests an original meaning having more to do with land than money or other material assets but subsequent cases have extended it to include mineral leases 1 1 5 tr Gratiot 39 1 1 5 14 Pet 526 1840 and electricity Ashwander v Tennessee Valley Authority 297 US 288 335-40 1936 Chapter 4 2t Frost Trucking Co v Railroad Commission 271 LLS 583 598111925 21 INS v Chadha 462 US 919 1983 22 Louis Fisher The Authorization-Appropriations Process Formal Rules and Informal Practices Congres- sional Research Service Report No 29-161 GOV Aug 1 mo p 3 23 Brown v Calit'ano 622 F 2d 1221 1980 24 Swaim v US 28 Ct C1 173 221 1893 25 US Senate Select Committee To Stud r Governmen- tal Operations Final Report at 39 26 Anderson v Dunn 6 Wheat 204 225-26 1821 1d at 628-29 28 Kiiboum v illtompsott 103 13 8 168 1881 read the power narrowly but tlieGroin v Dougiierry 273 1 1 8 135 192 and Sineioir v US 279 US 263 1929 in turn read Kiibotrrit narrowly Later cases have tended to involve eon- iliets between the contempt power and the First Amend- ment Watkins v US 354 US 178 195 and Borenhiott v US 361 13 5 109 1959 29 U S House of Representatives Permanent Select Committee on Intelligence Subcommittee on Legislation IUClth Cong Sess Hearings on HR FOB HR i37i and Other Proposois Which Address the issue of Affording Prior Notice of Cover Actions to the Congress April 1 and 8 June 10 198 p 126 30 id at 158 31 finial of 45 See oiso 46 49 53 32 US v t't'xon 418 US 683 203 1974 33 See Sibboeiz v ilt'ori 312 US 1941 and INS v Citodim 462 US at 935 n 9 34 v Chadho 462 U S at 951 1983 429 Part Nicaragua Chapter 5 Nicaragua The Context t is impossible to understand the motivations for the Administration s actions without rst understanding the strategic and political context within which it was operating In describing these circumstances it is nec- essary to begin with the fact that the Sandinista Gov- ernment in Nicaragua is a Communist regime that openly espouses the expansionist Leninist doctrine of revolution without borders Because of this and because the Sandinistas have behaved in a manner consistent with the doctrine by supporting COmmu- nist insurgencies elsewhere in Central America Nicaragua has become a direct threat to the stability of the governments of its neighbors and to US secu- rity interests In 1979 in the belief that it was sapporting a turn toward a more pluralistic more democratic path in Nicaragua the United States decided with bipartisan support to cut off all military aid to the corrupt predecessor dictatorship of Anastasia Somoza sup- ported its removal and provided $118 million in eco- nomic aid to the new regime in its rst 18 months That bipartisan support included some of us who are among the more conservative Members of these Com- mittees Indeed a clear majority in Congress accepted the Carter Administration s arguments that the Saudi- nista-lcd revolution should be judged by its actions In short the US Government wanted to believe that the incoming revolutionary government would honor its mid-1979 pledge to the Organization of American States of implementing democratic reforms It was not too long however before it became apparent that once again the United States had been fooled by Marxists masquerading as democrats much as the Sandinistas' mentor Fidel Castro had done 20 years before By April of 1930 the Nicaraguan Coun- cil of State was packed with Sandinista adherents who were more attuned to policies of internal repres- sion than to fulfilling the dashed promises that had led Social Democrats to join the revolutionary cause That turn of events prompted the resignation of AI- fonso Robelo and led him ultimately to join the lead- ership of the Nicaraguan resistance Nevertheless United States assistance continued But Sandinista repression goes beyond packing the key governmental forums Consider these remarks by Resistance leader Adolfo Calero in our hearings The Sandinistas are systematic breakers of human rights There is no habeas corpus in Nicaragua If people are not brought over to tribunals they are kept in jails at Sands the secret jails Their secret jails are spread throughout the country There is torture going on While I was living in Nicaragua 1 was personally told of experiences of one of my drivers driver salesman of the Coca Cola I re- member he was put into a freezer and when he was about to die and started to l don t know what you call the last reaction that people have when they are about to die somebody heard him and took him out 1 What ultimately turned the course on aid to Nicara gua was not only the change in the Sandinista's be- havior inside Nicaragua however but its growing importance in the global competition between the US and the Soviet Union The 1979 Foreign Assist- ance Act giving aid to the Sandinistas contained a provision authored by Rep CW Bill Young of Florida that required the aid to be terminated if the President could not certify that Nicaragua was not exporting or supporting violence and terror in neigh- boring Central American nations By September 1980 some Members of Congress began to question Presi dent Carter s certi cation on this point Representative Young then a Member of the House Intelligence Committee was disturbed by President Carter's certi cation of Sandinista compliance with democratic procedures and with its pledges to the OAS As a Member of the intelligence panel Young was privy to information that contradicted What the President was saying On September 30 1930 he de- cided to voice his concerns in public testimony before the House Foreign Affairs Committee s Subcommittee on Inter-American Affairs Young had this to say about the main substantive point at issue I am very concerned about the President making the certification that the government of Nicara- gua is not involved in the exporting of terrorism or in supporting the overthrow of other duly constituted governments in Central America since I have access to the intelligence information of the Central Intelligence and Defense Intelli- gence Agencies concerning this matter While I 483 Chapter 5 cannot quote classi ed information in this open session 1 can tell you that the intelligenee reports con rm in overwhelming detail that the Sandi- nista clique that rules Nicaragua is engaged in the export of violence and terrorism Young s testimony did not stop at this point how- ever It seems that the Democratic Administration was less than forthcoming about giving the legislative branch the information it needed to fulfill its policy responsibilities Young said I feel that yea shOuld also know about the dif - culties that we have recently had in obtaining the classi ed information on this subject from the Executive Branch As I previously noted the staff of the Subcom- mittee on Evaluation has had an ongoing study of intelligence on Nicaragua which began in late 1978 As part of that responsibility the staff often makes visits to the CIA to talk with and periodically requests studies produced by the CIA and other intelligence agencies in Washing- ton and in general has paid attention to what is going On On 12 August of this year the staff made a rou- tine request to talk with an analyst at Na- tional Foreign Assessment Center about Nicara gua The staff was told that they would not be able to talk with the analyst at CIA since there was a Presidential Embargo on talking about Nicaragua I was unaware of this at the time since this took place during the recess but the staff was quite concerned The Chairman of the Committee Mr Boland sent a letter to the Di- rector of Central Intelligence on this matter on August 22 To date the CIA has not responded to that letter I would further note that the staff was notified via telephone on September 10 that the embargo had been lifted and that discussions could be held with CIA Two days later the President made his certification that Nicaragua is not es- porting terrorism and or acting as a conduit for arms or sanctuary for revolutionaries in other Central American countries It is very disturbing that the Central Intelligence Agency was directed to not provide an answer to the Chairman of the House Permanent Select Committee on Intelligence to the questions that he asked in his letter of August 22 The conclusion Young drew from this was very serious It mirrors one particular charge we have heard in the ran-Contra hearings but from a much firmer base 484 What we have is a case of the intelligence com- munity being manipulated by the Executive Branch to protect a political sensitivity What dismays me is the political misuse of the intellih gence community which rightfully has a reputaa tion for objectivity The intelligence community must be free of political bias so that our decision makers can use their reports to reach decisions based on the facts of the matter and not on desired political outcomes 2 Following 1it oung s testimony the Carter Administra- tion slowed down its aid to Nicaragua It was not until January however in the nal days of his Presi- dency that President Carter decided to suspend aid The Reagan AdministratiOn quickly decided to con- duct a careful review of available intelligence regard- ing Nicaraguan subversive extraterritorial activities In April 193 the Administration determined that the Sandinistas were furnishing logistical and political as- sistance to the rebels in El Salvador By November 1981 the Sandinista armed forces had grown frOm an armed force of only 5 000 2 years before to about 40 000 troops supported by Soviet tanks artillery and armored personnel carriers 3 Some 2 years later the House Intelligence Committee chaired by Represent- ative Boland corroborated this finding when it de- clared that T his Salvadoran insurgency depends for its life-blood arms ammunition financing logistics and command-and-control facilities upon outside assistance from Nicaragua and Cuba This Nica- raguan-Cuban contribution to the Salvadoran in- surgency is longstanding It began shortly after the overthrow of Somoza in July 1979 It has provided by land sea and air the great bulk of the military equipment and support received by the in- During the period between January 1982 and Janu- ary 1985 while Congress was vacillating and pinching pennies the Soviet Union and its allies provided about $500 million in military aid alone to Nicaragua By early 1935 at the time of the cutoff of US tas- payer military assistance to the Resistance the Sandi- nista armed forces included 62 000 troops Their arse- nal also included nearly 150 tanks of which more than 110 were T-SS Soviet battle tanks that were clearly superior to any other tank in the region 200 other armored vehicles mostly machine-gun-armed BTR-60 and BTR-152 personnel carriers that can carry an infantry squad 300 missile launchers 4S airplanes and 20 helicopters including the deadly Soviet MI-24 HIND-D flying tanks that General Singlaub described as the most effective people kill- ing machine s in the world 5 During 1985 the already high level of aid acceler- ated According to publicly available material provid- Chapter 5 ed by the State Department the Soviet Union Cuba and Eastern Bloc countries gave Nicaragua another $l50 million in military aid in 1985 In addition to the Soviet Union and Cuba Nicaragua is receiving aid from Czechoslovakia North Korea Libya and the Palestine Liberation Organization among others That figure for military aid jumped to $580 million for 1936 alone Between December 1982 and October 1936 according to Defense Intelligence Agency esti- mates discussed in these Committees public hearings the same countries gave $1 34 billion in military aid and another $1 8 in economic aid to the Nicara- guan Government The net result is that Nicaragua has far and away the largest armed force in all of Central America and that does not even take into account approximately 2 500 to 3 000 advisers from the Soviet Union Cuba and other Soviet bloc coun- tries In contrast all US humanitarian and military aid to the Resistance during the entire 9805 amount- ed to approximately $200 million $100 million of which came in the scal year from October 1 1986 to September 30 1937 These numbers only begin to give a picture how- ever of the reasons for viewing Nicaragua as a threat to the rEgion According to former National Security Advisor Robert C McFarlane The danger is not Nicaraguan soldiers taking on the United States it is that country serving as a platform from which the Soviet Union or other surrogates like Cuba can subvert neighboring re- gimes and ultimately require the United States to defend itself against a Soviet threat whether by spending more dollars on defense that we didn t need to to worry about our southern border whether we need to worry more about the Panama Canal now that Russians are here whether we need to be concerned about the half of our oil imports that come from re neries in the Caribbean within MIG range of Nicaragua and we have not had to think about these things for a long time 9 The danger it should be obvious from what McFar- lane said is not simply that posed to other Central American countries by Nicaragua s own armed forces According to information presented during ISteneral Singlaub's testimony the Nicaraguans are building a 10 000-foot-long airstrip at Punta Huete As Repre- sentative Hyde observed the runway is capable of accommodating any Soviet aircraft in their inventory - That includes the Backfire bomber the Bear-D recon naissance aircraft and it s strictly a military facility with antiaircraft guns deployed around the air- eld 1 Singlaub agreed and said that what made the air eld signi cant was that it would accommodate intercontinental as well as short-range aircraft Nor is this all The Soviet Union has an intelligence collection facility at Lourdes near Havana Cuba that is able to monitor maritime military and space cem munications as well as telephone conversations in the Eastern portion of the United States A similar base in Nicaragua would mean a similar capability for the Paci c and West Coast 11 Finally the Nicaraguans are building the Corinto port facility that is being made into a deep water port able to accommodate submarines 12 The Soviet presence in Nicaragua in other words when combined with its presence in Cuba could mean a Soviet base on both ends of the Caribbean as well as the only Soviet port in the Paci c outside the Soviet Union itself The latter Singlaub said would give them for the first time a base from which they could threaten the West Coast ofthe United States 13 485 486 Figure 5 1 Affantic Ocean 45% of us N o 55% of US Crude Oil Imports Paci c Ocean NICARAGUA 65% 0 Ships Transiting Panama Canal- Carry Goods loftrem United States Chapter 5 Chapter 5 So there is plenty of reason for a President of the United States to think the Nicaraguan Government is not merely unfortunate for its own people but a dis- tinct threat to the security of the region and ultimate- ly to the United States This is no speculative threat In I983 the Congress found that By providing military support including arms training and logistical command and control and communications facilities to groups seeking to overthrow the government of El Salvador and other Central American governments the Gov- ernment of National Reconstruction of Nicaragua has violated article l8 of the Charter of the Orga- nization of American States which declares that no state has the right to intervene directly or indirectly for any reason whatsoever in the in- ternal or external affairs of any other state This nding was not repealed by the Roland Amend- ment the following year In fact in the International Security and DevelOpment COOperatiOn Act of 1985 the Congress found that Nicaragua Has committed and refuses to cease aggression in the form of armed subversion against its neigh- bors in violation of the Charter of the United Nations the Charter of the Organization of American States the Inter American Treaty of Reciprocal Assistance and the 1965 United Na- tions General Assembly Declaration on Interven- tion The legal signi cance of these ndings can be found in the charter of the Organization of American States The speci c clause of the treaty Congress charged Nicaragua with violating was the one that said No State or group of States has the right to intervene directly or indirectly in the internal affairs of any other State 5 By de ning Nicaragua s behavior as aggression the Congress also knowingly was bring ing another clause of the treaty into play Every act of aggression by a State against the territorial integrity or the inviolability of the ter- ritory or against the sovereignty or political inde pendence of an American State shall be consid' ered an act of aggression against the other Amer- ican States Finally by invoking these clauses Congress also was involving a third that fundamentally distinguishes U S actions from Nicaragua s Measures adopted for the maintenance of peace and security in accordance with existing treaties do not constitute a violation of the principles as set forth in Articles 13 and 20 13 What all of this means is that when President Reagan sought to bring pressure on the Nicaraguan Government by aiding the Resistance he was doing something more than merely furthering his own policy goals According to the ndings of the Con- gress of the United States and the terms of the OAS charter the President was obliged to do what he could to act against Nicaragua s aggression against its neighbors The nding would not have permitted the President to violate laws that explicitly prohibited the use of appropriated funds for a particular purpose Beyond these explicit prohibitions however the President was not only permitted by his inherent for- eign policy powers under the Constitution but was positively obliged to do whatever he could within the law to respond to Nicaragua's behavior Because of this obligation it is not proper to assert that the President should have gone out of his way to avoid any actions that some of the Roland Amend- ment s sponsors might arguably have wished to pro- hibit Although no President is required to so inter- pret a law on any subject within his constitutional authority such a response might have made sense as an act of prudence and comity rfCongress had only passed a prohibition The fact however is that Con- gress put two sets of obligations on the President one mandating action and the other restricting it Under the circumstances the President had a duty to try to satisfy both of the mandates to whatever extent he could possibly do so 43 Chapter 5 Endnotes I Calero Test Hearings 100a at 51 2 All of the above quotations from Representative Young are in 1 1 3- House of Representatives 96th Cong 2d Committee on Foreign Affairs Subcommittee on Inter- American Affairs Hearing Review of the Presidential Certification of Nicaragua s Connection to Terrorism Sept 30 1930 Prepared Statement of CW Bill Young pp lea-1 3 US Departments of State and Defense The Challenge to Democracy in Central America June 1986 at 20 4 U S House of Representatives 93th Cong 151 56 55 Permanent Select Committee on Intelligence H Rept 98- 122 Part 1 Amendment to the Intelligence Authorization Act for Fiscal Year 1983 p 2 emphasis added 5 The data are frorn Ex Hearings 100-7 Vol II and from US Departments of State and DefeHSe The ilfft't'rary Buildup An Update Oct 1987 at 5 9 The quotation is from Singlaub Test Hearings 100-3 5f21 at 178 488 6 McFarlane Test Hearings I at 19 T Calero Test Hearings 100 2 5 202 37 at 111 8 McFarlane Test Hearings 100-2 5 13 87 at 76 9 McFarlane Test Hearings IOU-2 at 64 10 Singlaub Tcst Hearings at 21 ll laid at 218 12 rare I3 Ibt'd at 134 14 Section 109 of the Intelligence Authorization Act for Fiscal Year 1934 Pub L No 93-215 9 Stat 1475 15 Section 722 of the International Security and Development Cooperation Act of 1985 Pub- L No 99-33 99 Stat 149 l6 Article 13 of the Organixation of American States as reprinted in the Congressional Record June 1935 p 571744 17 total Article 27 18 fetal Article 22 Chapter 6 The Boland Amendments People listening to the public hearings on the Iran- Contra Affair heard many statements about the spirit of the Boland Amendments Everyone knows the argument goes that Congress wanted the Nicaraguan resistance Congress did not anticipate that anyone on the National Security Council staff would support private and third-country fundraising or give advice to and help coordinate the private resupply effort Col North s activities were a clear attempt the argument concludes to circumvent the law There are three basic problems with this line of reasoning First as previously discussed the Constitu- tion does not permit Congress to prevent the Presi- dent or his designated agents from communicating with the Nicaraguan resistance or from encouraging other countries and private citizens to support the resistance Second as Justice Frankfurter said in Ad- dison v Holly Hill Congress expresses its mean- ing by words It is no warrant for extending a statute that experience may disclose that it should have been made more comprehensive 1 One of the reasons there was so much discussion of the spirit of the law at the hearings is as we shall show that it is dif cult to argue the letter of the law had been violat- ed Finally even this last statement concedes too much The fact is that Congress was not animated by a single spirit when it passed the Boland Amend- ments It is necessary therefore to take account of the political history in the rst part of this chapter as well as the statutory history in the rest The Spirit of October 1984 We have already noted that at the same time Con gress was denying appropriations for the anti-Sandi- nista resistance it was also declaring the Sandinista Government to be in violation of a provision of the OAS Charter that calls for a response by the Presi dent In addition Congress has changed its collective mind virtually every year over policy toward Nicara- gua The United States gave aid to the Sandinistas in scal 1980 took aid away from the Sandinistas at the end of 1980 for scal year l98l and then gave covert support to the democratic resistance in 193 for scal year 1982 For scal 1983 Congress denied aid for the purpose of overthrowing the government a re- striction that was all but meaningless and therefore adopted by the House unanimously For scal year l984 Congress removed the language about purpose but limited the amount of assistance to a level that it knew would not last for the full year Then the strictest version of the Boland Amendment was adopted for scal l985 partly it is often said be cause Congress was upset at allegedly not having been informed about the role in connection with the mining of Nicaraguan harbors ll Much has been written about whether the late Director of Central intelligence William Casey adequately infon'ned the Senate Intelligence Committee about the mining of Nicaraguan harbors in 1984 A review of the record indicates that while Casey could have been more expansive he did clearly tell the Committee on March 8 and again on March 13 that mines were being placed in the Nicaraguan harbors of Corinto and El Bluff as well as at the oil terminal at Puerto Sandino See Bob Woodward Veil The Secret Wars of the CIA Chapter 16 also McMahon at 32 41 On the House side the Intelligence Committee chaired then by Edward Boland received a mining brie ng on January 31 1934 more than two months before these activities became a public - controversy and approximately three weeks after the rst mines were deployed The CIA had been discussing the possibility of mines being employed in Nicaragua with the House panel as far back as the summer of F3333 In essence what appears to have happened in the Senate is that following disclosures in the media in early April 1934 about theSe operations a number of Senators feigned ignorance of these activi- ties in fact they had known about them for some time Senator Leahy was one who had known for some time and scolded his colleagues for their hypocrisy Reportedly some Senators who knew about the mining when they voted for additional assistance for the Contras turned around after the media disclosures and voted for a resoluliou condemning and prohibiting the mining As Leahy put it There were Senators who voted one way the Week before and a different way the following week who knew about the mining in both instances and 1 think were in uenced by public opinion and I think that s wrong and that is a lousy job of legisla- tive action See Henry I Hyde Can Congress Keep a SerreIP National Review Aug 24 1984 pp 46-61 also Bernard Gwertz man iMoyniliun to Quit Senate Post in Dispute or CIA New York Times April to 1934 Joanne Umang Charles Babcock Ivi'tn'ni firm Resigns Intelligence Panel Part Assails CIA ashington Post April lb 1984 Sen Mcytii'limilr Point Washington Post editorial April 1934 McFarlane Test Hearings 100-2 Wilt 8 at 230- During this period Casey's deputy was John McMahon His recollection of this matter is consistent with Leahy's He indicates 489 Chapter 6 The way the majority treats the mining incident is of its entire pro-history of the Boland Amendment The basic argument is that Congress had an open mind about Nicaraguan policy but that the Administration offered shifting rationales for the policy misled Congress as to its intentions and ac tions and finally justi ed a cutoff of funds by failing to notify Congress adequately about the mining of the harbors in Nicaragua This is of course a totally subjective hence fundamentally misleading account of the political history to the limited extent that the facts it cites are accurate First the majority thesis utterly ignores what the Soviets and Sandinistas were that on the March l2 l3 Appropriations Committee Senators were briefed and on the following day Casey was back to the Senate Intelligence Committee to remind Members of what he had told them previously about the mining After that session McMahon recalls There was still not a word We then on March 13 got a letter from Senator Pell in Foreign Relations saying Tell me about this mining So we prepared a written response sent it to Senator Pell through Barry Goldwater who was then Chairman of the Senate Select Committee on Intelligence Not much happened until the latter part of the rst week in April when there was a great deal of furor in the press which generated in Europe about the mining of the harbors was picked up by the Post and Times here and a lot of noise and suddenly amnesia struck Capitol Hill no one remem bered hearing about the mining Barry Goldwater sent a letter to Casey telling him he was pissed When I got this letter I went in to Casey and said What the hell is he talking about where has he been for the last two months See McMahon Dep WNW at 35-31 Subsequently according to McMahon Casey confronted Gold- water regarding the mining noti cation McMahon recalls Casey showed him then the lransuript from the hearings on the 8th and on the l3th of March and Barry Goldwater said You know i don't know I just don't remember And it's my under- standing that Barry wanted to send a letter of apology to the agency but was urged not to do so because the Senate apologizes to no one McMahon added that as far as he was concerned there was no intent by the agency to keep the mining of the harbors from the committees We did everything we possibly could to tell them about it and tell them about it in a timely fashion McMahon Dep at 36-38 Interestingly Senator Goldwater who excoriated Casey for al- legedly not properly informing the Senate Intelligence Committee on the mining voted on April It 1934 against the resolution condemning the mining See Congressional Record April It Willi p 54205 Ultimately Casey felt the politically expedient thing to do was to apologize to the Senate Intelligence Committee and get this brnuhaha behind him When he finally did so Senator Jake Garn reportedly became enraged because he believed there had been adequate notification In his new book Veil Bob Woodward claims Garn underscored his fury by screaming You re all espletivc deleted 5 the whole Congress is full of espletive deleted s all ve hundred thirty-five Members are deletedls Members stood up including Moyni- ban who wanted to prevent a further confrontation Smile Moynihan said when you call me an espletive deleted Garn later wrote to ioldwater and apologized for disrupting the Com- mittee See Vtt oodward Veil at 33 Garn subsequently con rmed 11051 of Ihis story saying only that the incident occurred after the committee meeting was over and that he did not apply the to the full Senate See Around the Htff Roll Call October 25 Will p 490 doing during the same period to escalate the conflict and consolidate the Marxist regime in Managua Second it ignores the fact that many Members of Congress almost all Democrats Opposed U S policy in Nicaragua almost from the beginning and that most of the votes in both the House and the Senate during the relevant periods including the votes on the various contested versions of the Boland Amend- ments were almost completely straight party-line v0tes One key result of its remarkably distorted account is that the majority often confuses cause and effect This is almost self-evident in its treatment of the mining of Nicaraguan harbors In October 1983 Con- gress decided to limit funding for the Contras to $24 million for scal year 1934 an amount deliberately calculated to fall considerably short of the Contras needs for that period This was the handwriting 0n the wall that the Contras might well be cut off com- pletely if there was a slight change in the climate of opinion The Contras knew it the Sandinistas knew it and the U S Government knew it The mining was therefore an effort to bring the Sandinistas to the table before Congress cut off support In short it was an effeCI of the Congressional decision not the cause of a later decision But this reversal of cause and effect is typical of the majority s amateur tory Unfortunately for them in many other parts of the world is correctly not regarded as a useful tool in foreign relations The strictest of the Roland Amendments was in effect for only eight months when Congress decided to allow some humanitarian aid to the resistance Then a few months into the scal year Congress also permitted communications assistance and advice Fi- nally for fiscal 1937 Congress resumed full funding for the resistance at a level of $100 million As McFarlane said to Representative Courter during tes- timony It is absolutely out of the question to have a coherent policy with that kind of a change in the legal framework 2 Congress's ambivalence expressed itself not only from year to year but within years as well including the year of the strictest Boland prohibition If all we were talking about was a clear expression of Congres- sional intent in the form of a strict prohibition that clear statement would have to govern for as long as it stayed in effect The fact however is that Congress was of more than one mind even within the statute that contained the strictest Boland prohibition The most stringent Boland Amendment was part of a continuing apprOpriations resolution that included 9 of the 13 appropriations bills needed to fund the Gov- lt is one of the curious facts of the Majority Report that the first acknowledgement of the communist nature of the regime comes on page of the Esecutive Summary while the first politi- cal description of the Sandinistas comes on page 3 Chapter 6 ernment for scal 1935 3 The fiscal year started on October 1 1984 President Reagan had already vetoed one continuing resolution because of its spending levels Government workers even had to be fur- loughed at one point By the time a reworked funding bill reached the floor on October 10 and I there was a great sense of political urgency Election Day only 3 weeks away the resolution contained a large number of contentious water and public works projects important for individual districts and mem- bers of the House and Senate were all eager to get home to campaign All year long passage of the Intelligence Authori- zation and Department of Defense Appropriations Acts had been stalentated between the staunch oppo- nents of aid for the resistance who made up a majori- ty in the House and the equally staunch supporters of aid who formed a majority in the Senate in the compressed highly politicized pre-eiection timetable of October the two groups were willing to work out a compromise The nal defense appropriations bill included the famous Roland prohibition quoted below together with a series of expedited procedures that would let Congress vote on a new $14-million aid package for the Contras any time after February 28 Some supporters of aid for the resistance such as Senator John East of North Carolina criticized the Senate Republican leadership for agreeing to the deal What I think we have done in this conference report is exchange the aid to the Contras and other impor tant defense-related items for water projects East said 4 Senator Ted Stevens who was the Assist ant Majority Leader and as Chairman of the Appro- priations Subcommittee on Defense was the floor manager of this portion of the conference report was the other main speaker on the Senate floor at the same time as East Stevens said that East s position is counterproductive to his point of view There is money in this bill for assistance to the Contras There is $14 million I can tell the Senator that it would take less than 3 days to pursue that subject under this report in terms of fast-tracking both the House and Senate a resolution to approve the President's tion That money is in the bill and it can be used The money that was provided the Contras ran out in August The Contras are still supporting themselves with assistance they are getting from elsewhere in the world Having that assistance out there to be made available on March 31 will encourage that assistance from other sources to the Contras during this period 5 Representative Boland's explanation of the conference agreement took note of the same compromise lan- guage albeit in terms that emphasized the importance of the prohibition he had been so strongly supporting Representative Boland did say This prohibition applies to all funds available in scal year 1985 regardless of any accounting pro- cedure at any agency It clearly prohibits any expenditure including those from accounts for salaries and all support costs The prohibition is so strictly written that it also prohibits transfers of equipment acquired at no cost 5 In the same speech however Boland also said The comprornise which we have worked out on Nicaragua preserves the House position with one important proviso No funds may be spent on the secret war in Nicaragua until February 28 1985 Only if Congress af rmatively provides for a re- newal of funding for the war could any funds be used for that purpose Representative Boland in other words essentially was con rming Senator Stevens interpretation of the compromise The Senate supporters of Contra aid were willing to agree to the conference report and the President was willing to sign the bill only be- cause there was a general understanding that a second vote would be forthcoming after the 1984 elections were out of the way Clearly that understanding would have made no sense unless the resistance con- tinued to exist Thus President Reagan s instructions to his staff to do whatever they could within the law to keep the democratic resistance alive and the ac- tions he took that were consistent with Congress s ndings about the GAS charter all were entirely in keeping with the full spirit the spirit expressed by all of the participating Members of Congress- of even the strictest Boland prohibition The Words of the Boland Amendment The real legal issue turns therefore on the exact words of the Boland Amendment Before turning to The majority criticizes the only contemporaneous executive branch legal opinion on the issue front the President's Intelligence Oversight Board Which concluded that the NSC was not covered by the Roland Amendment The majority asserts that the drafter was not given all the facts needed for his opinion but ignores the fact that the drafter specifically testi ed at the hearings that having the additional facts then before the Committees would not have changed his key legal conelumons Selarom Test Hearings 1011 5 at 12 The majority also criticizes the credentials of the 491 Chapter 6 those words however it is important to bear in mind that they were a rider or a limitation amendment to an appropriations bill The Boland Amendment was not for example like the Hatch Act which prohibits speci c political activities by civil servants whether they are on the job or off Nor is it like the Neutrali- ty Act which also prohibits de ned activities and makes them criminal 9 An appropriations rider even if it reaches salaries is nothing more than a limitation in the way Federal funds may be used It does not reach a person s whole life and does not make activi ties criminal What were the precise funds available to use Mr Boland's words whose use was prohibited The rele- vant language read as follows During scal year 1985 no funds available to the 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 or which would have the effect of supporting di- rectly or indirectly military or paramilitary oper- ations in Nicaragua by any nation group organi- zation movement or individual The terms of this prohibition apply to funds made available to speci c arms of the executive branch The fiscal 1983 prohibition of aid for the purpose of overthrowing the government applied only to funds available to the Department of Defense and Central intelligence Agency The fiscal 1985 law broadens the prohibition to include any other agency or entity of the United States involved in intelligence activities The obvious question given Col North s activities in behalf of the democratic resistance is whether the staff of the National Security Council NSC is an agency or entity covered by the act Comparing the Boland Language With Broader Prohibitions The phrase agency or entity involved in intelligence activities is surely an odd one that needs explaining Some Members of Congress may have thought they were enacting an absolute prohibition in 1984 and that feeling may help explain the vehemence of their reaction to what the NSC staff did But if that is the result Congress wanted to achieve it chose very bad language for doing son language that as we shall show soon carried a legislative history that specifical- ly excluded the NSC from its coverage If Congress had simply wanted to prohibit all US activity that might help the resistance there were plenty of easier ways available for it to have done so drafter but Ignores the fact that Committee testimony proves the Opinion was approved and issued after review by t Board which includes Charles Meyers former Dean of the Stanford Law School as one of its three members hit 492 All it needed to do was look at another very well known and similar law the Clark Amendment that cut off support to the resistance ghters in Angola in 1976 That language read as follows Notwithstanding any other provision of law no as- of any kind may be provided for the purpose or which would have the effect of pro- moting or augmenting directly or indirectly the capacity of any nation group organization movement or individual to conduct military or paramilitary operations in Angola 11 Congress obviously knows how to write an airtight prohibition when it wants to As in this example it does not write about agencies or entities but simply bars assistance of any kind from any source Virtually every year apprOpriations bills contain prohibitions worded more broadly than the Boland Amendment The continuing resolution for 1936 for example says that none of the funds available in this or any other Act shall be made available for the pro- posed Woodward light rail line in the Detroit Michi- gan area unless certain conditions are met 12 If this example seems too far-fetched consider the Hughes- Ryan Amendment to the Foreign Assistance Act of 193 an amendment that anyone responsible for the Roland Amendment would know in detail No funds appropriated under the authority of this or any other Act may be expended by or on behalf of the Central intelligence Agency for foreign operations unless the President nds the action to be important to the na- tional security and reports a description of the oper- ation to Congress in a timely fashion 13 The absence of the phrase any other Act item the Boland Amendment is important for considering whether the NSC was covered by that act The fiscal 1985 continuing resolution containing the Boland Amendment stitched together nine appropriations bills and a comprehensive crime control bill The major sections of the resolution followed the wording of the original appropriations bills by designating each of the original bills as a separate act each with its own preamble and title That each act within the con- tinuing resolution was treated as a separate legal entity is shown by the fact that several of them con- tained prohibitions against using the money in this act for lobbying but each of the lobbying provisions was worded differently prohibiting different kinds of behavior for different departments The Roland Amendment was not contained in the same appropria- tions bill that provides funds for the NSC The De- partment of Defense Appropriations for example in- cludes traditional elements of the intelligence commu- nity The National Security Council in contrast is and traditionally has been funded together with the rest of the White House in an entirely separate appro- priations bill for Treasury Postal Service and Gener- a Government that is considered by a separate appro- Chapter 6 priations subcommittee IE If Congress had intended to cover the funds made available to the NSC staff for salaiies in other words it could easily have followed the broad language of the Clark Amendment the Arms Export Control Act or words often used to extend appropriation riders to funds made available in any other act The Boland Amendment s Language in Other Intelligence Law What accounts for the narrowness of the language of the Roland Amendments The phrase agency or entity involved in intelligence activities did not origi- nate with these particular prohibitions The history of its use in intelligence legislation begins with the at- tempts during the late I9705 to pass a comprehensive charter for the intelligence community On February 3 1930 the last version of the broad charter bill was introduced in the Senate It contained the following de nition The terms intelligence community and I entity Of the intelligence community mean A the of ce of the Director of National Intelli- gence the bill s successor to the Director of Cen- tral Intelligence B the Central Intelligence Agency C the Defense Intelligence Agency D the National Security Agency E the offices within the Department of Defense for the collection of specialized national intelli- gence through reconnaissance programs F the intelligence components of the military services G the intelligence components of the Federal Bureau of Investigation H the Bureau of Intelligence and Research in the Department of State I the foreign intelligence components of the De- partment of Treasury J the foreign intelligence components of the Department of Energy the successor to any of the agencies offices components or bureaus named by the clauses A through and L such other components of the departments and agencies to the extent determined by the President as may be engaged in intelligence ac- tivities Later the same hill said that the entities of the intelligence community de ned above are authorized to conduct intelligence activities under the direction and review of the National Security Council but only in accordance with the provisions of this The bill in other words clearly and intentionally did not treat the NSC as an entity of the intelligence com- munity At least one staff consultant to the Senate Select Committee on Intelligence was concerned that the bill would not require the NSC to report any covert operations it might undertake William R Harris was directly involved in the deliberations that led to the statutory language we have been analyzing Because of his expertise on the subject House Chairman Lee Hamilton and Ranking Minority Member Dick Cheney wrote a letter to the former Senate consultant asking him for any observations or recollections that relate to the concept of an 'intelligence agency or intelligence entity as traditionally understood by Congress or the Chief Executive Harris responded on September 25 1987 with a l4-page statement that is reprinted as Appendix A to this Minority Report In his position as consultant Harris urged the Com- mittee to write language that would include the NSC It was my position that unless the mandatory reporting duties included the NSC and its staff there was a foreseeable risk of the NSC manag- ing covert operations through the NSC itself without a specific duty to report on such activi- ties to the oversight cemmittees of the Congress The Charter and Guidelines Subcommittee staff- ers indicated that the President would not author- ize this change in customary practice precisely because upon discovery the Congress would enact legislation requiring mandatory reporting by the National Security Council or the President regarding its activities At this point on a day in February 1980 that I cannot ascertain from my records I took the issue to the staff director of the Senate Select Committee William G Miller Any change of the nature 1 was proposing would reopen consti- tutional issues of concern to the Attorney Gener- al and the Counsel to the President Mr Miller reminded me that both Vice President Mondale and David Aaron the Deputy Special Assistant to the President for National Security Affairs served with the committee The President would not permit I was advised the conduct of covert operations by the NSC staff itself I reminded the staff director that intelligence charters must be designed to function under changed and partly unfereseen circumstances well beyond the serv- ice of of cials who knew the precise reasons for legislative action 9 493 Chapter 6 Harris' position was that if Congress wants to pro- hibit or require the President and the NSC to do something as he thought it should then Congress should say so clearly and not rely on the political sympathy of a current Vice President and NSC staff- er We agree with this position wholeheartedly As Justice Frankfurter said in the quotation we used at the beginning of this chapter Congress expresses its meaning by words 20 One month later the Committee staff produced a draft that partly addressed Harris s concern not by expanding the de nition of the intelligence communi- ty but by adding language that would have made it more difficult for the NSC and other parts of the GOvernment to conduct covert operations 21 The Congress did not enact this language however and decided to concentrate strictly on the subject of over- sight The lntelligence Oversight Act of 1930 started out as one section of the charter bill After some change it was enacted as an amendment to the National Secu- rity Act of 194 The shorter version omits the origi- nal bill s long de nition of the intelligence community to require reports of intelligence activities to Congress from The Director of Central Intelligence and the heads of all departments agencies and other enti- ties of the United States involved in intelligence activities 22 In this version the language is almost identical to the jurisdictional language of the Roland Amendment Given the statutory history the phrase appears simply to be a shorthand substitute for items C through L on the long itemized list in the proposed charter The fact that the Oversight Act was an amendment to the NatiOnal Security Act is instructive The Na- tional Security Act created the National Security Council which has only four statutory members the President Vice President Secretary of State and Sec- retary of Defense with the President clearly put at the head In order to believe that the phrase agencies and other entities involved in intelligence activities applied to the NSC one would have to accept the entirely preposterous idea that the 1980 law contem plated the head of the NSC that is the President personally reporting any signi cant anticipated intel- ligence aetivity including any of a purely informa tion-gathering character to the Intelligence Commit- tees Even if Congress had wanted to engage in the constitutional confrontation such a reading would imply it is dif cult to imagine Congress speci cally mentioning the Director of Intelligence in the Over- sight Act and then reaching the President by indirec tion without even bothering to say so The that Congress did not intend to treat the President as the head of an intelligence agency or entity is strengthened when one realizes that the 494 Oversight Act also amended a sentence that appears immediately after the one in the HughEs R yan Act which does require Presidential Findings for covert CIA operations There is no way the Members of Congress could have amended one sentence without considering its relation to the other As the words of Hughes-Ryan make clear when Congress wants to place a requirement on the President it does so di- rectly There is no way to avoid the conclusion that the test of Oversight Act imposes Even though many people today seem to assume that this law imposes a reporting requirement directly on the President the fact is that it does not The Oversight Act s reporting requirements cover the Director of Central Intelli- gence and the heads of all other agencies or entities involved in intelligence activities It deliberately did not cover the NSC or its head the President It knowingly exempted the NSC even though the NSC staff had engaged in many activities during the 19705 that were well known to Congress and would have called for a required report under the 1980 act if the NSC had been covered In fact no one even hinted in 1980 that the NSC or its staff should be covered by the Oversight Act It is fanciful to maintain that Con- gress intended to break almost 40 years of complete deference to the President s use of the NSC without prOvoking some extended discussion or controver- 5y Harris concludes that Congress adopted language in 1980 that deliberately stepped back from earlier pro- posals for Government-wide reporting requirements to narrower language that excluded the NSC He wrote In the period 1975-1978 Congressional investiga- tions of intelligence activities encompassed enti- ties of the entire federal government and propos- als for mandatory reporting to the Congress mir- rored that broad jurisdictional concern Commencing in 1978 the intelligence oversight committees adopted the procedure of enacting separate intelligence authorization acts for all en- tities of the intelligence community engaged in national intelligence or Con- currently from 1978 onwards draft legislation proposing mandatory self-reporting by heads of intelligence departments agencies or entities en- compassed expressly Speci ed departments and agencies and other entities that performed clas- si ed missions within the intelligence communi- ty Proposals in 1980 to extend the scope of entities to include the National Security Coun- cil and its staff were expressly rejected in the course of streamlining what became the lntelli- gence Oversight Act of 1980 Chapter 6 Once again we agree completely with Harris' cott- clusions His words we should point out gain credi bility from the fact that he wanted the NSC to be covered over the Opposition of President Carter s White House Nevertheless we acknowledge that a statement from a former Senate staff aide has no com- pelling legal weight as legislative history What gives the interpretation its real weight is that it is the only one that can make sense of the words Congress used in the various bills it considered and the nal law it enacted After the Oversight Act To complete this line of analysis President Reagan issued Executive Order 12333 on December 4 1981 de ning the intelligence community essentially along the lines of the charter bill This language was meant to be a de nition of the phrase agencies or entities involved in intelligence activities that appeared in the Oversight Act The principal NSC staff coordina- tor for the executive order was Kenneth DeGraffen- reid who had worked on the staff of the Senate Select Committee on Intelligence at the time the Oversight Act was enacted 25 The relevant section read as follows The Inteiligettce Community and agencies within the Inteiitgenee Community refer to the following agencies or organizations I The Central Intelligence Agency 2 The National Security Agency 3 The Defense Intelligence Agency 4 The of ces within the Department of Defense for the collection of specialized national foreign intelligence through reconnaissance programs 5 The Bureau of Intelligence and Research of the Department of State 6 The intelligence elements of the Army Navy Air Force and Marine Corps the Federal Bureau of Investigation FBI the Department of the Treasury and the Department of Energy and the staff elements of the Department of Energy It is worth noting that missing from this enumeration is the charter bill s elastic provision which could po- tentially expand the list It is also worth noting that the enumeration is fol- lowed in Intelligence Authorization Acts including the Specific one for scal I985 that contained the same prohibitory Boland Amendment as the continu- ing resolution The previous year the House had adopted a version of the Boland Amendment that also would have reached any other agency or entity of the United States involved in intelligence activi- ties 26 The Senate refused to agree and $24 million or enough to fund the resistance for about half a year was nally adopted as a compromise During the House s consideration of the bill however Repre- sentative Boland offered the following description of what the Authorization Act covered Mr Chairman HR 2963 the Intelligence Au- thorizatit tn Act for scal year l984 authorizes funds for all the activities of the Central Intelli- gence Agency the Defense Intelligence Agency The National Security Agency other intelligence components of the Department of Defense and the Departments of the Army Navy and Air Force the Bureau of Intelligence and Research at the Department of State the Intelligence Divi- sions of the Federal Bureau of Investigation in- telligence elements of the Departments of Treas- ury and Energy and of the Drug Enforcement Administration and the intelligence community staff of the Director of Central Intelligence Generally these activities are divided into two categories The rst is intelligence activities that is to say national intelligence activities which produce intelligence for important policy-makers of the Government the President the Cabinet the National Security Council and the Joint Chiefs of Staff 27 Representative Boland in other words adopted the traditional distinction of the Oversight Act and Exec- utive Order 12333 between the intelligence communi- ty on the one hand which produces intelligence and the National Security Council which is not an agency involved in intelligence activities but a consumer He made it clear that the authorisatiOn bill did not apply to the NSC The authorization acts follow the jurisdiction or power to legislate that the rules of the House and Senate give to the Intelligence Committees The White House and NSC staff authorizations clearly and exclusively fell within the jurisdictions of other com- mittees at the time of the Boland Amendment as they do now The importance of this fundamental fact of legislative history may be lost unless one has a sense of the jealousy with which committees traditionally guard their own jurisdictions If Congress had intend ed to cover staffs that fall within the jurisdictions of two committees the procedure virtually always adopted would have been for the second committee to ask for and get a multiple referral of the bill Committees normally insist on multiple referral even when they are in complete agreement with what a bill is trying to do because they want to preserve their own jurisdictional claims for the future 495 Chapter 6 To summarize the Oversight Act the Executive Order and the typical intelligence authorization act do not cover the President or the National Security Council To quote Harris again this history estab- lishes a presumption that only intelligence communi- ty entities are intended to be covered by other intelli- gence-related legislation utilizing the phrasing Harris does acknowledge that the presumption may be re- batted by evidence of actual legislative intent to the contrary and says that he does not know the speci c legislative history of the I984 and subsequent Boland Amendments We have searched that history how- ever and there is no evidence of an intention to change a well-known term of art that excluded the NSC into one that included it The Spirit Ftedux Some members of these Committees have tried to argue without addressing the legislative history just presented that the Boland Amendment should be read not to cover a Specific list of agencies but any agency or entity that might in the future become involved with intelligence activities Any other read- ing it is said would render the law meaningless by letting the President get around its provisions by put- ting agents in any of the Government's departments outside the intelligence community including the De partment of Agriculture We consider this argument to be completely mistak- en For one thing as we have just demonstrated the term agency or entity involved in intelligence activi- ties was not made up by the Boland Amendment out of whole cloth If the phrase is to have any meaning it must be the same in the Boland Amendment and Oversight Act But the argument that an interpreta- tion of Boland which excludes the NSC would be a slippery slope is also wrong because the slope is not technical question exists about whether North was covered by the Roland Amendment as an individual because his salary apparently was paid from the Department of Defense appropria- tion Because North s salary could just as easily have been paid 01' reimbursed from the NSC appropriation and because the functions he performed on detail to the NSC were clearly NSC duties unre ated to his DOD assignment our basic point is unaffected We note that the Department of Justice has concluded that language in section 403 bltl of the Intelligence Authorization Act reaches the NSC because it covers any agency or entity involved in intelligence or intelligence-refuted activities See U S Depart- ment of Justice Memorandum for the Attorney General Legal Authority for Recent Covert Arms Transactions to Iran Decem- ber 13' lqu p S n It Given the history we have discussed the accuracy of the Justice Department's couelusion is clearly Open to question Even assuming its correctness arguenrio Attorney General Meese made the point in his testimony that the underlined phrase toes not appear in the lloland Amendment and therefore makes this phrase broader than the one in that amendment Therefore Meese said this language is clearly distinguishable from the definitional language of the Boland Amendment which appears in a separate section of the same bill See Mecse Test Hearings liltl-Q 7 29 37 at 421-22 496 in fact slippery Arguments about the NSC staff do not automatically apply to other departments and agencies The NSC staff is the President's personal foreign policy staff the Department of Agriculture is not The NSC is therefore authorized to conduct and historically has conducted activities directly related to the President s Contra policy that others may not conduct without explicit statutory authority If the language of the Boland Amendment did not cover the NSC can the Administration fairly be said to have evaded the law through Oliver North s ac- tions to help the democratic resistance On the most obvious level no one is evading the law if he or she continues to do something the law permits or fails to prohibit But to leave the matter there makes it look as if the Administration was faced with a clear Con- gressional mandate In fact as we have shown the mandate was two-sided Part of what Congress wanted in 1934 was to cut off US nancial aid to the Contras That objective was ful lled During fiscal 1934 Congress appropri- ated $24 million to support the resistance and permit- ted the full infrastructure of the CIA Defense De- partment and other intelligence agencies to back up the expenditure of the money When the Boland Amendment went into effect the nancial and infrastructure support was eliminated The entire Na- tional Security Council appropriation for all salaries and all worldwide activities was between $4 million and $5 million during the mid-19805 The most the NSC staff could do would be to Spend a part of a few people s salaries to encourage activities that did not spend US funds At its most ambitious the NSC staff s activity would therefore represent a minuscule fraction of the US Government's support for the resistance before the prohibition This judgment is strongly reinforced by the facts disclosed by the record of these Committees' public hearings During the period of the Boland Amend- ment a very Small number of NSC staff officials had responsibilities that related to the resistance These responsibilities included among other things main- taining political ccmtact with the resistance exchang- ing information with it and providing it with guid- ance and political advice No one especially not anyone familiar with US intelligence would main' tain that the Boland Amendment outlawed these ac- tivities At the same time the NSC staff engaged in more controversial activities such as giving the resist- ance expert assistance on arms procurement helping to coordinate the operational details of military resup- ply and persuading other countries to give financial sapport to the resistance If one tried to keep a diary of the NSC staff s time however it would quickly become clear that any expenditure of NSC staff sala- ries on activities that might have been outside the law if the NSC were covered was clearly incidental to expenditures for activities that remained clearly legal during the time of the most stringent Boland Amend- ment There were no other signi cant expenditures of ap- propriated funds to support the resistance during the period of the Boland Amendment no diverted tanks or planes for example In short the appropria- tions limitation purposes of the Boland Amendment in fact were met Even though the NSC staff did sup- port the resistance in the ways just described the level of US support dropped to just a trickle of personal advice In addition we must reiterate that Congress' full intention involved more than just the limitation provision Congress assumed there would be a future vote on the resistance and that the resist- ance would continue to exist as a viable force until that vote with funds from private and non-US sources Satisfying Congress's full intention therefore would almost seem to require some form of NSC staff involvement Oliver North and John Poindester testi ed that they attempted to comply with the law We have seen that the NSC was not covered by the law's language But even if the NSC had been covered virtually all if not all of North s and activities in behalf of the democratic resistance would still have been lawful This point can be best under stood by looking at the different interpretations placed 0n the law from the beginning and at the changes Congress began making to the Boland prohi- bitions within months of its adoption Sharing Information and Intelligence Under the Boland Amendment A review of the legislative history of the Boland Amendment and related subsequent amendments makes clear that it was lawful for Col North and others to provide intelligence to the resistance leader- ship The legislative history also makes clear that it is reasonable to view the Boland Amendment as allow- ing the type of information transfer advice and co- ordination that Col North and others provided to the Contra resupply effort On December 19 1984 Director of Central Intelli- gence William J Casey wrote to Representative Boland Chairman of the House Permanent Select Committee on Intelligence to describe some activities the CIA considered to be consistent with the prohibi- tion bearing the Chairman s name Casey's letter did not discuss normal information and intelligence-shar- ing because as a still classi ed exhibit to Col North's testimony makes clear Members of Congress al- ready knew about and approved such communica- tion between the resistance and CIA Rather Casey's letter was about providing speci c detailed intelli- gence that might be useful operationally Casey wrote Til 026 E 8 - Chapter 6 We are contemplating providing defensive intelli- gence This intelligence would be furnished exclusively for the purpose of pre- cluding hostile actions against the FDN We would ensure that the information provided does not contain the speci c details requisite for the planning launching of offensive operations We are fully aware of the current restrictions pertaining to Agency support for insurgent forces It is our belief however that provision of this information is consistent with our long-estab- lished practice of providing intelligence as appro- priate to prevent loss of life 32 On January 14 1985 Casey's letter was answered by Boland and Representative Lee Hamilton who was soon to succeed Boland as chairman According to their reSponse The thrust of the public debate over the Boland Amendment was clearly directed at the complete severance of all intelligence community connections with the Contras and the end of all support for anti Sandinista military activity Therefore your stated intention to provide de- fensive intelligence to the FDN is trou- bling It is our opinion that at a minimum section 3066 prohibits the provision of intelligence information to the FDN on any systematic or continuing basis particularly if such information will enable a FDN force to avoid tactical contact with the enemy and thus be in a better position to contin- ue military operations of its own On the other hand the unplanned for isolated provision of incidentally acquired information to a person threatened by imminent assassination would seem reasonable In any event on the basis of the imprecise infor- mation given to us we are unable to approve or disapprove any contemplated CIA activity Some examples of intelligence you would provide to the FDN could in our view violate the law yet not every example seemed illegal If your decision is to proceed we ask that you provide the Committee with the guidelines under which your General Counsel will approve or dis- approve the furnishing of intelligence to the Fl Jll i 33 In the rst of the sentences quoted above Hamilton and Boland clearly went beyond both the letter and spirit of the Boland Amendment by suggesting that its purpose was to eliminate all intelligence community connections with the Contras Those connections were continuing throughout the period with the 49 Chapter 6 Chairmen's full knowledge and acquiescence as we indicated above However there remained a valid dis- pute over exactly how detailed such intelligence shar ing could be Hamilton and Boland took the view that tactical information of a militarily useful sort was prohibited even if it were for defensive purposes Two months later the CIA responded to the Chair- men s request to provide Congress with detailed guidelines On March 18 1985 Casey wrote to Ham- ilton and to Senator David Durenberger Chairman of the Senate Select Committee on Intelligence This is in response to questions raised by the Committee regarding the Agency's plans to pro- vide certain defensive intelligence to opposition groups in Nicaragua We do not intend to provide intelligence on any systematic or con- tinuing basis Our goal is humanitarian in nature and any intelligence we would pass would be strictly limited on a case-by-case basis to infor- mation which in general affects the lives of U S persons or third country noneombatants or which suggests that a holocaust-type situation involving substantial loss of life may occurfl l Casey thus indulged Hamilton and Boland temporari ly on the speci c issue but presented the guidelines as the Agency s statement about what it would do without conceding the House Chairmen's interpretation of what the law required Until the CIA was able to get the law clari ed it behaved in a manner consistent with its own guidelines which were drafted as shown below to be stricter than the law itself Five months later on August 8 1985 Congress resolved the interpretation dispute in the CIA's favor In the Supplemental Appropriations Act for fiscal 1985 Congress said Nothing in this Act section 8066 a of the De- partment of Defense Appropriations Act 1985 as contained in section 10 of Public Law 98- 473 or section 801 of the Intelligence Authoriza- tion Act for Fiscal Year 1985 Public Law 93 618 shall be construed to prohibit the United States from exchanging information with the Nic- araguan democratic resistance 35 Congress did not say it was creating new authority The phrase nothing in this act shall be con- strued to prohibit is the kind of language Congress uses when it is indicating its interpretation of what a past law has always meant The report of the House conferees made this abundantly clear The conference committee discussed and the In- telligence Committees have clarified that none of the prohibitions on the provision of military or paramilitary assistance to the democratic resist- 498 ance prohibits the sharing of intelligence informa- tion with the democratic resistance This point was made again in December 1935 when Congress again addressed the subject of intelli- gence sharing in the Intelligence Authorization and Department of Defense Authorization Acts of 1986 37 Congress permitted the intelligence community to provide communications equipment and related train- ing and to exchange information with and provide advice to the democratic resistance The conference report explained the provision this way The conferees note that under current few and the restriction contained in Section 105 of this Con- ference Report the intelligence agencies may provide advice including intelligence and coun- terintelligence information to the Nicaraguan democratic resistance Section 105 does not permit intelligence agencies to engage in activi ties including training other than the communi- cations training pursuant to Section 105 that amount to participation in the planning or execu- tion of military or paramilitary operations in Nicaragua by the Nicaraguan democratic resist- ance or to participation in logistics activities inte- gral to such operations 33 As with the August statute the statutory history con- tains a clear reference to words that interpret what the law has been and not just what it will be It is clear therefore that the law allowed Col North and others to pass intelligence of military value to the resistance Advice for and Coordination of the Resuppiy Operation The language and legislative history of the Boland Amendment as modified by the communications and advice provisions also make clear that Col North and other Government of cials could le- gally provide general advice coordination and infor- mation with respect to the Contra resupply operation that began in late 198 5 The Boland Amendment provides that No funds may be obligated or expended for the purpose or which would have the effect of supporting directly or indirectly military or para- military operations in Nicaragua Emphasis added This language does not prohibit all support but only support of a Speci c kind The question that always arose however was what kind of support would con- stitute indirect support of a military operation inside Nicaragua After the communications and advice provisions were enacted in 1985 the Chairmen of the House and Senate Intelligence Committees disagreed Chapter 6 about their meaning particularly as they might apply to a resupply operation as opposed to speci c mili- tary or paramilitary operations in Nicaragua Rep Hamilton in a December 4 1985 letter took the position that the law prohibited advice about lo- gistical Operations upon which military or paramili tary operations depend 39 Senator in a letter dated the next day however said that he be- lieved the law meant to allow just such advice Faced with these con icting interpretations the CIA after a careful analysis of the legislative history chose to accept the position that most clearly represented a harmonization of the points of difference between the two Chambers The legislative history therefore seems to draw distinctions between on the one hand participa tion planning and providing advice which would not be permitted in support of paramilitary operations and en the other hand informatiOn sharing including advice on the delivery of sup- plies There is no clear indication that Con gress intended to prohibit the CIA from giving advice on supply operations and some indication that it did intend to distinguish between mere information-sharing and actual participation in such operations Furthermore there would appear to be a valid distinction between permissi- ble general military reSUpply Operations and op- erations in the context of speci c military Oper- ations which were not authorized Merely passing intelligence on Sandinista gun or radar placements weather conditions flight vec tors and other information to assist in the deliv ery of supplies for general maintenance of the forces in the eld would not seem to be prohibit- ed both because this would not constitute par- ticipation and because this would not be inte- gral to a paramilitary operation as contem- plated by Congress 0 We agree with the legal conclusions reached in this memorandum Based on these conclusions we would argue that virtually all if not all of Col North's activities in support of the democratic resistance would have been legal even if the Boland Amend- ment had applied to the NSC By extension we be- lieve that virtually all if not all of the activities of employees of other executive branch agencies and entities that were covered were also legal The worst that can be said of all of these people is that they adopted one side of a reasonable dispute over inter- pretation In that dispute the opinions of the Senate are every bit as much of a valid indicator of Con- gress s intentiOn as the House s There is no way therefore that behavior undertaken in reliance on the Senate's legislative record can fairly be interpreted as an intentional outing of the law 499 Chapter 6 Endnotes 1 Addison v HUMP Hit Co 322 U S 607 5171 1944 2 McFarlane Test Hearings 100-2 5 113 337 at 187 1 Pub 1 No 98-473 98 Stat 183 4 Congressional Record Oct 11 1937 p 514206 5 161 at 51-1205 1d at 1112201 7 1d 3 5 U S C 7324 a112 9 13 U S C 960 10 Pub L No 93-423 98 Stat 183 1933' Oct 12 1934 Continuing Resolution Department of Defense Apa propriations Act See 3066 11 22 U S C 2293 emphasis added 12 Pub L No 99-190 99 Stat 128 13 22 1 1 5 0 2422 14 See for example P L 93 473 98 Stat 182 1835 1905 1923 15 For example compare Pub L No 93-423 98 Stat 1923 with 1937-38 16 See Pub L No 98-441 98 Stat 1699 Oct 3 1984 17 96th Congress 2d Sess 5 2284 Sec 103112 18 M Sec 111 19 William E Harris Reporting Obligations and Fund ing Restrictions Affecting Intelligence Departments Agen- cies and Entities of the United States Prepared Statement in reply to a request of the LLS House Select Committee to Investigate Covert Arms Transactions with Iran Sept 25 193 p 2 Full statement reprinted as Appendix A to the Minority Report 20 Addison v Hefty H111 C0 322 1 3-5 at 3 12 21 Harris Reporting Requirements prepared statement at 8 22 50 U S C 403 23 See T114 v 11111 93 S Ct 2229 230011973 500 24 Harris Reporting Obligations prepared statement at 14 emphasis added 25 191 p 11 26 Congressional Record Oct 20 1983 p H3413 fat p H8389 23 Harris Reporting Obligations prepared statement at 11-12 29 See Senators lnouye and Mitchell Meese Test Hear- ings 7 29 21 at 428-29 30 This point was corroborated by Generals Secord and Singtaub See Seeord Test Hearings 5 21 at 197 Singlaub Test Hearings 100-3 5 21 37 at 19 - 31 0LN-91 32 North testimony Exhibit OLN-333A 33 Id 34 1d 35 Pub L No 99-33 See 102 lb 36 1 1 5 House of Representatives 99th Cong Sess H Conf Rept 99-232 International Security and Develop- ment Cooperation Act of 1985 p 144 emphasis added The provision rst appeared in the ISDCA but the conferees agreed to drool the provision because the same language was to appear in the supplemental appropriations act Nev- ertheless this interpretation is the one that was ottered to the House by the COmmittce of jurisdiction that had on'gi- nated the language The interpretation was not contradicted in other reports or on the House or Senate oor 37 Pub- L No 99 169 Pub L No 99 190 33 House of Representatives 99th Cong Sess H Rept 99 373 Conference Report to Accompany HR 2419 p 16 emphasis added 39 As quoted in March 2 1937 memorandum from CIA Associate General Counsel VJ George Jameson to the Gen eral Counsel p 6 Ex TC-13 Hearings 100-4 40 M at 5 Chapter 7 Who Did What To Help The Democratic Resistance The public hearings of these Committees presented a confusing picture of U S assistance to the Nicaraguan democratic Resistance during the period of the Roland Amendments The overall impression the Committees majority tried to create was that the government was engaged in a massive effort to sub- vert the law A careful review shows however that this simply was not the case The NSC staff's activi ties fell into two basic categories Some were the kinds of diplomatic communication and information sharing that Congress may not constitutionally pro hibit even if Congress had intended the Boland Amendment to apply to the NSC Others with the possible exception of the diversion were in accord- ance with the law as we have analyzed it in the preceding sectinn Given the nature of the strategic threat in Central America we also believe President Reagan had more than a legal right to pursue this course of assistance to the Contras We believe he was correct to have done so The mixed signals Congress was giving indicates that many members agreed Our only regret is that the Administration was not open enough with Congress about what it was doing We have no intention here of trying to present all of the evidence the Committees received about what each person did If we did our dissent would have to be as long as the Committees narrative Frankly we believe the mind numbing detail in that narrative ob- scures as much as it reveals leaving readers with some fundamentally mistaken impressions In the fol- lowing few pages therefore we will limit our com- ments to a broad factual overview to indicate why we reach the conclusions we do The President President Reagan gave his subordinates strong clear and consistent guidance about the basic thrust of the policies he wanted them to pursue toward Nicaragua There is some question and dispute about precisely the level at which he chose to follow the operational details There is no doubt however about the overall management strategy he followed The President set the US policy toward Nicaragua with few if any ambiguities and then left subordinates more or less free to implement it The first crucial step was the President's decision to back a December 193 Central Intelligence Agency CIA prOposal for covert action Within a year the policy was covert in name only and Congress began passing the rst of the Boland Amendments Never- theless when the Kissinger Commission recommend- ed a more overt policy of support for the Resistance in 1984 former National Security Adviser Robert C McFarlane tesd ed that the recommendation was ig- nored by the President and by Congress The Administration was aware as early as mid-1984 that Congress would probably cut off funds to the Resistance the mining incident served as either a reason or as a convenient pretext for the cutoff de- pending upOn one's point of view The President in- structed the NSC staff according to both McFarlane and Col North as early as the spring of 1934 to keep the body and soul of the Resistance together until Congress c0uld be persuaded to resume support for them 2 North testi ed that he understood this to mean speci cally among other things that he was to keep the Contras together in the field as a lighting force 3 Although McFarlane appears to have interpreted the President s desires somewhat more narrowly McFar- lane said that the President repeatedly made his gen eral desire to support the Resistance known both pri- vately and publicly 1 McFarlane and his successor Admiral John Poin- dexter both portrayed the President as having been generally aware that the Resistance was receiving funds from third countries and from private parties but not of the details of Contra expenditures 5 There is no evidence that the President authorized or direct- ed McFarlane or the NSC staff to contact third coun- tries in 1934 or l985 to raise funds for the Resistance There also is no evidence that the President personal- ly solicited such funds from foreign heads of state and the President has denied having done 50 5 How- ever it is clear that the President knew such funds had been given to the Resistance during 1984-35 and that he did not tell the NSC staff not to encourage such foreign political or financial support In addition Poindexter said the President considered contributions from third countries to be entirely acceptable and 501 Chapter 7 thotight they should be encouraged 5 But whatever the President s precise knowledge or direction of the NSC staff s role in encouraging contributions we are firmly convinced that the Constitution protects such di- plomacy by the President or by any of his derignated agents whether on the NSC sta State Department or anywhere else The President also knew that some private US citizens were giving money to help the democratic Resistance-r-another activity that was perfectly legal In 1986 after Congress speci cally stated that third country solicitations by the State Department were not precluded the President did authorize such a so- licitation in a National Security Planning Group meet- ing That decision that eventually led Secretary of State George Shultz and Assistant Secretary Elliott Abrams to solicit the Government of Brunei The President s exact knowledge of other aspects of the NSC staff's support for the Resistance is less clear The President knew North was the main staff officer acting as liaison to the Resistance The Presi- dent was briefed by Poindester about the constructiOn of an emergency air eld in a neighboring country that was to be used for the private Southern Front rcsupply operation 10 and according to McFarlane he personally intervened with the head of state of a Central American country to obtain release of an arms shipment for the Resistance that had been seized immediately after a vote in Congress to reject an effort to resume C0ntra funding On most other aspects of the resupply operation and North s military advice to the Resistance the President seems not to have been informed of what McFarlane and Poin- dester considered to be details many of which McFarlane denied knowing himself Again whatever the President s precise level of information it is clear that matters about the President s knowledge of which these Committees can be sure including the ones just cited ahr jail ii't'thin the sphere of constitu tianalht protected diplomatic cornininn cattan or the equally protected speech and encouragement of fecal ac- tivity by U S citizens The yice President There is no evidence that Vice President George Bush knew about either the Contra resupply effort or the diversion of funds to the democratic Resistance The Vice President's staff docs acknowledge having learned about General Secord's resupply operation from lielis Rodriguez in August 1936 The staff ltu l'n' hers informed the relevant agencies but said they did not think the issue warranted informing Bush at the time The testimony all says the subject was not dis- cussed with the Vice President Two April scheduling nicnioi'tinda did use the word resupply in connec- tion with one Rodriguez visit to the Vice President's office but there is no reason to infer front a single 502 phrase that the Vice President's staff had full knowl edge ofa subject the NSC staff was deliberately keep ing from them Felix Rodriguez The one point of connection between the Vice President his staff and the resupply effort was Felix Rodriguez also known as Mart Gomez a retired CIA officer and personal friend of Donald P Gregg the Vice President's Assistant for National Security Af- fairs Rodriguez was a significant figure in North's resupply operation as the facilitatorfcoordinator of private benefactor ights He had three short personal meetings with the Vice President during this time period According to his testimony all three related to his counter-insurgency efforts in Central Amer- ica IE The second of these meetings took place on May 1 1936 some eight months after Rodriguez began work- ing with North on the resupply effort and a few months after that effort became active According to his testimony Rodriguez was fed up with the oper- ation and was planning to quit 13 Neither Watson nor Gregg had been told about his role at this time Ro- driguez said He had purposely kept that informs tion from all others at North s request and asserted that he did not intend to inform the Vice President or Thc majority in Chapter 3 claims that North employed the assistance of other LLS officials in order to obtain approval from a Central American country to serte as the host for the rcsupply operation air base Thereafter it strongly suggests that Col James Steele and Donald Gregg the Vice President's National Security Adviser were those other officials and that very matter was dis- cussed by the three of them at a meeting on September lfl WES The reference to a meeting on September 10 1935 is based on ambiguous notes contained in Col North's note- books Since Col North vtas tics cr asked about that meeting or those notes we cannot tell when they is ere m ide let alone vi heth- er they were accurate or reflect 1 meeting which actually occurred Moreover despite being subject to depositions and being totally cooperative with these Committees neither Col Steele not Mr Gregg has been asked whether such a meeting ever took place and if whether the quoted material was discussed Iri short there is simply no credible csidcnce against ti hich the meaning or accuracy of notes has been tested Indeed the eudciice before the Committees to date suggests the contrary North recruited Rodriguez to perform the function of obtaining support for the use of the Central American country s air htisc and that he did so permission in Use North's name North directed Rodriguez not to inform Gregg and his office about this tRodriguer st qu-ntent and he didn't ilorem er the l'lltlef' ily's own account of exents indicates that Rodriguez was first by North as a pi'issihlc source of assistance hen Col Sn clc suggested that idea on September In it day after this supposed meeting between North Steele and ircgg Therefore there is no evidence to suggest that North's pri ite resupply oper- ation was distressed on September it And finally the reference made Chapter 1 to Gregg not knowing about it resiipply oper- ation print to the summer of liltio is not cscit accurate 3 close reading of the very pages cited h the to Lircgg's deposi- tion indicates that Ilt admitted to knits-ting in early l liio about an informal non-lethal supply operation funded by American citizens Gregg Dep it lei-23 his staff about the effort on May Nevertheless a scheduling proposal dated April s and a very short April 30 brie ng memorandum described the purpose of the meeting as being in part to provide a brie ng about resupply of the Contras It is not clear how this language got into these documents Whatever the explanation the people present at the meeting former Senator Nicholas Brady Gregg Colonel Samuel J Watson Gregg s deputy and Rodri- guez all said they were certain resupply ttever was discussed with the Vice PrEsident anti the Commit- tees have no reason to doubt these statements Neither do the Committees have any reason to suspect that Watson or Gregg knew about North s involvement at this time Let us shift focus now to August 1986 On August 8 Rodriguez met with Gregg and Watson and told them about North's involvement with the resup- ply operation and possible profiteering by Secord and his Rodriguez s disclosures on the eighth of August and Gregg's ensuing conversations with North s deputy Robert Earl prompted Gregg to call a multi-agency meeting on August 12 to alert the agencies of the problems Rodriguez felt deserved their attention In other words when Bush's staff became aware that some aSpects of the resupply effort might be harmful to the Resistance the staff met with the appropriate agencies State CIA and Defense and told them of the potential problem Gregg did not however bring the matter to the Vice President's personal attention Byrne the secretary in the Vice President's of ce who typed these memos testi ed that after Rodriguez had requested the appointment she asked Colonel Watson about the visit s purpose She said that Watson gave her the language she used for the purpose 5eotion of the scheduling preposal when she typed it on April l4 Two weeks later she simply reused the same language for the Vice President's scheduling memorandum Byrne deposition June to pp 2-11 Colonel Watson has testified not only that he has no recollection of providing Ms Byrne with that information but reiterated that he would have had no reason at that time to connect Rodriguez with at all Furthermore Watson said that he had no recollection of reviewing the scheduling memoran- dum either alone or with Rodriguez before the meeting Watson deposition June 1-5 pp 21-10 Similarly Gregg does not remem- ber reading that language at either the prOposal or memorandum stages and says he would never have phrased such a discussion in that manner Gregg deposition May 18 pp 32-33 Watson's notes which were exhibits to his- deposition indicate that three times during the rst week of August lithe either North or Earl made resuppIy-related references to Watson regarding Ro driguez s activities in Central America Each time according to Watson he asked about the statements only to be rebuffed Watson Dep 6116 381 at 43 55 ironically the apparent purposr of these asides according to Watson was to get him and Gregg to admonish Rodriguez about whatever it was he was supposedly doing to harm the resupply effort 'According to all three however Rodriguez did not outline his own resupply role until December 1936 weeks after North had been reassigned Rodriguez Test Hearings 100-3 SITHET at 3l5 Rodriguez Den Sflfit'l at 43 Watson Dep fth 8 at 34- Gregg Dep Sfltix ti't at Chapter 7 Nationai Security Council Staff Robert McFarlanc and John Poindester appear to have had different views of what the President and what the law would allow the NSC staff to do It is important to be clear however that with the possible exception of some small fraction of NSC staff salaries overhead and small amounts of travel expenses all of which could legitimately have been used in any event to maintain contact by the NSC staff with the Resistance leadership and others no apprOpriated funds were devoted to the efforts dis- cussed below Robert McFarlanc testi ed that he believed that the NSC staff was covered by the Boland Amend- ment and that One of the principal purposes of the amendment was to prevent the government rais ing funds in support of the Resistance He testi ed that he toot this position for political reasons not on the basis of an analysis of the law 21 It should be noted however that although McFarlane says he was quite vocal on the point of NSC coverage Command- er l aul Thompson formerly the legal counsel has a different recollection Thompson said that he remembers a discussion in which he and McFarlane considered whether the NSC might conceivably be covered and then decided that the issue was moot because nothing the NSC staff was doing would be a violation even if it were covered Thompson also remembered a eunversation with Bretton Sciaroni the counsel for the Intelligence Oversight Board I told him that we at NSC Staff had already determined that the NSC Staff was not an intelli- gence agency under that de nition But the real message I left with him was that McFarlane had already represented to the members of Congress that whether or not we were subject to the Boland Amendment we considered ourselves subject to it or words to that effect The reason being that Mr McFarlane had already made the determination that we had not violated the Boland Amendment so it was almost a moot argument to make 23 Whatever MeFarlane s contemporaneously ex- pressed view of the Boland Amendment might have been he testi ed that his understanding of the role of the NSC staff was that it was limited to providing political SUpport and direction for the Resistance movement and did not include fundraising He also speci cally denied that the President intended him to provide military assistance to the C ontras 25 Poin- dester testified however that he was familiar with and approved the details of North s work as a switching point for activities related to the demo- cratic Resistance advice Poindexter also said that the President was generally aware of North's role 503 Chapter and that he believed the President had implicitly au- thorized the NSC staff s efforts 21 Whatever the differences in their understandings MeFarlane and Poindester both chose North to carry out their instructions North claimed his activities throughout were fully authorized McFarlane claimed that several of North s actions during his tenure were not authorized but Poindester said that he had gener ally authorized North's actions During McFarlane s tenure as National Security Adviser and after the previously appropriated funds had been used up in or about June of I984 the Na- tional Security Council Staff engaged in a series of activities described below Fundraising From Third Countries Beginning in June of 1984 Country Two provided what ultimately amounted to $32 million for support of the Resistance the support was provided at the level of $1 million per month in 1984 and then in a lump sum of $25 million in early 1985 t is clear from the hearing record that the NSC staff was engaged in an effort to encourage Country Two and other third countries to support the Contra cause both political- ly and nancially Even though McFarlane and North both claim not to have solicited funds McFarlane personally encouraged contributions unsuccessfully from Country One and successfully from Country Two North occasionally using Gaston Sigur who was then on the NSC staff General Secord and Gen- eral Singlaub encouraged contributions from several other countries as well It is important to note how- ever that there is no evidence of any kind in the records of the Committees which suggests that any quid pro one was sought or received in return for any third country contribution to the Resistance Raising Private Funds in Support of the Resistance Beginning in the spring of 1935 a group of private individuals began to raise funds to support the Contra cause North met with the fundraisers and their poten- tial contributors alone and in small and larger groups and helped acquaint these groups with the humanitarian and military needs as well as the politi- cal and military situation of the Resistance In addi- tion North helped to arrange White House briefings for certain gmUps of contributors on a few occasions the President spoke at some of these briefings The President believed and was consistently briefed that the private groups were using their funds to purchase television advertising to promote the Contra cause and to engage in other such public awareness pro- grams on behalf of Administration policies There is no evidence that North was aware of people using the promise of such meetings to obtain contributions of a Certain minimum amount Generally North did not personally solicit funds from contributors although 504 the record is clear that he was acting in general concert with individuals who were soliciting funds and that he did direct the disposition of some of the funds so raised From the record it also appears that the nature of North s presentations to groups was that he tried to present the reasons behind the President s policy of support for the democratic Resistance and opposition to the Sandinistas These presentations ap- parently were similar if not identical to ones he gave to many other groups of noncontributors to persuade them to support the President s policy Assisting in Arms Purchases and Humanitarian Supplies During McFarlane's tenure as NSC Adviser North asked General Secord by then a private citizen to assist the Contras in their arms procurements North met with Secord and on other occasions with Gener- al Singlaub to obtain their assistance as private citi- zens The arms were purchased with third country or private funds It seems clear that Colonel North dis- cussed the proposed procurements with Resistance leaders and also made his own suggestions for appro- priate procurements North appears to have had detailed knowledge about what was being shipped and the shipment de- tails necessary to coordinate air drops with the Resist- ance In fact there is evidence that North intervened on at least one occasiOn with of cials of a foreign country to persuade them to allow a proposed ship- ment of arms which had been purchased with private funds to proceed 23 McFarlane testified during his second appearance that he did not regard these activi- ties as having been authorized by him Giving Military Advice to the Democratic Resistance in addition during McFarlane's tenure and during the period of the most restrictive Boland Amendment North appears to have given strategic military advice to the democratic Resistance Secord testified that North actively participated in a program review meeting in Miami in July 3'85 a principal purpose of which was to discuss the overall military situation of the Resistance and to decide how their military effort should be reoriented m North provided military advice of a general nature to the Resistance on the other occasion as well 11 McFarlane claimed he was not informed of the Miami program review meeting by North or of other speci c occasions on which North gave military advice although he also testified that he did not regard such advice as central to the Boland Amendment s restrictions North speci cal- ly denied having given tactical military advice on speci c military operations Giving Intelligence to the Democratic Resistance During the entire period of the Roland Amend- ment's restrictions both the CIA and the NSC were expected to continue obtaining information about the activities of the democratic Resistance as part of their normally assigned duties Obtaining detailed knowledge about the Resistance by all normal intelli- gence gathering methods including direct conversa- tions with Contra leaders was clearly consistent with the law at all times During Meliarlane s tenure North provided intelli gence to the Resistance by conveying information provided in him by certain of cials of the Central Intelligence Agency who testified they did not know North Was passing it to the Contras Some of the information was principally of military significance and was provided for defensive purposes while other information could have been used for humanitarian purposes as well The CIA could not have passed the information directly under the agency's own cease and desist order which as we indicated earlier went well beyond the requirements of the Roland Amend- ment North also developed an informal intelligence source of his own in the person of Robert Owen whom he used as a secret courier and transfer agent for cash and intelligence Private Air Resupply Network in the fall of l935 after the program review meeting in Miami North approached Secord to devel- op a privately funded private air resupply network to support the Resistance General Secord proceeded to establish this network during late 1985 and ran it through early October 1986 when a resupply airplane carrying Eugene Hasenfus was shot down over Nica- ragua This air resupply network delivered both lethal and humanitarian cargo to Contra forces operating within Nicaragua The air resupply network was funded by private contributions the Iran arms sales and sorne third country funds As part of the deveIOpment of the resupply net work North through other U S of cials in Central America such as CIA station chief Tomas Castillo and Ambassador Lewis Tambs sought the creation of an emergency airstrip in a neighboring Central Amer- ican country It appears that this was done with Ad- miral Poindester's approval McFarlane who had es- sentially left the NSC by then claimed he did not know about the airstrip or about instructions to Am- bassador Tambs to Open a Southern Front a 'McFarlane testi ed that North did not tell him about Secord's involvement in this resupply network though he stated that North did indicate that occa sionally air deliveries were made to the Resistance McFarlane denied he had authorized North to direct the air resupply of arms to the Contras 35 Poindexter said he was aware of the air resupply network He regarded it as a byproduct of Colonel North s other Chapter efforts for the Resistance within the scope of the President's direction to the NSC staffs in the course of the resupply effort North provided some people with devices This cecurred after the law was changed to permit intelligence agencies to provide communication assistance and information to the Resistance Conclusion in sum the NSC's activities aside from its normal duties generally fell into two categories One in- volved information sharing with the democratic Re sistance and encouraging contributions that with the possible exception of the diversion were perfectly legal Activities such as these could not constitutional- ly have been prohibited by statute The second cate- gory involved North's military advice to the Resist- ance and detailed coordination of the resupply effort Since the NSC was not covered by the Boland Amendment these activities were clearly legal But even if one assumes the NSC were covered we showed earlier that the amendment did not prohibit general military advice and resupply coordination Some of these latter activities however perhaps could have been reached by Congress without violat ing the Constitution It was to protect these unpopu lar but legal activities from possibly being made the gal that we believe the NSC staff misled Congress There is no evidence that the President knew more than general information about this side of North s activities or anything at all about the deceptions of Congress State Department Little or no evidence surfaced during these hearings to suggest that the State Department was used wit- tingly or unwittingly to circumvent the Boland Amendment Individuals such as Louis Tambs Am- bassador to Costa Rica and Robert Owen who had a contract relationship with UNO under a grant agree- ment with the Nicaraguan Humanitarian Assistance Office or NHAO did assist North with the resupply effort but this was done without the knowledge and blessing of their superiors at the Department Owen's assistance arguably took place during his off hours but Tambs assistance with the establishment of the Point West airfield was clearly done in the course of his long ambass'adorial day Even Tambs activities however fell within the normal legal and constitution- ally protected scope of activity for an ambassador His error was to bypass his superiors in the State Depart- ment by reporting outside channels to North That Amhassador Tombs had been a friend of Col North's going back In 932 when Tambs was a consultant to the NSC Later when Tambs was the Ambassador to Colombia North personally 505 Chapter 7 is the error like that of a CIA station chief Tomas Castillo was a matter of violating his own depart- ment s policy rather than violating the law Robert Owen s activities received a great deal of attention during the early days our public hearings The examination of his role during the period of his NHAO contract seem to proceed upon two suspi cions I that North had placed Owen in the NHAO program to be his eyes and ears in Central America and 2 that North had also done this to gain access to NHAO facilities to assist the covert resupply effort The major problem was how to reconcile his off- hours assistance with lethal aid drops with the hu- manitarian purposes NHAO was designed to accom- plish The Boland Amendment clearly would have prohibited the use of NHAO resources for lethal as- sistance and Owen did not step over that line As a limitation on apprOpriations the Boland Amendment does not cover a person s private time However Owen s contract with NHAO reads as if it may well have prohibited such off-hours activity even if the Boland Amendment did not In any event Owen was not totally forthright with the State Department about the assistance he gave North In that respect he joins a long list of people whom North persuaded to work outside normal channels Elliott Abrams The main State Department focus of the Nicaragua side of the Committees investigation however was Elliott Abrams Assistant Secretary of State for Inter- American Affairs Abrams was the main spokesman for the Contra program 38 As chairman of the Re- stricted Interagency Group RIG Abrams therefore was a natural object of suSpicion for those opposed to Contra aid The theory that seemed to structure the investiga- tion of Abrams role was that he either knowingly assisted and advised North or that he realized what North was doing but ignored it to let North keep the Resistance alive while the Administration fought for renewed Congressional aid There was a third possi- bility testified to by Abrams however that North effectively kept Abrams in the dark The evidence more clearly substantiates what Abrams said than either of the other more conspiratorial theories In this respect Abrams was more of a victim than a co- conspirator He was deliberately kept uninformed by North and I oindealer just as were the President Secretaries Shultz and Weinberger the Intelligence Oversight Board s Bretton Sciaroni and the United States Congress Abrams was not engaged in any conduct that even remotely quali ed as a violation of the Roland prohi saw to it that troops were sent to the embassy in Colombia to prolect Tarnhs when his lift was threatened by drug dealers Tarnhs Test Hearings IOU-3 at Job-6 506 bitions or of any other law Indeed on the one occasion he was presented with information about the activities of the TOmas Castillo he immediately went to the Secretary of State This happened about three weeks after Hasenfus's airplane had been shot down During this period Abrams appears to have been misled by North and by CIA of cials As a result he repeatedly informed Congress the press and the Secretary to his later chagrin that there was no Government involvement with the resupply effort As he himself said during our hearings his statements were completely honest and completely wrong So convincing was Abram's testimony on this point in our hearings that Senators Rudman and Mitchell and House Vice Chairman Fascell characterized Abrams as having been hung out to dry An even better barometer of the extent to which Abrams had been kept in the dark by North was his testimony regarding his knowledge of critical key players and their involvement in the resupply effort and in the Southern Front With regard to the resup- ply Abrams testi ed that he did not know General Secord Robert Dutton Richard Gadd Rafael Quin- tero or Felix Rodriguez let alone what role they were playing in the resupply effort 2 He stated cate- gorically that neither he nor anyone else at State knew that Gwen in his off-hours was assisting North in coordinating lethal drops to the Resistance He asserted that if he or anyone at State had known this Owen would have been fired immediately There is no evidence to challenge those assertions nor were they challenged by the Committees Some on these Committees questioned whether Abrams lived up to the instructions Secretary Shultz gave him to Monitor Ollie Underlying the ques- tions seems to have been an assumption that Abrams knowingly averted his glance To reach this conclu- sion however one has to believe that everyone in government always should act on the assumption that his or her colleagues are potential liars Business would then be conducted through investigative tech- A clear indication of the extent to which the State DePartment attempted to comply with the Roland Amendment is the level of debate within the NHAO program m-er what constituted humani- tarian aid As Elliott Abrams testified - This was not something we did careIessly I remember Ambassador Deumling coming to a RIG meeting and saying the Contras have asked For wrist watches can I pay for wrist watches This was deadly serious because of the legal restrictions We actually debated Of course wrist watches weren't lethal aid but were they humanitarian aid We ultimately decided wrist watches were okay Abrams Test Hearings 100-5 at 35-3 Abrams Test Hearings 100-5 6 2 87 at lit 42 54 In chapter of the Majority chort Assistant Secretary Abrams is quoted as having admmitted to these Committees that certain state- ments that had been made by him were completely wrong For some reason the majority failed to point out that Abrams preceded that admission by noting that while the statements were completely wrong they were completely honest Id at 65 niques rather than through normal comity Congress does not apply this standard when it looks at Admin- istration presentations to Congressional Committees nor should it apply it to relationships inside the Ad- ministration Abramsmlike Secretaries Shultz and Weinberger on the Iran initiative and like several Committees of Congress that asked about North's Contra assistance proceeded on the assumption that his colleagues were telling him the truth If they were not the blame surely belongs more to the deceiver than the deceived The other major area of inquiry regarding Abrams was his November 25 l98b testimony before the Senate Select Committee on Intelligence on the clear- ly lawful solicitation of funds from Brunei With regard to the solicitation itself the only problem that seemed to raise any concern during the hearings was the fact that Abrams gave the Brunei representative 3 mistyped Swiss bank account number that was pro vided by Colonel North instead of using another number sopplied by the Chief of the Central American Task Force The account number North intended to give Abrams was one controlled by Gen eral Secord and Albert Hakim However despite theories and suspicions to the contrary Abrams se- lection of that account on the advice and with the blessing of his superiors at State was based on his belief that it was an account controlled by the Resist- ance His selection of that account was not part of a clandestine venture calculated to assist Lake Re- sources and the Secord-Hakim enterprised 5 There is no question that Abrams exercised very poor judgment in his SSCI testimony by attempting to answer questions regarding third country fundrais- ing in a technically correct but misleading manner to protect the con dence of Brunei Abrams himself de- scribed it as an indefensible and foolish act that he greatly regretted He surely could have asked the Senators to let him refrain from answering the ques- tion until he had a chance to discuss the matter with the Secretary Ultimately Abrams apologized to the Senate Intelligence Committee for his error six months before these hearings began The Role The Central Intelligence Agency was not a major player in the Administration's efforts to help the Nic- araguan Resistance during the period of the prohibito- ry Boland Amendments That was partly because the amendments esplicitly limited the CIA and other in- telligence agencies In addition the CIA as an agency wanted to avoid even coming close to the edge of the law As Admiral Poindester said in our public hearings They wanted to be careful and Di- rector Casey was very sensitive to this they wanted to keep hands-off as much as they could 43 Chapter 7 Of course the agency could not simply keep hands off For one thing it was expected thrOughout this period to continue intelligence gathering and political support for the Resistance At the same time the CIA felt it had to be responsive both to Congress's man- date and to the Administration s strong support for the Contras The result was an extremely dif cult situation for career professionals who had to imple ment policy at the Operational level The Chief of the Central American Task Force described his feelings this way I knew almost from the beginning that I was caught between the dynamics of a giant nutcrack- er of the Legislative on the one hand and the Executive on the other and I was in the center of a very exposed position 19 The agency had been traumatized during the postv Vietnam Congressional investigations of the 19703 The Latin American division was traumatized once again when five reprimands were issued as a result of the agency s role in helping to prepare a manual for the Resistance that some interpreted as talking about assassination a technique the US was explicitly prohibited from using As a result the CIA was very concerned throughout this period with protecting itself and the government's future intelligence capa- bility from political retaliation Two different ef fects flowed from this First as a matter of internal policy the CIA regularly issued extremely conserva- tive guidelines that avoided taking legally defensible actions for political reasons Second we believe this posture and Director Casey's own protective feelings toward the agency contributed to Casey s decision to work closely with Co North Because of their efforts to avoid both sides of the nutcracker four of the CIA's career civil servants nd themselves the subject of persistent reports sug gesting that their careers may now be on the line The four include 1 Tomas Castillo a pseudonym who was chief of station in a Central American country Elthe Chief of the Central American Task Force 3 Duane Dewey Clarridge and 4 Clair George the deputy director for operations DDO Castillo is now on duty pending a nal deter- mination of his status The others have been the sub ject of press reports We discuss the major allegation about Clarridge in our section on the legal issues raised by the Iran initiative For the others the main questions all grow out of the relationship with the Nicaraguan democratic Resistance during the time of the Boland Amendments There is substantial conflict in the testimony we have received particularly between Castillo and Task Force Chief It is impossible for us to resolve all of these conflicts in our own minds Our bottom line judgments however are as follows 50 Chapter 7 The CIA tried as an organization to work within the Roland Amendment and succeeded The essential diapute between Task Force Chief and Castillo is whether Task Force Chief s policy guidelines were clearly articulated whether Castillo overstepped those guidelines and whether Castillo properly informed his superiors of what he was doing The policy guidelines themselves which should have been written more clearly were issued for politi- cal reasons and not because Task Force Chief thought Castillo had overstepped the legal au- thority 52 Fina ly we do not believe these individuals de- serve to pay with their own careers for the political guerrilla warfare that was going on over Nicaragua between the President and a vacillating Congress We will not dwell on the legal issues here At the end of the Roland Amendment chapter we discussed an internal CIA legal memorandum with which we agree That memorandum it will be remembered argued that it was legal for the CIA to provide information involving safe delivery sites weather conditions hostile risk assessments and the like to assist the Nicaraguan Resistance in their resupply activities where the role did not amount to participating in the actual delivery of material or in planning directing or otherwise coordinating deliveries during the course of or in the context of specific military engagement 53 This legal opinion should have been written in early 1986 instead of a year later But it was not and peOple had to make judgments on the ground We believe their judgments were legally correct Never- theless a few of them have been controversial In judging the agency s activities to support the Resistance it is important to keep the level of assist- ance in perspective Tomas Castillo was the CIA offi- cial who worked most directly with the Resistance's private resupply network He apparently was far more active in this respect for example than the passive stance of the CIA elsewhere in Central Amer- ica Despite this he has testi ed that he spent only about one-tenth of one percent of his time in 1986 facilitating the resupply effort 55 The Task Force Chief was a mentber of the Re- stricted Interageney GroUp or RIG along with Abrams and North In this capacity he had plenty of opportunity to see how North had become the point man for the Administration s Contra policy Accord- ing to the Task Force Chief constant feuding among RIG members before Abrams became Assistant Secre- tary eventually led to a situation in which power grayitated toward North 56 In addition North man- aged to develop a relationship with Castillo in As with Tambs North developed a personal friendship wult Castillo The North and Castillo families vacationed together in February lass Sec Castillo Test Hearings loft-4 5119 57 at S 508 which Castillo like Ambassador Tambs was willing to work with North outside of normal channels Cas- tillo said he disagreed with the Task Force Chief Go various policy matters and hoped he could get his voice heard through North North claimed that Casey knew Castillo reported to North 8 The relationships between Castillo North and the Task Force Chief obviously led to some misunder- standings and missed communications The main issues on which these Committees focused were the development of an emergency air eld and Castillo s role in passing useful overnight intelligence to the private suppliers The last issue also has led to a dispute over the Task Force Chief s instructions to Castillo and Castillo's response Southern Front Air Strip Castillo and the Task Force Chief corroborate each other and the other evidence we have seen on the absence of a signi cant CIA role in conjunction with the construction of a privately owned emergency landing strip to help the Southern Front resupply effort Castillo did admit that he was probably the rst to have the idea that the air strip should be built Castillo testi ed that a resupply operation was a logistical necessity to supply the insurgents he wanted to see moved out of a neighboring country into Nicaragua He considered the move to be impor- tant politically because the Resistance s presence in the other country was causing resentment in that other country M The airstrip was in turn required for the success of the resupply operation Castillo himself upon specific instructions from the Clrt 31 took no concrete steps to assist in the plan to construct an airstrip other than to visit potential sites on one occasion on his own decision as an observer with Robert Owen 52 Castillo specifically denied that be instructed Ambassador Tambs to seek authoriza- tion for the airstrip from local of cials 3 He testi ed that Ambassador Tambs goals with respect to cre- ation of a Southern Front were based on instructions Tambs received from Oliver North but Castillo denied North asked for the airstrip Castillo felt his role was passively to monitor the activities of the private benefactors with respect to the airstrip he knew those activities were being coordinated by North 35 The Task Force Chief s testimony parallels Castil- lo's on these points There is no evidence to indicate that the Task Force Chief on his own or on behalf of the Agency instructed or suggested to anyone that Castillo should establish a Southern Front for the Contras He categorically denied as did Elliott Abrams ever knowing about let alone agreeing to North's alleged discussion with Tambs and Castillo about the necessity for opening a Southern Front E5 Indeed the first time he can recall learning about the airstrip was in a brief conversation with Castillo at a meeting on December 9 l JttS The Task Force Chief's hest recollection Was that he was worried attd concerned when Castillo indicated that it was being built and that Castillo did not mention who was doing the building He simply assumed that it was being built by the private benefactors and the Task Force Chief cautioned Castillo to make sure that whatever he was doing was legal Several months afterward when North started showing pictures of the work being done on the air- strip at the conclusion of a meeting of Administration of cials the Task Force Chief had to pull him aside to caution him about the wisdom of showing such pictures It was at that point that the Task Force Chief became concerned that North might not only be exceeding the boundaries of the politically accepta ble in his dealings with this highly controversial pro- gram but flaunting it before others He realized he did not have the power to control North was going to keep the agency and myself within the bounds of propriety and legality but there were things that were beyond my powers 5 Providing Intelligence for Air Resupply February 1936 General Secord complained to Di- rector Casey that the air resupply effort was not get ting any help from the Central American Task Force At about this same time in February North distributed KL-43 communications de- vices that he had obtained from the National Security Agency to Secord five people in Secord's resupply network and Castillo North also kept one for him- self 70 It should be noted that these devices were distributed after Congress in December 1985 passed a law speci cally authorizing intelligence agencies to share intelligence with the Resistance and to spend money to help the Resistance with communications Castillo testi ed that he received a KL-43 machine from North through Rafael Quintero in order to relay drop zone information between the Southern Front Commanders to the private benefactors From this point forward Castillo was described by both General Secord and Robert Dutton as having been very helpful Button used the word to the resupply effort 2 Castillo s facilitation of the efforts of the resupply operation involved the passing of information such as the location of proposed drop zones and times back and forth from the southern front commanders to the private benefactors During the Spring Castillo also requested intelligence such as hostile risk assessments and flight vectors from the CIA to support the ight activities and filed intelligence reports concerning the results of these activities H Castillo specifically denied that he was involved in the planning of any of the resupply ights He also denied in response to a point made by Dutton that there was any United States Govern- ment involvement in obtaining permission for the re Chapter 7 fueling of two resupply ights at a Central American country airport Castillo testified that the Chief of the Latin Ameri can Division Division Chief and the Task Force Chief knew of his activities and the abOve cited cable traffic from the Spring would beat him out The first successful lethal air drop was in April and was supported by cabled intelligence front headquarters No one in the operations directorate knew however about the KL-43 until the Division Chief designate s maiden visit to the country in April Castillo testified that he asked the new Division Chief for assurance that relaying information with the between the private benefactors and the Resistance was legal under the Roland Amendments He said that the Division Chief designate assured him he would look into it upon returning to t lfashington 79 The Task Force Chief testi ed that his soperior the Division Chief never informed him of this discussion with Castillo ml The Task Force Chief also said that he did not know about Castillo s direct contact with the private benefactors until a May l986 CIA of cials meeting that he Castillo and the Division Chief attended He said he was surprised to learn at that meeting how closely Castillo had been dealing with the private benefactors 31 At the meeting Castillo said that he let it be known that he thought the fact that he was the communications link between head- quarters the Resistance and the supply operation pre- sented a problem He suggested therefore that the agency train someone from the Resistance to take over that role FI2 On May 28 the Task Force Chief sent Castillo the following message Headquarters wishes to reaf rm with guidelines that no repeat no materiel or monetary support can be provided to or UNOfSouth representatives can provide advice and eommo communication equipment as approved by hqs and can engage itt intelli- genee exchange as approved by hqs 3 After this cable the agency worked to find and train an UNO communicator At this point the Presi- dent s $100 million aid package was going through the Congress On June 24 a Resolution of Inquiry into North s support of the Resistance was filed in the House in a move whose timing was obviously meant to influence floor votes The next day the House in a major reversal voted an aid package for the Contras On July 12 just days after the House vote the Task Force Chief sent a vaguely worded confusing cable that read in part as folloyvs Headquarters has reviewed our commitment to provide secure communications We have taken a second look at the commo link To date we have maintained our distance front the private 509 Chapter benefactors PB who are providing assistance to the Resistance and have repeatedly briefed Con- gress that we do not have any relationship with the The proposed program of assistance would change our policy There have been numerous allegations of violations of law by We do not have a rm handle on whether all of the allegations oating around are false We have come too far at this time to let the solid Operations that deleted ltas built to be jeopardized by elements which we are unable to control The Task Force Chief and Castillo have very dif- ferent interpretations of this cable The Task Force Chief says it was a cease and desist order especial ly in light of the one he had sent in the end of Mayi 5 It is interesting to note however what it was he was supposed to cease and desist doing The Task Force Chief describes the cable as telling Castillo in effect to break all contact with the private benefactors 5 liased on his own testimony the Task Force Chief assumed Castillo would still continue to get informa- tion to the resupply operation but would work di- rectly with the Resistance rather than the private benefactors Castillo in contrast saw it as saying that what he was doing to date was acCeptablc The outstanding feature of the cable from his point of view was that headquarters was telling him he was not going to get a communicator but seemed to expect him to contin- ue to be ready to get intelligence information to the resuppliers They Were satisfying their situation but not mine Castillo said 83 As we read the cable in context the following points seem to stand out 1 Headquarters was con- cerned primarily about the current legislative situation in Congress and with representations that had been made to Congress The concern in other words was political rather than legal 2 Castillo had to address a tough set of problems on the ground The cable was not written clearly if the intent was cease and desist Cease and desist orders can be and often are written simply without all of this cable s ambiguities If the Task Force Chief was trying to tell Castillo to use an UNO cutout to pass information to the reSUppliers he should have said so clearly Of course there would have been no legal difference between working directly with the suppliers or indirectly through the Resistance The difference as seen by the Task Force Chief Was a domestic US political one We want to make clear as we interpret the cable that we are not disputing the Task Force Chief's statements about his intentions if we assume both the Task Force Chief and Castillo are telling the truth as seems likely to us it would mean that the Chief sent a poorly worded cable that let the sender and receiver reach different conclusions with each reading his own problems anti preferences into its meaning The 510 problem in other words appears to us to have been one of missed communications That would not be the first time this has happened nor will it be the last Administrative errors such as these should not force the end of a career Congressional Testimony of OctobEr 1986 In September when the Task Force Chief learned of the final airdrops coordinated by Castillo he assumed that Castillo must have somehow found a way to assist without being in the middle of the operation and thereby placing the Agency at political risk The political problem came to a head in mid October after Eugene Hasenfus airplane was shot down when one of the Agency's peOpie learned that Castillo had used a Upon relaying that information to the Task Force Chief and Division Chief an internal in- vestigation Was instituted Assistant Secretary of State Abrams was informed on October 23 of this potential US Government involvement in this network 9U Abrams immediately informed the Secretary of State about this surprise turn of events uhich potentially undercut his prior Congressional testimony and media statements that there was no United States Government involvement with Hasenfus or with the resupply effort This may have been particularly surprising to Abrams because the Task Force Chief and the Deputy Director for Operations Clair George had been sitting next to him when he gave that unquali ed testimony Ques- tions about George s statements and the Task Force Chief's silence in the face of the Assistant Secretary s blanket denials became a third major focus of the COmmittees' inquiry into the CIA's role George had advised the House Intelligence Com- mittee on October 14 little that the CIA was not involved in arranging directing or facilitating the private rcsupply missnius Signi cantly George stated that he could not weak for the rest of the US Gt'ivernment 99 Abrams spoke after George and ex- panded the Claim without knowing its falsity to cover the whole government The Task Force Chief stayed silent The Task Force Chief knew Castillo had been facilitating the resupply effort in the spring but may have thought Castillo had not done so in September In testimony before these Committees George stated that his denial was based on incomplete infor mation that the CIA did not organize or conduct the resupply operations arid that he wanted to protect the CIA He apologised for the problems caused by his testimony M The Task Force Chief also said that he regretted his silence in response to Clair George s unqualified denial of any CIA involvement and Sec- retary Abram's denial of any U S GOvernment in volvement in the llaseni ns flight H Chapter 7 One should not underestimate our concern over misleading testimony We are satis ed however that this was not a byproduct of an orchestrated conspira- cy to keep Congress in the dark Conclusion The GUI had to work under dif cult politically charged circumstances To protect the agency its personnel steered a wide berth around the prohibi- tions of the law This was particularly difficult to do in an environment in which people were dying for a cause the Administration and the agency supported There were misunderstandings in management and errors in judgment particularly in Congressional testi- mony But the blame for this situation must rest upon unclear laws and a vacillating Congressional policy at least as much as it does upon the career profession- als who were faced with the Herculean task of imple- menting the law Private Fundraising The private fUndraising activities in support of the Contras conducted by Carl R Spitz Channell and Richard Miller received considerable attention in the news reports surrounding the Iran-Contra affair The fundraising efforts were also the focus of early crimi- nal prosecutions by the Independent Counsel and were explored somewhat during our public hearings They have also received signi cant attention in the Majority's Report where it is portrayed in a chapter as a project devoid of proper purposes We cannot agree with the analysis and conclusions of the Majority Report We agree that a private fund- raising effort organized and conducted by Mr Chan- nell raised funds for the Nicaraguan democratic Re- sistance and we agree that the manner in which the fundraising activities were carried out can be criti- cized We are in particular concerned that a rather sizable portion of the donated funds appears not to have actually gone to the Contras But we disagree with the majority s theme that the fundraising activi- ties represented an illegal conspiracy imbued through- out with criminal intent and improper motivations Based on the evidence we see the private contribu- tors as being worthy of praise rather than scorn For the most part their actions represented good faith activities of well-intentioned American citizens moti- vated by a genuine and completely legaIHdesire to do what they could to help the Contras in a time of need The private actions especially those of the donors were patriotic responses in harmony with the policies of the President that were designed to rebut the growing spread of Soviet communism in North America Our basic conclusions are as follows Channell deveIOped the private fundraising orga- nizations and controlled their solicitations Colonel North did not solicit money He did not conspire with Channell to commit in fraud Any suggestion that North deliberately created or nurtured the fundraising network to provide tax write-offs tax expenditures or backdoor Federal nancing for the Contras is wholly without support from the evidence President Reagan had no specific knowledge of the private fundraising efforts He generally believed the persons he met with had donated to a media campaign designed to generate support for further Contra funding by Congress President Reagan met with individuals in the White House to thank them for their long term sup port for his policies not for a particular contribution to Channell's organization This investigation unfairly chastised conservative fundraising efforts that supported foreign policy goals inconsistent with those of the majority of Congres- sional Democrats However the Committees failed to investigate parallel fundraising efforts by organiza- tions that support the Communist forces in Central America and use Members of Congress in their fund- raising Final y the private fundraising investigation of our Committees needlessly harassed private citizens whose political views happen to be contrary to the views held by the majority by asking them questions that intruded on their privacy and were irrelevant to the Committees investigation The Channell-Miller Network The Channell-Miller fundraising network developed as a result of common interests and chance occur rences The Committees have not uncovered evidence that Colonel North sought to establish a private fund raising group or that he motivated any individuals such as Channell and Miller to operate the necessary organizations The evidence demonstrates that Chan- nell was the primary force behind the private fund- raising organizations Colonel North was a relatively minor participant 5 When Channell left the National Conservative Po- litical Action Committee NCPAC in 1982 he pos- sessed a valuable asset a relationship with contribu- tors willing to donate large sums of money to political causes He formed a network of organizations one of which was the National Endowment for the Preserva- tion of Liberty NEPL incorporated in 1934 as a 501 c 3 tax exempt corporation According to section 501 c 3 of the Internal Revenue Code a tart exempt organization must be organized and operated exclu- sively for religious charitable scienti c testing for public safety literary or educational purposes Channell also formed several non-charitable organizations around this time period He formed the American Consen-atu-e Trust in 1984 as a Federal election political action commit- tee He also formed the American Conservative Trust State Elec- 511 Chapter 2' NEPL was the major organization Channel used for his fundraising in support of the Resistance and it is the one whose tax exempt status later became of inter- est to the Independent Counsel Fiaising Funds for the Resistance The idea of raising money for the Resistance was Chaniiell's He identi ed the Nicaraguan Refugee Fund Dinner held in Washington D C on April 15 1985 as the event that inspired him 95 Following President Reagan's speech at this dinner Channel recognized that his contributors were enthusiastic sup- porters of the Administration s Central American pro- gram Channel initially intended to raise money for an educational media program designed to win Con- gressional support for US aid to the freedom ght- ers He deviated from his original idea however when he realized that his contributors would be inter- ested in donating directly to the freedom ghters in- stead of to a media campaign Individuals working closely with Channel believed he chose the content of his fundraising themes for the purpose of drawing out the resources of his wealthy contributors There has been an impression created that Channel was working at North's behest But Channel solicited money for the freedom ghters from John Ramsey of Wichita Falls Texas two months before he even met Colonel North M Colonel North attempted to dis courage C hannell from raising money for lethal mate riel for the Contras in at least two occasions Chan nel ignored this advice and directly approached Adolfo Calero leader of the FDN It was after learn- ing of the Channell-Calero discussions that Colonel North directed the funds to their most ef cient pur- posg'iuu Channetl s Control Another sign of Channell s control over his fund raising operation was his relationship with his many consultants Channel surroUnded himself with con- sultants who had substantive expertise and access to influential political leaders In March or April of 1935 he retained Richard Miller and his consulting firm International Business Communications IEIC Miller and his partner had a contract with the State Department in which they worked closely with the leaders of the Nicaraguan Resistance and with mem- bers of the Reagan Administration Channel used tion Fund as a state political action committee to take advantage of state laws allowing corporate contributions to tech entities in 1983 he formed Sentinel to lobby Congress under the terms of Section S ltci 4 of the Federal tax code In the Spring of Filth Channel formed the Anti-'l'crrorisi American Committee as a federal political action committee to focus on Congressional atti- tudes towards terrorism During this time period Chan- nel also formed other less active organizations including the Channel Corporation which was his original for-profit consulting corporation See Channel ilr'lr'tii at nZ-b 512 IBC to work on practically every aspect of fundrais ing efforts for many issues Channel also retained the services of David Fischer Dan Kuykendall Penn Kemble Bruce Cameron Miner and Fraser the Robert Goodman Agency Martin Artiauo Eric Olson and others Channel perceived a division of responsibility among his associates in the fundraising organization Channel was the creative force and deve10ped the fundraising concepts for his various projects not all of which related to the Nicaraguan Resistance Daniel Conrad handled the administrative matters Miller Kuykendall Fischer and the other consultants provid- ed advice 1 The clear indication from the record is that Channell not North or anyone else was thor- oughly in charge of the Channel network of organi- zations White House Hole Although Channel was in charge of his network two kinds of questions have been raised about his relation ship with the Administration One is whether the President was using the power of his of ce to help Channel raise funds for the Resistance The other deals with the level and legality of North s role President Reagan Channel used White House brie ngs and photo opportunities with the President as a way to thank contributors for their support of Administration policy 2 The individuals who had a photo opportu- nity with the President however were not being thanked for a single contribution to Channell s organi- zations Rather the President thanked them for their long-term support of his policies As Channel said don't know of anybody who was thanked by the President solely because ofa single act Channel denies ever telling contributors they could meet with the President if they made a large contributiOn to his organization He did not believe he had any control David Fischer a former special assistant to President Reagan instrumental in arranging several meetings at the White House for contributors The Majority Report suggests that Fischer and his colleagues Marlin Arlianii and Richard Miller were involved in selling meetings with the President for a set fee While the evidence suggests that Channel viewed his consulting payments to IBC Fischer and Artiano as fees for While House meetings it appears that Fischer himself is as unaware of Chaiincll's View Fischer's retainer agreement with was based Cm Fischer's understanding that he ttould protide consulting advice on i large variety of public education projects including most notahly a project regarding the strategic defense initiative and ti series of messages celebrating the bicentennial of the Cotlslitution Fischer s efforts to arrange meetings a he White House represented a small percentage of his work for IHC During the public hearings one contributor William H D'Hoyle said that Channel told him he could meet with the Presi- dent if he contributed 5300 000 Sec Coors Garwood and U'Hoyle Tcst Hemmer It ll-3 it ll ST at During the same day's Chapter 7 over photo Opportunities with the President and in fact several requested meetings were not agreed to by the White House H Colonel North North briefed Channell s potential contributors and directed the disposition of funds after Miller received them He did not solicit money from contributors aitd made it his practice not to be present when money was solicited by others He made speeches to and met with people from whom Channel was trying to raise money 5 North would brief potential contributors on the weapons needs of the Contras and Channel often would followup by asking for funds directly related to Colonel North s brie ng At times North also prepared lists of humanitarian and military needs of the freedom ghters that he turned over to Chan- nel We have not received any evidence to suggest that the items North briefed contributors about were actually purchased Channel never knew if weapons were ever purchased with the money he sent to IBCJUB Conclusions It is fully legal for private individuals to raise money for weapons and then send that money to bank accounts controlled by the Nicaraguan demo- cratic Resistance The information to which Channel pled guilty was not about raising money for lethal aid for the Contras per se but about using a tax exempt corporation NEPL to do so Channel formed sever- al entities in his fundraising network to respond to the hearing Joseph Coors said he had given money to what he thought was a Swiss bank account controlled by the Contras to buy an airplane for them The account actualiy was owned by Lake Re- sources a Secord-Hakim company In addition in the same hear- ing Ellen I Garwood said that Channel produced a list of weap- ons in North's presence that could be purchased with a contribu- tion from her We have no reason to beiieve these kinds of requests were typical During the hearing Rep McC otlunt made the follow- ing statement which was not challenged by anybody It might appear to the casual observer that the three who are here with us are typical contributors to the Spitz Channel organizations or in the case of Mr Coors more directly to the Contras But from my understanding of the depositions and various taking of testimony that went on and efforts to get statements from folks before many many contrib utors were interviewed and deposed and not asked to testify because they did not have a list like was involved with Mrs Garwood or they didn't have an occasion where they were suggested to them that they might see the President if they gave money and they didn't give to the Lake Resources ac count I just simply want to make that clear to everybody who is involved and I think it needs to be that these three wu- nesses are not the typical contributors and in fact many others gave more money to Channeil s organization No list was found in those cases Nobody else was told that they had to see the President or could see the President if they gave money and no other private contributor at least that we disem'ered received or sent his money to Lake Resources Sec l'd at its complicated tax laws covering charitable and political activities There is no evidence that indicates North knew about the tart problem much less conspired with Channel and Miller This conclusion is support ed by the fact that Channel did not know of any contributors who donated money because NEPL was tax exempt who would not have donated if NEPL were not tax As for Colonel North s other activities there is no evidence that North instructed Channel to use NEPL to raise money for the Con- trasma In addition he did not solicit money from contributors 9 There can be no question that North knowingly conveyed the impression that he favored what Channel was trying to do but there is nothing wrong with the White House openly endorsing pri- vate activities in support of Administration policy Left Wing Private Fundraising Conservative fundraising organizations have been criticized during this investigation because they have raised money to support policy goals that a majority of the Democratic Members of Congress did not sup- port Clearly it is permissible under current law to raise money for foreign political movements includ- ing military activities If there were any question about this the Committees should for the sake of a balanced fair record have devoted similar resources investigating organizations that support left-wing forces in Central America opposed to United States foreign policy that use Members of Congress in their fundraising Several organizations have opposed United States policy in Central America by sending money and supplies to El Salvador The most notable is the Com- mittee in Solidarity with the People of El Salvador CISPES which Assistant Secretary Abrams de- scribed as an organization that essentially serves as a front for the FMLN guerrillas in El Salvador lln According to a 3 page set of State Department cables about these groups that was introduced by Rep Bill McCollum as a Committee exhibit CISPES was founded in l980 by the leader of the Salvadoran Communist Party Shaftk This Washing ton D C based organization coordinates efforts of a major US support network CISPES activities are said to include among other things a program to send material aid to Central American struggles and creative harassment at public appearances and speaking engagements of individuals who support US policy 1 2 New El Salvador Today NEST is an organization that has worked closely with on fundraising volunteer training and other activities l NEST has raised funds for projects in areas of El Salvador con- trolled by the Communist insurgents There have been allegations included in the State Department cables to the effect that much of the money received by organizations such as these ends 513 Chapter 7 up the coffers of guerrilla groups or being used to provide welfare services that help the FMLN's politi- cal program in areas the FMLN controls According to a State Department interview with former Salva- doran leftist guerrilla leader Miguel Castellanos the Western Democracies became the largest source of cash for the guerrillas during the IQSOS Castellanos served on the nance committee of the Popular Forces of Liberation PFL in I973 and defected in 1985 He stated that the guerrilla groups set up insti- tutions to collect donations from leftist humanitarian organizations and use that money without concern for its original purpose Approximately 70% of the money which purported to go for humanitarian assist- ance actually went for the purchase of arms Senator McClure introduced an eshibit which is a t undraising letter for CISPES purportedly written over the signature of a Member of Congress' An- other exhibit is purportedly from another Member which states that is a non-pro t tax-exempt foundation which is sending humanitarian aid to those whose lives are most affected by the violence of the US supported war The same two Members also hosted a reception for NEST in Washington D C on July l0 1936 1 lily repeating Castellanos' general statement and mentioning the fundraising role played by two Mem- bers of Congress we do not tnean to suggest that we have evidence to prove I that Castellanos general allegation applies Specifically to or NEST or 2 if it applies that the two Members of Congress knew about the allegation The point is that we can neither confirm nor deny the allegation because the Committees did not review the subject in its investi- gation The similarities between the conservative and liber- al fundraising efforts for Central American groups are striking both used politicians to support their respec- tive causes both used tax exempt organizations both may have donated money which was ultimately used to buy weapons both supported foreign policy goals inconsistent with the declared Congressional policy The primary difference between these two fundraising efforts is that the Committees have publicized the conservative fundraising efforts in an attempt to em- barrass the President If one set of groups was worthy of investigation then so surely was the other Overstepping the Bounds With the time it saved not investigating groups on the left the private fundraising investigation has needless- ly harassed private citiaens who happen to hold con- servative foreign policy views Witnesses were forced to travel long distances and testify concerning money which they legitimately gave to political organiza- tions 8 Committee attorneys questioned witnesses about their political activity 9 religious affili- ations ' educational employment 514 history 5 political lineageJ roommate s political contributions- 124 social and more The subpoenas issued to many of Channell s contribu- tors required tax returns correspondence related to Nicaragua documents concerning political contribu- tions and other broad categories of personal papers without any apparent effort being made to limit the material to items that fell within the Committees' le- gitimate mandate to investigate governmental activi- ties The Committee used its subpoena powers and the wedge of a reasonable inquiry into private fundrais- ing to go on a wide-ranging shing expedition into irrelevant political issues For example counsel asked Martin Artiano if he knew who stole the 1980 Carter debate manualsua David Fischer who was responsi- ble for Corazon Aquino's very successful American tour was asked several questions to determine wheth- er he prevented Aquino from meeting with liberal groups at the Kennedy Library in Boston Counsel inquired of several witnesses whether they had any knowledge of Ambassador Faith Whittlesey's dinner to honor Sir James Goldsmithl Counsel also asked about Roy Godson s efforts to counter Soviet disin- formation in Europe Finally Carl Channell was asked about President Reagan's Strategic Defense Ini tiative 13 3 Many other examples could be cited but these are enough to make the point These Committees had Unfortunately even the non-partisan reputation of the GEneral Accounting Of ce has been tarnished during this phase of the investigation The incident does not quite t in with this list of outrageous questions asked of witnesses but is too important to Congress for us to let it pas without comment The Comptroller General of the United States sent a letter On Saptember 30 to Reps Jack Brooks and Dante Fascell which concluded that the State Department violated a restriction on the use of funds for publicity Unlike its normal procedure with a Final opin- ion or report the GAO issued this letter in lime to be used in this rcport before its audit was complete and without giving the head of the relevant office or his deputy a chance to hear and reply to the allegations The opinion fails even to mention let alone respond to documentary evidence that conflicts with the conclusions it presents as facts We are in no position to say whether the pressure for timely publication was generated inside GAD or externally In any case the preliminary opinion was then given to the press by counsel 1 a release with an October 5 embargo date in the name of the two House Democrats who had asked for the audit Sec GAO Letter of September 30 1937 to Reps Brooks and Fascell 84229009 In a letter to Representatn es Lee Hamilton and Dick Cheney Lawrenee L Tracy Colonel U 5 Army disputes the factual basis for the GAO Report Tracy worked for the Of ce of Public Diplomacy for Latin America and the Caribbean from Col Tracy believes that Jonathan Miller s memo discussing white propaganda was probably an exaggeration intended to curry favor with the i'hite House In a thoughtful analysis Col Tracy com pares the Of ce of Public Diplomacy for Latin America and the Caribbean to the public diplomacy campaign conducted by the Carter Administration on the Panama Canal Treaty Although many in this country disagreed with the Carter policy 1 do not recall anyone in Congress calling on the GAO to investigate a Chapter 7 legitimate reasons to ask about private fundraising if Congress wants to be worthy of trust as an institution however it has to restrain itself Just as the President ultimately has to accept responsibility for tile actions of any one subordinate who zealously steps over the line so too must these Committees bear the responsi- bility for the actions of one of its own staff even if or especially because they were not typical of the Committees work as a whole Conclusion Our analysis of the past two chapters has largely been about legal questions It has shown the Administration did stay within the law By giving the Administration a clean bill of legal health however we do not intend to be endorsing the wisdom of everything it was doing Notwithstanding our legal Opinions we think it was a fundamental mistake for the NSC staff to have been secretive and deceptive about its actions The requirement for building long term political support means that the Administration would have been better off if it had conducted its activities in the open Thus the President should simply have vetoed the strict Boland Amendment in mid-October 1984 even though the amendment was only a few paragraphs in an approximately 1 200 page long continuing appro- propaganda' effort The public was well-served by the national debate that ensued for the American people came to understand both the costs and the benefits of the Treaty and were better able to advise their representatives in Congress of their position on the issue That is the essence of rte-mocracy See Appendix I to the Minority Report for Col 'I'raey's letter priations resolution and a veto therefore would hat-'c brought the Government to a standstill within three weeks of a national election nce the President de- cided against a veto it was self-defeating for anyone to think a program this important could be sustained by deceiving Congress Whether technically illegal or not it was politically foolish and counterproductive to mislead Congress even if misleading took the form of artful evasion or silence instead of overt misstate- ntent We do believe firmly that the NSC staff s deceils were not meant to hide illegalities Every witness we have heard told us his concern was not over legality bill with the fear that Congress would respond to complete disclosure with political reprisals principal ly by tightening the Roland Amendments That risk should have been taken We are convinced that the Constitution protects much of what the NSC staff was doing particularly those aspects that had to do with encouraging contri- butions and sharing information The President's in- herent constitutional powers are only as strong how- ever as the President's willingness to defend them As for the NSC actions Congress could constitutionally have prohibited it would have been better for the White House to have tackled that danger head on Some day Congress's decision to withhold resources may tragically require US citizens to make an even heavier commitment to Central America perhaps one measured in blood and not dollars The commitment that might eliminate such an awful future will not be forthcoming unless the public is exposed to and per- suaded by a clear sustained and principled debate on the merits Endnotes 1 McFarlane Test Hearings lDtl-l 5 1 litl'North Test Hearings lilO- i l art l Will 87 at 2u4-oS 3 Id at Bowl-bi 4 McFarlane Test Hearings 100-2 5 llf8'i at 5-6 5 hi at Ii 23 27 28 Poindester Test Hearings at 54 55 See also Poindester Test Hearings 100- 8 at 89 10 ft Compilation of Presidential Documents May 1937 pp Slit 27 Excerpts From President's Meeting TWith Edi- tors The New York Times May NET p 7 MeFarlanc Test Hearings 100-2 S llf i at and 22-24 8 Test Hearings 100-3 7 15 87 at 54-55 Iii 37 at 80 9 TilSi S'i at 54-55 Garwood Test Hearings 100-3 at Ht 132 it l oindester Test Hearings l tl-S at 3 ll McFarlane Test Hearings 100-2 lei'i at 28 Rodriguez Test Hearings Hill-3 5 27 81 at 300-02 312 That testimony is corroborated by Donald Gregg and his deputy Colonel Samuel J Watson See Gregg Dcp at 4b Watson Dep bile 87 at 21-14 13 Rodriguez Test Hearings liltl-J Z ii lili at EGG-300 14 Id at 315 15 Gregg Den 5 13 37 at 44 lb Rodriguez 'l'est Hearings Hill-3 5 21 57 at 301 H Gregg Dep Hit 4 18 Brady Dep at Gregg Dep at 59 lt t atson Dep brie 37 at 22-24 Rodriguez Test Hear- ings 100-3 5 281 at 324 l Crregg Dep at 14 T4 20 McFarlane Test Hearings 100-2 SKI lf'ti'i at 20 21-23 ll 5 12 31 at lit 3t 22 Thompson Dep TEE-lid at 11 12 See also 21-25 23 Id at 14 24 McFarlane Test Hearings IOU-2 Bill ST at 21-12 25 McFarlane Test Hearings ltlD T Part ll Tr l4r 8'i at 2b l oindester Test Hearings IOU-8 'ifl i tii at 2T l oindexter Test Hearings lilO E 'i lSXS'i at 80 lilti 33 MemOrandum from North to McFarlane Dec 4 1934 Es 32 Hearings at 46h 2Q McFarlane Test Hearings Hill-7' Part ll at U Secord Test Hearings Sfir 'i at 57 60 3 North Test Hearings till '1' Part 1 7 33 87 at ln'i 32 McFarlane Test Hearings lilil-l Silli h'i' at T5 Hearings 100 7 Part II ifH tt'i at Ell 515 Chapter 7 33 North Test IOU-7 Part 1 7 8 37 at 167 14 MeFurlane Test Hearings 100-7 Part 11 7 14 87 at 2111 222 35 MeFarIane Teet Hearings IOU-7 Part 11 7 14 87 at 24H 36 Poimiestet' Test Hearings 100-3 7 15 87 at 73-75 7 16 57 at 1111-11 See alm 7 20 87 at 2 5 37 EA Attachment 1 See Hearings 100- 2 at p 335 311 Abrams Test Hearings 11711-5 6 3 87 at 131 39 hi 6 2 37 at 69-70 13 Lid at 6-1-65 11 id at 65 42 id 6 2 87 3197-93 102 13 id at 102 id 6 2 37 at 14 and 6 3 87 at 124-25 45 6 2 37 at 45-47 16 1 11 6 3 87 at 117-13 See also Test Hearings 1110-9 7 23 3131 p 274 47 Abran'e Test Hearings 100-5 6 3 37 at 117518 43 Poindester Test Hearings 1011-8 7 15 37 at 76 See also North Test Hearings 100-7 vol 11 7 13 67 at 114 49 Task Force Chief Test 8 4 37 at 33 50 Test 8 5 87 at 108 51 For expressions of this concern see Tesla 3 4 1117 at 93 and 3 5 37 at 133 George Test Hearings 100-1 8 6 8131 210-212 52 Task Force Chief Test Hearings 11111-11 3 5 37 at 128 53 Ex TC-I3 Hearings 100-4 130 5-1 Test Hearings 100-11 11 5 87 at 126 55 Cantillo Tent Hearings IUD-4 5 29 37 at 56 Test Hearings 100-11 11 4 87 at 89 57 Castillo Tent Hearings 11111-4 5 29 37 at 79 53 North Test Hearings 100 7 Vol 11 7 13 37 at 116 59 Castillo Test Hearings 1110-4 5 29 8717 63 10151 11-12 6-17 18 66 Tent Hearings 1011-11 3 4 1317 at 91 1 67 1 7 at 95-97 68 '16st Force Chief Test Hearings 1110-11 11 4 37 at 97-911 69 Seeord Test Hearings 1110-1 5 5 87 at 71 7t Seeortl Test Hearings 1110-1 5 5 87 at 65-66 71 Castillo Test Hearings IOU-4 5 29 37 19 72 Second Test Hearings 100- 5 5 87 at 62 Button lent Hearings 100-3 5 27 37 at 233-34 73 11 at 24 7-1 EA Til-1 Hearings 1011 4 75 Cautilln Text Hearings 1110 4 5 29 37 at 23 76 at 23-31 Test Hearings 1011-3 5 27 87 at 211321 24-26 7 1 hi 11 25 31 Tank Force Chief Test Hearings 100-11 8 5 87 at 28 1 11 Task Force Chief Test Hearings 11711-11 3 5 37 at I Ll-1 1 112 Castillo Test Hearings 100-4 5 29 37 at 26 H3 Cahle May 28 1986 Ex Hearings 100- 1 84 Ex TC-M Hearings 100-4 5 29 37 85 Tar-t Foree Chief Test Hearings IOU-11 8 5 37 at 11 1 12 86 Id at 111-12 See also Ex 3 Hearings 100- at 426 117 Task Force Chief Tent Hearings 1110-11 8 5 37 at 1119-11 88 Cantillo 'I'est Hearings 1011-4 5 29 37 at 47 See also 27 41 44-47 89 Test Hearings 1110 I 3 5 87 at 113 9D Abrams Test Hearings 1110-5 6 2 87Hearings 100-11 92 id p 17 93 George Test Hearings 3 6 87 at 164 I65 I63 94 Test Hearings 100-11 8 5 87 at 120 95 Channel Dep 9 17 87 at 49- 96 Channel Dept 9 1 87 at 167 97 Miller Dep 7 3 37 3161 98 1a 99 id 100 1211 at 62 101 Channel Den 9 17 37 at 66 102 Channel Den 9 17 87 31611 1113 Channel Dep 9 17 87 at Channel Den 9 17 37 at 66 105 Miller Den 7 3 67 11 1116 Channel Depu 9 17 37 at 711 107 Channel 9 17 37 at 82 1113 Channel Den 9 17 87 at 71 76 109 Miller Dep 7 3 87 at 4 1 110 Abrams Test Hearings 100-5 6 3 87 at 159 111 State Department Cable December 4 1986 p 4 Es EA-49 Hearings 1011-5 112 Ex 38 Miller 9 16 87 113 State Department Cable December 4 1986 p 3 Es Eat- 19 Hearings 11212 5 114 in at 2 115 Es Eat-4B Hearings 1130-5 116 E1 Hearings 1110-5 117 State Dept eahle p 3 Es Hearings 100-5 113 Garwood Test Hearings 111 1-3 5 21 37 at 110 12 119 Fischer Dep 3 11 87 1 16 120 Godson Den 9 9 87 at 12 Fischer DCP 122 Henry Miller Den 3 6 37 at l 2 123 Garwood Test Hearings 1110-3 5 2 1 117 at 1 12 12-1 Channel Delt 9 17 37 at 27 125 Henry Miller Dep 8 6 57 at 41 1 126 At'tiano Den 7 31 37 at 180 127 Fischer Den 13 11 87 216-17 128 Henry Miller Den 3 6 87 at 411 129 in at 43 1311 Channell Delt 9 2 87 at 96 165 Part IV Iran Chapter 8 The Iran Initiative Simple plots make for stirring fiction Sometimes amateur historians fall into the temptation of present- ing events as if all lines inevitably and always pointed toward the already known conclusion That is not the way events happen in the real world The lran chap- ters of the majority report create the impression that its authors have fallen into the amateur historian s trap The narrative tries to simplify events and moti- vations for the sake of a story line That does a disservice to history The record ought to reflect the complex motives of the participants in these oper- ations The motives may be dif cult to determine but papering the difficulties over will not help future gen- erations learn from what happened The majority report seems alternately to be torn between two theses about the lran Initiative that it was strictly an arms-for-hostages deal or that starting in December 1985 or January 1986 it was driven by a desire to provide funds for the Contras Additionally the lran sections of the report continue the majority s portrayal of the Administration as a gang of law- breakers who would do virtually anything to achieve their objectives while invoking an exaggerated fear of leaks to keep the truth about activities from Con- gress This portrayal is patently absurd The hostages were important to President Reagan He probably did fall victim to his own compassion and let their per- sonal safety weigh too heavily on him But it is clear from all the evidence we have that the initiative was pursued primarily for strategic reasons We may dis- agree with the underlying assumptions or with the decision to sell arms but any honest review of the evidence must acknowledge these intentions and with the fact that strategic considerations played an impor- tant part in the discussions conducted through the so- called Second Channel Similarly the use of residuals to bene t the Contras was certainly seen as a plus a neat idea by North and Poindexter But Contras funding never drove the Iran initiative A sober look at the amount of money involved would make that clear to anyone At most the residuals were seen as a peripheral benefit from a policy whose justi cation lay elsewhere We shall show in this section of our report that the Administration did in fact1 substantially comply with the legal requirements Moreover the decision not to notify Congress was not based on an anti-democratic obsession with secrecy but was based on the same sound reasoning that led the Carter Administration to the identical decision not to report operations during the Iranian hostage crisis of 1919 and 1980 Summary Overview The United States was taken by surprise when the Shah fell in 1979 because it had not developed an adequate human intelligence capability in Iran Our hearings have established that little had been done to remedy the situation by the mid-1980 s The United States was still without adequate intelligence when in l985 it was approached by Israel with a proposal that the United States acquiesce in Israeli sales of U S - origin arms to Iran This proposal came at a time when the NSC was already circulating a recommen dation that the United States consider the advisability of such sales to Iran Long term strategic consider- ations dictated that the United States try to improve relations with at least some of the important factions in Iran The lack of adequate intelligence about the situation inside Iran made it imperative to pursue any potentially fruitful opportunity it also made those pursuits inherently risky United States decisions of necessity had to be based on the thinnest of independ- ently verifiable information Lacking such independ- ent intelligence the United States was forced to rely on sources known to be biased and unreliable Well aware of the risk the Administration nonetheless de- cided that the opportunity was worth pursuing To explore the chance fOr an opening the President decided to sell arms to Iran Some suggest that this decision stemmed from little more than the President s ignorance the NSC staff s foolhardiness and private lt IE important at the outset to note the small amounts involved The total arms sold included 2064 TOW anti-tank missiles 3 Hawk antiaircraft missiles and some 200 or so types of spare parts for Hawk batteries Some of the missiles were sold from lsraeli stocks with US approval The remaining materiel came from US stocks A small amount of perishable intelligence information was also transferred to the Iranians The amounts insolved were trivial compared to the world arms trade With lran which Secretary t'einberger estimated at SID billion For the last point see Wem berger Test Hearings inn-10 at use 519 Chap ter 8 greed We completely reject this interpretation The initiative was controversial We disagree with the de- cision to sell arms and we wish that the whole initia tive had proceeded with more caution But despite these reservations we remain convinced that the deci- sicm to pursue some such initiative was not an inherently unreasonable one The major participants in the Iran arms affair obvi- ously had some c0mmon and some conflicting inter- ests The key question the United States had to ex- plore was whether the US and Iranian leadership actually felt enough of a common interest to establish a strategic dialogue No one can deny the common U S and Iranian interest in opposing Soviet expan- sion But how much would that community of interest be felt acknowledged and acted upon Iran and the United States have compatible goals in Afghanistan The question was whether such isolated examples could be broadened into something more substantial The initial dealings with the Iranian government were undermined by the unreliability of the interme- diary Manucher Ghorbanifar Nevertheless Ghorban- ifar did help obtain the release of two US hostages Rev Benjamin Weir and Father Lawrence Jenco and he did also produce high Iranian of cials for the rst face to face meetings between our governments in five years At those meetings US of cials sought consistently to make clear that we were interested in a long-term strategic relationship with Iran to oppose Soviet expansionism The hostages issue was present- ed as an obstacle to an enhanced relationship that would have to be overcome not as the objective of the initiative Colonel North made an extensive pres- entation to this effect in February 1986 former Na tional Security Adviser MeFarlane made a similar presentation in Tehran in May l986 Iiut the Iranian of cials brought by Ghorbanifar seemed to be inter- ested only in Weapons and in using the hostages for bargaining leverage The full extent of the difference between these approaches nally was made obvious to the United States at the meeting in Tehran which North McFarlane and others attended at great per- sonal risk Ghorbanifar appears to have misled both sides in the preparations for that meeting Afterwards the United States suspended discussions arranged by Ghorbanifar except to complete the transactions al ready underway After the Tehran meetings the United States was able to approach a very high ranking Iranian official using a second channel arranged by Albert Hakim and his associates Clearly Hakim had business mo- tives in arranging these contacts Whatever his mo- tives he did produce contacts at the highest levels of the Iranian government Discussions with this channel began in the middle of 1986 and continued until De- cember They resulted in the release of one further hostage David Jacobson and U S of cials expected them to result in the release of more hostages Per- haps more importantly these discussions appear to 520 have considered the possibility of broad areas of stra- tegic cooperation However as a result of factional infighting inside the Iranian government the initiative was exposed and substantive discussions were sus- pended Not surprisingly given the nature of Iranian politics the Iranian government has publicly denied that signi cant negotiations had taken place The Reagan Administration's Iran initiative repre- sented an attempt to narrow the differences stemming from the Iranian revolution and the intervening years of hostility Both sides confronted sharp internal divi- sions over the issue of rapprochement In such a situa- tion the margin between success and failure looms much larger in retrospect than it may seem while events are unfolding While the initial contacts devel- oped by Israel and used by the United States do not appear likely to have led to a long-term relationship we cannot rule out the poSSibilin that negotiations with the second channel might have turned out differ- ently At this stage we never will know what might have been In retrospect it seems clear that this initiative de- generated into a series of arms for hostage deals But it did not look that way to many of the U S participants at the time In our view it is simply wrong therefore to reduce the complex motivations behind these events to any one simple thesis Clearly the participants from different countries and even those within each country had different and some- times conflicting motives Without endorsing or agreeing with the use of arms sales as a tactic we believe that U S of cials made a risky but neverthe- less effort To explain why we shall begin by outlining the strategic importance of Iran The Strategic Context Iran is the largest country in the Persian Gulf region an area of vital economic importance to the United States and its allies It is in a strategic position poten- tially to dominate the world's largest proven oil re- serves and threaten the vulnerable pro-Western states of the Gulf littoral The most complete public information about this incidem ap- peared in a September 29 1'38 New York News article about the execution of Mahdi Hashemi The article identified Hashemi as the former director of the office of Ayotollah Hussein Montageri Ayotollah Ruhollah Khomclni's personal choice as his successor itt the post of supreme religious guide in Titties also said I Montazeri and Speaker of the Parliament or Majlifl ilashemi Raf- sanjani were factional rivals t1 Hashenti was arrested in October and the l- Iontazerifllaslicmi faction was responsible for a story that appeared in the Lebanese weekly Shiraz In early November 1936 describing a May meeting In Tehran betvl een Mr McFarlane and Rafsanjani That was the story that led to the Iran arms initialive's unraveling See John Kit'ner Aide to Khomeini Heir Apparent ls Reported Executed in Tehran The l'ark Timer Sept 29 1957 pp All For the same reasons Iran is of critical interest to the Soviet Union which in addition to seeking access to and control of the West s oil supplies continues in its historic quest for a warm water port The United States has long recognized these critical and compet- ing interests At the end of the Second World War Chapter 8 President Truman was willing to threaten military action to force the Soviet Union to withdraw from areas of Northern Iran it had occupied during the war In defense of its interests the United States has maintained a naval presence in the Persian Gulf since 1949 521 522 Figure 8 1 Map of Middle East ROMANIA Seurce Centla1 Agnnm GI Congrasslonal Ariana Serdr'nI'a Beinrade YUGOSLAVIA Bucharesl 0 BULGARIA 0 Sntla BIack Sea 0 Ankara TURKEY Caspian Chapter 8 Tab HIGUSIB PRUS LEBAN II SYRIA Damascus Beirut Baghdad iv IRAQ AIT Iraq-Saudla Aranla Neu'lral Mediterranean Sea IRAN AFGHANISTAN Trinali Banghazl Ahadan SAU DI Riyadh Persian 3qu ARABIA a UNITED EMIRATES 1 OMAN 30 30- Llne Bandar-a Abbas Ll BYA PAKISTAN ALGERIA Troplc of Cancer NIGER Middle East 3 Boundary InternalIonal boundary I ilk Jlddah Pan - de ned AdmII-Ilshetwa L-ne CHAD I r v DEM I OF YEMEN Asmara N'YemntQEIanaa 5 Yemen Arabian NatIonal' ca Ital Sea Khanoum 25D 15- I 500 Kurommers I 25' 500 Nauhcal rnIIes u c 3mm ETHIOPIA Marc alnr Fromm-an CAME noon 15_ NIGERIA SOMALIA Boundary raprasemahan is not necassarlfy aulhurllalwe OAddIs Abaha Iran dominates the entire eastern shore of the Iter- sian Gulf it controls the Strait of Hormuz and can threaten the free flow of oil from the Gulf to the industrial economies of the West In 1987 as part of its effort to disrupt non-Iranian shipping traffic in the Gulf Iran has used anti-ship missiles and other muni tions to attack neutral oil tankers and laid mines throughout the Gulf U S and allied warships have been deployed in the Gulf to ensure that the flow of oil is not impeded Although less than six percent of US oil consumption transits the Gulf 24 percent of Western Europe's oil and almost half of Japan s total oil consumption must pass through the Strait of Hormuz Iran alone supplies some ve percent of Western Europe's and Japan's oil Increased oil pro duction elsewhere in the world and the opening of new pipelines to take all through Turkey Iran and Saudi Arabia have somewhat reduced the Gulfs rela- tive importance 1 Even so Iran remains able to be a seriously disruptive force to the world s economy In addition to its importance to oil supplies and oil routes Iran whose population of about 45 million is larger than the other Gulf states combined is in a pOsition to dominate or destabilize the small weak pro-Western countries of the Western Gulf coastal region Recent Iranian policy toward Kuwait exempli- fies the pressure Iran can exert on its neighbors An aggressive Iran can promote anti Western Shiite fun- damentalism throughout the Middle East threatening ltey U S allies such as Israel Egypt and Turkey Events of the last decade have raised the strategic stakes in the Persian Gulf region and given the Soviet Union the chance to expand its influence in an area where it historically has had little The fall of the Shah the installation of a revolutionary Islamic regime in Tehran and the Iran-Iraq war have given the Soviet Union strong incentives to try to improve its position in Iran and the entire Gulf region A Soviet-dominated Iran would pose an even great- er threat to Jestern interests than the current radical regime Such a development for esamplc would give Moscow direct land access to warm water ports on the Persian Gulf and Arabian Sea The Soviet Navy's home ports on the Soviet mainland are frequently ice bound in winter or provide limited access to the open ocean making it easier for US and allied navies to contain the Soviet fleet Soviet land access to a warm water port in this region would seriously endanger US security interests in the entire Indian Ocean region from the Indian subcontinent to Eastern Africa On Iran's eastern border the Soviet aggression in Afghanistan has further skewed the unstable strategic balance of the region unsettled Iran's neighbor Pal-ti stan and left the Soviet Union better-placed to meddle in post-Khomeini Iran In response to events in the Gulf the Carter Administration developed a Rapid Deployment Force to demonstrate an increased US resolve to defend US and interests Chapter 8 there It was against this background that the Reagan Administration conceived its policy opening to Iran On May 17 l985 just before the United States decided to pursue the Iran initiative Graham Fuller the CIA's National Intelligence Officer for Near East and South Asia produced a memorandum Toward a Policy on Iran reporting that the intelligence com- munity was learning of signs of signi cant internal unrest in Iran and was monitoring Soviet progress toward developing significant leverage in Tehran E By the end of l985 the intelligence community took a less worried view which was reflected in a new esti- mate published in February 1986 3 By mid-I937 however press reports were begin- ning to suggest that Fuller s original concern might have been well founded These reports involved pos- sible Soviet intelligence sites in Iran and a pipeline and railroad through Iran to its long sought after Persian Gulf warm water port l Should these ac- counts prove true the l985w8 initiative might even- tually be seen as a farsighted attempt to prevent seri- ously troublesome developments that could occur after the factional struggle everyone cspects to begin when the aged Ayotollah Khomeini dies if it has not already begun Strategic Opening Or Only Art Arms-For-Hostages Deal The majority report systematically downplays the im- portance of strategic objectives in the lran initiative We believe to the contrary that the record is unam- biguous on the following facts I that strategic ob- jectives were important to the participants at all times 2 that the objectives were credible 3 that they were the driving force for the initiative at the outset and 4 that without such a strategic concern the initiative would never have been undertaken One of the most disappointing forms of evidence- slanting throughout the majority's narrative is that it refuses adequately to present the hey witnesses' ac- counts of their own motives in their own words from the hearing record That failure is most glaring in connection with the witnesses statements about the strategic motives behind the Iran policy We have no intention of trying to recite all of the evidence here We are convinced however that anyone who reads the material we cite will rec-Ognize the bias involved in presenting what purports to be any analysis of the arms sales without including the participants' own explanations of their motivations The majority may not agree with the Administration's strategic reason ing but it is simply unfair to ignore it The President's words are probably the most imv portant here Dale Van Atta a reporter knew the essential facts of the initiative in February l98ft The President was willing to talk to him on February 24 on the condition that the information not be used ttntil 523 Chapter 8 the hostages came home Van Alta asked the Presi- dent about the hostages Instead of answering in kind the President spoke about strategic matters All right The Iranian situation We have to re member that we had a pretty solid relationship with Iran during the time of the Shah We have to realize also tltat that was a very key ally in that particular area in preventing the Soviets from reaching their age old goal of the warm water ports and so forth And now with the take-over by the present ruler we have to be- lieve that there must be elements present in Iran that when nature takes its inevitable course they want to return to different relationships We have to oppose what they are doing We at the same time must recognize we do not want to make enemies of those who today could be our friends 5 The President s own statements were sapported by senior officials in his Administration testifying before these committees For simplicity s sake we will cite this material by grouping the references under the substantive topics covered These included estah1ish a new US relationship with Iran thus strengthening the US strategic posture throughout the Persian Gulf region 6 counter Soviet influence in Iran 1r lessen Iran s dependence on the Soviet Union and other communist nations as arms suppliersr'3 open a channel to pragmatic Iranian 0f Ci3lS g wean the lranian regime away from terrorism eneourage a negotiated settlement of the Iran- Iraq war 1 protect the northern tier centuries Pakistan India and their neighbors and encourage their inter- est in supporting the Afghan resistance forces 12 proteet the southern tier countries Saudi Arabia Kuwait Jordan Israel and Egypt 13 improve US intelligence capabilities in Irate and diseourage Iranian arms exports to Nicaragua 5 As we said earlier one need not agree with these strategic goals or agree that arms sales were a good way to achieve them to recognize their importance to the key players The Administration felt it was crucial to begin making some inroads into Iran before that country became embroiled in a succession crisis The last thing we wanted was to abandon the field to the SOviets it was important to keep looking for opportunities Unfortunately our ignorance of the sit uation in Iran was such that we had few realistic ways to do so 524 U S Intelligence Weaknesses in Iran Although the motives were clearly present for trying to develop a new relationship with Iran the means were not In an important respect the Iran initiative had at least one of its roots in an intelligence failure There are two different intelligence issues raised by the Iran initiative One is that intelligence gaps or weaknesses in uenced US decisions We agree with this point The other is that intelligence was cooked to match the preconceived conclusions of policy makers We strongly disagree with this charge to the extent that it relates to the information generated by the executive branch We do believe however that some officials most notably Admiral Poindexter and Director Casey failed adequately to present the US intelligence community s assessment to the President at a crucial moment of decision Let us begin with the issue of intelligence gaps Gary Sick who worked on the National Security Council staff during the Carter Administration dev scribed the state of US intelligence in Iran when the Shah fell in 1979- 1 had written a briefing paper for National Secu- rity Adviser Zbigniew Brzezinski noting that the most fundamental problem at the moment is the astonishing lack of hard information we are getting about developments in Iran I cemment- ed that this has been an intelligence disaster of the first order Our information has been ex tremely meager our resources were not posi- tiOned to report accurately on the activities of the opposition forces on external penetratiOn the strike demands the political organization of the strikers or the basic objectives and political ori- entation of the demonstrators 5 General Secord who became Deputy Commander of the hostage rescue task force in 1980 after the unsuc- cessful Desert 1 operation con rmed that the lack of intelligence was the reason why his combat-ready task force never made a second effort to rescue the hos- tages Faced with the loss of the Tehran embassy and its intelligence secrets the ight or execution of pro W estern officials and agents a ruthless secret police network and restrictions on travel to Iran US intelli- gence efforts had to start again from scratch Accord- ing to new reports efforts to rebuild our intelligence capability were further devastated by the 1983 bomb- ing of the US Embassy itt Beirut which killed many of the leading Middle East experts and by the abduction of the post-bombing Beirut station chief W illiam Buckley Before his death as a result of lor- ture Buckley was allegedly forced to reveal his ex- tensive knowledge of CIA anti-terrorism and other Operations in the Middle East There was near unanimity inside the government on the weakness of US intelligence in Iran Director Casey reportedly conceded the point and his former deputy John McMahon agreed 18 Casey believed that the need for intelligence was one of the main reasons for going ahead with the initiative 19 Robert McFarlane and John Poindexter both lamented the dearth of intelligence on internal Iranian politics and Iranian support for terrorism which left them vulner- able and flying blind In particular U S policy makers lacked the information necessary to assess the in uence and bone des of the Iranian of cials with whom they were dealing The core problem was a lack of well-placed human agents within Iran 21 The Deputy Director for Operations Clair George is responsible for clandes- tine human intelligence collection He freely acknowl- edged that the Directorate was not collecting the information necessary to influence or deal with Iran In the Opinion of some intelligence professionals the CIA's weakness of human intelligence collection re- ects a long-term shift toward a greater reliance on more exotic technical collection methods which are considered clean and safe compared to the messy business of running human spies As Admiral Poin- dexter said The problem is that with technical means of col- lection there is no way that you can nd out about intent as to what the peOple are planning or doing The only way you can get that is through human intelligence A satellite will tell you how many divisions or how many tanks or how many airplanes but it won't tell you what they are planning to do with that 22 One problem with human intelligence is that it often requires the use of individuals of dubious rep- utations DeSpite criticism of the use of Ghorbanifar in the Iran initiative U S intelligence may have no choice but to rely on questionable individuals in future operations As George told the Committees If we only served and dealt with the honest and fair we would be out of business fairly fast 23 Poindexter made essentially the same point Human intelligence is messy because you have to deal with people You don t always know if they are telling you the truth or not You have to deal with pretty despicable characters if you are going to get penetration of these organizations 24 Faced with this frustrating lack of intelligence it appears that Admiral Poindexter adopted the view that the Israelis had better information On the situa tion in Iran Poindester was so convinced of this that he even accepted the Israeli view that Iraq gradually was acquiring a battlefield advantage in the war with Iran 25 even though he knew U S intelligence held a Chapter 8 contrary view 26 and the issue would have been open to independent veri cation The Issue of Cooked Intelligence One of the many dramatic charges Secretary Shultz made about his own Administration involved this as- sessment of the Iran-Iraq war Responding to Senator Inouye Shultz said that the failure to separate the functions of gathering and analyzing intelligence from the function of devel0ping and carrying out policy 27 resulted in the Administration getting faulty information on which to base its judgments and decisions I hate to say it but I believe that One of the reasons the President was given what I regard as wrong information for example about Iran and terrorism was that the agency or the people in the CIA were too involved in this So that is one point And I feel very clear in my mind about this point And I know that long before this all emerged I had come to have great doubts about the objectivity attd reliability of some of the intel- ligence I was getting DeSpite Secretary Shultz s statement these commit- tees have found absolutely no evidence to support allegations of intelligence bias within the CIA As Deputy CIA Director Gates has observed one of the best guarantees against an intelligence bias is the wideSpread circulation of CIA analyses on Capitol Hill particularly the intelligence committees' scrutiny of virtually everything the CIA and intelligence com- munity produces 29 With the exception of one contro- versial 198-2 report neither committee has exhibited any concern over the objectivity of analysis within Casey's CIA despite the committees' often stormy relationship with the Director Shultz is also refuted by former Deputy CIA Director McMahon who in response to a deposition question regarding the Secre tary s assertions said It wouldn t happen This is just so expletive deleted outrageous I can t stand it That is just so damn false and I think George Shultz got away with murder on that one McMahon also said he asked Director Webster why the hell he didn t challenge Shultz on that Webster according The 1932 exception provoked the resignation of Admiral tRet Bobby lnman as a consultant to the House committee Speci cally Inmanua former director of NSA and a former Deputy Director of Central Intelligence and one of the intelligence community's most respected alumni gave as his reason for leaving the fact that he had not been consulted on a Congressional subcommittee report criticizing intelligence analyses on Central America Inman felt that the report which focused on El Salvador was put out on party lines lnman also underscored in his resignation statement that Congressional oversight of intelligence agencies had to be nonpo- liticat to earn public credibility He added that if the country doesn't establish a bipartisan approach to intelligence we are not going to face the problems of the nest fifty years See Washington Post October I932 525 Chapter 8 to McMahon said he did ask Shultz but guess he hasn t heard from Shult'r yet Admiral reliance on an Israeli assess- ment that Iran s position was deteriorating in the war with Iraq was particularly controversial White House Chief of Staff Donald Regan's notes of a November 10 1986 meeting of top advisers makes it clear that the President was still using the assessment as a justi - cation for his decision the previous January to sell arms to Iran in Poindexter acknowledged however that the assessment differed from that of the US intelligence community Poindester had the option of course of agreeing with such an assessment over the one he was getting from 1 1 5 intelligence But he and Director Casey should have felt an obligation to high- light that disagreement at the time it was being used to buttress the proposed January 1936 nding- It is clear from Poindester's testimony that he did not remind the President at the time that this view dif- fered from the majority view within the intelligence community The evidence seems to suggest strongly in other words not that intelligence was cooked by US intelligence but that the views of U S intelli- gence were not properly passed up the line and high- lighted to the President The Israeli Connection The Administration s reliance on Israeli intelligence has raised questions about Israel's role in the Iran initiative That role probably will never be fully un- derstood The Tower Commission Report 32 supple- mented by some new material in the majority narra- tive lays out the basic outline We have too little con rmed evidence however and too many conflict- ing theories to sort it all into neat packages The immediate background to the Iran arms initia- tive had two separate strands in 1984 One strand begins with Ghorbanifar s desire to sell arms the other with an independent review of US policy toward Iran conducted by the NSC The two strands came together in mid-1985 Ghorbanifar began trying to approach the United States in June 1984 with the story that he had access to some important gures in the Iranian government who wanted to improve relations with the West The CIA polygraphed Ghorbanifar he failed not for the rst time and the agency issued a burn notice to its eld personnel and other US intelligence services warning them to treat Ghorbanifar as a known liar Clair George told the Committees You have to work at it pretty hard to get a burn notice out of the Operations Directorate at the 3 Over the next several months Ghorbanifar and Adrian Khashoggi a Saudi arms dealer reportedly made several attempts to develop a U S -lran arms relationship M One of the approaches they made in 1984 according to the Tower Commission was through a former CIA of cer TheodOre Shackley In 526 that approach the arms dealers speci cally linked weapons to Americans held hostage in Lebanon Shackley a former CIA of cer reported that in a meeting November 19-21 1984 in Hamburg West Germany General Manucher Hashemi former head of Department counterespionage introduced him to Manucher Ghorbanifar Hashemi said Ghorbanifar's con- tacts in Iran were fantastic Ghorbanifar was already known to the CIA and the Agency did not have a favorable impression of his reliability or veracity Shackley reported that Ghorbanifar had been a SAVAK agent was known to be an international deal maker and generally an inde- pendent man dif cult to control 35 Shackley's report went to the State Department but the department was not interested By January 1935 Ghorbanifar was discussing a po- tential arms relationship that would have involved the United States Iran and Israel Participating in these discussions with Ghorbanifar were Adolph Schwim- met an Israeli arms dealer who had been an adviser to Prime Minister Peres since September 1984 Amiram Nir Peres Adviser on Counterterrorism and Yaacov Nimrodi another arms dealer who had been an Israeli defense attache and then an unof cial con sultant in Tehran for a total of 24 years 36 At least one of these meetings included Roy Furmark a busi- ness associate of Khashoggi s and an acquaintance of Casey s Israel and the United States were major arms suppliers to the Shah s Iran during the 19705 and a classi ed State Department document says Israel had sold some arms to the Khomeini regime in 1981 and 1981 The arms dealers in the 1985 group had an obvious stake in resuming such sales At roughly the same time beginning in early 1984 the NSC staff was beginning to rethink the U S pos- ture toward Iran The net effect of the 1984 efforts was to conclude that the United States neither knew enough about not was in a position to have much influence over future deveIOpments in that country Early in 1985 the Tower board wrote the NSC According to a November 1986 classi ed State Department document in 1931 and 1982 prior to the initiation of Operation Staunch the Government of Israel asked the United States to approve shipment of certain military items under US control to Iran Israeli representatives made many of the same points that were made In the 1935 arms sale proposals including that such transfers would improve access and influence with moderate ele- ments and could lead to progress in securing the release of US hostages The United States stated that certain types of U5 con- trolled items could be shipped if speci c US Government approv- al were obtained but no shipment of such items was ever ap- proved In May 1932 Israeli of cials acknowledged publicly that Israel had sold substantial quantities of US origin military supplies to Iran U S Department of State Memorandum from Richard W Murphy to Secretary of State Shultz US-Israel Discussions on Arms Sales to November 21 Wtib 53547 See also Secord Hearings loll-l 5 31 37 at Elli-T4 staff undertook actions aimed at least to improve the government s knowledge about Iran 3R One person who got involved with that job was NSC consultant Michael Ledeen When Ledeen was in Europe in March or April of I985 an of cial of a West European country told Ledeen that the situation in Iran was more fluid than it had been in the past If Ledeen wanted to know more about Iran the of cial said that Israel had the best intelligence there of any country in the Western world Ledeen visited Israel in early May where he met alone for about 45 min- utes with Prime Minister Peres to express the US interest in learning more about Iran The hostages were not part of this discussion Ledeen said Accord- ing to Ledeen Peres said that Israeli information was not all that outstanding but Peres urged Ledeen to meet with Shlomo Gazit President of Ben Gurion University and a former director of military intelli- gence In that subsequent meeting Ledeen was asked to carry a request back to McFarlane asking for per- mission for Israel to sell some artillery to Iran During May and June the NSC staff continued to work on a draft National Security Decision Directive NSDD At the end of its analysis of the United States' long and short term goals in Iran a June ll draft NSDD recommended provision of selected military equipment as determined on a case-by-case basis McFarlane circulated the NSDD draft to Shultz Weinberger and Casey Shultz responded on June 29 by saying he disagreed with the suggestion that our efforts to reduce arms flows to Iran should be ended Weinbergcr's July 16 answer was sharper This is almost too absurd to comment on he wrote This is roughly like inviting Qadha over for a cozy lunch Only Casey endorsed the thrust of the draft but his July 13 response said nothing about arms sales 1 The draft NSDD was never brought to the President s attention and was not adOpted The two separate strands came together in the weeks after the draft NSDD was circulated and before all the answers were in On July 3 McFarlane met with David Kimche Director General of the Israeli Foreign Ministry According to McFarlane Kimche wanted to know the position of our govern- ment toward engaging in a political discourse with Iranian officials and thought the Iranians would ulti- mately need something namely arms to show for the meetings 42 About July ll Schwimmer came to see Ledeen Ledeen testified that Schwimmer claimed he and his colleagues had been introduced a short time before by Adrian Khashoggi to a very interesting Iranian by the name of Ghorbanifar and that Ghorbani- far had a lot of very interesting things to say both about Iran and about the intentions of the leading gures in the Government of Iran Chapter 8 We do not intend to produce a full recitation of events here but it is worth pausing at Schwimmer's reported statement that he had just been introduced to Ghorbanifar The clear implication of the statement as it was understood by Ledeen was that Ghorbanifar was a new source of information for the Israelis even though Ghorbanifar had been meeting with them since January There is a dispute over Ghorbanifar s exact relationship with Israel but no one seems to think the relationship was new North Poindester George and Hakim have said they thought Ghorbani- far was an Israeli agent or asset H Hakim speci cally said he thought someone working for Nimrodi had recruited Ghorbanifar years before in Tehran 3 Shackley however described him as an independent man with SAVAK connections Hakim had also mentioned SAVAK The view of Ghorbanifar as being essentially independent would be consistent with his having had a past relationship with Israel but with different connotations on the extent to which Israel could have controlled Ghorbanifar The inter- pretation that stresses Ghorbanifar's independence gains some support from the sheer number and varie- ty of methods Ghorbanifar tried to use to approach the United States Either way however Ghorbanifar and Nimrodi knew each other during Nimrodi's quar- ter century of service in Tehran Schwimmer s al- leged representation to Ledeen that he was a new source therefore seems disingenuous to say the least So Israel was more than a passive message bearer at the outset of the initiative In addition it weighed in to help keep the initiative on track at several points later These included among other things an August 2 1985 visit Kimche paid to McFarlane to seek an- thorization for the rst Israeli TOW transferr Nir's January 1936 proposal to keep the initiative moving forward at a time when US interest appeared to be flagging and Peres February 1986 letter to 43 and September 1986 communicatiOn with President Reagan Shultz v Shultz Suckers or Big Boys The question that arises out of all this is whether Israel was playing on US ignorance to draw the United States into the Iran arms transactions At a November 10 1986 meeting between the President and his top advisors Secretary Shultz said according to Donald Regan's notes that he Thinks Israeli sic suckered us into this so we can t complain of their sales 5 Shultz apparently expanded on this point in a private meeting he held with the President ten days later A brie ng paper Shultz brought with him to that meeting stated Much if not all of the incentive on the Israeli side of the project may well have been an Israeli sting operation The Israelis used a number of justi cations to draw us into this operation in- 527 Chapter 8 telligettce gaitts release of hostages high strate- gic goals Israel obviously sees it in its na- tional interest to cultivate ties with Iran includ- ing arms shipments Any American identi cation with that effort serves Israeli ends even if Amer- ican objectives and policies are We are inclined to agree with Shultz that Israel was actively promoting the initiative because the initi ative suited Israel's own national interest We dis- agree however with the idea that the United States was being played for a sucker We believe the US Government reSponsibly ntade its own judgments and its own mistakes To show the extent to which US eyes were open it is worth reviewing a few more items in the Com mittees records In MeF arlane's July l3 cable to Schultz about his own meeting with Kimche and Le- deen's meeting with Schwimmer McFarlane seemed to be more aware than Ledeen that the relationships being described were not new ones McFarlane said that in the course of his conversation with Kimche it became clear that their access to Iranian of cials has involved extensive dialogue for some time His cable also mentioned Ghorbanifar On the same day Assistant Secretary Richard Armacost sent a cable to saying that the US Government eon- siders Ghorbanifar to be a talented fabricator 5 Shultr told the Tower Commission he read this cable on July 16 54 From early in the initiative in other words the U S Government had good reason to be wary of Ghorbanifar Why then did the NSC want to pursue this chan- nel at all North s answer is persuasive I knew and so did the rest of us who were dealing with him exactly what Mr Ghorbanifar was I knew him to be a liar I knew him to be a cheat and I knew him to be a man making enor- mous sums of money He was widely suspected to be within the people I dealt with at the Cen- tral Intelligence Agency an agent of the Israeli Government or at least one of if not more of their security services That is important in understanding why we con- tinued to deal with him We knew what the man was but it was difficult to get other people in- volved in these kinds of activities I mean one can't go to Mother Theresa and ask her to go to Tehran I know there is a lot of folks who think we shouldn't have dealt with this guy but at the bottom we got two Americans out that way and we started down a track I think we could have succeeded on As bad as he was he at least got it started there 55 The United States also went into the initiative knowing well that there was far front an identity of interests between the US and Israel McFarlane 528 mentioned in his cable to Shultz at the start of the initiative that the risks of failure would be different for the United States than for Israel Surely we ought to expect that Israel s fear over any Arab as opposed to Iranian fallout would not necessarily co- incide with our own 55 Shultz s cable of the nest day also mentioned that Israel's interests and ours are not necessarily the same As for the character of the difference between US and Israeli interests toward Iran several witnesses testified that the United States would like to see a quick end to the Iran-Iraq war but Israel at a mini- mum might find its interests served by prolonged ghting between the two countries 58 This key differ- ence was said by McFarlane to have been openly discussed in his July 3 1985 meeting with Kimche Kimche said Obviously Israel's interests are very different from your own and pointed out that they have an interest in sustaining the con- flict We don't 1 stressed all of our policy points They are different itt many respects from Israel s But that was clear on both sides going in eyes open The President was very conscious of that 9 Another major point of difference was that Israel like ntost West European and many other countries reportedly was sellittg arms to Iran The United States was trying to stop the flow of such arms For that reason the speci c method for trying to establish a relationship involving arms and hostages was a par- ticularly risky one for 1 1 8 policy interests Once again however this point was thoroughly argued within the Administration The point of all this is that Israel had good reasons for wanting the United States to get involved but the US had its own reasons for listening The United States decided the initiative was worth pursuing for all of the reasons we have already noted To be sure the US did make important errors of judgment It was overeager On occasion it did listen too uncriti- cally to Israeli advice But the warning flags were there and McFarlane at least paid lip service to noting their presence Any U S mistakes therefore can be laid only at our own country s feet As Secre- tary Shultz said before our Committees We are big boys and we have to take responsibility for whatever it is we do We can't say that well somebody else suggested it to us therefore it is their fault 50 Hostages and the Iran Initiative We are convinced as we have argued that the Iran initiative started as a desire to pursue a strategic op portunity and that these considerations always re- mained important At the same time there can be no question as the President himself acknowledged Chapter 3 that the President's personal concern for the hostages added a sense of urgency that skewed our negotiating tactics and helps esplain the imprudently wishful thinking that led Poindexter and Casey to proceed despite repeated disappointments t is important to note that the President has an affirmative duty under US law to do everything in his power to secure the release of Americans illegally imprisoned or held hostage abroad Under the 1868 Hostage Act invoked by President Carter during the Iranian hostage crisis of 1979-81 Whenever it is made known to the President that any citizen of the United States has been unjustly deprived of his liberty by or under the authority of any foreign government it shall be the duty of the President forthwith to demand of the govern- ment the reasons of such imprisonment and if it appears to be wrongful and in violation of the rights of American citizenship the President shall forthwith demand the release of such citizen and if the release so demanded is unreasonably de- layed or refused the President shall use such means not amounting to acts of war as he may think necessary and proper to effectuate the re- lease and all the facts and proceedings relative thereto shall as soon as practicable be communi- cated by the President to Congress 51 Under the Hostage Act the President has a posi- tive legal obligation to take whatever steps may be necessary and proper short of war to secure the release of American citizens Even without the act however we observed in our chapters on the Consti- tution that the President has a duty to protect the lives and liberty of Americans abroad Unfortunately the duty to protect lives does not always give clear guidance about what to do in spe cific cases Taking the wrong steps to save an individ- ual hostage can make hostage taking seem profitable to terrorists The methods used to save one hostage in other words may threaten countless other Ameri- cans traveling or living abroad We have to acknowl edge however that it is easier to put advice on a piece of paper than to implement the advice in the face of a constant barrage of public criticism and direct pressure from the hostages families As hard as it may be to let any American remain hostage one was a special case William Buckley the Beirut Station Chief Buckley was rebuilding the Lebanon station after the disastrous embassy car bombing of 1933 When he was taken hostage he knew a great deal about US sources and methods in the Middle East and US of cials strongly suspected that he was being tortured to force him to divulge those secrets Mr CHENEY I would assume partly on the basis that he was literally one of our own a man in service to the nation that there were special - 8 - 13 feelings on the part of Director Casey for Mr Buckley as well Mr NORTH It was my understanding that there was not only a professional relationship be- tween Mr Buckley and Director Casey but a personal one and that Director Casey felt very strongly about William Buckley To the very end Director Casey was anxious to get the body of Bill Buckley home and certainly the tortured confession Mr CHENEY Would it be fair to say that the situation of the hostages and especially Mr Buckley had an impact at least Upon the policy decisions we have been talking about here in connection with the opening to Iran the decision to ship weapons to the Ayatollah Mr NORTH I believe the most dif cult things that experienced in this rather ordeal and I am sure it was the same for Mr McFarlane and Admiral Poindexter and the President was to see the pictures that we were able to obtain the videotapes particularly of Bill Buckley as he died over time to see him slowly but surely being wasted away 52 This testimony from North certainly makes it easier to understand how concern for the hostages could come to have played too prominent a role in the Iran initiative DEA Activities We shall digress briefly from the lran initiative at this point to discuss another effort the Administration un- dertook to gain the release of the hostages in Leba non This one involved Drug Enforcement Adminis- tration DEA agents and began in early 1935 The majority is highly critical of this effort in its report This is puzzling to us because if the DEA operation had succeeded there would have been no temptation to mix concern for the hostages with the strategically more important talks with Iran The majority repeatedly describes the DEA activi- ties which were under North s direction as an overt attempt to pay ransom for the hostages Indeed a number of the points made by the majority depend on the ransom theme The importance of this claim to the overall thesis of the majority report is that if true it would show a predisposition toward paying ransom that would tend to con rm an interpretation of the Iran initiative as an arms-for-hostages deal- We too would be troubled if ransom were being contemplat ed But according to the evidence received in the Committees investigation the DEA rescue plans con templated bribes as the means to gain the hostages 529 Chapter 8 release There was no attempt to pay ransom to the captors The majority discounts the testimony of one of the two DEA agents involved whom we shall call Agent 1 The agent clearly stated that the plan was to offers bribes to certain individuals and not to pay ransom to those who had directed the capture of the hostages The agent emphasized that none of the captors had solicited ransom Rather money was to be delivered as bribes to those who could effect the release of the hostages not to the people who actually controlled the terrorist organization The idea was to nd indi- viduals who could be paid off without the knowledge of those in control The money was intended to go directly to these individualsf a The majority also ignores the account of the De- fense Intelligence Agency DIA Major who served on the Hostage Locating Task Force in 1935 and 1986 In January 1986 the BIA Major met with the other DEA agent involved in hostage activities whom we shall call Agent 2 and with two sources who were assisting the DEA agents The Major observed that one of the two sources was more prom- ising because of his contacts and superior access to the hostage takers EH The DIA Major prepared a memorandum of these meetings and he testi ed to its accuracy According to the memorandum the more promising of the two sources suggested bribery to free the hostages Furthermore Agent 2 testified that when one source suggested that the Lebanese hostage takers would release the hostages in exchange for weapons the agent dismissed the suggestion Asked whether the subject of weapons was ever raised again the agent replied No because I think we had told the source that forget it you knowbribe situation not a ransom but a bribe situation 67 In fact the questions from the majority s own counsel clearly recognized that the plan involved bribery A prime example of the majority's attempt to char- acterize the DEA plans as ransom plans is their analy- sis of activities in May and June of 1985 The majori- ty alleges that the plan in that time-frame was to pay ransom money of $1 million per hostage On the con trary three memorandums on the issue written by Co North all clearly described a plan to bribe indi- viduals other than the hostage takers The bribe money was to be paid to individuals with access and to those who would arrange transportation and safe passage for the hostages None of these memoran- dums mentioned any ransom payments to the hostage The counsel stated during the deposition You were trying to bribe these people money at the same time they were trying to get weapons from North See Agent 2 Dep 3 23 81 at 61 Later the same counsel asked Ho were these people to be released In other words was it to be a forcible estraetton Was It to be a bribing to loot the other way The agent responded Brib- It was always bribing May not even he bribing lt may he they go shoot all the guards Sec Agent 2 Den at 109 530 takers 53 North s superior Robert McFarlane similar- ly described the plan as one of bribery 39 The majority also claims that the DEA activities were inconsistent with the simultaneous effort to gain the release of the hostages through the ran initiative Such a claim is based on the majority's view that at the same time North was arranging to sell weapons to the Iranians to induce them to influence the Hizballah captors to release the hostages North was offering direct ransom payments to the captors As shown above the majority's ransom notion conflicts with the facts Also the majority's theme of inconsistent chan- nels for release of the hostages ignores the fact that the DEA activities which commenced in early 1935 were in existence months before the first sale of arms to Iran in August and September 1935 In any event the fact is that notwithstanding the DEA plans as well as other plans for hostage release the Iran initia- tive did lead to the release of three hostages Any alleged conflict or inconsistency is based on Specula- tion Given the majority s inclination to criticize every perceived or misperceived activity of the Ad- ministration in its effort to free the American hos- tages the case can be made that if North had not pursued alternatives to the Iranian arms sales the majority would have found fault with such failure to find better ways to free the hostages The last important majority contention is that the activities of the DEA agents were operational rather than intelligence-rEIated and that such activi- ties therefore required that Congress be noti ed The facts show that the DEA agents gathered intelligence planned several operations to free the hostages and took some preparatory steps for these operations However the actual operations to free the hostages did not take place to a large extent because of events in the Middle East beyond the control of the agents The participants should however have paid closer attention to accounting funding and reporting re- quirements in order to ensure full compliance with the applicable rules and regulations In the final analysis the DEA efforts to free the hostages must be viewed in perspective The Presi dent was personally committed to do all that he could to bring the hostages home and there was intense national pressure to do so Accordingly the Adminis- tration initiated several alternative programs includ ing the plan to use DEA assets in Lebanon DEA efforts ultimately failed and in hindsight these efforts could have been better implemented Nonetheless the facts show that many involved in these activities acted at great personal risk and with the best of intentions Moreover the Administration deserves recognition for its efforts to explore every promising avenue for the release of the hostages Chapter 8 The Second Channel It is tempting knowing Buckley's fate and the depth of the President s feeling to portray U S policy as having become hostage to the hostages The hos tages did become too prominent Negotiations con- ducted through the First Channel arranged by Ghor- banifar never got off the arms-for-hostages track de- spite rcpeated U S efforts Once discussions began through the Second Channel however they began to take in broader geopolitical issues Some aspects might potentially have been promising Others such as the Da wa prisoners should have been turned off from the beginning The First Channel talks between Iran and the United States from late 1985 through the May 1986 Tehran trip were arranged and principally conducted by representatives of the Iranian prime minister who has ties to the more radical elements of the govern- ment Representatives of the so-called middle of the road Rafsanjani faction also appear to have attended some of these meetings Rafsanjani generally regard- ed as the number two of cial in Iran is the Speaker of the Majlis or Parliament and has principal responsi- bility for Foreign affairs and the conduct of the war These early meetings used an unreliable intermediary Ghorbanifar who misled both sides and who thereby frustrated the progress of the discussions The discussions during the Fall of 1986 on the other hand generally referred to as the Second Channel meetings were sought arranged and con- ducted by representatives of Speaker Rafsanjani Raf- sanjani proposed that representatives of the other fac- tions be included in the joint commission that was to be established to pursue the normalization of rela- tions 1 These changes in the leadership of the negoti- ations appear to have corresponded with an increas- ingly serious willingness on the part of the Iranian leadership to consider renewed strategic cooperation with the United States although the leadership did not abandon its interest in acquiring arms in return for hostages The Ayatollah Montazeri a prominent religious leader who is virulently anti-American and a support- er of radical fundamentalist violence in Saudi Arabia and elsewhere was excluded from both sets of discus- sions It was later determined that Ghorbanifar had leaked information concerning the First Channel meetings including the secret participation of Israeli representatives to the Montazeri faction This faction was responsible for disclosing the U S -Iran negotia- tions in the Fall of 1986 in retaliation for the arrest of several of its leaders After the disclosure factional warfare within Iran and the U S public's reSponse effectively ended the discussions Since then they have been overtaken by events in the Gulf Nego a ons The initial meetings with the second channel took place secretly in Washington DC over two days in September 1986 Detailed contemporaneous notes have been made available to the Committees They show that Colonel North accompanied by George Cave a CIA expert on Iran engaged in two-way discussions of the elements of a new relationship in a way that had not apparently been of interest to the previous channel The discussions moved from broad strategic objectives to a number of sensitive and highly speci c points According to the notes these included the following and Soviet interests in Iran and Iranian interests in Afghanistan lran s objectives in the Iran-Iraq war Soviet objectives in the lran lraq war lntelligence information about deceased hostage William Buckley and Establishing secure communications between the two governments to avoid compromise by hostile third governments The negotiators also raised the possibility of an ex- panded military supply relationship but the US par- ticipants made it clear that such a relationship presup- posed resolution of the hostage situation which was also discussed The next significant meetings were held in October 1986 in Frankfurt West Germany The U S partici- pants were North Cave Secord and Hakim The lranians made it clear that they wanted the relation- ship to go beyond a merchant or trading relation- ship The U S and Iranian representatives discussed common geopolitical interests extensively and com pared available information The discussion then turned to the extent to which the United States was willing to supply additional weapons to Iran U S negotiators made clear that the weapons Iran had requested could be supplied if the hostage issue was resolved rst The U S and Iranian negotiators also discussed the Iran-Iraq war the meaning of an honor- able victory for Iran the status of Iraq's Saddam Hussein North then left the meeting after stating that his Seven Point proposal was the full limit of his authority The Iranians made a counterproposal Hakim and Secord were left with authority to try to come to an agreement with the Iranians subject to approval by the U S Government After some addi- tional discussicm Hakim and Secord reached a new Nine Point agreement It provided in substance for the release of one hostage with a premise to attempt to obtain another in return for the shipment of some U S weapons instead of insisting on all of He had to leave suddenly because he had Icarncd that the airplane carrying Eugene Hascnfuh had been shot down over Nica ragua Sec North Test Hearings Mitt 7 v'ol it at 531 Chapter 8 the hostages as North s original proposal had doae It also included a plan that might result in direct Irani- an-Kuwaiti negotiations over release of the infamous Da'wa prisoners The agreement was reviewed by North and Poindexter and Poindexter claims to have briefed the President The evidence indicates how- ever that the President was not told about the Da'wa When he learned about the Da wa part of the talks later the President found it repugnant T9 So do we lt is hard to reach a de nitive judgment about the Sceond Channel meetings Consider this exchange be- tween Representative Hyde and Admiral Poindester from the public hearings Mr Hyde The conventional wisdom is that the Iran overture was a policy disaster Is that not too precipitous a judgment Shouldn t the jury still be out on that Because if we do lack good intelligence we don t really know whether we were getting somewhere or not on the hostage issue or the strategic opening Is that a fair state- ment Mr Poindexter I think that is a very fair state- ment think it is possible if the present people working this problem in government go about it properly I think it is still possible One of the interesting things is that we maintained contact with the second channel right up until the day 1 left the White House and we were alerting the channel as to what we were getting ready to do so that the President's speech so that his press conference didn t surprise them We got the Iranian Government to have their ambassador at the UN make a statement which referred to the United States in terms that are more favorable than ever had been made public by this particular Iranian Government because I truly believe that with the second channel that we had established we were in contact with some people that really wanted to bring about some changes in the Iranian Government that would be much to the bene t of the United States I am not talking about returning to a situation in Iran that was the same as when the Shah was there but turning the government around to a direction where we could indeed have a con- structive relationship with them At the meeting in Frankfurt North speci cally told the Iranian representatives not what the United States would be willing to do to release the prisoners but what the Iranians would have to do before the Kuwaitis would release them See C378 North did not promise then or later to take any af rmative steps on behalf of the United States to seek the release of the lJa'wa prisoners George Cave testi ed to this effect as well See Cave Der at 152-53 See also Id at 56 532 I think it is still possible that that may ceme about lilo In some respects the actual results of the Second Channel negotiations a small shipment of arms the release of one hostage were similar to the earlier agreements conducted through the First Channel Two elements of the Second Channel meetings were different however First although some of the same people participated in meetings held through both of the channels the Second Channel meetings involved a different more powerful leadership Second the Ira- nians this time clearly seemed to recognize that if the hostage problem could be nally resolved the United States and Iran had important mutually compatible interests that might well sustain a substantially in- creased level of cooperation The precise elements of the strategic relationship being discussed were decidedly mixed however Some were bene cial to the United States such as the exchanges of information over mutual geopolitical in- terests in the region Others such as proposed Da'wa release were not North may have been correct in saying that the position he endorsed on the Da wa did not exactly contradict publicly stated U S policy Ell This technical accuracy does not begin to account though for the way such a position would have un dermined U S credibility It is another example of the NSC staff thinking about literal compliance without adequately considering the long term political conse quences Conclusion The Role of the NSC Staff and Others The Tower Commission concluded that the Iran initi- ative was pursued with a awed decision process managed by the NSC staff and suggested that the procedural flaws were reSponsible for some of the initiativc's substantive errors $2 The Tower board we believe underestimated the extent to which major issues were aired and argued before the President from November 1985 through January 1936 But the board was right to say that the lack of regular proce- dures fostered by an excessive concern for secrecy short-circuited the process of periodic review and evaluation both of the substantive desirability of continuing the initiative and of the decision not to notify Congress To describe what happened simply in terms of the process however leaves some important questions unanswered It is true that good organization can help make sound decisions more likely But organization at best is a tool The real flaw in the NSC's Iran negotiations as well as in the deceptions of Congress over Nicaragua came from errOrs in judg- ment The question therefore is what can an admin- istration do to ensure that people with the appropriate Chapter 8 breadth and depth of judgment are fully involved in the process at the appropriate stages The majority report seems to want to get at this issue by legislating organization for the executive branch down to the finest detail We are convinced however that no one formula will work best for all Presidents It is important not to let the record be closed with a naked criticism of the NSC staff such as the one with which we closed our review of the Second Channel negotiations The weakness and the way the lran initiative and Contra support programs gravitated toward the NSC point to issues that go beyond this particular NSC and the specifics of this investigation The NSC staff operated within a c0n- text that was also a part of the problem Presidents can use their NSC staffs in a variety of different and equally valid ways One President might prefer a staff that filters and summarizes An- other might want a more active more politically at- tuned and more powerful NSC staff Like the Tower Commission we do not think it is appropriate to tell Presidents how to arrange the people who work for them The best organization is the one that works best for the elected of cial who bears final responsibility But an administration s style overall has to be one that ts together in all of its parts If the NSC staff is to operate primarily as an honest broker that imposes responsibilities on cabinet officers chosen for their judgment 1f the cabinet officers fail to meet those responsibilities they end up leaving policy initiation oversight substantive review and political review to people who may not have those tasks as their primary The Reagan Administration has been beleaguered from the beginning by serious policy disagreements between the Secretaries of State and Defense among others That in itself in not unusual The perSpectives of those two departments often produce disagree- ments under many Presidents One reason Presidents need an NSC staff is precisely to help the President benefit from the differences within his administration and not suffer from them We have learned in our hearings that President Reagan has been willing to act decisively to settle policy differences when they are presented to him He has not been as successful h0w- ever in ensuring that all such important differences are brought to his personal attention In addition he has not taken a strong band in settling issues on which policies personnel conflicts and turf battles merge One result has been that some peOple in the Administration have had an interest in seeing the NSC staff play the role of honest broker and not being an independent source of power Their coincided with President Reagan s own preference for cabinet government and for a less independently powerful NSC staff than those of his predecessors It is ironic that many have looked upon the lran Contra Affair as a sign of an excessively powerful NSC staff In fact the staff s role in the Iran and Nicaragua policies were the esceptions of the Reagan years rather than the rule When Robert McFarlane resigned in December 1985 both Chief of Staff Donald Regan and Secretary Shultz were wary of a strong successor Passing over some widely discussed and independently powerful people such as Jeane Kirkpatrick the President chose McFarlane s deputy Admiral Poindextcr Press accounts written at the time saw Poindexter s selection in precisely these terms as a decision to have the National Security Adviser play the role of honest broker This image of the NSC lasted almost until the moment the lran arms initiative became public Poindexter was seen as a technician chosen to perform a technical job not to exercise political judgment Poindexter is a talented man In addition to his skills as a naval of cer he is highly intelligent knowledgeable about international relations and expe rienced with procedures in the Reagan White House He was not the sort of man however who normally sought to initiate policy or engage in jurisdictional battles 0n the other side of this same character trait he had little feel for the people side of domestic or international political strategy That would not be a problem however as long as he managed to stay in the role of honest broker Of all people White House Chief of Staff Donald Regan surely should have known of Poindester's and weaknesses He should not have tried to second-guess everything the National Security Advis- er did but his job in the White House did require him to take note of when issues were likely to cause the President political problems Even if Regan were not an expert in the substance of the international issues it was his job to stay on top of the political implications of the NSC staff s activities That alone should have led him to see red warning flags and to make a careful check when North was asked to testify about support for the Nicaraguan democratic Resistance after press accounts and a formal Resolution of fur quiry He should have had a similar reaction when the NSC never reviewed the decision not to notify Congress about the January 17 finding One way of looking at Poindexter s mistakes is to say that they were just waiting to happen Once the NSC staff had to manage two operations that were bound to raise politically sensitive questions Poin- dexter was not well equipped to handle them It is not satisfactory however for people in the Administra- tion simply to point the finger at him and walk away from all responsibility For one thing the President himself does have to bear personal responsibility for the people he picks for top office But the problem here may not have been who was picked Instead it may be that a person chosen to do one kind of a job as National Security Adviser suddenly was thrust into a very different kind of a situation The question 533 Chapter 8 therefore is how did it happen that the NSC came to play so prominent a role in the Iran-Contra Affair There is no mystery why the NSC staff became so important for US policy toward Nicaragua North s powerful personality and disputes within the Restrict- ed Interagency Group before Abrams became Assist- ant Secretary of Slate both contributed to North s growing power But the fundamental reason for the prominence beginning in 1984 was the Boland Amendment Once that amendment was passed the CIA and State Department were all but read out of the picture The NSC staff was able to operate under the restriction and it did The evolution of the NSC's role in the Iran initia- tive was more accidental David Kimche brought Is- rael s proposal to McFarlane in August 1935 instead of to the State Department because he knew McFar- lane well because the State Department had rejected similar overtures in the past and because he knew the issue would have to be decided by the President The NSC staff was asked for ight assistance instead of State in November 1985 for essentially the same rea- sons In January 1986 Amiram Nir saw Poindexter and North partly because Nir and North were their respective governments' counterparts on counterter- rorism and had worked closely together in that capac- ity partly because the hostages made this a counterterrorism issue partly because the initiative had already started in the NSC and partly or mostly because Secretries Weinberger and Shultz were strongly opposed to the arms sales In addition the CIA was more than happy not to be managing the operation itself It was content as former Deputy Director of Central Intelligence John McMahon has said to play a sapport role Clair George the Deputy Director for Operations ex- pressed even stronger feelings as did his whole direc- torate because Ghorbanifar was being used as the intermediary After having issued a burn notice on Ghorbanifar once before Casey asked George to re- evaluate him The agency reinterviewed Ghorbanifar in late December 1985 and gave him a second poly- graph in January 1936 35 George told North how poorly Ghorbanifar had done and then told Casey mBill I am not going to run this guy any more which means in our language will not handle him he is a hum i There were a number of reasons peculiar to the particular operation in other words that explain why the NSC staff ended up running the Iran initiative It is important to remember however that this function was an aberration But the NSC lacked not only a person at the top who was picked for policy judg ment it also lacked operational experience There However the NSC played an operational role in a series of risky foreign activities during the Reagan Administration the raid on Libya the freeing ot' the American students on Grenada and the capture of the Achillt lauro Admiral Poindester 534 were people with such experience in the line agencies but their Secretaries were vehemently opposed to the initiative in the best of all textbook worlds the department secretaries and other political appointees would ac- knowledge the President s decision and work hard to make sure the decision is implemented professionally As George Shultz said in his testimony however issues never seem to be settled in Con- cern was rampant throughout the government that trusting anyone to run a policy he or she opposed vigorously was an open invitation to having the policy undermined through leaks or otherwise The situation helps explain why the NSC staff when run- ning a dangerous Operation during which hostages could easily be killed decided to be secretive There can be no question that the NSC denied Secretaries Shultz and Weinberger some information they should have had However if one looks at the record presented in testimony it is also clear both of the Secretaries had many indications of what was happening Weinberger did not push as hard he might have done to insist on a policy review but we do not accept the Tower Commission's conclusion that he simply distanced himself from what was going on On the other hand the Tower Commission s assessment of Shultz seems more accurate He does seem to have distanced himself and then complained loudly after- ward about what had happened Let us begin with Weinberger During our hear- ings the Secretary of Defense described himself as having been pretty horrified at a November 10 1986 White House meeting when he heard Poin- dexter give what the Secretary described as Poin- dexter s first general exposition and report on the initiative 1n contemporaneous notes Weinberger also said he was surprised to learn that the President had signed a nding for the initiative in January 1986 90 It would be misleading to treat Weinberger however as if he were left in the dark For example even though Weinberger did not know the President had signed a nding on January 17 he did attend a meeting at which the nding was discussed the day before and he did know the Defense Department was shipping weapons to the CIA for Iran in February He also learned about McFarlane's trip to Tehran from reports even though he had not been told about it in advance by Poindexter and he knew about the pointed out that nobody Congress and press included ever com- plained about the role in these successful operations it was not until the problems with the ran initiative and the Contra assistance program both highly controversial foreign policy initia- liVCt-ii' that the NSC's operational role was questioned l'oindester Test Hearings 100-8 at teams This raises a serious question as to helher the NSC should be legislatively prohibited front evei playing an operational role to assist the Presidt ltl with sensitive and risky activitiEs that the Slate and Defense Depart- ments bureaueruttes might he too cumbersome to react to effective- 1y Chapter 8 October 1936 When he did not see all of the hostages come out he could have said it was time to see how the policy was working In fact Wein- berger said that he did make the point all through that year to Admiral Poindester I talked to Mr Poindexter so many times and I don't remember whether the President was present at some of those meetings or not I think he may well have been but I am not sure of that But the continued objection was made all through that year with repeated my repeatedly calling attention to the fact that it wasn t work- ing Weinberger was repeatedly told by Poindexter however that the President had made up his mind and it was useless to keep rearguing the Weinberger probably could have insisted on a review anyway Poindeater s past record however led others mistakenly on this one issue to see him as a person who carried cabinet level messages faithful- ly and was not an inordinate risk-taker We have to surmise from Weinberger s behavior therefore that he accepted Poindexter's characterization and con- cluded that the issue was not important enough to him to be worth repeated pushing Other battles over arms control for example must have been of higher priority Shultz is more open to criticism than Weinberger in our view For one thing the Iran initiative directly went against Operation Staunch and other State De- partment programs He had more reason bureaucrati- cally to insist on an active role and more solid rea- sons than Weinberger to think the initiative might be running counter to the positions he and his depart- ment were charged with enforcing Secretary Shultz submitted a chronology to the Committees that listed an impressive number of occa- sions on which he was led by Poindexter to think that the United States was not contemplating or engaged in arms sales to Iran Nevertheless there are also a signi cant number of occurrences that would have given a more engaged Secretary or one who wanted to be more engaged an opportunity to insist upon being fully informed For example on December 5 I985 Shultz was briefed by Poindester on Iran In that brie ng Shultz complained about the State Department being cut out of distribution on certain reports DeSpite the com- plaint the reports did not start coming to him 95 From the very beginning of Poindexter s tenure as National Security Adviser therefore Shultz was given a strong signal that he would have to be very aggressive to stay on top of all of the relevant infor- mation he would need to know Then in January Shultz all but told the secretive Poindexter that he would let him be the judge of what he thought Shultz should be told about Iran What I did say to Admiral l'oindester was that I wanted to be informed of the things I needed to know to do my job as Secretary of State But he didn t need to keep me posted on the details the operational details of what he was doing That is what I told him Now the reason for that was I m not this is the gist of what I told him I don't remember the exact words but that was about it The reason for that was that there had been a great amount of discussion of leaks in the Administration justi- ably so I felt it would probably leak and then it wouldn't be my leak Shultz insisted that he intended and expected to be informed about major issues But he did leave it to Poindester to decide which issues were which On January 7 936 the President held a meeting to discuss Amiram Nir's proposal to resume the arms sales with Iran Shultz Weinbergcr Meese Casey Regan and Poindexter were there Shultz and Wein- berger opposed selling arms to Iran as they had in past meetings Unlike other meetings Shultz said it seemed to me that as people around the room talked that Secretary Weinberger and I were the only ones who were against it 9 Then on January to Shultz attended a cabinet meeting at the White House After the meeting he was invited to come back later in the afternoon for a meeting about Iran Shultz said he could not attend because he had another engagement In our hearings Shultz made a point of complaining that he did not know the meeting was to discuss what became the January nding 98 But he must have known after the January 6 meeting that arms sales and hostages were on the agenda Weinberger Meese Casey Spor kin and others attended the meeting which was held in Poindexter s of ce The nding was discussed ex- tensively Weinberger could have begged off on the same grounds as Shultz by saying that the President was aware of his view But the Defense Secretary attended and heard a thorough discussion of the nd ing Shultz stayed away did not send a stand-in and never asked for let alone insisted upon a brie ng on what had happened After this sequence one could certainly understand how Poindexter got the impres- sion that Shultz did not really care to be informed If this meeting did not give off every signal of a major policy event it is hard to know what would And if Shultz chose not to come or to inquire afterwards what should Poindexter have been expected to cona elude about how much to tell the Secretary On February 23 Poindexter told Shultz that hos- tages would be released the following week and that Iranians wanted a higher level meeting but even after the January meeting Shultz did attend this news did not prompt Shultz to ask about arms Shultz also 535 Chapter 8 approved the Terms of Reference for McFarlane s trip to Tehran on February 23 The trip was delayed repeatedly Then on May 3 Shultz received a cable while he was attending a summit meeting with the President in Tokyo The cable said that the U S Am- bassador to Great Britain had learned that a British businessman Tiny Rowlands had been approached by Nir to take part in an arms transaction with Iran that had White House approval and included Ghor- banifar and Khashoggi Don Regan told me that the President was upset and this was not anything he knew about and Admiral Poindester told me I think his words were something like We are not dealing with these people This is not our deal He told Ambassador Price who called him that there was I think his words were only a smid gen of truth in it something like that It is puzzling to us how Shultz could have been reassured by what Poindexter told him in Tokyo The phrases this as opposed to something else is not our deal and Smidgen of truth should invite skepti cism What is the point of reviewing Shultz s record of disengagement Shultz and Weinberger left the im pression in our hearings whenever they were asked about the subject that the main reason to have asked for an NSC review of how the Iran policy was being implemented would have been to reargue the Presi- dent's basic decision But surely that is not the Only obligation a cabinet secretary owes to his President Full NSC members have a responsibility to remain engaged to make sure I that the President's policies are being implemented correctly with a prOper for consequences not noted by an agency running an operation and 2 to insist that the President periodi- cally review important policy decisions so all power is not left in the hands of the people most committed to pushing forward If a top of cial cannot honestly serve his President in this way raising questions about implementation even when disagreeing with the underlying policy decision then it is time to think about resigning Presidents need the judgment and support even if it is 538 honestly skeptical support of their 0p appointees If the appointees nd the policy so repugnant that they can only distance themselves from it then they are not doing their best to serve Weinberger did make sure that the Defense Department aspects of the oper- ation Were implemented properly Shultz simply failed to nd out about the aspects of the negotiations that directly affected his own department s responsibilities Everyone who had a stake in promoting a techni- cian to be National Security Adviser should have realized that meant they had a responsibility to follow and highlight the political consequences of operation- al decisions for the President Even if the cabinet of cials cannot support the basic policy they have an obligation to remain actually involved if they could manage to do so without constantly rearguing or un- dermining the President s basic policy choice That is an essential corollary of a system of cabinet govern- ment with a relatively weak National Security Coun- cil staff If the NSC staff is not expected to provide independent judgment somebody else must do so It is at least theoretically possible that the idea of a strong cabinet government with a weak NSC staff will not meet any President s needs in today s interna- tional climate That is with the constant pressure of events and the inevitability of interdepartmental dis- agreement it is possible that future Presidents will decide that some important issues over the course of a full term inevitably will require them to have some- thing more than an honest broker as National Security Adviser If the need is inevitable Presidents would be well advised to choose people who are known for their independent skills at understanding the strategic politics of international relations both domestically and abroad President Reagan certainly reached this conclusion when he picked Frank Carlucci to replace Poindexter and we expect that General Powell will also turn out to be a person with the requisite sense of judgment But Presidents should not simply assume that the Iran-Contra affair automatically proves the inevitable need for an independently powerful NSC staff President Reagan's approach toward governing automatically requires something from the cabinet that was not supplied in this case The mode in other words was never given much of a chance Chapter 8 EHUHDIES l Youssef Ibrahim New Pipelines Are Reducing l er- sian Golf s Strategic Role New York Times October 7 1987 2 Tower at 3 lran ProSpeets for Near-Term Instability Special Na- tional Intelligence Estimate February 1986 4 See Philip Taubman Iran and Soviets Draft Big Projects Including Pipelines and Railroad New York Times May 8 1987 Elaine Sciolino Soviet Overture to Iran Reported New York Times June 30 1987 Soviets Iran Seek Accord to Open Pipeline Rail Links Washing- ton Post Aug 8 1987 Iran and Soviets Are Said to Near a Friendship Pact Wall Street Journal August 13 1987 5 Poindexter Test Hearings 100-8 7220 87 at 307 6 Secord Test Hearings 100- 577287 at 24-4 and 528 87 at 272-73 341-42 344 McFarlane Test Hearings 100-2 5213 87 at 222 244 and 5214 87 at 273 Poindexter Test Hearings 100-8 7 17287 at 216 and 7 20 87 at 290 7 McFarlane Test Hearings 1002 5213287 at 222 North Test Hearings 100-7 Vol 11 7213 87 at 61 Poin- dexter Test Hearings 100-8 7 17 87 at 210 and 7X20287 at 290 Tower at 13-8 13-90 8 MeFarlane Test Hearings 100 2 5213187 at 222 225 North Test Hearings 100-7 Vol 11 7 13 37 at 62 Tower at 13-7-8 13-61 9 Secorcl Test Hearings 100-1 at 267 272-73 McFarlane Test Hearings 100-2 5 13 87 at 223 Hakim Test Hearings 100-5 at 363- North Test Hearings 100-7 Vol 11 7 13287 at 62 Poindexter Test Hearings 100-8 7 17 87 111210-11 216-17 10 McFarlane Test Hearings 100-2 5 113287 at 224 North Test Hearings 100-7 Vol II 7213287 at 62 Poin- dcxler Test Hearings 100-8 7 20 87 at 290 Tower at 13-8 3-61 0-12-13 11 MeFarlane Test Hearings 100-2 5213 87 at 224 North Test Hearings 100-7 Vol II 7f13 87 at 62 Poin- destcr Tcst Hearings 100-8 7 20 87 at 290 Tower at 3-8- 9 13-61 3-89-90 0-12-13 12 McFarlane Test Hearings 100-2 5 13 87 at 224 North Test Hearings 100-7 Vol 11 7 13287 at 62 Poin- dcster Test Hearings 100-8 7 20 87 at 290 Tower at 8-7 3-90 13 McFarlane Test Hearings 100 2 5143 87 at 224 North Test Hearings 100-7 Vol 7 13287 at 62 Poin- dester Test Hearings 100-8 7 20 87 at 290 14 McFarlane Test Hearings 100-2 5 13 87 at 225 Poindextcr Tcst Hearings 100-8 7217 87 at 214-16 and 7 20287 at 2911 Second Test Hearings 100- 528287 at 342 Tower at 13-8 15 North Test Hearings 100-7 1or'ol 11 7 13 87 at 62 16 Gary Sick All Fall Down America's Tragic Encoun- ter With Iran 1986 at 104 17 Seeord Test Hearings 100-1 5716 187 at 148 18 McMahon Dep 9 2 87 at 64-67 19 See Weinberger Test Hearings 100-10 7231287 at 140 See also North Test Hearings 100-7 Vol I 729 87 at 220 20 McFarlane Test Hearings 100-2 5213287 at 229 Poindeater Test Hearings 100-8 7217287 at 216 21 Secord Test Hearings 100 1 5 6 87 at 148-50 527 87 at 230 31 and 5 8 87 at 352-55 Poindexter Test Hear ings 100-8 7 117287 at 215 22 Poindester Te5t Hearings 100-8 7 17 87 at 215 23 George Test Hearings 100-11 8 5 87 at 190 24 Poindester Test Hearings 100-8 7 717237 at 215 25 Memorandum from Poindexter to the President Janu- ary 17 1986 p 1 Ex IMP-28 Hearings 100-8 26- Pomdester Test Hearings 100-8 7 17287 at 215 See also Weinberger Test Hearings 100-10 7231 87 at 146 27 Shultz Test Hearings 100-9 7 23 37 at 52 28 id at 53 29 Robert M Gates The CIA and the Making of American Foreign Policy Speech delivered at Princeton University September 29 1987 p 23 30 McMahon Dep 9 2 87 at 27 31 Regan notes p 13 Ex DTR-41A Hearings 100 10 32 Tower at 11-4 to 111-8 and 1-1 to 13-24 33 George Hearings 100-11 8 5 87 at 191 34 US Senate 100th Cong Sess Select Committee on Intelligence Preliminary Inquiry Into The Sales of Arms to Iran and Possible Diversion of Funds to the Nica- ragua Resistance S Rept IUD-7 p 3 35 Tower at 13-3 citations omitted 36 Weymouth Yaacov Nimrodi A Tale of Arms and the Man The Washington Post Dec 14 1986 p H4 37 Tower at 1-1 1 38 Tower at H4 39 Ledeen Dep 3 11 87 at 9-11 40 id at 16419 Tower at 8-4 to 3-6 41 Tower at 13 9 42 Tower at 3-14 43 Ledeen Dep 3211 87 at 28 44 North Test Hearings 100-7 Vol I 729287 at 218 Poindexler Test Hearings 100-8 7 21 87 at 385 George Test Hearings 100-11 8 5 87 at 194 Hakim Tesl Hear ings 100-5 624287 at 261 and 6 5 87 at 393 45 Hakim Dcp 5 25 87 at 58 60 46 Tower at B-19 47 Poindexter Test Hearings 100-8 7 21287 at 385 and notes Ex IMP-23 Hearings 100-8 48 Letter from Prime Minister Peres to President Reagan 2228286 1743 49 Ex JMP-SB Hearings 100-8 50 See Ex DTR-41 notes by Alton Keel and Es DTR- 4174 notes by Donald Regan Hearings 11 10-10 51 Brie ng paper for November 20 1986 meeting 53921 52 McFarlane cable to Shultz July 13 1985 Ex GPS-9 Hearings 100-9 53 Armacost cable to Shultz July 13 1985 Ex UPS-8 Hearings 100-9 54 Tower at 13-17 55 North Test Hearings 100-7 Vol I 729 87 at 218 56 McFarlane cable to Shultz July 13 1985 Ex Gl S-g Hearings 100-9 57 cable to McFarlane July 14 1985 Ex 10 Hearings 100-9 58 See Secord Test Hearings 100-1 5 8287 at 273 North Test Hearings 1110-7 Vol 1 7 8287 at 219 and Vol 11 7214 87 at 150-51 McFarlane Test Hearings 100-7 Vol 11 7 14287 at 173-74 Poindexter Test Hearings 100- 8 7220287 at 305 Shultz Test Hearings 100 9 7224787 at 184-85 59 McFarlane Test Hearings 100-2 5 13 87 at 175 537 Chapter 8 so Shultz Test Hearings 100-9 7224937 at 185 til 22 U S C 1232 as cited by President Carter in Execu- tive Order 12294 affecting private claims against Iranian assets held in the United States 46 Fed Reg 14111 1931 Both the law and executive order are cited in Dames Marne v Regan 453 US at 675-76 62 North Test Hearings 100-7 Vol 11 at 22 433 Agent 1 Dep at 191-196 64 Major Dep at 38-90 65 Tlld at 94 66 DIA Major Dep at 4 67 Agent 2 Den 3 28r 37 pp 5'1 109 38 Memorandum From North to McFarlane 5 24 85 at 3 4 NOrtlt Test Hearings 100-2 Part 11 Ex memorandum frOm North to MeFarlane 6 7 35 at 2 4 North Test Hearings 100-7 Part Ex memo- randum titled suppon for recovery of American hostages seized in Beirut Ex IBM-2 Hearings 100-9 69 McFarlane Test Hearings 100-2 5 11f87 at 44 70 Cave Dep at 111 Cave Den 9f29 37 at 621-159 Tl Allen Cave memo on the Frankfurt meetings 36 22 Memorandum of conversation Sept-Oct 1936 at P59 73 Transcript of Second Channel Meeting at C332 74 Id at 33156-67 75 id at 3367-31 is El OLN-308 Hearings Vol 11 538 77 Bit OLN-JIO Hearings 1013-2 Vol 11 T3 Poindexter TESL Hearings 100-3 7f15f87 at 69 79 Shultz Test Hearings 100-9 7 23r 37 at as Regan Test Hearings 7 30 37 at 20-21 30 Poindexter TESL Hearings 100-3 7 16 87 at 216 81 North Test Hearings 1004 Vol 1 7 10 37 at 332 82 Tower at lV-3 4 33 See for example Primus Fares and Poindexter New York Times editorial December 6 1935 Mary Belch- er White House shift realigns influence in foreign policy More clout likely for State Defense The Washingmn Times December 5 1985 p l 34 Leslie H Gelb How the New Admiral at the White House Fares New York Times September 23 1986 p 24 35 McMahon Dep 9 2 82 at 69-22 36 George Test Hearings Bf fii'i at 153 37 Id at 160 33 Shultz TESL Hearings 109-9 7 241 83 at 43 89 Weinberger Test Hearings 190-11 7 31 87 at 150 90 Ex Hearings 100-10 91 1 5 at 143-45 92 Weinberger Test Hearings IGO-ID at I45 93 Poindexter Test Hearings 10133 7 31 32 at 42 94 Ex GPS-Chronology-H Hearings 00-10 95 Shullz Test Hearings 7 24r 87 at 30 96 Shultz Test Hearings 100-9 7 23237 at 6 9T Shultz Test Hearings 100-9 at 33 98 Shultz Test Hearings 100-9 2 23 37 at 33 99 Shultz Test Hearings 100 9 at 10 Chapter 9 Iran The Legal Issues These Committees hearings and the majority report have trivialized important disagreements over interna- tional policy and the political relationships between the legislative and executive branches In an attempt to gain partisan advantage the majority has Focused upon legal disputes trying to portray the Committees role as that of prosecutor We have indicated several times that we have some policy disagreements with the Administration's actions of 1984-86 We disagree for example with the decision to sell arms to Iran and to withhold noti cation to Congress for as long as the President did in this case We also think it was a political mistake for the President not to have con fronted Congress over the Roland Amendment in 1984 In neither case however do we think the Ad- ministration made serious legal missteps Our reason- ing with respect to the Boland Amendment was laid out in an earlier chapter Here we examine the major legal points raised by the majority in criticism of the Iran initiative We conclude that the Administration was in subtantial compliance with the law throughout the Iran initiative Introduction The Iran arms sales involved two different kinds of transactions The 1985 shipments involved sales from Israel to Iran of arms Israel had purchased from the United States The President gave his verbal approval for these sales t and the US assured Israel that the weapons could be replenished from LLB stocks The August September 1985 TOW missile sales took place without any direct U S participation A shipment problem in November 1985 brought General Secord into the picture Ultimately the CIA also became involved in a minor peripheral way because Secord used a CIA proprietary at commercial rates to ship the missiles and because CIA personnel became involved in trying to help arrange transship- ment through a European country Because of the participation the General Counsel Stan- ley Sporkin drafted a written Presidential Finding within days of the event that was signed by the Presi- For the dispule over this point see Tower 13-19-23 These Committees have developed no Important new evidence on the point dent about December 5 1985 This is the Finding Admiral Poindester said he destroyed in November 1986 1 A draft of the Finding has been entered into the Committees' record as an exhibit The 1 le ship- ments in contrast all involved the shipment of U8 arrns through a cornmercial cutout the Secord Hakini Enterprise All of these shipments were adequately described and fully covered by a written Presidential Finding signed January 17 1986 The basic law governing most sales of arms to other countries is the Arms Export Control Act Under the AECA the President is re quired to notify Congress of covered arms sales and Congress has an opportunity to pass a joint resolution prohibiting major sales if it can get the President's signature or a two-thirds veto override vote The AECA also requires special waivers if a sale is to be made to a country such as Iran that has been named by the Secretary of State as one that supports interna tioual terrorism Finally the AECA requires any country that receives arms under the terms of the act such as Israel to notify the President of any proposed transfers to third parties or countries and to limit such transfers to countries or organizations otherwise eligible to receive arms under the terms of the act Under this provision transfers from Israel to Iran would be governed by the same noti cation and waiver requirements as direct sales or transfers from the United States Similar restrictions apply to the retransfer of arms given to another country under the Foreign Assistance Act FAA of 1961 5 Under the AECA and the FAA sales of munitions valued at less than $14 million are not subject to the formal report- ing requirements outlined in 22 U S C 2753 Arms sales may also proceed covertly under the National Security Act '3 with prices set under the terms of the Economy Act The National Security Act does con- tain rules requiring noti cation of Congress and the Hughes Ryan Amendment to the Foreign Assistance Act of 1961 limits the use of appropriated funds to support CIA foreign operations to ones for which the President nds the operation to be important to the national security 9 The legal issues raised by the arms sales to Iran may therefore be summarized as follows 1 Did the arms sales of 1985 from Israel to Iran violate the terms of the AECA or 539 Chapter 9 2 Did the I985 Israeli sales to Iran violate the requirements for Presidential authorizations or Find ings under the terms of the National Security Act and the Hughes Ryan Amendment 3 Did the 1986 sales violate the National Security Act s requirements for notifying Congress Our answer to each of these questions is no We conclude that the Administration was in substantial compliance with the law during each of the Iran transactions Export Controls and the 1985 Shipments All of the arms transfers before January 1936 that is the transfers of August September and No- vember l985 -were accomplished by Israel s ship ment of weapons from its own supplies These weap- ons were originally obtained from the United States and were sent to Iran with the understanding that the United States eventually would replenish Israeli stocks It is reasonable to assume that the weapons Israel shipped to Iran in 1935 were originally supplied under the AECA or FAA These two statutes do permit the President or the Secretary of State to consent to re transfers provided that certain conditions are satis- ed Under the Arms Export Control Act these con- ditions are that the United States itself must be able to sell weapons to the third country directly that the third country transferee must agree in writing not to retransfer without U S permission and that Congress must be noti ed 1U The Foreign Assistance Act con- tains provisions similar to the rst two above but no noti cation provision 11 It should be noted that while the Letter of Offer and Acceptance 2 Israel signed in receiving arms in the first instance required it to re- ceive written authorization from the for re- transfer of weapons to a third party neither the AECA nor the FAA require a written authorization In these instances Israel received oral authorization for the retransfers Because each of these transactions involved less than $14 million compliance with the formal reporting requirements of the AECA and FAA is not required 13 The retransfer restrictions of the AECA and FAA were intended to cover situations in which the trans ferring country rather than the United States is the sole source of the retransfer request The laws seek to ensure that such retransfers foster the national securi- ty interests of the United States But in the ease of the Iran arms sales the Israeli shipments were made with the agreement of American authorities and Israel was promised and later was given substantially identical replacements Clearly the Iran arms sales were pre- mised on US views about America s own national security interests In short the substantive purposes of the AECA and FAA were met 540 An Alternative Route The National Security Act provides an alternative legal route to using the AECA or FAA Like the AECA and FAA the National Security Act presup poses some kind of Presidential determination Speci - cally the determination must be that an action in this case a retransfer would affect the national security 14 If the CIA is involved the so-called Hughes-Ryan Amendment requires a more emphatic Presidential determination Instead of saying an activi- ty must affect national security Hughes-Ryan says it must be important More signi cantly this deter- mination must be made personally by the President and reported in a timely fashion to Congress We believe that the terms under which the Presi- dent may use the National Security Act in fact meet all of the underlying purposes of the AECA and FAA and that is why Congress has been satis ed to let the one approach he a substitute or alternative route to the other The fact is that the I985 Israeli transactions essentially and legally were equivalent to ones in which the United States sold the weapons directly to Iran The evidence indicates that Israel participated in the I935 transactions in reliance on U S assurances provided by the NSC staff with the President s ap- proval that the US would not oppose the transac- tions and that the US would replenish the arms Israel sent to Iran The same arms could have been supplied lawfully however directly from American stocks Indeed the transactions of 1936 did proceed directly under the authority of the National Security Act and the Economy Act Assistant Attorney Gener- al Cooper pointed out in his December memoran- dum to the Attorney General I t is apparent that the real nature of the 1985 transactions was a bilateral sale by the United States to Iran with Israel serving solely as a conduit or facilitator in the execution of that sale We see no reason to treat the legality of Israel s participation differently than we would treat the participation of any other party that served as a conduit in a lawful covert operation Had the United States censigned weapons from American stocks to Israel for shipment to Iran Israel s role would have been exactly equivalent to the role that common carriers and public warehouses play in overt transactions Because so far as we know the weapons that Israel shipped to Iran in I935 and received from the United States were com- pletely fungible a similar equivalence is present- ed here Just as an illegal sale of arms to Iran There are differences in the formal reporting requirements to be sure in some circumstances we might imagine that such differ- ences could be signi cant In this particular retransfer they were HOL Chapter 9 would not be made legal by using Israel as a conduit so too a legal transaction could not be made illegal by Israel being used in the same way 15 The Laws Governing Covert Action We turn now to the laws governing covert operation which Were the ones under which the Administration was operating In our earlier chapter on the Constitu- tion we argued that the President has the inherent authority to use special agents and to encourage or order covert activities Once the President begins using appropriated funds however including salaried personnel Congress can put strings on the use of such funds Congress can for example tie the Presi- dent s hands in knots by appropriating money for only one speci ed operation at a time For any number of important national security reasons we noted in the Constitution chapter the Congress has recognized that the President needs a contingency reserve fund to meet changing conditions during the course of a fiscal year Once Congress gives the President a con- tingency reserve there are lines of inherent Presiden- tial authority that Congress may not properly cross Those lines come into play most importantly in the extremely rare circumstance when the President has legitimate reason to believe that reporting must be withheld We shall discuss this issue below For any circumstances outside the extreme however Con- gress has put a number of requirements on the Presi- dent that seem to us to pass constitutional muster For most of the country's history covert activities were conducted by giving the President a contingen- Cy fund without any additional explicit statutory au- thorization The first law codifying this power was the National Security Act of 1947 That law estab- lished the National Security Council and gave it the power among others to perform such other func- tions as the President may direct 15 1n the polite language of the post-World War II diplomatic world in which covert activities were not acknowl- edged publicly by governments everyone understood this term to give broad authority to the President to use the NSC as he saw Another title of the same law however created the CIA as the government's main body for conducting such activities It shall be the duty of the Agency under the direction of the National Security Council to perform such other funcriOns and duties related to intelligence affecting the national security as the National Security Council may from time to time direct Historically this language has been understood to au- thorize a wide range of foreign covert activities in- cluding arms transfers Covert Transactions The position that covert arms sales could proceed without triggering the requirements of the AECA was expressed as the Administration's interpretation of the law in October 198 In conjunction with one covert transaction that year Davis R Robinson Legal Adviser to the Secretary of State wrote It seems clear that Congress has not regarded the FAA and the AECA as an exclusive body of law fully oopupying the field with respect to US arms transfers There are several illustrations where Congress having been made aware of transfers to foreign countries outside that body of speci c authorities has reacted by enacting limit- ed restrictions or reporting requirements rather than by prohibiting such transfers altogether a Robinson noted that if Congress had thought the AECA and FAA completely covered the field it would not have passed the Clark Amendment of 1976 prohibiting covert aid to Angola or the Hughes-Ryan Amendment establishing separate nding and noti ca- tion requirements for CIA covert operations Three days after the Robinson memo was written Attorney General William French Smith forwarded a copy to Director Casey Smith wrote We have been advised by the State Department s Legal Adviser that the Foreign Assistance Act and the Arms Export Control Act were not in- tended and have not been applied by Congress to be the exclusive means for sales of US weap- ons to foreign countries and that the President may approve a transfer outside the context of those statutes The Attorney General concurred with this opinion and Congress was well aware of this fact Congressional awareness is shown most clearly in a provision of the Intelligence Authorization Act for Fiscal Year l936 This provision which became a new section to the National Security Act reads as follows Sec 503 a l The transfer of a defense article or defense service exceeding $l 000 000 in value by an intelligence agency to a recipient outside that agency shall be considered a signi cant anticipat- ed intelligence activity for the purpose of section 50 of this Act Paragraph 1 does not apply if-- A The transfer is being made to a depart- ment agency or other entity of the United States so long as there will not be a subsequent re- transfer of the defense articles or defense services outside the United States Government in con- 541 Chapter 9 junction with an intelligence or intelligence-relat- ed activity or B the transfer- i is being made pursuant to authorities contained in part of the Foreign Assistance Act of 196 or the Arms Export Control Act 20 This act makes it clear beyond any doubt that Congress intended some covert arms transfers to occur outside normal AECA channels It was precise- ly for this reason that it put in a threshold to trigger the reporting requirements under the provisions gov- erning reporting and Congressional oversight of intel ligence The General Accounting Office agreed with this conclusion In a March 1987 report on the direct US arms sales to Iran the GAO said Since Congress has explicitly recognised that in- telligence activities may include the secret trans fer of arms Intelligence Authorization Act for scal year 1986 section 403 quoted above as section 503 of the National Security Act the CIA is authorized by the Economy Act to turn to other agencies for that equipment Therefore we believe that the decision to use the Economy Act to provide support for this covert transaction was proper Transfers of equipment by the CIA and others including foreign governments are governed by applicable laws relating to intelligence and spe- cial activities rather than the Arms Export Con- trol Act which ordinarily governs overt arms transfers overseas Consequently we consider those transfers to be subject to the requirements pertaining to the conduct of intelligence and spe- cial activities As a general rule those transfers would not be subject to the pricing or reporting restrictions applicable to overt arms transfers conducted under the Arms Export Control Act 21 Hughes-Ryan Amendment The direcr statutory regulation of special activities began only recently in 1974 In that year Congress passed the Hughes-Ryan Amendment to the Foreign Assistance Act of 1961 As amended by the Intelli gence Oversight Act of 1980 Hughes-Ryan reads as follows No funds appropriated under the authority of this or any other Act may be expended by or on behalf of the Central Intelligence Agency for op- erations in foreign countries other than activities intended solely for obtaining necessary intelli- gence unless and until the President finds that each such Operation is important to the national security of the United States The following was 542 added in 1930 to replace earlier timely noti ca- tion language Each such operation shall be considered a signi cant anticipated intelligence activity for the purpose of section 501 of the National Security Act of 1947 Section 501 is the 1930 Oversight Act 33 As pathbreaking as Hughes-Ryan was at the time its omissions are at least as important as its coverage for analyzing the ran arms sales Hughes-Ryan ap- plies only to those covert Operations involving the expenditure of apprOpriated funds by or on behalf of the CIA August September 1985 Transactions Speci cally the omissions of Hughes-Ryan mean that the Israeli s TOW transfers to Iran in August and September WES which did not in any way involve the CIA did not require a covert action Finding under the terms of the law r In fact no written Find- ing was made at that time Nonetheless there is evi- dence indicating that the August September and No- vember 1985 shipments were carried out putsuaat to the oral authorisation of the President In fact the Hughes-Ryan Amendment contains no requirement that this Finding be reduced to writing or that it be articulated in any particular form The main purpose of the Presidential nding requirement is to ensure that the President himself decides before each such operation whether the national security justified its being carried out An oral authorization therefore sat- is es the Hughes-Ryan finding requirement r We do believe it would be better to reduce covert action Findings to written form so as to memorialize the undertaking and to avoid any confusion in imple mentation and noti cation Certainly all of the 1935 arms shipments should have been preceded by a writ- ten Finding or Findings Paying more attention to It should he noted that Executive Order No 13333 on United States Intelligence Activities Dec 4 1931 46 Fed Reg 59941 extended the nding requirements of Hughes-Ryan to the intelli- gence community As we have already pointed out in the Holand Amendment chapter however this language and the earlier lan- guage of the Oversight Act of 1980 were crafted deliberately to exclude the NSC which was the only 5 government agency involved in even tangentially in the August-September shipments This is the positlol'l taken by Assistant Attorney General Cooper in Cooper Memorandum Legal Authority n 15 infra at 7-3 in the President s National Security Jt cislt in Direc- tive 159 dated January 13 1935 there is a provision stating that the appropriate procedure for Presidential approval of covert actions is a written Presidential Finding See Es BBS-15 Hearing-t Oil-5 However this procedure having been instituted for the internal use of the President and his intelligence advisers cannot be considered to be legally binding on the President 1Writ- ing about lisccutive Irder 12333 which if anything must have greater binding authority than a classi ed Cooper said Activitlcs authorized by the President cannot violate an executive order in any legally meaningful sense especially in a case where no private rights are involved because his authorization creates a valid modification of or exception to the executive order M at 14 Chapter 9 formalities could have eliminated a number of legal issues which have been raised But this criticism of the White House s past administrative practices is not intended to suggest that the shipments themselves did not meet the legal requirements November 1985 Transaction One difference between the summer and the Novem- ber shipments in 1935 was that the CIA did play a role albeit a minor one in November It should be emphasized that this shipment consisted of a mere 13 HAWK missiles and the CIA did not pay for their tranSportation CIA of cials merely referred North and Seeord to a CIA proprietary airline and this airline transported these missiles in a single plane as a strictly commercial transaction with full payment by Seeord's enterprise to the airline No CIA funds fi nanced the shipment The only direct role in this shipment was to facilitate over ight clearances from foreign governments Thus the CIA provided logistical support for a secret initiative conducted by the NSC staff There has been an inordinate amount of attention paid to the role in the November 1985 ship- ments The underlying theory seems to have been that the CIA and others in the Administration knew the November 1985 shipment was illegal and that attempts to cover up the 1935 i11egalities explain the altered chronologies shredding and other events of November 1936 We consider both the theory and the underlying premise to be unfounded For one thing we do not consider the November 1985 ship- ments to have had legal problems except possibly ones of a technical minor sort Allegations that the CIA covered up an illegal action have been fueled by the mysterious disappear- ance of a cable DUane Dewey Clarridge allegedly sent to Country 15 on November 22 and one alleged- ly sent back to him from the same country the next day The officer sending the second cable has said it informed headquarters that he had learned from Gen Secord that the ight would contain HAWK mis- siles There have been questions about what hap- pened to these cables Clarridge specifically denies ever having received the second one and said that so do the Deputy Director for Operations and others in the of ce who would normally have received a copy 24 Clair George the DDO continued this testimony Moreover Clarridge said he did not think the difference between HAWKS and oil-drilling parts was all that signi cant from the agency s point of view since both were embargoed items 5 We do not believe that support of this sort rises to the level of a CIA covert action that would require a Finding under Hughes-Ryan The action at most should be treated as being de minimis In any event there is evidence that the President orally approved this HAWK shipment from Israel to Iran and a writ- ten Finding was made within days Gener- al Counsel and now U S District Judge Stanley Sporkin who had as much experience interpreting Hughes-Ryan as any other federal of cial testi ed that when CIA Deputy Director John McMahon told him to draft 3 Finding to cover the involve- ment Sporkin thought a Finding was not required by law in this instance even though he agreed it was prudent According to John Poindexter who in early December 1935 succeeded Robert McFarlane as Assistant to the President for National Security Af- fairs the President signed the Finding probably on December 5 1935 25 By its terms the Finding rati ed the prior actions that the U S government took to obtain the release of the American hostages The November-December 1935 Finding reflected in written form that the President had been briefed before the shipments on the efforts made to obtain the release of the hostages and that the President himself had found that these efforts were important to the national security of the United States Therefore in both the oral Findings referred to earlier and the written Finding itself the President accordingly rati- ed all prior actions and directed further actions to be taken As for the 1986 arms transfers the President s writ- ten Finding of January 1986 clearly and obviously satis ed Hughes-Ryan for all of them These Findings covered both the 1 1 8 sales to Iran and the portion of the May 1986 transaction that replenished Israeli stocks for the 1985 transfers Timely Notification Our closing pages on the Constitution contained an extensive analysis of why Presidents have the inherent power under exceptional circumstances to defer noti- fying Congress of a covert operation Congress wisely recognized this fact when it passed the Intelligence Oversight Act of 1930 The Oversight Act was an outgrowth of the the proposed intelligence charters of the 1970s which we outlined in our chapter on the Roland Amendments In this chapter we shall concentrate on one aspect of that law the requirement for Administration reports to Congress about intelligence activities That law appears in the statute books as a new section 501 of the National Security Act Under section 501 3 the Director of Central Intelligence or the heads of other agencies or entities involved in intelligence ac tivities are required to keep the intelligence commit- tees of Congress fully and currently informed of all intelligence activities including any signi cant an- We showed in the Roland Amendment chapter that the lan- guage in the Oversight Act deliberately excluded the NSC from these requirements 543 Chapter 9 When prior notice is not given to the committees or the smaller group of eight the conference report makes clear that the full Intelligence Corn- mittees must receive reports on the covert cper- ation in a timely fashion m ticipated intelligence activity However section 501 a further provides I f the President determines that it is essential to limit prior notice to meet extraordinary circum- stances affecting vital interests of the United States such notice shall be limited to the chair- man and ranking minority members of the intelli- Clement J Zablocki then Chairman of the House Foreign Affairs Committee as well as a member of the Intelligence Committee pointed out genee committees the Speaker and minority leader of the House of Representatives and the majority and minority leaders of the Senate This is the provision that permits an Administration to limit advance noti cation to a so-called Gang of Eight The law also speci cally contemplates a situa- tion however in which notifying the Gang of Eight might be too risky Consider this wording from sec- tion 501 1 The President shall fully inform the intelligence committees in a timely fashion of intelligence op- erations in foreign countries other than activities intended solely for obtaining necessary intelli- gence for which prior notice was not given under subsection and shall provide a statement of the reasons for not giving prior notice Emphasis addedJ While we agree with the majority that the idea of timely noti cation almost always envisioned a short time period the rare conditions under which prior noti cation has been withheld could not possibly have been de ned in calendar or other precise statutory terms As a result the decision not to notify must of necessity rest on Presidential discretion The constitutional basis for withholding noti cation was recognized in but of course does not depend upon the preambular language of section 501 To the extent consistent with all applicable au- thorities and duties including those conferred by the Constitution upon the executive and legisla- tive branches of the Government and to the extent consistent with due regard for the protec- tion from unauthorized disclosure of classi ed in- formation and information relating to intelligence sources and methods the intelligence com- mittees are to be kept informed of various intelli- gence activities Thus section 50 acknowledges that reporting re- quirements cannot limit the constitutional authority of either the executive branch or the legislative branch and further recOgnizes the need to protect sensitive information from disclosure The legislative history of the Oversight Act rmly supports our interpretation of its language Consider the following explanation of the pending conference report on the Oversight Act by Rep Boiand then the Intelligence Committee chairman 544 In addition the legislation makes the fundamental recognition that in extraordinary circumstances advance information on covert operations might be withheld from the Select Committees on Intel- ligence provided the President informs the com- mittees in a timely fashion and provides a state- ment of the reasons for not giving prior notice Mr Speaker this recognition of the need for limited exceptions to prior reporting of covert operations is fully consistent with the Committee on Foreign Affairs amendment to Hughes-Ryan I therefore welcome its inclusion in the confer- ence report Such exceptions are absolutely essen- tial to a strong intelligence community and im- portant for US security Such exceptions will also help the American in- telligence community to maintain the extraordi nary secrecy necessary in intelligence activities and promote cooperation from the intelligence communities of friendly countries 31 William Broom eld Ranking Republican on the Foreign Affairs Committee observed Henceforth in extraordinary circumstances af- fecting vital national interests the President will be allowed to defer reporting to Congress on CIA covert action operations abroad The key word here is defer The President is not excused forever from letting us know about such activi ties This is not an abdication of our oversight responsibility We are just allowing him to post- pone his reporting in those rare instances where for example prior disclosure would je0pardize the lives of the personnel or the methods em- ployed in a particular covert action activity As the conference report notes If prior notice of a covert operation is not given the President must fully inform the select committees in a timely fashion and provide a statement of the reason for not giving prior notice Is that unreasonable It seems to me common sense dictates that we allow the President this flexibility so that ite can effectively discharge his constitutional responsibility to conduct foreign policy In this connection let us not forget that covert action is an important and sometimes vita aspect of foreign policy and has been utilized by Chapter 9 Presidents all the way back to George Washing- ton A number of my colleagues have expressed con- cern abOut how often a President might invoke the deferred reporting option provided by this measure A look at the record to date is illumi nating in this regard Since the passage of the Hughes-Ryan Amendment in 197'4 there has been only one known covert action that was not reported to Congress prior to its initiation Our committee was subsequently briefed on that action and learned that the reason for the de- ferred reporting was because the President felt such prior noti cation could jeopardize the lives of the personnel involved in that action More- over participants in this successful Operation which we all applauded when we became aware of it agreed to participate in the action only after being assured that there would be no prior disclosure to Congress Essentially the same interpretation was put on the bill by Rep Les Aspin who was then a member of the Intelligence Committee What makes Aspin s statement particularly important is that it came from a member who was unhappy with what he perceived as the bill's vague language After describing and complaining about the provision to limit noti cation to the chairmen A5pin then went on to note There is second of course the possibility and I guess the statutory possibility that the Administration can in effect just waive the whole thing 33 There can be no question from the legislative histo- ry in other words that the statute contemplated situ- ations in which the President would not give prior noti cation The remaining question is how long is timely We would maintain that the answer must vary with circumstances To weigh circumstances re- quires one to use discretion that function therefore must belong to the President Was 1 months too long for President Reagan to have withheld noti cation of the Iran arms sales We think so he could have purchased what Rep Henry Hyde has described as some good political risk insur- ance early by coming to Congress and getting Con- gress on board On the other hand we are also well aware that President Carter withheld noti cation for about six months in a parallel hostage crisis In fact President Carter in his four years in of ce withheld notification two or three times about the same number of times and for roughly the same kind of U S House of Representatives Permanent Select Committee on Intelligence Subcommittee on Legislation lOUlh Cong Seas Hearings on HR HR 1371 and Other Proposals Whit Adv dress the Issue of Affordr'ng Prior Notice of Coven Actions to the Congress April I and 3 June It HST p 30 waiting period as President Reagan In any event whenever it nally comes time to notify the Presi- dent will have to pay a signi cant political price if Congress is not persuaded by the reasons the Presi- dent gives for having withheld notice Conclusion We conclude that the Administration was in substan- tial compliance with the law during each of the Iran arms transactions The arms sales of 1985 from Israel to Iran did not violate the terms of the AECA or FAA It is reasonable to assume that the weapons Israel shipped to Iran in I985 were originally supplied under AECA or FAA These two statutes permit the President or the Secretary of State to consent to re- transfers In these instances oral authorization was given for the transfers Moreover the formal report ing requirements do not apply because each of these transactions involved munitions valued at less than $14 million The AECA and FAA seek to ensure that such retransfers foster the national security interests of the United States The Israeli shipments were made with the agreement of American authorities and were premised on US views about America s own national security interests The substantive purposes of the AECA and FAA were met Moreover the 1985 Israeli sales to Iran did not violate the requirements for Presidential authoriza- tions or Findings under the National Security Act and the Hughes-Ryan Amendment The National Security Act provides an alternative route apart from the AECA and FAA under which the Administration was in compliance with the law during the 1985 trans- actions The terms under which the President may use the National Security Act meet all of the underlying purposes of the AECA and FAA Therefore Con- gress has been satis ed to let the one approach he a substitute or alternative route to the other The Hughes-Ryan Amendment contains no require- ment that Presidential Findings be reduced to writing The November-December 1985 Finding re ected in written form that the President had been briefed before the shipments on the efforts made to obtain the release of the hostages and that the President himself had found these efforts were important to the national security of the United States Therefore in both the oral Findings of 1935 and the written November- December 1985 Finding the President accordingly rati ed all prior actions and directed further actions to be taken With regard to the 1986 transactions the President s January 17 l936 Finding clearly satis ed the Hughes-Ryan Amendment These examples were discussed previously in the closing sec- tion of chapter 4 As was there pointed out in one of the cases Canadian participation was conditioned on a U S agreement not to notify Congress until Americans hidden in the Canadian Embassy were safely out of Iran 545 Chapter 9 Finally the 1986 arms sales did not violate the National Security Act's requirements for notifying Congress Certainly the National Security Act re- quires agencies involved in intelligence activities to keep the intelligence committees of Congress fully and currently informed of all intelligence activities However the law speci cally contemplates situations in which notifying the appropriate Congressional members might be too risky The act requires that in instances in which the President has not given prior notice of intelligence operations he must inform the intelligence committees in a timely fashion The decision not to notify must rest on Presidential discretion The reporting requirements of the National 546 Security Act cannot limit the constitutional authority of the President to withhold prior noti cation of covert activities in exceptional circumstances In this case the lives of hostages were at stake such that premature noti cation was extraordinarily dangerous to the lives of American citizens We conclude that in circumstances such as these the President must have the discretion to determine when noti cation is timely ll Congress after the fact disagrees with the way in which the President has exercised his discretion the appropriate remedy is a political and not a legal one Endnotes Poindexter Test Hearings 100-8 7 1528'1 at IS Es 55-4 Hearings 10111-6 22 U S C 2253 22 U S C 2280 22 U S C 2314 51 1 1 3 62 40 et seq 31 U S C 1535 50 U S C 413 SUI U S C 2422 10 See 22 U S C Sec 2253 3 II See 22 U S C See 2314 e 12 See Offer and Acceptance Form Ex CWW-T Hear- ings 100-111 13 See 22 U S C Sec 225311 11 I4 50 U S C 403 15 Cooper Memorandum for the Attorney General Legal Authority for Covert Arms Transactions to Iran December 17 1936 pp reprinted as Ex IBM-69 Hearings 100-9 16 50 U S C 402 1'1 50 U S C 403 18 Memorandum of Law on Legal Authority for the Transfer of Arms Incidental to Intelligence Collection by Davis R Robinson Legal Adviser Department of State October 2 1931 p 5 Chapter 9 19 Letter from Attorney lGeneral William French Smith to William 1 Director of Central Intelligence Octo- ber 5 1931 reproduced as Weinberger testimony exhibit 1 20 5f U S C- 415 21 US General Of ce Report to the Chair- men Senate and House Select Committees Investigating Iran Arms Sales Iran Arms Sales Dom Transfer of Arms to the Central Intelligence Agency March 1932 p 3 22 22 U S C 2422 23 See Eggleston narrative in Sporkin Test Hearings IOU-6 6f24 87 at 221 24 See Clarridge Tesl Hearings 100 11 3 4232 at 15 25 George Test Hearings 11111-11 at 201-03 26 Clarridge Test Hearings 8 4 87 at 17 19 27 Sporkin Testimony to Tower Commission Jan 9 1937 pp 7 3 28 See Ex Hearings Poindexter Tet-1L Hmr- ings 100-8 at 12 17 29 50 U S C 413 30 Congressional Record 1004-4 emphasis added 31 1% at H10045 32 Id 33 161 all 110047 September 30 1930 p 54 Chapter 10 The Use or Diversion of the Iran Arms Sales Proceeds What did the President know and when did he know it That was Senator Howard Baker s famous question about President Nixon from the Senate Watergate hearings of 1973 Political tensions were heightened in the Iran-Contra Affair when the same question was asked about the so-called diver- sion of funds from the lran arms sales to the Nicara- guan democratic resistance The very term diver- sion given currency by Attorney General Edwin Meese s press conference of November 25 1986 had the sound of illegality Beginning with the rst public revelations about the Iranian arms sales in early November 1936 reaction in the United States was a mixture of curiosity puz- zlement and controversy The Attorney General's press conference added a new dimension to the furor The proSpect that money had been sent to the Con- tras during the period of the Boland Amendments greatly intensi ed the scrutiny the Iran initiative re ceived in the media Speculation ran unchecked The Attorney General put the amount that might have been diverted at $10 million to $30 million 1 Members of the Congressional investigating committees sug gested that the amount might have been as high as $50 million 2 Ultimately the diversion received more scrutiny than any other aspect of the lran-Contra Congressional investigations The evidence is overwhelmingly clear however that the President did not in fact know about the diversion despite Democratic wishes to soft peddle the point by attacking Adm Poindexter's credibility in addition the use of the word diversion itself assumes that the funds belong to the United States We shall show later in this chapter that the legal questions surrounding the ownership of the proceeds from the Iran arms sales are by no means settled Before we can reach these points however it is first necessary to explain what the diversion was how it came about and how much was transferred What Was The Diversion What has come to be called the diversion was simply a transfer of a portion of the proceeds of the Iranian arms sales to the private Contra resupply operation under the direction of Gen Secord The funds came from two different sources The initial diversion ap- pears to have been from Israeli funds in late 1935 after the sale of HAWK missiles by lsrael to lran North informed Secord that the Israelis would not ask for the return of the unused transportation expense and that Secord could use it for other purposes Secord testi ed that he used it for the Contra project and so informed North 3 After the United States began selling Iran its own arms in February 1986 the transfers took place out of the portion of the Secord-Hakim funds that were left after the so-cailed Enterprise paid the US Govern ment all that it was owed under Economy Act prices and after other immediate operational ere penscs This remaining money has been referred to as the excess the pro ts or the residuals with each characterization resting on a different point of view about the ownership of the funds The American arms sales to Iran were carried out under a January 17 1936 Finding signed by the President Sales purposely were not organized as a direct government-to-government transfer Rather the operation was dependent on middlemen Col North Gen Secord Albert Hakim Adm Poindexter Clair George of the CIA Attorney General Meese and all others associated with the initial planning of the Iranian covert Operation described it in the same manner the United States would sell arms to Gen Secord acting as a commercial cut-out who would in turn sell the arms to Manucher Ghorbanifar who would in turn sell the arms to the Iranians From the American standpoint the organizational structure was desirable for several reasons It gave the US Gov- ernment some distance from the operation which would provide maximum protection and plausible deniability It also satis ed the Attorney General's and Secretary Weinberger s legal concerns about pro- ceeding under the terms of the Arms Export Control Act The Economy Act established the basis on which the Department of Defense in February 1986 sold the CIA TOWs for $3 7 million dollars or $3 700 per TOW The price to be paid by the Iranians See Chapter 3 for a discussion of pricing under the Economy Act 549 Chapter 10 was not statutorily limited however Ghorbanifar ap- parently offered $l0 000 per TOW as early as August 1935 This price eventually beCame the purchase price Ghorbanifar paid to Seeord in late February I986 It should be noted that $l0 000 per TOW was not an exorbitant price The replacement cost in 1986 of the TOW missiles utilized in the arms sales was approxi- mately $8 000 Under these arrangements there was an obvious surplus Ghorbanifar had paid Seeord the commercial middleman the agreed-upon price of 310 000 per TOW and Seeord had paid the CIA the Economy Act price of $3 7r'00 per TOW The surplus on the February transaction after transportation and other expenses was on the order of $6 3 million How Did The Diversion Happen The concept of transferring a portion of the excess proceeds from an arms sale to another project was not a new one Gen Singlaub explained that he and North had discussed this concept in connection with arms sales to an entirely different country in early 1935 lNhen the Israeli arms sales to Iran begin in l lSS the US was aware that the Iranians were paying relatively high prices for the arms compared to what Israel had paid for them This meant that the United States could reasonably conclude that some funds were being put to other uses by Israel Seeord and North were both aware that the Con- tras needed money By late 1985 they had both been involved in obtaining funds and arms for the Resist- ance The specific decision to transfer a portion of Iranian arms sales proceeds to the air resupply oper- ation was the result of a number of factors one of which was General Secord's involvement in both op erations The rst time a possible surplus came to North's attention was after the November 1985 sale of General Accounting Of ce Report to the Chairmen Senate and Home Select Committees Investigating Iran Arms Sales Iran Arms Sales DOD's Transfer of Arms to the Central Intelligence Agency March I937 p II The cost is dif cult to calculate with speci city The basic TOWs sold in February were obsolete and 1were to be replaced by an imprm'ed model Singlaub Test Hearings IOU-3 at to l ypical of the majority's tendentious treatment of the evidence in its diversion chapter is how much it tries to rnalte out of the so called Singlaub- Studley plan for transferring arms sales proceeds to anti-commu- ni t insurgents Yet after a three page discussion of this plan the majority states The Singlaub-Studley plan was not implemented The majority continues but the idea of using sophisti- cated US weapons to nance arms was l-tnown to those working to support the Contras before any proceeds from US sales of arms to Iran were first received A careful reader will note that the majority is thereby admitting that the first diverted funds those obtained by Israeli sales of arms to Iran were received before the Singlauh Studley plan was tabled in December 1985 Zine can only wonder why the Is intent on gltissmg over this aspect of the history which the majority itself develops and instead assigning another inlellectual patrimony to the diversion 550 HAWK missiles from Israel to Iran Seeord had been provided with $1 million by the Israelis to cover transportation for the missiles from Israel to Iran When the Iranians expressed dissatisfaction With the initial delivery further deliveries were stopped and Seeord had spent only 5200 000 of his retainer Seeord testi ed that the $800 000 surplus was eventu- ally spent on the Contra resupply project Hence the initial diversion appears to have occurred with Israeli funds It set the pattern for the future Seeord testi ed that he had not viewed the Iranian operation as generating any pro ts for him Or his partners His foremost concern he said was having suf cient capital reserves to ensure continued oper- ations 5 When as it turned out the sales generated money in excess of that needed for adequate reserves he was more than receptive to the suggestion that he send the excess funds to the resupply operation Col North had a similar divergence of interests As strong as his commitment was for the success of the Iranian operation it was equally strong for the Contras When surpluses were available he vt'as unmistakably motivated to advise Seeord to use them for the Nica- raguan democratic resistance According to Co North's public testimony the idea of sending the Contras some of the surplus gener- ated by the direct US to Iran arms sales was offered by Ghorbanifar in late January Earlier that-month or perhaps in late December North had discussed with Nir the possibility of using excess funds for joint US - lsraeli operations but said that this discussion never involved using the money for the Nicaraguan resist- ance 6 North testified that during a January meeting in London Ghorbanifar spoke with North in a hotel bathroom and speci cally suggested using the surplus for the Nicaraguan resistance 7 North saw an excel lent opportunity to get the Khomeini regime which was openly supporting the Sandinistas to unwittingly arm the Contras He thereafter set prices suf cient to create a surplus and encouraged Seeord to send all available surpluses to the Resistance After the end of our hearings the Committees received an unsworn unveri ed and unveri able document purporting to show that North rst conceived of a diversion to the Contras by early December An Israeli chronology claimed that North told Israeli supply of cials in New York on December 6 that the Contras needed money and that he intended to use preceeds from the Iran arms sales to get them some When North was asked about the December 6 meeting he reiterated that he did not recall discussing the Contras with anyone involved in the Iran initiative before the late January meeting with 'Ghorbanifar R We are inclined to believe North in this diapute largely because his testimony was sworn and he was granted immunity from all charges arising out of the testimony except that of perjury Ultimately howev- er this dispute is of little importance because even if Chapter 10 the idea was expressed in early December it never went beyond North until after the January London meeting Poindexter testi ed that he rst heard of the idea when North asked him to authorize it in Febru- ary 9 North testi ed that he rst mentioned the idea to the Director of Central Intelligence William J Casey at about the same time in late January or early February after the postr nding London meeting In addition North and Poindeater both testified that no one else in the U S Government was told about a diversion before this time What that means is that the diversion cannot possibly have been a consideration for people at the poticymaking level before North s January London meeting with Ghorbanifar How Much Was Diverted The most reasonable calculations show that approxi- mately $3 8 million of proceeds item the Iran arms transactions was spent for the support of the Nicara- guan Resistance During the period that the Enter- prise received income from the Iranian transaction November 1985 through November 1936 it also had other funds available for support of the Resistance that totaled $3 4 million Much of this money came from foreign and private domestic donations specifi- cally earmarked for the Contras During that same period of time the Enterprise spent approximately $7 2 million in support of the Contras If one subtracts the $3 4 million in non-Iran funds designated for the Resistance then the remainder of the $7 2 million or $3 8 million was the total amount of the diversion The Committees have indeed received evidence that the Janu- ary 17 Finding was revised several times in January 1936 to reflect US strategic goals more clearly In addition hearing testimony speci cally showed that the commercial cutout arrangement was designed to mirror the previous Israeli arms sales structure for security reasons after the US had decided to make direct sales to avoid legal questions under the Arms Export Control Act In short both the Finding and the transactions were restructured for reasons unrelated to the diversion which could still have been accom- plished just as readily even if Israel had continued to be either the seller or had been the intermediary The partners in the Enterprise also paid themselves 51 2 mil- lion in commissions out of the Iranian proceeds That sum can be considered to have been diverted but it is hard to see it as an expenditure for the bene t of the Contras and the Committees have not done so The majority s statements about the amount of money diverted represent what appears to be an amusing political compromise The majority says that at least 53 3 million in arms sales pro ts were used for the Contras Yet the reader is given no factual basis whatsoever for the conclusion that more than $3 3 million was diverted a fact apparently indicative of the continuing disagree- ment between parts of the majority about what the Committee's records show Since we accept the $3 8 million number as a matti- mum the majority view of the Committee actually is that $3 8 million was diverted Who Authorized The Diversion The diversion was authorized by Poindester The Committees were careful when taking testimony on this point to make sure that the principal witnesses would testify in private session before they had a chance to hear the crucial public testimony of this particular point Thus Poindexter testi ed in private session before North's closed session or public testi- mony that he had authorized the diversion at North's request 11 North corroborated this point in his own executive session testimony before he could have known anything about what Poindester had said l Poindexter also testi ed that he believed he had the authority to make the decision on his own to approve the use of the Iranian arms sales surplus for the Nica- raguan Resistance He said that because he had worked for the President for a number of years he felt he knew what the President would want to have done in this situation Poindexter stated that to him the diversion appeared to involve the use of what could be considered either third-country funds or private funds to support the Contras and that he believed the President favored the use of such private or third-country funds to support them Therefore in his view the President would have agreed to the use of surplus funds in such a manner However Poin- dexter said because he thought it would be politically as opposed to legally controversial to use the funds to support the Contras he decided not to inform the President of it so the President could truthfully deny knowledge if the diversion were revealed 12 The President has stated however that he would not have consented to the diversion had he known 'erorth Dep at The majority purports to show a con ict between Point-tester and North over the question of the time lapse between when North requested approval of the diversion and when Poindeitter approved it Obviously the majority is con- ceding here that North did request approval from Poindexter and that Poindeitter gave it Moreover even a casual reader of North s testimony will see that North had no speci c recollection of how long it was before Poindexter got back to him North said don't recoil speet eat fy on this caste hut my Rom-tot modus operandi on making a proposal such as that would be to go over and sit down with the Admiral Normally the Admiral would like to think about it North 'l'est Hearings Vol I p 29 emphasis added Counsel then asked Did you do you remit new long after you rst told him about this orally he got back to you North responded No I dealt I guess it was a matter of weeks or days or weeks certainly because by February we did it Id at 293 emphasis added Curiously the majority ignores this testimo- ny which would con ict with its preordained conclusion North also testi ed in private session that he assumed until November 21 1986 that the diversion had the President's apPFOVal- On November 21 he said he learned from Poindexter that it did not See North Dep at 7 25 Poindeitter testified in private session before North s that he had speci cally decided not to tell North that the President had not approved the decision Poindexter thus corroborates North on the essential point although he did not recall the November 2 conversation to which North testi ed See Poindexter Dep SHEET at 72 l 551 Chapter 7' 0 about it He has also stated that in his opinion Admi- ral Poindeater did not have the authority to make the decision without the President s approval The Committees have received no documentary evidence or testimony which shows that any other US GOvernment official approved or in any other way was involved in agreeing to the diversion Col North testi ed that Director Casey knew about and was supportive of the diversion but North did not suggest that Casey's approval was either sought or required 13 The President Knew Nothing About The Diversion The evidence available to these Committees shows that the President did not know about the diversion The President has made this point repeatedly The Committees have received swom testimOny support- ing the President on this point from four individuals with rst-hand knowledge and from another individ- ual who directly corroborates some of this key testi- mony The plain fact of the matter is that the Com- mittees have no testimony or documentary evidence to the contrary Poindexter Adm John Poindeitter stated under oath in executive session and during the public hearings of the Commit- tees that he had not told the President about the diversion He did so even though he knew that he had thereby deprived himself of an important defense against possible criminal prosecution 15 Poindester also testified that he was certain that the April 4 diversion memorandum the only surviving memoran- dum that documents the proposed diversion did not go to the President 16 The Committees have received no testimony or documentary evidence that contra- dicts Poindexter s testimony on these points striking thing about the majority's deeply awed effort to impeach Poindexter's testimony on the President's knowledge of the diversion is that it not only adduces no evidence to contradict that testimony it completely ignores directly relevant corrobora- tive evidence provided by Paul Thompson and presented below Lacking hard evidence the majority baldly speCulates that it was totally uncharacteristic for Poindexter not to have told the Presi- dent about the diversion and that therefore the majority implies but is apparently afraid to state Poindeitter must have done so and lied to the Committees The majority selectively uscs evidence concerning Poindexler's background and character To suggest that Poindexter as new in the job and would therefore not have made this decision by himself the majority states that the diversion decision was made only two months after became National Security AdviSer The reader is not told of Poindester's directly relevant testimony that he had served first on the NSC staff and then as deputy national security adviser for a total of 51% years and therefore felt con dent that he knew how the President felt about Contra policy and private and third country fundraising of which Adm considered the diversion an example This he explained made hint CUnl-Idenl he knew what the President would approve without being asked Poindeitter Den 5 331 at 552 Thompson The Committees have also received sworn testimony which directly corroborates Poindexter's testimony Cnidr Paul formerly the NSC General Counsel and assistant to Adm Poindexter testified in an executive session deposition as follows Q Were you ever asked by Admiral Poindeiiter to do any legal research relating to the question of the use of proceeds of sales of United States weapons A No Q Have I made that question general enough so you would construe it to include any aspect of the law related to a diversion such as the one we believe actually occurred A Yes that s sufficiently broad I asked the Ad- miral that same question myself on November 25th 1936 why he didn't ask me to do legal research on that issue Q What did he say A He said he didnlt want me to involve me in that aspect of the operations Q Did you have any further discussion on that with him A No Well I did I asked him whether he told the President or not Q What did he say A No After the questions about researching the fah' the deposition turned to who authorized the diversion Q Did you ask him whether or not he had au thorized the diversion A No I didn't ask him in those concrete terms I asked him after I asked if he had told the Presi- dent and he said no he went on to say the reason he didn t tell the President he said he felt con - The majority also makes a chain of command argu ment suggesting that Poindeater would be unlikely to have acted outside of that chain Yet the majority ignores the fact that Poin dealer testi ed tinder immunity in private before North appeared that he alone approved the diversion as a command decision and that he gave this testimony knowing full well as he said that he had thereby deprived himself of an important defense against per- sonal criminal liability Potndeitter Dep at 72-15 Finally the majority s character argument utterly ignores the fact that Poin- dester was clearly the single most secretive witness the Committees heard from a mart for whom keeping secrets from long time col league and assoriates was a matter of habit In short was just about the most likely witness from a character re-mt of view to have made a decision to keep the diversion from the President dent the President would approve it But it was an interesting few moments because he had for himself as the naval of cer and as the command- ing of cer of the ship whatever you want to call it he had a standard of what we call inescapable reSponsibility in the Navy which means you are inescapably responsible for what any member of your staff does I was unable to tell whether or not he was just generally aware of the diversion and North's knowledge of the diversion or whether he was more extensively aware of it Q But you apparently were concerned enough about it to ask him both why he hadn't told you and whether or not he had ever asked you to do any legal work that might have borne on the subject am I right r A Well Sure I was I saw that as a prime reason for his resignation or his request to be transferred and One of my missions was to help him out in all areas and I was really just asking the question why didn t you ask for my help in this area Q When did the conversation occur what date A November 25th or during the course of that week I guess it was the 25th Nonh Lt Col Oliver North also testi ed that he had not told the President of the diversion North testi ed further that he did not have any indication that the memorandums he had written to seek approval for the diversion had ever been forwarded to the Presi- dent Thc memorandums were written to Poindester and not to the President North testi ed that none 'The majority gives an incomplete Mutual of the testimony of James Radzimski All available physical evidence and testimony either fails to support or dlrectly contradicts Radzimski's testimony as the majority correctly notes But the majority ignores the fact that Radzimski clari ed his account of certain key events in his Second deposition Radzimski speci cally admitted then that he had no independent recollection of any cover memorandum from Poin- dester to the President being part of any April diversion memoran- dum on the Iran initiative at point the majority appears to have forgotten See Radzimski Den at Radzimski also admitted that if any such document had ever existed three sepa- rate actions ittvolving at least two different secure systems to which different groups of individuals have access would all have to have been taken to remove all record of its existence See Id at 734 Nor could Radzimski explain why he would have seen as he claimed non-log NSC documents such as the diversion memo- rattdum which never would have entered the NSC document con- trol system in the rst place The fact is that Radzimski's testimony was not deemed credible by the Committees and he was therefore not called to testify despite a premature announcement that he would be so called Chapter 10 of the memorandunts returned to him on this subject had any indication that they had been seen or ap- proved by the President North said I did not send them the memorandums to the President Mr Nields This memorandum refer- ring to the April 4 diversiott memorandum ex- hibit went to the National Security Ad- viser seeking that he obtain the President's ap- proval There is a big difference This is not a memorandum to the President 13 I want to make it very clear that no memoran- dum ever came back to me with the President s initials on it or the President s name on it or a note from the President on it None of these memorandums seeking approval of the diversion written to Poindexter I do have as you know in the files that you have of mine many many of my memorandums do have the President s initials on them but none of these had the President's initials on them 19 Col North admitted at the hearings that he had misled Gen Secord when he told him that the Presi- dent was aware of the diversion in order to enhance the General s enthusiasm for the project 20 North also admitted that he had made a comment about the di- version to Poindexter once as they were leaving a meeting with the President but stated that he be- lieved the President had not heard the remark Diversion Memorandums Although their acc0unts of how the diversion was authorized were consistent North and Poindexter had different recollections about the extent to which the diversion had been documented North said he be- lieved he had written five memorandums seeking ap- proval of diversions but that he had later destroyed them Poindexter said he did not recall seeing most of these memorandums although he thought it was pos sible that he had seen the original of the surviving April diversion memorandum and then had destroyed the section that dealt with the diversion However the references to the diversion apparently usually oc- cupied one or two paragraphs in a multipage docu- ment Given the amount of paper normally flowing through the National Security Adviser s of ce it Id Through what is a surprising oversight to put it mildly the majority's account of North s testimony about the President's tele- phone call to him on November 25 as it relates to the diverSIon completely omits North's testimony about Earl's statements about that telephone call North testi ed that he did not recall having said to Earl that the President had said It is important that I not know North continued am sure that what I said to Earl was basically what I told you yesterday wouldn't have charac- terized it the way you have just indicated Earl testi ed I don't believe North at 93 In short North's first hand account disagreed with Earl's hearsay testimony and North dented having given Earl the account Earl recalled 553 Chapter 0 would not be surprising if Poindexter had simply for- gotten or overlooked these rcferences In any event the Committees have no evidence to suggest that any of these North memorandums which Were addressed to Poindexter ended up going to the President The Committees actually have some docu- mentary evidence supporting the testimony that they did not go to the President Poindexter s practice on some occasions was to brief the President orally with respect to what he considered to be the key points of memorandums such as the one supporting the January Finding That is probably what he did with the April diversion memo using the Terms of Reference portion that did not contain a reference to the diversion 23 Hogan and Meese The case for the view that the President did not know about the diversion does not rest solely on the corroborated sworn testimony of Poindexter and North The Committees also have sworn testimony from former Chief of Staff Donald Regan and Attor- ney Genera Edwin Meese concerning the President's reaction when he was told of the diversion According to Regan s graphic description the President s reaction was Deep distress deep distress You know the ques- tion has been asked I've seen it in the paper time and time again did the President know Let me put it this way This guy I know was an actor and he was nominated at one time for an Acade- my Award but I would give him an Academy Award if he knew anything about this when you watched his reaction to express complete surprise at this news on Monday the 24th He couldn t have known it 24 At his deposition Regan testified as follows Q And do you recall what the President's reac- tion was to learning about the diversion A Horror again and thinking back on it it is hard to it is like a person was punched in the The majority makes a strained effort to fabricate a con ict between Poindexter and North over whether North was told not to create written records of the diversitin To do this the majority must ignore Potndester's testimony at his private deposition given before North s appearance that he might have seen the diversion memorandum at or about the time it was written Poindexter Dep 5 2f37 at see also Poindexter TESL Hearings nos 7 16 at Ill-l l3 Further at the hearings as the majority also fails to nore Poindexter stated 1 do recall telling North when i took the decision the rst time that I didn t want anybody else to know about it I don t recall telling him not to put it on paper but I thought Colonel North understood from earlier discussions with him to limit the amount of paper that he prepared id at emphasis added Poindexter testi ed further that North prob- ably prepared the diversion memorandum at his request Uri at 1 l4- I 554 stomach I mean the air goes out of him crest- fallen You know a slumping in the chair sort of thing A real blow had been delivered here that not only was there this possibility of a diver- sion but that they people responsible were pri- marily Ollie North for whom the President had high regard as a staff person and the Attorney General told the President that Admiral Poin- dexter had some type of inkling of this and should have investigated but didn t 25 Attorney General Meese testi ed at his deposition Q And what was the President s response to being told about the diversion A Well he was very much surprised I would say shocked as was Don Regan Q Do you recall what he said the President A I can't remember exactly but it was some expression of surprise 25 Meese's testimony at the Committees public hearings on this point was to much the same effect 27 Conclusion From all of this evidence it is clear the President did not know about the diversion A contrary conclusion would have to be based on the view that a series of individuals including the President decided to engage in a criminal conspiracy to cover up the Presi- dent s knowledge and then to lie about it in a well- coordinated manner in sworn testimony much of it given under grants of immunity protecting the witness from use of the testimony against him for anything except a perjury prosecution The Committees have no evidence of any kind that would lend the slightest support to this contrary view Who Else In The Government Knew About The Diversion Col North testi ed that he told Robert McFarlane about the diversion at the end of the trip to Tehran in May 1986 McFarlane was by then a private citizen and there is no indication he participated in planned or authorized the diversion McFarlane has corrobo- rated North s testimony on this point In addition North testi ed and Robert Earl agreed that Earl knew about the diversion 3i North also testified that Director Casey knew about the diversion Casey denied knowledge of the diver- sion to Members of Congress shortly before he en- tered the hospital In addition when Director Casey learned that there was a possibility that someone had diverted funds from the Iran arms sales to the Con- tras Co North assured Director Casey and Deputy Director Robert Gates that the CIA was not involved in the diversiOn Finally Casey tried to alert Poin- dester to the possible problems that were presented by such a diversion and suggested he seek legal coun sel to deal with the situation These can either be seen as efforts indicating that Casey did not know about the diversion or as efforts to convey an understand- ing to Gates and others suggesting that he did not know about it in order to conceal the fact that he did Whether or not Casey knew and we are inclined to believe that he did one thing is clear Casey's knowl- edge or lack thereof is not in any way indicative of what the rest of the CIA may have known about the diversion since it is quite clear that Casey had infor- mation that he shared with no one else there The Committees have no substantial evidence that other CIA personnel did know about the diversion The CIA and operatives who were involved in the Iran Operation did have reason to know that there was a spread between the cost of the weapons pur- chased from the Government and the price being charged the Iranians for them However their evi- dence on this point was equivocal and made it dif - cult for them to know how large this spread was in some of the transactions In addition the fact that there were several intermediaries meant that even though they knew there was a potential for a diver- sion in the sense that there would be excess funds they did not know where the excess funds were going In this connection it is important to remember that the National Security Council not the CIA actu ally managed the Iran arms sales operation There- fore the CIA did not have reason to follow the details in the way they would have done had they had been managing the transaction themselves We have no reason to disbelieve the consistent unequivo cal denials of CIA personnel that they did not become aware of any possible diversion of funds to the Con- tras until very late in the day and did not know that NSC personnel were involved in the diversion of funds Finally the Committees have no evidence to sug- gest that other US Government of cials were aware of the diversion Did The Diversion Cause 0r Interfere With The Iran Initiative The Iranian government clearly paid higher prices for US weapons than the United States would have charged other governments From this some have drawn the conclusion that the diversion must inher- ently have interfered with the Iran initiative because better relations between the two countries could not be based on higher than necessary prices for US Chapter 10 weapons In addition some have suggested that gen- erating surplus funds for the Nicaraguan Resistance was the main motive for moving ahead with the sales The ClucsliOH of motive was considered at length in the previous chapter What we have just shown about the diversion only strengthens what was said there In our view the record supports neither of these posi- tions Since there is no evidence that the President or any other major US government decisiOnmaker knew about the diversion through the time of the January 1986 Finding it would make no sense to argue that their thinking was influenced by this con- sideration The previous chapter also gives the lie to the idea that the diversion or overcharging adversely af- fected the success of the Iran initiative If the Second Channel representatives were upset at the prices ne gotiations would hardly have proceeded as we have described In fact Gen Secord speci cally testi ed that he was told by Iran that the price was not an important issue for the Second Channelzg As we have already noted the price was not much higher than the replacement cost In any case the Iranians were in a war they needed the weapons and there was no other place to buy them As Adm Poindester pointed out the Iranians had already paid Israel es- sentially the same premium price the United States charged He therefore did not think they would be concerned about the U S price North s testimony corroborated this point The fact is that we knew that the Iranians would pay even more than we charged from intelli- gence that we had gathered We knew that during the first channel for example Mr Ghor- banifar had a little frolic and diversion of his own going in which he had pocketed at least some for himself if not for others a considerable sum And that even the prices we charged he further inflated And so we judged that risk the risk to the hos- tages from overcharging to be minimum given that they would be basically pay whatever they could to get these items or weapons from the source that whatever source they could For these reasons both Poindexter and North re- jected the idea that the diversion materially affected the prospect of achieving a new relationship with the Iranian Government 32 The concern the Iranians ex- pressed about overcharging in connection with the Hawk shipment is not necessarily to the contrary Enterestingly some of the same people who make the argument that the diversion hurt the chance for the Iran initiatives success also want to say that the initiative had no chance for success in the rst place It is as if they know the policy must be bad for some reason so why not offer some inconsistent reasons to see if any can he supported 555 Chapter 70 They were concerned that their own representative Ghorbanifar was pro ting from the overcharging This does not mean that the United States could not have continued to charge these same prices since the Iranians had no practical alternative but to pay them 33 Some Legal Questions Growing Out Of The Diversion The technical legal questions surrounding the diver sion appear to us to turn on the issue of ownership If the money was rightfully the property of Gen Secord and Albert Hakim then it follows that they were free to donate the excess proceeds to the Resist- ance or use it in any other legal manner that they wished They may have felt a moral obligation to use the money as suggested by North but they would have been under no legal obligation to do so If however the funds belonged to the United States it follows that the money should have gone into the Treasury of the United States and could only be sent to the Nicaraguan Resistance under the terms of an authorized disbursement Sending the money to the Contras would not technically have been a viola- tion of the Roland Amendment even under these con- ditions because the funds were not appropriated But if the funds were technically the property of the United States then the Executive had no authority to direct how it would be spent except under an appro- priation or some other legal authorization Substantial legal arguments can be made to support and oppose each of the conclusions about who owas the Enterprise s funds In support of the view that the funds belonged to the United States it can be argued that Secord was acting as an agent of the United States The facts that the price to Iran for the arms was set in c0nsultation with North that the United States selected Iran as the ultimate buyer that the United States anticipated that the sales would trigger Iranian help in the release of American hostages held in Lebanon that Secord and Hakim represented them- Three transactions are at issue In February 1936' Ghorbanifar provided Khashoggi With four postdated checks for $3 million each Hhashoggi deposited SID million in the Lake Resources ac- count eontrolied by Hakim and Sword The CIA then received its contract price of $3 7 million for LOUD and certified the availability of the funds to DOD The certi cation and payment of the amnum to DOD initiated the transfer of the to the custody of Secord who arranged for their transportation and deliv- ery to Iran Thereafter Iran transferred $7 35 million to the Lake Resources account which was supplemented by $5 million from Israel stemming from the abortive HAWK missile shipment in Nmember NBS Hhashoggt was repaid $12 million from Lake Resources leaving a profit for the Enterprise of Sb 3 million less the cost of transportation of the TOW's The same general method of financing was employed tn the transfer of 1 008 and HAWK spare pathr in May With Augusl Who and October till-lb The aggregate surplus to the Enterprise In dtspute approximates 5H 5 million 555 selves as spokesmen for the United States at various times that Seeord did not expect to make a profit from his services and that North and Secord both expected that any surpluses would be used to further U S interests all support the contention that Secord was an agent and that the surplus funds were the property of the United States On the other hand there are substantial facts to support the conclusion that Secord was purely an independent contractor with his own risks of pro t and loss Secord was never designated formally in writing or otherwise as a U 8 agent Any argument that they were agents has to be based on a theory of c0nstructive trust rather than from some facts that will show an explicit written trust relationship In addition Secord claims that although North gave him suggestions and he listened he made all the decisions and therefore had the control 35 One relevant fact that would support the conclu- sion that the United States did not have an automatic claim to the funds would be the fact that the CIA and DOD were paid the full amount the law requires for the arms and refused to transfer the weapons until full payment was received That fact would not settle the issue however because the price the Defense Department set was based on the knowledge that the first buyer was another Government agency the CIA The real question of ownership does not turn on the relationship between Defense and CIA but between the CIA or NSC on the one hand and the Enter- prise on the other It does seem relevant on Secord's side of this argu- ment that the Enterprise assumed all of the major nancial risks of the operation For example if the arms were destroyed during the shipment because of an air crash or otherwise there was no agreement that the CIA would restore to the Lake Resources account the payment previously received Similarly if Iran was dissatisfied with the arms and refused to pay as occurred with the transfer of Israeli arms in November lQSS there was no understanding that the CIA would repurchase the arms for the amount previ- ously paid 35 We have not attempted to resolve this legal ques- tion of ownership because it is not within the charter or province of the Congressional Investigation Com- mittees to do so It is a matter for the courts to decide We do however believe that even if Secord and Hakim were not agents under the technical terms of the law they nevertheless received the arms sale proceeds only because there was an expectation be- tween themselves and North based on trust that they would put the money toward mutually agreed-upon public ends Whether legally required to do so or not therefore they ought to feel some moral obligation to turn the surplus over to the United States after de- ducting reasonable costs and compensation for serv- tees Chapter 10 Conclusion The diversion has led some of the Committees Mem- bers to express a great deal of concern in the public hearings about the use of private citizens in covert Operations in settings that mix private pro ts with public bene ts We remain cenvinced that covert op- erations will continue to have to u5e private agents or contractors in the future and that those private par- ties will continue to operate at least partly from pro t motives If the United States tries to limit itself to dealing only with people who act out of purely patri- otic motives it effectively will rule out any worth- while dealing with most arms dealers and foreign agents In the real world of international politics it would be foolish to avoid dealing with people whose motives do not match those of the United States Nevertheless we do feel troubled by the fact that there was not enough legal clarity or accounting controls placed on the Enterprise by the NSC Whether viewed with foresight or hindsight and regardless of its legal status the decision to use part of the proceeds of the Iran arms sales for the bene t of the Contras was extremely unwise Even if the diversion is determined by the courts to have been legally permissible it was the result of poor judgment on the part of US Government officials The deci- sion to proceed with the Iran arms sales was itself fraught with great potential for controversy and dis- agreement There was no sound basis whatsoever for adding to the political risks of the Operation by bring ing into it another hotly debated aspect of American foreign policy It was equal folly not to tell the President of the planned use of the proceeds of the arms sales The question of legality aside the President should have been given the opportunity to exercise his own good judgment to instruct the participants not to allow the diversion The diversion decision was not the first time an unwise operation has been undertaken in the conduct of American foreign affairs and unfortunately it un- doubtedly will not be the last At a minimum the decision should generate a fuller awareness in the executive branch of the serious negative rami cations of risky and short-range decisions that have not had a full airing in the Presidential office let alone in the halls of Congress The decision also serves to underscore the tremen- dous pressures placed on the Chief Executive and his staff in carrying out an effective and coherent foreign policy in Central America or elsewhere when Con- gress unnecessarily and unwisely abuses its power of the purse to manage foreign affairs with an inconsist- ent on again off-again policy Congress needs to learn that to be an effective participant in the eld of for- eign affairs it must afford Presidents from either party the latitude to plan and implement an effective foreign policy based on clear decisions that are free from annual change When Congress learns this the world will be more stable for us and our allies 557 Chaprer 10 Endnoles 1 Almrney General s Press Conference of Nov 25 1935 pp 2 7 E1 Hearings 2 Sara Fritz and Dayle Inquiry Tracer- Mil- lions in Iran Sales to Contras The Los Angeles Time-5 March 2 3 Seemd Test Hearings 1110 Shir 37 at 95 96 4 Seer-rd Tent Hearings 10041 at 35 5 Secord Tush Hearings 1004 at 158 1th f1 Norlh Test Hearings Part I at 7 Nurlh Tesl Hearings Part I 7 82 87 at 106 10 32 at 295 96 Part II Fifi 31m 164-65 8 2a 11295 Paindexler Test Hearings 11 35 Pain demer Den 5f2 37 at 69 20 11 Numb TesL Hearings IUD-T Part 1 at 159 11 Poindexler Den 5 2 82 at 10-21 12 l'aindenler Den Sill 87 at Paindexter Tesl Hearings at 35 32 13 Norm Test Hearings 1110-1 Part 1 7 3 81 31 115 and 7 93 37 a1 2411 245 1-1 Den 5 2 87 at 7131 21 Pnindexter Tenn Hearings 100-8 7 15287 at 37 38 15 I nindexter Den 5 2 31 11 72 7 16 Paindexler Den 5 2f87 at 232 553 17 Thompson Den 7 24 32 at 66 63 70 18 Team Hearings Pan 1 WNW at 13 19 Id 31 I2 20 id 11 21 Pnindexter Den 5f2i'87 at 173-79 Paindexler Tesl Hearings IOU-3 TKISXST at 44 45 22 See Poindexter's handwritten notes Ex Hearings 100 7 Part II 23 Paindexler Test Hearings 100-8 7 151 37 31 44 45 24 Regan Tetslu Hearings 100'- I0 at 29 25 Regan Dep 7 15 87 at 2h Mee e Den at 1-H 27 Meez-ie 'I'e51 Hearings 10041 28 37 11 251 23 Earl Den 51 2 32 at 32 29 Seenrd Teal Hearings lG -l at 13-1 30 Paindexter Dep SHEET 11 133-34 31 North Test Hearings Purl II 7i13f37 at 89 32 Poindexler Den at 133 84 North Te tu Hearings 100-7 Part 1 2 9 87 at 215 33 North Te5 Hearings Part II at 89 34 See 3 Am Jur 2d secs l'i 22 35 Secord Test Hearings 100-1 SHIRT at 250 36 See Uniform Commercial Code See 2 401 2 501 2 509 Part Disclosures and Investigations Chapter 11 From the Disclosure to the Uncovering On Tuesday November 4 I986 the New York Titties carried a front page story disclosing a portion of the Iran initiative Only three weeks later on November 25 1986 the Attorney General of the United States announced that officials of his department had discov- ered a diversion of funds front that initiative to the use of the Nicaraguan resistance This chapter de scribes our view of the events of November 1986 We reach three principal conclusions First the President's decisions about how much to disclose were motivated by his effort to balance the need for protection of hostages and secret diplomatic discus- sions with the public s need for information Second once the President decided that the Administration did not have a complete picture of the Iran initiative the Attorney General undertook an aggressive effort to obtain the facts He then made the information available to the President and to the public Third the President and the Attorney General discov- ered and disclosed the essential facts despite efforts on the part of certain members of the NSC staff and others to cover up certain events including the diver- sion There is no evidence that the President directed encouraged or in any way condoned this coverup a point the majority spares no effort to gloss over In our opinion the Attorney General and his associates did an impressive job with a complicated subject in a very short time Far from being inept or parties to a cover up the Department of Justice was responsible for uncovering the diversion of Iran arms sale pro ceeds to the Contras Early November The Iranian initiative was disclosed for political rea- sons by high level dissident Iranian religious of cials The New Ibr Times report was based on a report from 3 Lebanese weekly Al-Shiraa Its report was in turn based on a politically inspired leak front Iranian dissidents bent on retaliation for efforts by the Iranian Government to curb their support for wide scale ter- rorism and possibly to reach an accommodation with the United States At least one of the key dissidents has recently been executed by that Government For more details see asterisk in Chapter 8 at 520 7'7-1326 87 American of cials had learned of the pending dis- closure of McFarlane s May trip to Tehran at a secret meeting in Europe a week before the disclosure ap- peared in the press Their immediate concern was for the lives of remaining American hostages They also wanted to continue the secret discussions as did offi- cials of the GOvernment of Iran In addition there were serious questions about the impact of the disclo- sures on a significant American ally Israel During the week after the New York Titties story there were vigorous disagreements within the Admin- istration about what if anything the Administration should disclose about the Iran initiative As the situa- tion was later described by former Chief of Staff Donald Regan I recall discussing with other members of the staff The cover is blown here We have got to go public with it We have got to tell the Con- gress we ltave got to tell the American public exactly what went on so they were aware of it Mr Smilijanich What did Admiral Poindeatcr recommend Mr Regan His recommendation was Absolute- ly not It was later reported in local papers here that we had a shouting match W e did have a difference of opinion a strong one His reasoning was a good one that Jacobsen had just come out as a hostage North was preparing to go to London and actually did go to London that first weekend in November what was it the 8th or 9th in through there to meet with Iranian of cials and theres a possibility of two more prisoners coming out two of the original ones and maybe even the additional three the later Ones And why blow that chance We got to keep the lid on this we got to deny it we're endangering their lives And then I might add here a very dramatic thing happened I recall it vividly Jacobsen had a Rose Garden ceremony welcoming hint back He had said in his remarks he had cautioned the media about discussing this On the way back as the President and he were mounting the steps to 561 Chapter 7 the colonnade to go back into the Oval Of ce there were shouted questions frOm the media about What are you going to do about the hostages what about the others that are there And Jacobsen turned and very emotionally said For God s sake don't talk about that that is exactly what I have been saying you are endan- gering lives of the people I love these are my friends That made quite an impression on the President And even though that same day urged him again to get this story out he said No we can't Den ' he said We can t endanger those lives And he didn t 2 Regan s testimony shows the Administration s con- cern for the hostages North s notes of a meeting with Iranian representatives on November 7 three days after the New York Times story show both the desire to continue the negotiations and a concern for the hostages Holding to no comment e We recog nize that public statement RR admit ting mtgs w 2d Channel wd be dangerous for you and Speaker Need to know WTF going on -Press release - Second Channel told in Frankfurt 2 host two hos- tages November 10-20 Public pressure for an account of the Administration s dealings with Iran led during November to meetings a speech and press conference by the President and testimony by various Administration of cials before Congressional committees Questions were raised both inside and outside the Administration about the Ad- ministration s compliance with civil statutes governing Executive-Legislative branch relations in the conduct of covert activities and arms transfers The President and his advisers continued to grapple with the ques- tion of how to balance the diplomatic concerns just described with the need for public disclosure According to Regan's notes of a November I0 meeting the President opened the discussion with a statement to the effect that as a result of media etc must have a statement coming out of here Some things we can't discuss because of long term consider- ations of people with whom we have been talking about the future of Iran 3 At that same meeting Poindester made a presenta- tion on the history of the Iran initiative that omitted is interesting to note that while the President and his staff were wrestling with the question whether to disclose the mission and thereby jt l Pttl dliC the hostages the leader of the Government of a close all in that part of the world had a senior aide call North to ask the President and l omdestcr to flatly deny that there had been an operation such as the one reported about McFarlanc tn Iehran liar Dcp 562 or misstated certain facts Poindexter also noted cor- rectly the fact that the Iranians wanted to continue contacts despite news reports Poindester noted that North had met with Iranian representatives the previ- ous weekend that Iranians happy with our no com- ment Raf will have to speak out due to world press comments 5 At a later point the President noted We should put out statement but cannot get into 8 a re hostages so as not to endanger them 6 In the period between November 10 and November 21 the Administration continued to try to balance its concern for the hostages and the Iranian initiative with the need for public disclosure The President addressed the nation on November l3 and then agreed to answer questions concerning this matter on November 19 The drafting of the speech and the Presidential press conference preparation on these issues were done by the National Security Council staff acting under Admiral Poindexter s direction Some of the information provided during thoSe events was incorrect However the speech and the Presi- dent s answers at the press conference provided basic information concerning the initiative from the Presi- dent's point of view while attempting to withhold certain information in order to protect diplomatic sen- sitivities such as the role of the Israeli Government T There is evidence that the President and most re- sponsible Administration of cials were trying to keep the public record accurate For example the White House issued an immediate correction with respect to one factually incorreCt statement the President made at the November 19 press conference Regan testified that this inaccurate statement resulted from the Presi- dent's confusion about what information could be re- vealed without causing national security problems R By this time however Secretary Shultz had conclud- ed based on the November 13 speech and November 19 press conference answers that the President was beittg misled on some key facts by certain members of the NSC staff and sought a meeting with the Presi- dent to explain this to him in detail The meeting occurred on November 20 During Shultz's meeting with the President they reviewed what Shultz believed were a number of inaccurate or misleading statements the President had made concerning the Iran initiative 1r The State De- Regan Test Hearings Hill-ID Tfilfl at 23-25 The effort to show that the President made inaccurate statements at his press conference completely ignores the fact that lsrael's involve- ments in U S sales of arms and direct sales of arms were then regarded as diplomatic secrets which should be concealed to pro- tect Israel's securtty Several of the President's other arguably inac- curate statements made then were clearly based directly on infers matron given to the President by certain members of the NSC staff The majority makes much out of the Secretary s battle royal with the NSC to get out the true facts it is worth noting In this connectton how much of the disagreement at the tune rested on matter - such as differing interpretations of Intelligence reports stra- partment brie ng paper prepared for this occasion went through these matters in considerable detail in- cluding comments on such matters as the legality of various arms transactions possible political connec- tions which might be drawn between lran and Nicara- gua and so 011 9 The points in Shultz's brie ng paper were designed to give the President what Shultz be- lieved to be a more accurate picture of the political history and rationale for the iran arms deal Shultz described the meeting as a long tough discussion not the kind of discussion I ever thought I would have with a President of the United States But it was bark off all the way 1 Testimony and Chronologies The need for additional detailed information on the Iran initiative was intensified by the need to testify before the Intelligence Committees on November It became clear that the Administration had only an incomplete institutional memory on the origin and conduct of that highly compartmented initiative and that different participants had conflicting memories of certain key 1935 events The events surrounding the creation of false and misleading chronologies have been discussed in detail during the hearings and there is no need to review the matter here These chronologies misstated the fact of the President's authorizatiOn for the I935 arms ship ments the Israeli participation in those shipments and contemporaneous knowledge by United States Gov- ernment officials of the nature of those shipments it is suf cient to note that the preparation of these mate- rials was almost exclusively the work of then present and former members of the NSC staff particularly North and McFarlane Their false presentation of these events appears to have been acquiesced in either knowingly or unknowingly by Casey and Poindexter The later versions of the chronologies and the dis- cussions of draft Congressional testimony led some Justice Department of cials to realize that they did not know some of the signi cant facts about the initia- tive The Department had been involved only tan- gentially in the initiative and in responding to issues raised by the public disclosure The Department offi- cials also realized that certain other facts concerning the I935 arms sales were disputed among the partici- pants In response to these Justice Department con- cerns Casey altered the draft testimony he had pre- tegic motives and similar matters of judgment July with hindsight is it clear that concerted efforts to slant the facts rather than honest differences of recollection or judgment were involved in many cases This is a fact that a dispassionate student of events would be well advised to consider Chapter It pared for November 2 to omit false statements that might otherwise have been madc Justice Department Investigation 0n the late evening of November 20 986 Justice Department officials alerted Attorney General Meese about the factual dispute between various participants in the Iran initiative on certain key events surround- ing the 1935 arms sales They indicated that a lot of people had different recollections and that the situa- tion was pretty well fouled up because of that There was no suggestion of intentional wrongdoing and Meese did not think that was the situation de- scribed to him then The majority report agrees On the morning of November Meese suggested to President Reagan that the President should author- ize Meese to conduct an investigation to pull together an account of all the facts The reason was to support a review of the initiative at a meeting of the National Security Planning Group scheduled for Monday No- vember 24 1986 Accordingly the investigation was conducted over the weekend of November 21-24 19% 12 At that time the Attorney General had no reason to believe that any crime had been committed l The simple fact is that the statutes that might possibly have been bypassed by the arms sales were not crimi- nal For those who would argue that the investigation should have been a criminal one from the first it is worth noting that a Justice Department Criminal Division memorandum prepared independ- ently and dated November 22 IQSB reviewed these The majority are at some pains to show that North attempted to falsify this Casey testimony North claimed his proposed changes were a reaction to CIA drafts and that he and Casey made changes to remove af rmatively untrue statements before the Department of Justice intervened We are uncertain whether to believe North on this point or not but note that exhibits and ULNJD tend to support his version of events ' Cooper did not know who was right or wrong Maj Rept Ch The majority states that MeeSe had been apprised of the specifics of this dispute earlier on Nov 20 by Deputy Attorney General Burns after Burns had been informed of the problem by State Department Legal Adviser Abraham Sofaer The facts are otherwise Meese and Burns spoke on an unsecured car telephone line while Meese was en route to the airport Burns was very general in describing the problem while Meese was equally general in assuring him that as a result of the meeting he had just left problems had been resolved Meese Dep at Meese was not given speci c information showing the inaccuracy of the prOposed testimony at that point In any event within a few hours Justice Department officials who stayed involved in the process discovered the conflict and informed Meese who decided that the Casey testimony should be altered See Meese Tesl Henr- ings till-9 at iris-2st TThe Attorney General has extensive criminal investigation and prosecutiOH experience See Meese Test Hearings IUD-9 at 263 ttludeed the Attorney General discussed the matter with FBI Director Webster on Friday afternoon and both agreed it would be premature to involve the FBI in an investigation at that point 563 Chapter 3' statutes and reported no basis for criminal prosecution based on information then The Attorney General s brief investigation received exhaustive scrutiny during the course of the hearings both during his own testimony and that of Assistant Attorney General Charles CODper That investigation has been criticized on a number of points We think the criticisms are without merit The Attorney Gener a1 assembled a team of competent attorneys two of whom in addition to him had been con rmed for their jobs by the United States Senate and all of whom had directly relevant responsibilities within the De- partment of Justice for national security matters to conduct the fact nding inquiry On November the Attorney General personally requested that the National Security C0uncil make available to his staff all relevant documents concern- ing the lran initiative The investigating team pro- ceeded to interview all material witnesses with re- spect to the 1985 arms sales 15 Witnesses were repeat- edly instructed by then that the President s interests would be best served if the Attorney General were given a full and accurate account of what hap- pened Yet McFarlane North and Poindexter made false misleading or inaccurate statements to and cun- cealed directly relevant information from the Attor- ney General and his representatives DeSpitc this the Attorney General s investigation unc0vered the es- sential facts that are still the essential facts today 17 Although the Committee majority makes much of its purported discovery of the Enterprise that network of shell corporations and secret bank accounts really represents the mechanics of the diversion the Attor- ney Genera discovered and little else in the course of the review of documents on No- vember 22 Justice Department officials discovered a memorandum that showed a plan that part of the Iranian arms sales proceeds were to be used to sup- port the Nicaraguan Democratic Resistance pro- vided no evidence that the plan had been carried out 'Mcese 'l'est Hearings IOU-9 23 137 at 200 The majority makes a halfhearted effort to imply that the FBI or the Criminal Division of the Department of Justice should have been called in earlier than they were possibly even as early as November The majority's reasoning ignores the following points The facts on which the majority relies such as the Casey testimony arid possible Arms Esport Control Act violations were not criminal in nature at least so far as could reasouably be determined at the tinte Even more importantly the majority utterly ignores the fact that the Attorney General speci cally testified that he had consulted former FBI Director Webster and the tOp leadership after the disclo sures occurrcd and had been assured that their view was that Meese had acted properly Webster also took this position at his con rmation hearings See Meese Test pp 281-282 29 - 292 Finally the majority ignores the fact that the head of the Criminal Division also a political appointee testified that his con- cerns about Criminal Division involvement which were not es- pressed to the Attorney General al the time were based on existing Criminal Division court actions unrelated to the Iran initiative and to management issues not matters of propriety rir judgments about evidence of criminal conduct See Weld Dep Trio 3t at 13-20 564 They immediately arranged to interview North the next day Sunday and waited until the end of that interview to confront North with the memorandum Meese speci cally testi ed to North s surprise on being shown the memorandum After North had con- firmed that a diversion of funds had fact occurred the Attorney General and his associates undertook to determine who knew about and who might have authorized such a diversion We think that the suggestion that the Attorney General s investigative procedures changed in some irregular manner after the discovery of a possible diversion is particularly unfair We encourage any reader who is interested in this issue to review the colloquy on this subject between the Attorney Gener- al and Senator Mitchell in which Senator Mitchell raised this issue and then dropped it after the Attor- ney General directly challenged him for doubting Meese s testimony about it The allegation has also been made that Department officials disregarded other evidence which came to their attention con- cerning the possibility of such a diversion such as the use of Southern Air Transport in both the Iran and Contra Operations The question is moot because the JustiL c Department in fact quick- ly discovered the first hard circumstantial evidence that members of the NSC staff had been involved in a diversion the diversion memorandum itself However a close examination of this alleged evidence shows that it was speculation communicated in a vague general way which related to a physical or political connection rather than to evidence of financial diversion See Sofaer Dep if Iii 3 at 63-70 Meese Test Hearings 1039 7 18 37 at ETD-TI 27 at 414-45 Although there was some speculation by of cials at the Dcpartment of State and the Central Intelligence Agency based on price differentials about some type of a diver- sion there was no evidence to suggest that the funds had gone to Nicaragua or that the disposition of any surplus was being directed by certain members of the NSC staff The majority attempts to bootstrap the fact that some of this vague information may have been conveyed to the Attorney General into an attack on the truthfulness of the Attorney General's account of his meeting with Director Casey on November 22 The members of the majority are much holder in a report which the Attorney General never saw before it went into print than they were when he testified and therefore could respond to similar cheap shots Suf ce it to say that the Attorney General has consistently and credibly recounted events at this meeting where appropriate in his testimony in various fOrurrls including our public hearings See Meese Tower Board Test 20 337 at 32-33 Meese Dep 7 8 37 at ill-123' TESL Hearings lOfl-Q 7f23fti7 at llJ-llSl He testi ed he made a deliberate decision to protect his investigation by not asking Casey for information before confronting North iti our view this was a correct and successful decision See Meese Test Hearings 100-9 p 218 Meesc Test Hearings lOO- i TleJE'i p 33l-334 The majority ignores the fact that virtually all of the interviews involved lasted only a few minutes took place hurriedly between other meetings and involved only a couple of basic questions - who knew of the diversion and who authorized it See Meese Test p 230 The majority also ignores the fact that Meese's accounts of these meetings have been corroborated in substance by the living partici- pants who have been questioned by the Committees The majority's sporadic efforts to suggest coaflicts are strained to put it mildly A classic esample of the majority's reaching is their statement Meese met alone with Regan and the President Chapter 1 The Attorney General's November 25 press confer- ence report was based principally on admissions made to him on November 23 by North At the press con- ference the Attorney General repeatedly made clear that there were a large number of matters on which his information was uncertain and subject to addition al review and correction At that time Justice De partment of cials were not aware of any document shredding or altering by North and others As McFar- lane testi ed although he did not participate in the shredding he did not inform Meese that North had told him it might occur Similarly Justice Depart- ment officials had no immediate way to determine that several of these of cials gave them misleading or inaccurate answers to their questions The majority's pointless cavilling about this press conference is very much indicative of the quality of their work in this area As noted despite this attempt at a coverup by certain NSC of cials the Attorney General's investi- gation turned up the facts that are still the essential ones today There is no evidence that the President directed encouraged or otherwise in any way condoned a c0verup We reject as completely unsupported by the record any suggestion that the Attorney General or his staff ignored signs of potential criminal behavior or consciously sought not to obtain information in an effort to assist or protect the President After intense scrutiny by two Congressional committees with a very large staff it is clear that the Attorney General and his staff conducted themselves honorably and dis- closed to the President and the public their ndings without regard to any political damage which would ensue On December 4 1986 at the request of the Attorney General a motion was led with the Special Division of the Court of Appeals for the District of Columbia Circuit seeking the appointment of an Independent Counsel 565 Situatvteir I I Endnotes 1 lhsan A llijazi RelE bt' 1h Linked to Shift in Iranian Policy New York Times November 4 1936 Al A 10 Regan Test Hearings lflO-lf at 21 22 Regan notes of November 10 meeting Ex Hearings lUfl-lfl Regan Term Hearings lDfl-ll at 23 Ex BITE-41A rt 5 Hearingi' Ex p 9 Hearings See p 562 Regan Tent Hearings at 24-25 Ex GPS-45 Hearings Shultz Test emerge 3 31 at 44 ll Meese Test Hearings at 26 ll It is noteworthy that Judge Sofaer on whose suspi- cions and speculation the majority narrative relies extensive- ly often without describing them as such testi ed that he began to suspect a coverup on the afternoon of November 20 Sofaer Dept at 41-42 This seems as good an 566 indication as any that the Attorney General acted in a timel r fashion The majority s innuendo that the Attorney General did not move aggressively on this matter is utterly belied by the fact that for example one of his staff spent until dawn on Nevember 22 reviewing intelligence reports See Cooper Test Hearings 100-6 6 25 31 at 24-2 and passmi l3 See Meese Tent Hearings IUD-9 at 381 14 Id at 268 15 Ex Hearings Ex Hearings 100- 16 Meese Test Hearings 100-9 at 269 17 Meese Test Hearings 7f28x 37 at 201 quoting Secretary Shullx 13 Meese Test Hearings 100-9 1728 87 at 2 9 at least 40 instances 19 MeFarlane Test Hearings SEIIXST at 130-81 l8 Chapter 12 NSC Involvement in Investigations Introduction The majority chapter entitled Involvement in Criminal Investigations and Prosecutions raises questions about the connection between the work of the National Security Council and traditional law en- forcement activities Unfortunately the majority com- bines carelessly assembled information about matters which any fair-minded person would conclude raise no important issues with scattered and conclusory judgments about matters where real questions ofjudg- ment exist Because of the necessity for accurate and timely information about threats to persons or property posed by those who may wish to cause harm for reasons connected to the foreign policy of the United States the national security community must some- times be involved in pending criminal investigations undertaken by domestic law enforcement agencies The real question is not whether but when and how much involvement is appropriate To answer this question requires a close examination of the reasons for such involvement and the manner in which such involvement is responded to by law enforcement offi- cials The record of the various investigations discussed by the majority shows that law enforcement agencies outside the NSC from the Department of Justice to the FBI and Customs Service responded in an appro- priate manner to requests for investigations prompted by such reasons In addition the record of several of the investigations in which NSC personnel became involved reveals that NSC involvement in these ac- tivities at least at their preliminary stages was appro- priate However their involvement in others was questionable at best The circumstances of each case will determine whether such involvement was appropriate We en- courage each reader to examine the facts of each investigation carefully to make this determination In order to set the record straight we provide a brief review of the investigations related to the Iran-Contra affair in which the NSC staff was involved Basically the majority alleges that certain Adminis tration of cials particularly Colonel North became improperly involved in a number of investigations relating to Contra activities However the majority s highly critical analysis is based on a flawed methodol- ogy In view of the majority's intent to show that Col North acted improperly it is noteworthy that the majority in most cases declined to ask Col North himself during six days of public testimony about these allegations against him During the Committees investigation the majority obtained information on these matters from witnesses who were in contact with North but North was never asked to give his side of these events The majority uses selected entries from North s written notes of conversations and meet- ings but even though these entries are often abbrevi- ated and the majority declined to ask North to explain them Instead the majority attempted to interpret what these notes suggest In light of this flawed methodology the majority s c0nclusions re- garding purported interference with various investiga- tions cannot be considered objective Moreover the following brief discussions of several of these investi- gations demonstrate some additional problems Miami Neutrality Act Investigation The majority has analyzed a charge that a Miami investigation of an alleged conspiracy by a pro-Contra group to violate the Neutrality Act was impeded by officials of the Department of Justice The majority has concluded that the investigation was not aggres- sively pursued However a review of the facts clearly shows that the charge of interference was based on one witness s testimony which was contradicted by all of the other witnesses Further any delays in the investigation were caused by legitimate problems David Leiwant an Assistant U S Attorney in Miami has claimed that he overheard one side of a telephone conversation on April 4 1936 between US Attorney Leon Kellner in Miami and someone at the Department of Justice in which Kellner was ad- vised that the DEpartment wanted him to go slow on a pending investigation of possible Neutrality Act vio- lations According to Leiwant after the phone con- versation ended LLS Attorney Kellner stated that the Justice Department wanted the investigation to go slow and to be kept quiet Kellner reputedly made these statements with a sneer suggesting that he would ignore these requests 1 56 Chapter 12 Leiwant s account of this incident is unsupported by any other evidence In fact every other person who was present at the meeting when the telephone conversation allegedly took place denies Leiwant s version of events In addition to Leiwant ve people were present at this meeting in US Attorney Kellner s of ce On April 4 I986 Kellner Chief As sistant U S Attorney Richard Gregorie Executive Assistant U S Attorney Ana Barnett Special Counsel Lawrence Scharf and Assistant US Attorney Jeffrey Feldman who was handling the investigation All have denied Leiwant's claim that Kellner received a telephone call from the Justice Department instruct- ing Kellner to go slow 2 Leiwant has speculated that the alleged Justice De- partment call may have come from D Lowell Jensen Stephen S Troll or Mark M Richard l but each of these three of cials denies any sueh conversation and further denies knowledge of any attempt to impede this investigation l Leiwant himself concedes was listening to it the alleged telephone conversation with half an ear 5 Also he is certain that he never heard Kellner tell Feldman to go slow 5 It is noteworthy that Leiwant failed to discuss with his superiors this disturbing telephone conversation which he purportedly overheard 1 Instead Leiwant began to discuss this matter with outsiders even though he had neither requested nor received the required departmental approval to disclose anything about this ongoing investigation 3 Within days of the April 4 1986 meeting Leiwant called two Washing- ton Post reporters in Washington DC According to his testimony he mentioned to both of them that he might have inf0rrnation about the Contras and Nicara gua Since they were not very interested he purport- edly did not say much 9 Then in August l936 Leiwant leaked his allegation to John Mattes a defense attorney who represented Jesus Garcia the informant who provided early infor- mation about the alleged Neutrality Act violations Mattes client was awaiting sentencing on a federal conviction and he could have bene ted if his infor- mation led to new indictmentsm Then Leiwant told two investigators from the Senate Foreign Relations Committee Later Leiwant told his story to US Sen- ator John Kerry 11 The publicity generated by Leiwant s actions led to these Committees' inquiry Leiwant has alleged the Neutrality Act investiga- tion was proceeding too slowly 12 Similarly the ma jority has claimed that the investigation was not ag- gressively pursued These allegations ignore several important factors Assistant US Attorney Feidman who was as- signed to handle the investigation was relatively ines- perienced Moreover the information his investigation was eliciting was disorganized and in some respects unreliable Feldman himself described the case as a confused mess 3 For instance a polygraph of 563 Jesus Garcia the convicted felon who provided early information about the reported conSpiracy was incon- clusive and showed deception on an important issue Garcia later admitted he had lied about that issue ll One of the two FBI agents assigned to the investiga- tion testi ed that Garcia provided inaccurate informa- tion 15 and the other agent testi ed that Garcia did not have a great deal of credibility 5 Another example of evidentiary problems was the information provided by witness Jack Terrell Most of Terrell's information was found to be based on hear- say rather than his direct observation Feldman s superiors felt that the investigation needed additional work and that the case was not suf ciently devel- Oped to be presented to a grand jury Furthermore the delay in the progress of the inves- tigation was affected by the press of other investiga- tions 19 In this regard it is noteworthy that the Miami US Attorney's Of ce is recognized as one of the busiest in the nation with limited resources to apply against an ever-increasing criminal caseload Southern Air Transport Investigation The majority also raises questions in another chap- ter of their report about the handling of an Customs investigation of Southern Air Transtiorl The FBI at least began an investigation of Southern Air Transport for possible violations of the Neutrality Act after the shootdown of the Hasenfus aircraft Howev- er Southern Air Transport also provided the air transportation services for most of the Iran initiative This initiative cominued after the Hasenfus shoot- down and in fact produced one hostage in early No- vember 1986 after a shipment of arms involving Southern Air TranSport Whatever the reader concludes about the prOpriety of the actions of the NSC staff in requesting a delay the record is clear that the Department of Justice and FBI of cials who granted it acted entirely properly They were told that the delay was required for the purpose of protecting the Iran initiative They checked to determine whether the ongoing investiga- tion would be impeded and were told it would not be They granted a delay conditioned on the c0nclu- sion that the ongoing investigation would not be af- fected and asked that it be resumed as it was The Attorney General speci cally testi ed that when he was asked to grant a delay he was not told of any connection between White House of cials and Southern Air Transport's work in the Contra resupply operation or of Southern Air Transport's involvement in this Operation 21 lnstigation of Investigations The majority claims North attempted to exploit his contacts with the FBI to attempt to instigate or intensify investigations of people and organizations perceived as threats to the Enterprise lie vvas ulti- mately assisted in this effort by Richard Secord and Glenn Robinette 32 These statements by the majority are false as we shall show below The first instance cited by the ntajority appears to have been based on a good faith but mistaken belief about FBI jurisdicti0n The other two instances cited by the majority where the FBI became involved in a matter in which North had an interest were based on either legitimate human con- cerns or a legitimate desire to protect the life of the President of the United States in the latter instance it is abundantly clear that North did not instigate or intensify any investigation at all In the first instance cited by the majority lorth appears to have suggested in conversation an FBI investigation of certain individuals based on a suspi- cion that a foreign government was secretly nancing or supporting a lawsuit against various United States citizens a matter about which it would have been legitimate for North to inquire for national security reasons and which if true might have constituted a fraud on the courts of the United States North a nonlawyer was flatly told that the FBI did not have the legal authority to investigate such a matter and did not pursue the request The second instance discussed by the majority is based on North s request for an investigation of van dalism and harassntent directed against hint The FBI investigation occurred in May and June I936 North requested the ittvestigation because of incidents of vandalism that had been directed against him at work and at home which he believed might be related to the actions of foreign intelligence sources There is no doubt that the incidents of harassment in fact oc- curred and the appears to have concluded that they might have been associated with the dates of Congressional votes on Contra aide sic 23 They together with threats against North s life which occurred at about this time were sufficient to motivate North to have a sophisticated security system installed around his home at precisely this time 24 While North may have been completely wrong about the source or nature of the vandalism which was being directed against him we do not find any- thing in the record to suggest that North s conduct was based on anything other than a good faith belief that this harassment might have been based on such actions Given North's position in government and the nature of his of cial duties this possibility could not be completely discounted We therefore see noth ing improper in North's having asked the FBI to investigate even though some of the persons who were to have been interviewed for information might have been connected to or involved in political oppo- sition to North s Contra activities since such persOnS were logical sources of information necessary to a proper investigation The FBI itt turn appears to have acted to determine whether there was any possi- bility that North's concerns might have a reasonable basis and then to have dropped the matter But it is the third instance cited by the majority which we find particularly egregious This instance concerns an FBI investigation of Jack Terrell based on the possibility that Terrell had threatened the life of the President The majority sttidely suggests that North was responsible for using the FBI to investi- gate Terrell They say North ultimately hit on a better formula for having such investigations c0n- ducted with Secord s assistance 25 The facts clear- ly show just the opposite and the majority has so clearly disregarded the facts we are forced to ques tion its motives Signi cantly it was the FBI which first independ- ently obtained information about a possible threat against President Reagan This information came from a classified source in mid-1986 The FBI concluded that the threat probably came from Jack Terrell a mercenary who had been associated first with Contra forces and then with pro Sandinista forces 27 The FBI therefore sent a request to various federal law enforcement and national security agencies including the NSC specifically asking them for information concerning Terrell according to testimony by FBI Executive Assistant to the Director liver B Buck Revell 28 The majority completely omits to mentiOn that the Fit asked the NSC for information concerning Terrell By coincidence North was aware that Terrell was assisting the plaintiffs in a lawsuit against Secord and others and that Glen Robinettc was involved as an investigator for Secord in that lawsuit However North and Robinette had never previously discussed Terrell according to Robin- ette North called Robinette and asked if he had any information about Terrell Robinette said yes and North asked him to provide it to the FBI North did not ask Robinette to limit his cooperation with the FBI or to withhold any information from them ac cording to Robinette Robinette thereafter met with the FBI and assisted them in establishing Surveillance of Terrell In any event the FBI shortly thereafter discominued contact with Robinette and surveilled Terrell until it concluded that he was not a threat to the President Rohmelte specifically dented that he was asked to near a wire for surveillance purposes as a former electronic surveillance he was certain he uould have remembered such a re- quesl Robin-cite Dep at 34-36 Revel Dep Vii 87 at 32 so When utters-lewed by the Flil In ecoltectlon with the Terrell matter North disclosed Hohtnettcis acltvities for Secord in connection with the Honda civil lawsun brought by Honey and Attrgan in v Secord was a defendant t't'x l fiib FBI Report of Ullz n interview of North at North acknowledged his involvement In US pulley but dented Secord works for him In short North appears to have 559 Chapter 12 In all of this we are unable to discern anything that resembles a politically motivated effort on North's part to harass Terrell The FBI's information concern- ing the threat was real obtained independently of North and pursued with national security agencies in the normal manner The fact that North knew of Terrell by reputation is nothing but coincidence and we think it is extraordinarily unfair to imply that Colonel North or General Secord acted in this in- stance in any manner inconsistent with their obliga- tions as citizens or employees of the United States We think it is unfortunate that the majority is so bent on pressing the thesis of this chapter that they have included misleading information about this incident in an effort to try to reinforce it Clearly the majority would not want to suggest that anyone who had potentially useful information about a threat to the life of the President should withhold it for fear of later being accused of political harassment The Reward a Friend Investigation The majority has alleged that North and other gov- ernment officials tried to in uence the sentencing of a former of cial in a Central American country who had pleaded guilty to two felony counts in the United States The official had allegedly provided assistance as a friend of the in Central America Yet the only purported result of government support of the of cial was his reassignment to a minimum security prison 31 Such reassignments are commonly requested and granted truthfully disclosed the associations and bias of Rohmette the infor- mation source North provided here North's other reported stale- which the Committee did not ask hint about the hearings appear to relate to the Neutrallty Act issues and were not relevant to the FBl s investigation of Terrell M North denied responsibiltty for funding arming or administrating Contra pro- grams Id at 3 North stated that he was not involved with any covert operations being run in the United Stalecht' are This of cial had previously received of cial recog- nition for his services to the US in the region The majority notes that North was concerned that if the of cial was dissatis ed with his sentencing in 1986 he would break his longstanding silence about the Nic araguan Resistance and other sensitive Oper- ations 32 The majority further notes that North wanted to keep the of cial from feeling like he was lied to in the legal process and start spilling the beans 33 The majority is unable to concede that the of cial assistance to the US may have involved le- gitimate intelligence operations Instead the majority boldly asserts that the NSC staff s ultimate motive appears to have been a desire to prevent disclosure of certain questionable activities Signi cantly the ma- jority never asked North to address the issue of the of cial's assistance to the US Accordingly the ma- jority s suggestion of a cover-up of questionable ac- tivities should be recognized as pure speculation The Fake Prince The majority's main allegation regarding the fake prince is that in 1985 Col North interfered with the bank fraud investigation of this Saudi prince because North was attempting to develop this individ- ual as an asset in the lran initiative and in Contra activities The prince was ultimately discovered to he an Iranian imposter North allegedly interfered because during an FBI interview he requested that an upcoming FBI interview of the prince be delayed for several days so as not to interfere with the prince's intended donation to the Contras Howev- er the FBI report notes In no way does North want to interfere with a criminal prosecution of the prince 3 And the majority concedes that North subse- quently backed down on this request Moreover this alleged interference had no effect on the pros- ecution of the prince for bank fraud Following a plea of guilty the prince was imprisoned Endnotes 1 Letwunl Den WNW at 3 2 Kellner Den 4f3lI 37 at 13-21 Gregurte Den 1'17 l9 20 Barnett Den 7 17 31 at 33-4-1 7 17 at Feldmun Den 4 30 87 at bS- ltl 3 Leiwant Den Evil 87 at ll 39 4 Jensen Den at SS Troll Den at 9 Richard Den at '32 93 S Leiwunt Den 1 2 31 at 13 Leiwant Den 3 387 at 30 Leiwant Den 1 2 31 at 44 45 Leiwunt Den at 29 Leiwant Den 1 2 31 at 33-36 It Den 41 30 37 at S 6 ID Leiwnnt Den at lit-32 l2 Leiwant Den WNW at 2t l3 Feldman Den 4 30 31 at MS I4 Feldman Den 4 3tlf87 at ll 17 18 IS Currier Den 515 3313 13 I4 In Den 5 51 81 11 IT 4 30 81 at 33 13 Gregorie Den at Ill 33 Feldrnan Den 4 30 37 at 31-33 Kellner Den 4130f87 at 46 19 Kellner Den at ll'r' Gregorie Den 7 1773 at 39 42 44 Chapter 3 2 It See Willitnn Webster In Mr Clark etuher WHO regarding Southern Air l'rttn's'purt Cited at Meese 'I'est Heurr'rrgr Inn-9 at TF4 Meese Tent Hearings 100-9 NZBIRT at 231 1 4 22 Majority Repnrt tynescript Chapter 5 at 44 23 FBI le 346-967 2 of WFO teletype to Fill Director 24 See the testimony nl Glenn Rnhinette Robinetle Teal Hearings 100-6 HENRI at nassim North Ten Hearings lDtI- r Vol I at 26-32 25 Majority Reptirt type-script at 47 Ch 5 2t Revel Den at 25426 Revell Den TXISIBI at 2f 28 Revel Den 7 15 87 at It 29 Robinette Den at 33 30 Rnbinette Den at 33 34 Richard Den Wig 3 at I30 32 North PROF note to Pnindexter 33 North PROF note In l'nindexter WITKEIE Ch 5 at 33 34 FBI Interview Memorandum Ex Test Hearr'ngr Part II 35 Memorandum of Interview of Nicholas Harhist 5 22 87 57'1 Part VI Putting Congress House in Order Chapter 13 The Need To Patch Leaks Throughout the majority report much is made of the Administration s concern for secrecy That concern is portrayed almost exclusively if not exclusively as the desire of some Iawbreakers to cover the tracks of their misdeeds We agree that the National Security Council staff under Admiral Poindexter let its con- cern over secrecy go too far We should not be so deceived by self-righteousness however that we dis- miss the Admiral's concern as if it had no serious basis Our national security like it or not does depend on many occasions on our ability to protect secrets It is easy to dismiss the speci c Iran arms sales decisions about exeCutive branch compartmenta- lization and about withholding infermation from Congress for almost a year as having been excessive Everyone on these Committees would agree with that conclusion But unless we can understand the real problems that led the NSC staff to its decision future Administrations will once again be faced with an un- palatable choice between excessive secrecy risking disclosure or foregoing what might be a operation Time after time over the past several years ex tremely sensitive classi ed information has been re- vealed in the media Predictably both Congress and the Administration have blamed each other In fact both are culpable It is important for these Commit- tees to recognize this truth As Secretary Shultz said quoting Bryce Harlow trust is the coin of the realm 1 But trust has to be mutual Some people on these Committees seem to want to bring criminal prosecutions against former Administration of cials for not speaking candidly to Congress It is true that the business of government requires the Ad- ministration to be considered trustworthy by Con- gress But so too must Congress prove itself trustwor- thy to the Administration We do not mean by our focus on congressional leaks to suggest that we turn our eyes from the same problem in the executive branch Executive branch leaks are every bit as serious as legislative branch ones But as long as there is a consensus on this point we do not feel a need to dwell on it here At the end of this chapter we will recommend legislation to help address the issue of executive branch leaks along with our suggestions for the legislative branch There is much less consensus in Congress however about leaks from the legislative branch Those prob lems are real As Representative Hyde wrote in a recent article the fact that the executive branch leaks more does little to get Congress off the hook Proper Congressional transgressions admittedly are relatively rare but so are proven executive- branch leaks In truth only a handful of leaks ever have been definitively traced to their source so lack of proof establishes nothing A partial Senate Intelligence Committee study often quoted by Mr Beilenson reportedly found that journalists referenced congressional sources only 8-9 percent of the time but cited Reagan Admin- istration of cials 66 percent of the time Report- ers may not be entirely candid about their sources But generously assuming that Congress has 2 500 people with clearances as opposed to 2 2 million in the executive branch and the mili- tary reliance on the Senate study forces us to conclude that Congress maintains just over 0 1 percent the number of executive branch clears ances but is responsible for 8-9 percent of the leaks on national security issues Speci cally on average a cleared person in Congress is 60 times more likely than his counterparts to engage in unauthorized We believe that these problems rather than a desire to cover up a supposed lawlessness whose existence we do not concede Peontributed signi cantly to the Administration s posture in 1985-36 Protecting Secrecy in the Early Congress To put the issue in perspective it is to consider how the country's Founders dealt with the problem Those hardheaded realists understood that breaches of security during that perilous revolution- ary period could mean the difference between life and death Consequently only ve members of the Second Continental Congress sat on the Committee of Secret Correspondence the foreign intelligence direc- 575 Chapter 13 torate that was mentioned in our earlier historical chapter The Continental Congress was especially careful about protecting sources and methods For example the names of those employed by the Secret Corre- spondence Committee were kept secret as were the names of those with whom it corresponded Even then there was concern about Congress keeping a secret As a result when the Committee learned that France would covertly supply arms munitions and money to the revolution Ben Franklin and another Committee member Robert Morris stated We agree in opinion that it is our indispensable duty to keep it a secret even from Congress We nd by fatal experience the Congress consists of too many mem- bers to keep secrets To underscore the importance of protecting sensi- tive information the Continental Congress on No- vember 9 1775 adopted the following oath of secre- cy which should still be in effect today Resolved That every member of this Congress considers himself under the ties of virtue honour and love of his country not to divulge directly or indirectly any matter or thing agitated or debated in Congress before the same shall have been determined without the leave of the Con- gress nor any matter or thing determined in Congress which a majority of the Congress shall order to be kept secret And that if any member shall violate this agreement he shall be expelled this Congress and deemed an enemy to the liber- ties of America and liable to be treated as such and that every member signify his consent to this agreement by signing the same This oath was not taken and no less a revo- lutionary gure than Thomas Paine the author of Common Sense was fired as an employee of the Centinental Congress for disclosing information re- garding France s covert assistance to the American Revolution Interestingly Congress then resorted to its ovvn covert action and passed a blatantly false resolution repudiating Paine's disclosure 1 Obviously the Founding Fathers realized that there are some circumstances when a well-intentioned noble lie as Plato put it is a necessary alternative to the harsh consequences of the truth They also believed in pun- ishing leakers a practice their modern counterparts in both the executive and legislative branches need to emulate more consistently Let us move forward in history now to the early years of the Constitution President Washington learned quickly that once information is shared with Congress it is up to Congress often the opposition 'Ft tf all earlier dlse tlssinn of this committee including this quintu- lion sec supra ch 3 p Ht 576 party in Congress to decide when or how it will be made public During the time the Federalists controlled the House they enforced a rule that excluded the public during any debate concerning material sent to the House by the President in confi- dence After the Republicans gained control they changed this rule to allow the majority to vote for public debate on confidential communi cations on an ad hoc basis Soon thereafter the House voted to lift an injunction of secrecy they had placed on some letters sent by the President in confidence A similar rebellion of sorts took place in the Senate after the Jay Treaty was conditionally ratified The President wanted the treaty kept secret until all negotiations were com- plete The Senate voted however to rescind its injunction of secrecy although it continued to enjoin Senators not to authorize or allow any copy to be made of the said communication Both Senators Pierce Butler of South Carolina and Stevens T Mason of Virginia smug- gled c0pies out of the Senate chamber apparent- ly before the secrecy injunction was lifted and on the same day that the Government planned to make the treaty public the Republican Aurora beat it to the punch by printing an abstract of the terms 5 The Leaky 19703 Some things never change and as we celebrate our constitution s bicentennial Congress is still prone to unauthorized and sometimes damaging disclosures The worst period in recent history was during the 19 03 when the legitimacy of the CIA and covert operations were under attack What follows are some examples of alleged congressional leaks during that period Rather than rely on classified material we have chosen here to protect still secret information by relying on accounts from secondary sources The in- clusion of this material is not meant to con rm 0r deny the veracity of the specific disclosures alleged We begin with a 1972 example from Arthur Maass book Congress and the Common Good On April 25 1972 Senator Mike Gravel D AK asked unanimous consent to insert in the Congres- sional Record excerpts from a top-secret National Security memorandum The SUD-page document concerning policy Options in the Vietnam War had been prepared for Richard Nixon in 1969 by the National Security Council staff under Henry A Kissinger The senator's normally routine re- quest was blocked temporarily by minority whip Robert P Griffin R The Senate met on May 2 and 4 in closed executive sessions to con- sider Gravel s request but no decision was reached Then on May 9 Grave without ad- vance notice read into the Record during debate on the annual State Department authorization bill excerpts from the memorandum dealing with proposals to mine North Vietnamese ports an action that had been announced by the President on the previous day Senator Grif n who en- tered the chamber during Gravel s statement criticized him for acting before the Senate had disposed of the question The Senator responded have an obligation to the American people to let the American people have the infor- mation that he Richard Nixon has Congressman Ron V Dellums DCA then ob- tained from Gravel a copy of the full document which he placed in the Congressional Record on May II by simply asking unanimous consent to extend his remarks in the Record without giving any hint of their contents 6 Maass book followed this example with two others from the committees that investigated the CIA In January I976 the House Intelligence Commit- tee under Chairman Otis G Pike D NY sought to make public a report containing information that the White House considered to be top secret The House intervened voting 246 to 124 to block the committee from releasing its report until the President certi ed that it did not contain informa- tion that would adversely affect the nation's intel ligence activities Whereupon Daniel Schorr of CBS News having obtained a CUpy of the report presumably from a House member or staffer gave it to the Village Voice which published it thereby frustrating an overwhelming majority of the House Schorr was subsequently red by CBS and became a cult hero on the college lec- ture circuit commanding top fees for one-night stands The Senate Intelligence Committee chair- man Frank Church D ID went to the full Senate in November 1975 for approval of release of the committee's report on CIA involvement in assassination attempts against foreign leaders The report included secret information that the Presi- dent believed shonld not be made public The Senate met in executive session that is secret session and when considerable opposition to re- lease of the report developed more opposition than Church had anticipated he and the Demo- cratic majority adjourned the session without a vote and the committee released the report on its own authorityl Chapter 1'3 The same Daniel Schorr who leaked the Pvitugon Papens to the Village Voice wrote about leaks in a 1985 Washington Post article The late Rep Leo Ryan Schorr wrote told me in 1975 that he would con- done such a leak if it was the only way to block an ill conceived operation 3 In fact wrote former Direc- tor of Central Intelligence William Colby every new project subjected to this procedure informing eight congressional committees leaked and the covert part of covert action Seemed almost gone 9 The Still Leaky Congress During the Reagan Years By the late 1970s the House and Senate had formed intelligence committees reducing the number of com- mittees to which intelligence agencies had to report That clearly improved the situation but it did not cure all problems Senator Joseph Biden then a member of the Select Committee on Intelligence scunded a bit like the late Leo Ryan in a 1936 Brit Hume article from The New Republic Biden reported- ly said he had twice threatened to go public with covert action plans by the Reagan administration that were harebrained 1 ln l984 according to an article by Robert Cald- well CIA of cials briefed the same Senate Select Committee on Intelligence about information indicat ing that the Government of India was considering a preemptive strike against Pakistan s nuclear facility When word of the brie ng leaked the operation was halted According to Caldwell the leak showed India that it had a security breach at a high level The breach was discovered and a French intelligence ring was put out of business 1 1 The Senate Select Committee on Intelligence was one of the bodies to which the President would have had to report the lran arms sales Of course the Presi- dent could have limited the report to the committee chairmen and ranking minority members as well as the party leaders of the House of Representatives and Senate The problem with this scenario is that some senior members of the committee have been suspected of leaking as was discussed in the Committees hear- ings 12 The House committee has also been the source of some damaging disclosures Bob Woodward's book Veal describes one incident that allegedly hap pened after members of the committee had sent a secret letter to President Reagan to protest an oper- ation about which Director Casey had just briefed them Representative Clement Zablocki the chair- man ofthe House Foreign Affairs Committee and It is clear that leaks during this period were often motivated by an animus toward the CIA's mission in general or as a way of killing individual operations a member of the House Intelligence Committee had reviewed the nding and the letter to Reagan The sixty-nine-year-old lawmaker leaked Chapter 2'3 to Newsweek that the letter to Reagan about the yet unnamed operation in Africa was a plan to topple Qaddal't Newsweek reporters went back to House Foreign Affairs Chairman Zablocki after the Libya plan was denied Zablocki went to House staff mem- bers tipping them that he had been a source for t'Vewsweek He was set straight but the House Intelligence Committee chairman Edward Boland decided to take no action against Za- blocki since leaks were epidemic 13 Complaints and investigations about subsequent inci- dents involving the House committee so far remain at the informal stage To complete this picture of the world about which Poindexter had to make judgments Cm November 3 l 985 in the weeks just before the November arms transaction a Washington Post article by Bob Wood ward broke a story about a Anti-Qadha Plan Backed Director Casey responded to this article with a blistering letter to the President about execu- tive and legislative branch leaks The Washingtonian magazine accurately in our view linked the atmos phere in the White House immediately after this leak to the decision not to notify Congress about the Iran arms sale 15 it may be that not all these reported details about named Members of Congress are true True or not they fit in with a real pattern As such they form part of the background Director Casey and Admiral Poin- dexter had to consider in November 1985 It seems clear with 20 20 hindsight that Casey and Poin- dexter overreacted They may even have used the Post story as a convenient peg in their ongoing battle over secrecy with Secretary Shultr and others But even if they did overreact it is irresponsible to dis- miss their fears as being simply irrational power hungry or nefarious Yes some foreigners Ghorbanifar the Israelis KhashOggi the first and second Iranian channels did have to know what was going on That is the nature of any secret international dealing The issue is how much should be told to anyone who did not have a need to know to complete the operation successfully The simple fact is we had no way of knowing wheth- er our sources in Iran were endangering their lives by dealing with us Judging from the thousands executed in the early days of the Khomeini regime and the recent execution of Mehdi Hashemi the threat seemed real enough 15 Nor could we know whether the slightest misstep might get the hostages killed Certainly such threats against the hostages lives have been a part of the hostage takers' media events and Kilburn's death was real Given the track record no one in Congress or the executive branch can afford to be smug about these concerns Trust is a two-way 578 street and each end of Avenue had good reasons to doubt the other Problems In These Committees Past leaks contributed to decisions that in turn led to these investigations The leaks did not stop however when the committees started to work The Commit- tees began with every good intention Recognizing that it was dealing with highly sensitive information the leadership made a concerted effort to prevent leaks The complexity and short time frame of the probe however led to a decision not to compartmen- talize sensitive information Consequently everyone on the joint staff of some 165 people had multi-com- partmented clearances and access to the highest levels of classi ed material The same access held true of course for the 26 members of the two Select Com- mittees Given the number of people with access to these secrets it is surprising there were not more revelations We are reluctant to identify leaks with too much precision because con rmation may help adversaries sort out the ones we consider harmful Suffice it to say that the types of leaks included misleading the media on the nature of a witness secret testimony several days before he appeared as a public witness as well as revealing intelligence collection methods the identities of undercover personnel and the names of a number of countries which in one way or another were trying circumspectly to be helpful to the United States in a variety of foreign policy undertakings Needless to say these disclosures and others are causing these and other countries to have serious res- ervations about future cooperation with the United States That turn of events should give us real pause This is a highly interdependent world It no longer is possible for the United States to go it alone whether to combat terrorism or contain Soviet Cuban expan- sionism in Central America Consider one example On Friday May 29 the Committees took testimony in closed executive ses- sion from Tomas Castillo the former CIA station chief in a Central American country At the end of Castillo's testimony the following colloquy took place Mr RUDMAN I just want to make one com- ment It is my understanding that the declassi- ed transcript is going to be made available sometime tomorrow to the press Chairman HAMILTON That is correct Mr RUDMAN It is also my understanding that under the rules of Congress and the Intelligence Committees that it would be inappropriate for any members or staff or anyone else to comment Chapter t3 on these proceedings without speci c permission in some way from the chairman Chairman HAMILTON That is correct Under the rules of the House Committee at least you cannot release classified information without a vote of the committee and in the Senate my un- derstanding is it is a similar procedure Chairman INOUYE That is correct Despite these explicit statements articles appeared in May 30 new5papers with May 29 datelines accurately summarizing the testimony and quoting named mem- bers of the Committees giving broad characterizatitms of the testimony The declassi ed transcripts were not available until Sunday night May There were no Committee votes in the interim Some of these revelations by staff and Members as well as current and former Administration officials occurred during intense questioning and cross exami- nation of witnesses and appeared to be inadvertent Such mistakes however suggest in retrospect that this nation s security interests would have been much See for example RA Zaldivar and Charles Green sta- tion chief wasn't renegade ctingresSmen say The Mi'erni Herold May 30 1937 p lt iA Fox Butter eld Of cer Tells of Orders to Assist Contras The New York Times May 30 H87 p Associated Press Centra role told by cit-CIA agent Chicago Tribune May 30 1937 p 5 Interestingly The Washington Post the same nem'Spaper that publishes Bob Woodward s intelligence disclo- sures distinguished itself from the others this day by refusing to publish certain classi ed information The Past also gave no details about Castillo's testimony and quoted Sen Rudman refusing to give information Dan Morgan Higher-Level CIA Of cials May Be Subpoenaed on Contra Aid The Hhriringmn Post May 30 I'Jti'r' p All better served had we decided to take more testimony in closed session Potentially damaging slips of the tongue could then have been redacted before a tran- script was made available to the public As a consequence of this probe and that of Judge Walsh this nationls intelligence community could be facing the same situation it confronted more than a decade ago after the Church and Pike Committees investigations Leaks from those inquiries seriously de- bilitated our overall intelligence capabilities and it took us over a decade to repair the damage A rerun of that sorry chapter would have grave national secu- rity implications coming on the heels of a series of very damaging spy scandals epitomized by the Walker family case What happened to Castillo's testimony which was open to all Committee members and many staff con- trasts sharply with the executive session deposition of Admiral Poindexter on May 2 l987 The two select Committees recognized that the Admiral s testimony on the diversion of funds was the pivotal and poten- tially most explosive political question of this whole investigation As a result extraordinary steps were taken to protect the information Speci cally only three staff attorneys and no Members of either Com- mittee participated in the secret questiomng The suc- cess of these procedures speaks volumes on how to protect secrets In the final analysis as Chairman Hamilton noted in a perceptive article on protecting secrets that appeared in the September 4 1985 Con- gressional Record Leaks are inevitable when so many people handle secrets m The most effective way of ensuring secrecy is to restrict access to sensitive infor- mation to just a handful of responsible people 57'9 Chapter 13 Endnotes 1 Shultz Test Hearings 100 9 7 031581 at 52 2 Henryr J Hyde How To Reduce The Leaks Case for a Joint Intelligence Cemmittee The Washington Times October 12 1987 pp D1 D4 3 US Central Intelligence Agency r Bicentennial Pub- lication Intelligence in the War of Independence published by the Nathan Hale Institute 1976 p 14- 4 Edward F Sayle The Historical Underpinnings of the US Intelligence Community reprinted by the Intelligence Publishing Groups Inc from I Journal of Intelligence and Counterintelligence 1936 5 Sofaer War Foreign Affairs and Constitutional Power at Gib-97 6 Arthur Manse Congress and the Common Good 19831 1 241 M at 243 8 Daniel Schorr Cloak and Dagger Relics The Wash- ington Post November 14 1935 A23 580 9 William Colby Honorable Men 1973 p 423 it Brit Hume Mouth The New Republic Sep- tember I 1936 p 20 11 Robert J Caldwell Button the loose lips in Con- gress The San Diego Union July r 26 1987 pp 1 8 12 Mee5e Test Hearings at 350-51 13 Bob Woodward Veil The Secret Wars of the CIA 1987' pp 158 160 14 Bob Woodward CIA Anti-Qadha Plan Backed The Washington Post November 3 1985 pp A1 A19 15 Barbara Matusow Woodward Strikes Again The Washingtonian Sept 1937 pp 114 234- 16 See Chapter 8 of the Minority Report The Iran Initiative at p 520 IT Castillo testimony May 29 pp S d o- 13 Hon Lee H Hamilton Protecting Secrets Congresv sional Record September 4 1935 pp 133355 56 Part VII Recommendations Chapter 14 Recommendations The majority report reaches the conclusion accurate- ly in our opinion that the underlying cause of the ran-Contra Affair had to do with people rather than with laws Despite this laudable premise the majori- ty goes on to offer no fewer than 27 recommenda- tions most involving legislation and several of them multifaceted Some of the recommendations unfortu- nately betray Congress' role in the legislative-execu- tive branch struggle by proposing needlessly detailed rules for the organization of the executive branch At the same time the majority recommendations barely touch the problem of leaks and say nothing at all to no one s surprise ab0ut Congress' misuse of massive continuing appropriations resolutions to conduct for- eign poliCy We do not intend here to give a detailed critique of the majority recommendations We do believe that requiring the President to notify Congress of all covert operations within 48 hours without any excep- tions would be both unconstitutional and unwise Many of the remaining recommendations seem to us to be unconscionably meddlesome No good reasons are offered for prohibiting military officers such as General Powell from being National Security Advis- er No good reasons are offered for having the Na- tional Security Council produce regular staff rosters for Congress And so forth and so on it all strikes as more of the same an attempt to achieve grand policy results by picking away at the details In the Spirit of offering recommendations however we are pleased to present some of our own Recommendation 1 Joint Intelligence Committee Congress should replace its Senate and House Select Committees on Intelligence with a joint committee Congress has realized that limiting the number of people with access to sensitive information can help protect the information's security The Hour-e and Senate took first steps to limit the number of Members and staff engaged in intelligence over sight by establishing Select Committees on Intelli- See Chapter 8 in the Minority Report at 531-536 See the Minority Report Chapter 4 at 4ii-4i'8 and Chapter 1 at 543-545 gcnce Unfortunately as we have seen security still is not tight enough The time has now come therefore for taking the next logical steps Given the national security stakes involved Con- gress and the Administration must find a remedy for restoring mutual trust One major step in that direc- tion can be taken by merging the existing House and Senate intelligence committees into a joint committee along the lines of legislation HJ Res 48 sponsored by Representative Henry Hyde and a bipartisan group of 135 cosponsors see Appendix Such a commit- tee need not have the 32 Members plus four ex- of cio and 55 staff now needed for two separate committees Fewer Members supported by a small staff of apolitical professionals could make up the single committee In recognition of political reality the majority-party membership from each House would have a one vote edge A joint intelligence panel would drastically dimin- ish the opportunities for partisan posturing and sub- stantially reduce the number of individuals with access to classi ed and sensitive information This would not only minimize the risk of damaging unau- thorized disclosures but would also signi cantly in- crease the likelihood of identifying leak sources something that rarely occurs now because so many people are in the intelligence information loop Fur- thermore with the possibility of discovery so much greater potential leakers would be strongly deterred from unauthorized disclosures To achieve both efficiency and secrecy in congres- sional consideration of intelligence matters a Joint intelligence Committee must have legislative as well as oversight jurisdiction Otherwise the two Houses would not give the Joint Committee the deference the two existing intelligence committees enjoy Neither would the intelligence agencies have the budget-based incentives to cooperate with the Joint Committee as they have now with the two select committees Inad- equate jurisdiction might also prompt the various committees in each House with historical interests in intelligence to reassert themselves That could trigger increased fractionalizaiion of the congressional over- sight process with the concomitant proliferation within the Congress of access to sensitive intelligence information 583 Chapter 14 Recommendation 2 Oath and Strict Penalties for Congress To improve security the Joint intetiigence Committee er tire present House and Senate committees adopt a secrecy oath with stiff penalties for its vioiatiott Creating a joint committee will not by itself guaran- tee the security of intelligence information Also es- sential is committee self-discipline Earlier we pointed out how the reputations of the Senate and House Intelligence Committees have been sullied by leaks from Members or staff As the importance of congres- sional oversight and the reputation fOr leaking both grow foreign intelligence agencies are discouraged from unguarded cooperation with the United States Change is therefore urgent both to stanch the flow of leaks and to symbolize to foreign countries that Con- gress is serious about preserving the con dentiality of secrets One signi cant change that would help further both goals would be to require an oath of secrecy for all Members and staff of the intelligence committees Such an oath would not be an American novelty As we have already noted the Continental Congress Committee on Secret Correspondence required all of its members and employees to pledge not to divulge directly or indirectly any information that required secrecy The proposed oath should read do solemnly swear or af rm that I will not directly or indirectly disclose to any unauthorized person any infOrmation received in the course of my duties on the Senate House or Joint Intelligence Committee except with the formal approval of the Committee or Congress The Committee Rules should be amended to compel permanent expulsion from the committee of any member or staff person who violates his or her oath 1While proceedings remain pending the accused would be denied access to classi ed information The rules of the House and Senate should also be amended to provide that the Intelligence Committee would be authorized to refer cases involving the unauthorized disclosure of classi ed information to the Ethics Com- mittees The rules should make it clear that the Ethics Committees may recommend appropriate sanctions up to and including expulsion from Congress This approach is well within the Constitution s ex- pulsion power and the power of each House to set rules for its own proceedings The power of each House of Congress to expel Members for misbehavior by two-thirds vote is virtually uncircumscribed 1 His torically fifteen Senators and four Representatives have been expelled Fourteen of the Senators were expelled for supporting the Confederate secession The fteenth Senator Blount was for conspiring with Indian tribes to attack Spanish Florida and Louisiana The House and Senate also have considEred and re fused expulsion on twenty-four occasions for charges as varied as corruption disloyalty Mormonism trea 584 sonable utterances dueling and attacking other Mem- bers of Congress Expulsion decisions of Congress are probably beyond judicial review 2 Any set of recommendations that limits itself to Congress would not be adequate to respond to the problem of leaks Therefore we recommend a more balanced approach that would stiffen the penalties for others who participate in this activity Recommendation 3 Strengthening Sanctions Sanctions against disclosing nationai security secrets or ciassified information shenfd be strengthened Current federal law contains many provisions pro- hibiting the disclosure of classi ed information but each of the existing provisions has loopholes or other dif culties that make them hard to apply The section that covers the broadest spectrum of information classi ed information only prohibits knowing un- authorized communication to a foreign agent or member of a speci ed Communist organization Another set of provisions contains no such limit on the recipient of the information but applies only to information related to the national defense For some speci ed information unauthorized disclosure or transmission is criminal under any circumstances The transmission of other information relating to the national defense to an unauthorized person is also illegal if a person has reason to believe the informa- tion would be used to injure the United States or to bene t a foreign nation The problem with these pro- visions is that they cover only information relating to the national defense rather than the full range of national security information whose secrecy the gov- ernment has a legitimate reason to protect 5 A third set of provisions in current law is limited to nuclear weapons production 7 A fourth is limited to information about ciphers or communications intelli- gence E This is the law that the National Security Agency Director General illiam E Odom believes should be applied more vigorously against both feder- al employees and the press Thc following is quoted from Molly Moore Prosecution of Media for Leaks Urged The Washington Post Sept p A4 don't want to blame any particular area for leaking said Udorn who added There's leaking from Congress there's more leaking in the administration because it's bigger I'm just stuck with the consequences of it Leaks have damaged the communications intelligence system more In the past three to four years than in a long long time UdOm said he has encouraged the administration to use an obscure law that prohibits disclosures of communications intelli- gence Odom said he has referred seteral cases involving news leaks in the JustiCe Department since HES but said the department has declined to prosecute any of them The department said It has not prosecuted any so far Chapter 4 Finally a fth provision also limited in the infor mation it protects makes illegal the disclosure of agents identities This law is also restricted to disclo- sures by someone who has authorized access to the identity from classi ed information or is en- gaged in a pattern of activities intended to identify and expose covert agents with reason to believe the publicity would impair the foreign intelligence activia ties of the United States 9 The latter limitation means that the agent disclosure law does not cover most normal press disclosures such as the ones we men- tioned earlier about reports based on these commit- tees work because they are not normally part of a pattern or practice of identifying covert agents In order to close these loopholes Rep Bill McCol- lum has introduced a bill HR 3066 co-sponsored by all the other Republican members of the House Iran Committee The bill is limited to current and past federal employees in any branch of government For these people the bill would make it a felony knows ingly to disclose classi ed information or material not just speci c national defense information to any unauthorized person whatever the intent Another approach that would supplement the McCollum bill would be to introduce substantial civil penalties for the knowing disclosure of classi ed in- formation to any unauthorized person The penalties might range from administrative censure to a perma nent ban on federal employment and a ne of $10000 The advantage of giving the Justice Department the option of using a civil statute would be that the standard for proof would be the preponderance of evidence rather than proof beyond a reasonable doubt and the law could stipulate that contested viola Generally when l m with a group of journalists 1 can usually see two or three people who fall in the category of those who probably could be successfully prosecuted Odom told the reporters The followsving material from the Same press brie ng is from Norman Black Gen Odom blames leaks for 'deadly' intelligence loss Associated Press dispatch published in The Washington Times Sept 3 1987 pp 1 12 Asked to provide examples Gen Odom said he didn't want to get speci c right now and compound the things but a number of sources have dried up in some areas which you are all familiar with the past year or two A number of years ago there was a case that had to do with a Damascus cemmumeationleak It attributed this thing to an intercept And the source dried up immediately Gen Odom said Asked then about Libya he replied Libya sure Just deadly losses tions should be heard in secret without a jury These procedures should not encounter constitutional dif - culties in light of the Supreme Court s broad endorse- ment of centrols on the disclosure of classi ed infor- mation in Snepp v US 1 Recommendation 4 Gang of Four Permit the President to notify the Gang of Four in- stead of the Gang of Eight in special circumstances Representative Broom eld has introduced a bill that among other things would permit the President on extremely sensitive matters to notify only the Speaker of the House House Minority Leader Senate Majority Leader and Senate Minority Leader Under current law limited noti cation means noti cation of these four plus the chairmen and ranking minority members of the two intelligence committees On the principal that notifying fewer people is better in ex- tremely sensistive situations We would be inclined to support legislation along these lines that would ratify what has already come to be an informal occasional practice Recommendation 5 Restore Presidential Power to Withstand Foreign Policy by Continuing Resolution Require Congress to divide continuing resolutions into separate appropriations and give the President on item veto for foreign poiicy h'mitntion amendments on appropriations The way Congress made foreign policy through the Boland Amendment is all too normal it way of doing business Congress uses end of the year continuing resolutions to force its way on large matters and small presenting the President with a package that forces him to choose between closing down the Gov ernment or capitulating Congress should give the President an Opportunity to address the major differ- ences between himself and the Congress cleanly in stead of combining them with unrelated subjects To restore the Presidency to the position it held just a few Administrations ago Congress shOuld exercise the self-discipline to split continuing resolutions into separate appropriation bills and present each of them individually to the President for his signature or veto Even better would be a line-item veto that would permit the President to force Congress to an override vote without jeepardizing funding for the whole gov- ernment 585 Chapter 14 Endnotes 1 See In re Chapman 166 us 66 law-mo 1397 3 See Powell v HCC'armuc k 395 1 1 5 436 50' n 54 1969 3 50 U S C 733 4 13 U S C 793 d1and e and 79-1 5 See New York Times v Sumvan 403 US 7 13 3 -40 US v 1furiswi 604 F Supp 655 586 6 Gar-in v 312 US 19 28 1941 HS Dedeyau 584 F 2d 36 4th Cir NUS 7 IS U S C 227-1 2277 E 13 U S C 793 9 50 U S C 421 10 444 US 50 1930 Part Appendixes CORPORATION l mm- Ir-q-rr lot haying n Cl- September 25 198 Representative Lee H Hamilton Chairman House Select Committee to Investigate Covert Arms Transactions with Iran United States Capitol Washington D C 20515 Representative Dick Cheney Ranking Minority Member House Select Committee to Investigate Covert Arms Transactions with Iran United States Capitol Washington D C 20515 To the Chairman and Ranking Minority Member of the Committee The enclosure to this letter entitled Reporting Obligations and Funding Restrictions Affecting Intelligence Departments Agencies and Entities of the United States is submitted to your Commit- tee through the U S Senate Select Committee on Intelligence I have prepared the enclosed statement in reply to your letter of September 3 1987 Enclosure 1 That letter requested my observations and recollections of the legislative history of intelligence law that might be helpful to the Committee in its evaluation of whether any laws were violated by members of the executive branch in the Iran Contra affair and or 0 relate to the concept of an intelligence agency or intelligence entity as traditionally understood by Congress or the Chief Executive In preparing a response to your letter I have reviewed my records pertaining to the legislative history of both enacted intelligence legislation and executive orders for the period 1974-1934 Based upon this review and my experience as the longest continuously-serving consultant to the Senate Select Committee on Intelligence in the period 1976-1984 I have prepared Enclosure 2 My review of pertinent records brought to my attention a related issue whether authorisations for covert activities to be conducted under the direction of the National Security Council should be subject to a preceding legal opinion respecting the conformity of the proposed activity to United States law In 19 4 I reviened the legal authority for the conduct and control of foreign intelligence activities of the United States under sponsorship of the Intelligence Panel of the Murphy Com- mission Hith the cooperation of the NSC staff and general counsels of the various intelligence agencies 539 2 At that time I posed for the Commission's Intelligence Panel a set of issues relating to legal authority and accountability In particular I invited the Commission to consider whether the National Security Act of 1947 should be amended to require before NSC authorization of covert activities an opinion as to the activity s legality under the laws of the United States and obligations of the United States under international law Enclosure 3 provides a copy of the Murphy Commission Intelligence Issues Paper Legal Authority for the Conduct and Control of Foreign Intelligence Activities as revised on November 22 19 4 See in particular pages 13 to 22 Issue 310 at pp 21-22 and Appendix 2 The Chairman of the Intelligence Panel and the Commission Ambassador Robert D Murphy did not favor my proposal to estab- lish a Legal Adviser to the National Security Council both because the Attorney General was the principal legal adviser to the President and because of possible impairment of presidential freedom of action respecting U S covert activities The National Security Council is by statute responsible for the direction of performance of such other functions and duties related to Had a system of mandated legal review and an NSC Legal Adviser been established in the 19705 it is entirely possible that the need for your Select Committee would not have arisen I am pleased to learn that the present Special Assistant to the President for National Security Affairs Hr Frank Carlucci has established the position of Legal Adviser to the NSC in January 198 This initiative assures the availability to the NSC of a legal officer It does not by itself mandate legal review of proposed covert activities prior to Presidential finding and NSC direction Intelligence activities of the United States can and must be conducted under the rule of law in a democratic society I trust that the enclosed review of intelligence laws and Congressional oversight practices will assist your Committee as it completes a difficult task William R Harris 16641 Marques Terrace PacifiC'Palisades CA 90272 590 3 Enclosure 1 Letter from Rep Hamilton and Rep Cheney to Killian R Harrie Sep 3 1987 Enclosure 2 William R Harrie Reporting Obligations and Funding Restrictions Affecting Intelligence Departments Agencies and Entities of the Sep 25 1987 Enclosure 3 Hilliem R Harrie Legal Authority for the Conduct and Control of Foreign Intelligence Activities Issues Paper Commission on the Organization of the Government for the Conduct of Foreign Policy November 22 19 4 591 CORPORAI ION in la - In In - br- Inln-r- CA Ch FIJI September 25 1987 Senator David L Boren Chairman Senate Select Committee on Intelligence SH-le Hart Senate Office Building Washington D C 20510 Senator William S Cohen Vice Chairman Senate Select Committee on Intelligence SH-le Hart Senate Office Building Washington D C 20510 To the Chairman and Vice Chairman of the Senate Select Committee on Intelligence By letter of September 3 1957 the Chairman and Ranking Minority Member of the House Select Committee to Investigate Covert Arms Transactions with Iran requested my assistance regardin - Legislative history of intelligence laws that might be helpful to the Committee in its evaluation of whether any laws were Violated by members of the executive branch in the Iran Contra affair - AJny observations or recollections that relate to the concept of an intelligence agency or 'intelligence entity' as traditionally understood by Congress or the Chief Between January 1976 and December 1984 I served as a consultant to the Senate Select Committee on Intelligence and its prede- cessor committee In that capacity I reviewed and sometimes revised drafts of the oversight charter of the Committee S Res 400 in 19T6 and intelligence legislation including the Intell igence Oversight Act of 1980 50 U S C sec 413 Drafts of legislation were prepared in unclassified form but as work product of the Intelligence Committee Accordingly I am trans- mitting to you my response to the House Committee in conformity with my secrecy agreements with your Committee executed in 1977 and 1984 and in accordance with Committee Rules Please advise me if and when you release the accompanying letter to the House Select Committee to Investigate Covert Arms Trans- actions with Iran Re sjectf su m ted William R Harris 16841 Marquez Terrace Pacific Palisades CA 90272 Encl Ltr to Rep Hamilton and Rep Cheney w Enc1-1 2 and 3 592 Iq'hll atoll Huh urn-u I Iem Jluroui'u me Io -Io II Im- an m wrenw 3 113 main- mmwunl HOUSE OF REPRESENTATIVES an hmlo- mo- uutw EELECT columns to mm m tr cw- Mum Itrun mellow-II elm rm tom-In COVERT WITH IRAN 1 um nun um UNITED STATES CAPITOL - Fol wasemo'rou or ions Z g_ -c Soptember 3 1937 Mr Hilliam R Harris H1 The Rand Corporation 1 00 Main Street Santa Monica CA 904 6-2138 DEar Mr Harris We understand that you participated in the deliberations and forging of events that culminated in the 1980 Intelligence Oversight Act as a consultant to the Senate Select Committee on Intelligence We further understand you played a role in the drafting of President Carter's Executive Order governing the intelligence community we believe your expertise in these intelligence law matters might be helpful to the Committee in its evaluation of whether any laws were violated by members of the executive branch in the Iran Contra affair In particular we would be grateful for anyl observations or recollections that relate to the concept of an intelligence agency or intelligence entity as traditionally understood by Congress or the Chief Executive A letter to the Committee addressing these and related issues regarding the history intent or scope of the IDA and President Carter 5 Executive Order would be much appreciated Sincerely Lee H Eamilton Dick Cheney% DC on I SHE -Ivlm IEo iDe thu '1 Hr-mu lo o n o D Elnu'cmEnEg In gut-I m lulul-Iltiu Jllm lieu _la nin- 593 CI - 20 Enclosure 2 REPORTING OBLIGATIONS AND FUNDING RESTEICTIONS AFFECTING INTELLIGENCE DEPARTHENTS AGENCIES AND ENTITIES OF THE UNITED STATES Prepared Statement of William R Harrie In reply to a request of the U S House Select Committee to Investigate Covert Arms Transactions with Iran September 25 1987 The views expressed are those of the author in his individual capacity They neither represent the U S Senate Seiect Committee on nor The RAND Corporation with regard to the issues considered 594 2 FU DING TI NS FF CT HG US CUR SCOPE QF COEGBESSIQNAL IEIELLIGENCE QVEBSIQEI UNDER 5 RES 400 1976 H RES 658 1977 AND EXECUTIVE ORDER 12035 l978 The Senate established by 5 Res 21 the Senate Select Commit- tee on Government Operations with Respect to Intelligence Activi- ties the Church Committee in January 1975 This Committee con- conducted broad-ranging investigations and drafted proposed intelligence oversight legislation that resulted in establishment of the present Senate Select Committee on Intelligence in May 1976 Preceding S Res 21 President Ford signed into law P L 93-559 including as Sec 662 of the Foreign Assistance Act of 1961 22 U S C 2422 the Hughes-Ryan Amendment This required a presi- dential finding important to the national security preceding any expenditure of funds for covert operations of the Central Intelligence Agency It did not specify any reporting duty of the NSC or its staff It did require the President to report each finding to the appropriate committees of the Congress in a timely This resulted in reporting of presidential findings to the full membership of the House and Senate Armed Services Committees to the Defense Subcommittees of the Appropriations Committees and to the House Foreign Affairs Committee and the Senate Foreign Relations Committee See Gary J Schmitt Congressional Oversight of Intelligence Spring 1965 Subsequent to the establishment of the Senate and House Intelligence Committees in 1976 and 1977 respectively the appropriate committees included more than 150 members My records indicate that in 1975 a staff attorney of the Senate Select Committee on Government Activities with Respect to Intelligence Activities Hs Hertha Talley prepared for the Committee a draft Intelligence Oversight Act of 1975 The committee's draft legislation was not introduced in that year but is indicative of the scope and intent of the oversight legisr lation that the Senate approved 5 Res 400 the following year The draft Intelligence Oversight Act of 19 5 contained both proposed amendments to Senate rules sec 4 through 10 and proposed legislation sec 11ff Proposed Section 6 a 11 B Sec of S Res 400 provided jurisdiction over intelligence activities of all other departments and agencies of the The scope of proposed legislative oversight reflected the exper- ience of a committee responsible for investigating intelligence activities of the entire government The committee did in fact 595 3 investigate intelligence activities of the Postal Service the Internal Revenue Service and other agencies outside the intelli- gence community whose activities raised issues of legality or propriety The analysis of Section 5 prepared by Ms Talley for the Committee in 1975 indicated The Committee would have oversight and legislative Jurisdiction of intelligence activities engaged in by the following agencies their successors employees subcontractors and proprietaries National Security Council and its subcommittees panels and working groups with authority to deal with intelligence counterintelligence internal security and related matters My records indicate that Senate Select Committee completed a revised Staff Draft 5 Res on December 31 1975 to establish a Senate Committee on Intelligence Sec 8 retained government-wide jurisdiction and proposed per the suggestion of a Senator who served on the Joint Committee on Atomic Energy a duty of each department agency or instrumentality of the government to keep the Committee fully and currently informed with respect to all intelligence and counterintelligence poli- cies programs and activities which are the responsibility of or are planned supervised financed or carried out by such department agency or The currently and fully informed standard was derived from Section 202 of the Atomic Energy Act of 1946 42 U S C 2252 In January 1978 the Office of the U S Senate Legislative Counsel prepared a redraft of S titled the Intelligence Oversight Of 1976 retained Jurisdiction over the intelligence activities of all other departments and agencies of the This language was retained in Sec 3 a of S Res 400 Sec 13 which as later modified became Sec 11 of S Res 400 proposed a duty for the head of each department or agency of the United States to keep the Senate intelligence oversight committee - fully and currently informed with respect to all intelligence activities which in any respect are the responsibility of or are planned supervised financed or engaged in by such department or agency 596 4 The above-quoted language preserving the exact language of Sec 11 a of the draft Intelligence Oversight Act of 1975 appeared unworkable to representatives of intelligence agencies in early 1976 In early 1976 the Special Counsel to the Director of Central Intelligence Mitchell Rogovin proposed alternative reporting language in a meeting with Hilliam R Harris a Consultant to the Senate Committee Hy records indicate that the Rogovin-Harris substitute read it the duty of the head of each depart- ment and agency of the United States to keep the Committee on Intelligence Activities fully and currently informed with respect to intelligence activities which are the responsibility of such department or agency This language retained a reporting duty for each department or agency of the United States without restriction to agencies of the intelligence community It was later amended by Senatorial initiative to add the phrase including any significant anticipated before its introduction on Harch 1 19 8 with 19 co-sponsorsl as 8 Res 400 On April 9 1975 the Senate Rules Committee favorably reported 8 Res 400 and on May 19 1975 the Senate considered amended and approved 8 Res 400 by a vote of 72 to 22 Sec 11 a provided It is the sense of the Senate that the head of each department and agency of the United States should keep the select committee fully and currently informed with respect to intelligence activities including any significant anticipated activities which are the responsibility of or engaged in by such department or agency Sec 14 a defined intelligence activities to include intelligence counterintelligence covert or clandestine activities Without specific restriction to an intelligence agency's sponsorship and internal security intelligence Sec 14 b included in the definition of department or agency any federal organization including any committee council establishment or office within the Federal Government For parallel definitions adopted by the House Permanent Select Committee on Intelligence see H Res 858 of July 14 1977 Rule sec 10 a and Despite misgivings on constitutional and other grounds plrior notice to the Intelligence Committees of significant covert actions programs has been the practice since 597 5 See prepared statement of William G Hiller former Staff Director Senate Select Committee on Intelligence Sep 22 1983 HPSCI Hearings Comm Print 1984 On July 14 1977 the House of Representatives established the House Permanent Select Committee on Intelligence adopting H Res 658 by a vote of 247 to 171 The House Committee Juris- diction paralleled that of the Senate Committee without re- striction to agencies of the intelligence community The following month staff assistants of the President asked the staff of the Senate Select Committee on Intelligence to review a draft Executive Order on intelligence activities Hith amendments some suggested by the Committee staff this became President Carter s Executive Order 12036 of January 24 19 8 Section 3-4 of E 0 12036 43 F R 3574 at 3689-90 provided for reports to the intelligence committees of Congress It applied to the Director of Central Intelligence and heads of depart- ments and agencies of the United States involved in intelligence activities It utilised the fully and currently informed standard of the Atomic Energy Act and S Res 400 of 1976 It included a duty to report on significant anticipated activities which are the responsibility of or engaged in by such depart- ment or agency In sum the legislative history of enabling resolutions of 1976 and 19 for the present intelligence oversight committees of Congress indicate legislative intent that any head of a depart- ment agency or institution that is involved in intelligence activities report to these committees The initial draft of 1975 explained an intent to include the National Security Council within the purview of the reporting duties Executive Order 12038 of January 1978 applied to all departments and agencies of the United States and impliedly would cover the National Security Council staff were it to have proposed to engage in significant anticipated activities during application of this Executive Order in 19 8-1981 NC In 1978 the Senate Select Committee on Intelligence through a subcommittee chaired by Senator Walter Huddleston introduced draft leiislation that were it enacted would have reduced the scope of mandatory reporting to heads of departments agencies or other entities of the intelligence community On February 9 1978 Senator Huddleston and 19 co-sponsors introduced S 2525 the National Intelligence Reorganisation and Reform Act of 1978 Representative Boland introduced S 2525 in the House as H R 11245 on March 2 1978 598 As a proponent of streamlined mission-oriented legislative charters 1 did not actively participate in drafting the 263-page 197B charter legislation S 2525 or the initial 1 2-page 1930 charter legislation S 2284 Section 151 g of S 2525 required reports to the intelligence oversight committees by the head of each entity of the intelligence The 1973 Senate charter legislation S 2525 introduced the Of an ButitY Of the intelligence community but did not include the term in its definitions Sec 104 16 did define the intelligence community without any express inclusion of the NSC or its staff and impliedly exempted that Council and staff from mandatory reporting A limitation of mandatory reporting duties to the head of each entity of the intelligence community remained in the provisions of S 2284 the National Intelligence Act of 1980 introduced by Senator Huddleston Chairman of the Subcommittee on Charters and Guidelines on February 6 1960 See Section 142 a Rep Boland introduced a companion bill H R 6533 in that same month As opposition to detailed legislative charters developed in the executive branch objecting to reporting other than in a timely fashion and in the Congress the Senate Select Committee Staff Director approved my review of the 172-page5 for the purpose of abbreviation and simplification consistent with protection of civil rights and safeguards I consulted with Keith Raffel John Elliff and others of the Committee staff between February 14 and March 19 1980 first to make technical changes in S 2264 as drafted and second to produce streamlined charter legislation It was during the first phase of review in late February 1960 that I identified the failure of S 2284 s oversight provisions to provide for mandatory reporting of NSC intelligence activities I proposed to extend the reporting duties of Section 142 a beyond the head of each entity of the intelligence community for the express purpose of including the National Security Council and its staff within the scope of reporting duties respecting intelligence activities including signifi- cant anticipated intelligence Neither Keith Raffel nor Mr John Elliff who had partici- pated in the work of the Subcommittee on Charters and Guidelines favored express inclusion of the National Security Council in the reporting duties under Sec 142 a of S 2284 Neither claimed that the NSC was covered by the phrase intelligence community It is clear from the pertinent text on Congressional oversight of intelligence activities that neither the nor its staff was covered In particular section 103 12 defined intelligence community and entity of the intelligence community to mean -- A the Office of the Director of National Intelliiencei B the Central Intelligence Agency 599 7 C the Defense Intelligence Agency D the National Security Agency E the offices within the Department of Defense for the collection of specialized national intelligence through reconnaissance programs F the intelligence components of the military services G the intelligence components of the Federal Bureau of Investigation H the Bureau of Intelligence and Research of the Department of State I the foreign intelligence components of the Department of the Treasury J the foreign intelligence components of the Department of Energy K the successor to any of the agencies offices components or bureaus named in clauses A through and L such other components of the departments and agencies to the extent determined by the President as may be engaged in intelligence activities Specific requirement of reporting by the National Security Council raised constitutional issues relating to executive privo Liege and separation of powers It was my position that unless the mandatory reporting duties included the NSC and its staff there was a foreseeable risk of the NSC managing covert opera- tions through the NSC staff itself without a specific duty to report on such activities to the oversight committees of the Congress The Charter and Guidelines Subcommittee staffers indicated that the President would not authorize this change in customary practice precisely because upon discovery the Congress would enact legislation requiring mandatory reporting by the National Security Council or the President regarding its activities At this point on a day in February 1980 that I cannot ascertain from my records I took the issue to the staff director of the Senate Select Committee William G Hiller Any change of the nature I was proposing would reopen constitutional issues of concern to the Attorney General and the Counsel to the President Mr Miller reminded me that both Vice President Hondale and David Aaron the Deputy Special Assistant to the President for National Security Affairs served with the Committee- The President would not permit I was advised the conduct of covert operations by the NSC staff itself I reminded the staff director that intell- igence charters must be designed to function under changed and partly unforeseen circumstances well beyond the service of officials who knew the precise reasons for legislative action The staff director decided to leave sec 142 a as it stood Hence I did not reiterate my proposed redraft when I summarized a set of possible amendments to S 2284 on March 4 1980 I did recommend providing the President additional flexibility 600 8 under extraordinary circumstances to delay from 43 hours to 30 days notice to the full oversight committee membership so long as prior notice were provided the leadership and committee chairman and vice chairmen sec 125 of S 2284 This was a proposed amendment that was not adopted On March 17 1980 Representative Aspin introduced H R 6820 a much abbreviated intelligence bill It retained the provisions of S 2284 effectively exempting from mandatory reporting duties the NSC staff even if they were engaged in intelligence activities Sec 102 a stated The head of each entity of the intelligence community shall keep the intelligence committees fully and currently informed of all intelligence activities which are the responsibility of are engaged in by or are carried out for or on behalf of that entity On March 19 1980 Keith Raffel William R Harris et al of the SSCI staff completed a streamlined simplified National Intelli- gence Act of 1980 Labeled Draft expectably following drafts and it covered in 30 pages much of what 5 2284 initially covered in 172 Pages It retained the concept entities of the intelligence community and once again excluded the National Security Council and Staff from its list of entities sec 101 b l through This draft provided an impediment to if not a guarantee against potential unreported self-executed NSC covert operations Section 103th provided that special activities be conducted only by the Central Intelligence Agency except when the President determined that another agency should support an actiVity Whatever the merits of streamlined intelligence charters might have been the consensus in support of any charters legislation had disinte- grated during the earlier drafting of detailed charters S 2525 and S 2284 On April 12 1930 the House Committee on Foreign Affairs provided for consolidated reporting of presidential findings and favorably reported H R 6942 This retained the Hughes Ryan Amendment but reduced the reporting requirement from eight to the two intelligence committees of Congress On April 17 1930 the Senate Committee on Foreign Relations held hearings on the role and accountability of the Special Assistant to the President for National Security Whatever concerns the Foreign Relations Committee had did not result in legislation to require reports to the Congress on activities of the National Security Council or its staff On April 17 1980 the Senate Select Committee reissued a revised draft of S 2234 Shortly thereafter the executive branch submitted to the Senate Select Committee a document labeled Agreed SSCI-Executive Branch Condensation of S 2284 This document generally reflected agreements but also set forth em 9 executive branch preferences for legislative charters where issues remained unresolved Section 132 retained a mandatory reporting duty for the head of each entity of the intelligence Of some interest section 111 c of the so-called Agreed 5801- Executive Branch Condensation specified that the Title not be construed to prohibit any department or agency from collecting processing or disseminating information if otherwise authorized to do so Hence the understanding of the executive branch which had an interagency committee on intelligence charters in operation throughout enactment of the'lntelligence Oversight Act of 1980 and the Senate Committee that drafted the legislation was that duties imposed by this Title not be applied to other entities of the federal government merely because they collected processed or disseminated intelligence information under other existing authority Hence the National Security Council authorized by the National Security Act of 1947 to evaluate the quality of intelligence and otherwise authorized by the Presi- ident did not become an intelligence entity merely by reason of collecting processing or disseminating information The Senate Select Committee considered S 2234 in executive ses- sion on April 30 and thereafter on May 1 6 and B 1980 Senator Inouye proposed an amendment restricting prior reporting of significant anticipated covert activities under extraordinary circumstances as determined by the President See 50 U S C sec Senator WallOp and Senator Moynihan proposed further reporting on significant intelligence failures See 50 U S C sec See S Rpt 96'730 for a summary of these amendments On Mn 3 1980 the Senate Select Committee on Intelligence unanimously approved 5 2284 as amended containing primarily the provisions for legislative oversight and provisions to protect the identities of agents On May 15 1980 the Committee issued S Rpt 96-730 to accompany S 2284 the Intelligence Oversight Act of 1980 This report indicated that references to lany department agency or entity in subsection impose obliga- tions upon officials to report only with respect to activities under their responsibility subject to the procedures established by the President under subsection Rpt 96-730 May 15 1980 p On June 3 1980 the Senate took up consideration of the Intelli- gence Oversight Act of 1930 S 2284 A colloquy on the Senate floor represented concerns of the Counsel to the President Lloyd Cutler and General Counsel of CIA Daniel Silver that diverging executive-legislative views on executive privilege and on manda- tory reporting be contained in the floor debate The Senate adopted the Intelligence Oversight Act by a vote of 39 1 The Senate's provisions for legislative oversight what became subsections 501 a through were not contained in the House 502 10 Bill H R 7152 In the September 1930 Conference members of the House Intelligence Committee Rep Boland and others the House Armed Services Committee Rep Price and others and the House Foreign Affairs Committee Rep Fascell and others agreed to the Senate provisions for Sec 501 with a supplementing amendment sec This amendment indicated that duties to protect intelligence sources and methods did not authorize the withholding of reports to the intelligence committees of the Congress See the House Conference Report 96-1350 on S 2597 The Senate on Sept 19th and the House Sept 30th agreed to the Conference Report President Carter signed the Intelligence Authorization Act for FY1981 on October 14 1980 Title V the Intelligence Oversight Act of 1980 96-450 94 Stat 975 provides in Sec 501 a 50 8 0 The Director of Central Intelligence and the heads of all departments agencies and other entities of the United States involved in intelligence activities shall 1 keep the Select Committee on Intelligence of the Senate and the Permanent Select Committee on Intelligence of the House of and currently informed of all intelligence activities which are the responsibility of are engaged in by or are carried out for or on behalf of any department agency or entity of the United States including any significant anticipated intelligence 2 furnish any information or material concerning intelligence activities which is in the possession custody or control of any department agency or entity of the United States and which is requested by either of the intelligence committees report in a timely fashion any illegal intelligence activity Notwithstanding efforts in 1930 to broaden its scope of coverage what became Section 501 a 1 of the Intelligence Oversight Act of 1980 did not represent a legislative effort to include operations of the National Security Council or its staff within the mandatory reporting duties of this subsection Sec 501 of the Intelligence Oversight Act did not prohibit the conduct of special activities by the staff of the National Security Council A precursor draft Draft of March 19 1930 that would have prohibited covert operations other than by CIA except by Presidential determination was not enacted 603 11 Over a three year period from the initial drafting of S 2525 in late 19 through enactment of the Intelligence Oversight Act on October 14 1980 the linked reference to department agency or entity engaged in intelligence activities developed a meaning widely understood in the executive and legislative branches This phrase of legislative art applied exclusively to the intell igence agencies or specialized intelligence collection components of the U S intelligence community This definition did not include within its scope other entities of gOVernment that supervised the intelligence entities or summarized and dissem- inated their products Indeed the legislative history of the Intelligence Oversight Act of 1980 applies only to such of an entity activities as are under their responsibility subject to the procedures established by the President under subsection Rpt 96-730 May 15 1960December 4 1961 President Reagan implemented section 413 of the Intelligence Oversight Act of 1930 by signing Executive Order 12333 46 F R 59941 United States Intelligence Activities Section 3 1 provided for the implementation of Congressional oversight It established t he duties and responsibilities of the Director of Central Intelligence and the heads of other departments agencies and entities engaged in intelligence activities to cooperate with the Congress in the conduct of its responsibilities for oversight of intelligence activities Section 3 4 e defined intelligence activities to mean all activities that agencies within the Intelligence Community are authorized to conduct pursuant to this Order Section 3 4 1 specified agencies or organisations of the Intelligence Community excluding from the listing the National Security Council and its staff It is notable that the Executive Order followed the established scope of the Intelligence Oversight Act of 1930 and also notable that the principal coordinator of the Executive Order Kenneth DeGraffenreid came to the NSC staff from staff work at the U S Senate Select Committee on Intelli- gence where he served during enactment of the Intelligence Oversight Act The Intelligence Oversight Act of 1930 and the 1931 Executive Order implementing it define intelligence activities of depart- ments' agencies or entities with exclusive regard to entities of the intelligence community This establishes a presumption 604 12 that only intelligence community entities are intended to be covered by other intelligence-related legislation utilizing this phrasing But the presumption may be rebutted by evidence of actual legislative intent to the contrary The October 20 1953 amendment Boland to the Intelligence Authorization Act for FY1984 93-215 sec 801 a pro- hibited obligating or expending funds for the Central Intelli- gence Agency or any other department agency or entity of the United States involved in intelligence activities for covert assistance to military operations in Nicaragua Roll Call 403 Cong Rec p 88426 The Intelligence Authorization Act for FY1984 Sec 103 95- 215 authorized not more than $24 million to CIA DOD or any other agency or entity of the United States involved in intelli- igence activities which may be obligated or expended for the purpose or which would have the effect of supporting directly or indirectly military or paramilitary operations in Nicaragua The specific legislative history of these or subsequent Boland Amendments is not known to me Consequently I would not seek to evaluate whether the presumption of a limitation to entities of the intelligence community as defined in Executive Order 12333 has been rebutted by the specific legislative history of these Acts of Congress Acts of Congress requiring evaluation of legislative intent include Sec 106 of Title I of the Intelligence Authoriza- tion Act for 1987 99-569 providing that funds available to the the or any other agency or entity of the United States involved in intelligence activities may be obligated and expended duiing fiscal year 1987 to provide funds material and Sec 9045 of the DOD Appropriations Act for FY 1987 99 -591 prohibiting expenditure of funds available to CIA DOD or any other agency or entity of the United States involved in intelligence activities INTE GEN Eg 591 Sec 801 of Title of the Intelligence Authorization Act for FY1935 provided without regard to the agency or entity sponsor- ing the activity that No funds authorized to be appropriated by this Act or by the Intelligence Authorization Act for fiscal year 1984 Public Law 93-215 may be obligated or expended for the purpose or which would have the effect of supporting directly or indirectly military or paramilitary operations in Nicaragua by any This prohibition is not in any war limited to entities of the intelligence community Similarly section 290 of Title IX of P L 93-369 98 Stat 1210 22 0 3 0 2151 prohibits the mining of ports or terri- 605 13 torial waters of Nicaragua without limit to an entity of the intelligence community 0V This review of legislative history relating to departments agencies and entities involved in intelligence activities would be incomplete without noting the practices of the intelligence oversight committees since enactment of the Intelligence Over- sight Act in 1980 The two oversight committees have a special stake in the Intelligence Oversight Act of 1980 particularly because it treats their access to the information required for effective legislative oversight To the best of my knowledge in the period 1980 through 1983 the intelligence oversight committees treated Section 501 a 1 as if it covered only entities within the intelligence community as defined in President Reagan s Executive Order 12333 1981 In the spring of 1984 the Senate Select Committee on Intelli- gence whose staff had drafted section 501 a1 of the Intelli- gence Oversight Act first applied that section to an entity Outside the intelligence community During preparation of the Intelligence Authorization Act for FY1985 the Committee reviewed the requirements and capabilities of the Bureau of Verification and Intelligence of the 0 8 Arms Control and Disarmament Agency ACDA On behalf of the Chairman of the Budget Subcommittee Senator Wallopl of the SSCI in the spring of 1984 I reviewed the legislative history of the Intelligence Oversight Act of 1980 and prepared a letter to the Director of ACDA advising the Director of the Committee's assertion of Jurisdiction under the Intelligence Oversight Act of 1980 To the best of my knowledge after review of my proposed assertion of oversight jurisdiction by the staff director the Committee Chairman Senator Goldwater signed the letter to the ACDA Director in the spring of 1984 Predictably the Director of the Arms Control Intelligence Staff of CIA objected informally to the assertion of oversight Juris- diction on the grounds that ACDA was not a part of the intelli- gence community as specified in E O 12333 There was however a statutory basis for the assertion of Jurisdiction Section 37 of the Arms Control and Disarmament Act the Derwinski Amendment of 1977 provides the Director of ACDA legal responsibility for verification of compliance and noncompliance with arms control aEreements The Bureau of Verification and Intelligence performs statutorily-required intelligence assessment functions under Section 37 of the Arms Control Act The Director of ACDA accepted the Senate Select Committee's assertion of oversight jurisdiction in 1984 606 14 In the period 1975-1976 Congressional investigations of intelli- gence activities encompassed entities of the entire federal government and proposals for mandatory reporting to the Congress mirrored that broad Jurisdictional concern Commencing in 1978 the intelligence oversight committees adopted the procedure of enacting separate intelligence authorization acts for all entities of the intelligence community engaged in national intelligence or counterintelligence Concurrently from 1978 onwards draft legislation proposing mandatory self-report- ing by heads of intelligence departments agencies or entities encompassed expressly specified departments and agencies and other entities that performed classified missions within the intelligence community Proposals in 1980 to extend the scope of entities to include the National Security Council and its staff were expressly rejected in the course of streamlining what became the Intelligence Oversight Act of 1960 This legislative history establishes a presumption that parallel or subsequent legislation including the phrase departments agencies or entities engaged in intelligence activities applies to entities of the intelligence community and not the National Security Council or its staff But the presumption may be rebutted by any specific legislative history of a later Act of Congress if that legislative history indicates unequivocal intent to prohibit the expenditure of any federal monies by any entity of the federal government I am simply not aware of the precise legislative history of restrictive legislation that originated in the House of Representatives in 1983 and later years Hhatever the specific findings may be regarding the scope of legislative restrictions in 1984 and thereafter a general principle must apply to all intelligence activities conducted in a democratic society Intelligence activities and related covert activities conducted in the national security interests of the United States must be conducted under and subject to the rule of law I trust that the foregoing review of intelligence laws and Congressional oversight practices will assist your Committee as it completes a difficult task Respectfu submitted We 44 William R Harris 50 John Norton Moore Flordon Drive Charlottesville Virginia 22901 Anon-t 4 1937 The Honorable Daniel 5 Inouye Chairman The Select Committee on the Secret Hilitary Assistance to Iran a the Nicaragua Opposition 83-722 Hart Senate Office Building Washington DC 20510-1102 Dear Chairman lnouye During the course of the Iran-Contra hearings Lieutenant Colonel Oliver North apparently inadvertently created the impression that I had provided him with legal advice concerning the constitutionality and scope of the so-called Boland Amendment' that has been at the center of the hearings although he seems to have implicitely corrected this in later testimonyi Since I had not provided any such legal advice I immediately called his counsel and sent a letter to correct this apparent mieimpression Enclosed is a copy of the letter that I would appreciate your making part of the hearing record he a national security lawyer -- indeed one who has sought to pioneer the new field of national security law I have long urged the establishment of a strong legal office in the National Security Council NSC staff with involvement in all activities of the NSC Hhen-the Tower Commission was appointed I wrote a letter to Chairman Tower urging establishment of such an office It was a matter of great satisfaction for me to see that the Commission recommended such an Office that the President singled this recommendation out as one of the recommendations he believed most important to the Nation and that Assistant to the President for National Security Affairs Prank C Carlucci has moved vigorously and effectively to implement this recommendation This is believeIr one of the most important structural changes in the national security process to emerge from the Iran-Contra affair and I hope that your Committee will endorse this change As I am sure the Committee is aware there is a great difference in lawyering roles in being consulted for legal advice prior to events and a variety of lawyering roles including public comment on the law after events have transpired Prior to events effective lawyering should provide among other things advice that prevents persons acting in good faith from having future legal roblems and advice that includes the creative potential of egal-system options for serving the national 608 The Honorable Daniel R Inouye August 4 1937' Page 2 interest In contrast after events have transpired lawyers have an obligation to work for one process in protecting individuals who have acted in good faith and in educating the public about important issues In this latter connection it is noteworthy that the hearings produced opposed interpretations of the applicable 'Boland Amendment' from public servants all or vhom seen to have conscientiously sought to serve the nation Surely a major lesson of the Iran-Contra affair has been the great need for the structural change that has now been made of a strong legal office in the NSC to provide legal advice in advance as to significant NSC activities Wm ohn Norton Moore J zkww Enclosure as stated cc Hr Brendon Sullivan Hr Eugene c Thomas President American Bar Association Richard A Merrill Dean University of Virginia School of Law 609 ll John Norton Moore Flordon Drive Charlottesville Virginia 22901 July 9 l9 Mr Brendon Sullivan Williamstit Connolly 17th and Street NW Washington DC 20003 Dear Mr Sullivan is has come to my attention that your client Lieutenant Colonel Oliver North may have inadvertently created the impression by his testimony this morning that have provided him with legal advice regarding the constitutionality and scope of the so-callcd 'Boland Amendment' that has been at the center of the current Iran- Contra controversy This may have been implicitly corrected this afternoon when i am told he testified that he had received legal advice on this issue only from the present Counsel to the President's Intelligence Oversight Board but I would appreciate your correcting the record should any doubts remain As you are no doubt aware 1 served as a Special Counsel for the United States in the case before the international Court of Justice Subsequently in my personal capacity I have written and spoken widely about the war in Central America including a book The Secret War in Central America published by University Publications of America earlier this year and several addresses on the legal issues delivered before members of the press and congressional staff at the White House The re have of course been a multiplicity of 'Boland Amendments' concerning Nicaragua dating back to December l9 On more than one occasion in years past when have been asked to address some of the legal issues involved in the Central American controversy I have expressed the view that I did not believe Us support for the Contra program conflicted with the 'Boland at the time of course to earlier versions and events then known Certainly this is reflected in my published writings and is a conclusion concerning these earlier 'Boland Amendments' that seems well supported by the record I have been told that Colonel North was frequently called upon to address similar audiences and although I don't recall encountering him in that context it is quite possible that he heard me express such views on the 'Boland Amendment and he is liltely to be familiar with my published writings He may also have been familiar with my Opinion Editorial 'Goverornent Under Law and Covert Operations' published in the Mr Brendon Sullivan July 9 19 Page 2 It'nslu ngron Times on February 24 193 in response to the Iran-Contra controversy that does make the point that the scope of the l9l4-IS 'Boland Amendment' has been embroiled in a dispute For the record however prior to the public disclosure of the current Iran- Contra controversy late last year I had not even had occasion to examine the I934- 85 'lloland Amendment and thus I am certain that I did not provide Colonel North or anyone else with a 'legal opinion about its constitutionality or whether it encompassed the National Security Council The first time I have had occasion to even preliminarily review the range of domestic legal issues involved in the iron- Contra affair was during the writing of an opinion editorial on the issues after the affair had become public Although the 'Boland Amendment' at issue in the current controversy seems to me on the basis of a preliminary review to contain relevant ambiguities--and at least one separation-of-powers constitutional scholar whose judgment I respect has expressed doubts to me about the constitutionality of at least certain interpretations of the amendment have not at this time personally taken a dcfinitive position on these important issues which would of course among other things require a careful review of the legislative record I have however on numerous occasions expressed my view in response to media inquiries after the Iran-Contra affair had become public that the relevant 'Boland Amendment' may well be ambiguous and to the extent that it is well recognized principles of due process and separation of powers would require that it be interpreted to protect Executive Branch flexibility Thus while i had not had occasion to review the pertinent 'Boland Amendment' prior to the Iran-Contra affair becoming public knowledge and have still not had an occasion to do a careful legal analysis of that amendment and its voluminous legislative history it is my preliminary judgment on reviewing that amendment that it may well be ambiguous in several key respects it is also my judgment that there are strong policy reasons why any significant ambiguity should be construed in favor or continued Branch authority Certainly when Congress does not in an area of sensitive presidential power such as the conduct of covert activities it must do so clearly Any other conclusion does a serious disservice to separation of powers and the dedicated men and women who serve to implement foreign policy in the Executive Branch 612 Mr Brendon Sullivan July 9 I987 Page 3 I have no doubt but that Colonel North s reference to me this morning was a consequence of misunderstanding and have no desire to add to his burdens at this difficult time But as a lawyer I am sure you can appreciate my concern that an inaccurate impression not he left that have participated in providing legal counsel to Colonel North on the 'Boland Amendment' or any other national laws involved in the Iran-Contra affair it would not be inaccurate for Colonel North or any other individual to note that on numerous occasions including in my recent book The Secret War in Central Amrn an have publicly eapresscd my conviction that United States assistance to the Contras is consistent with the norms of international law as reflected in the United Nations and Organization of American States Charters This is premised upon a factual recognition of covert Nicaraguan armed aggression against El Salvador and other democracies in the region dating back to at least 1980-4 conclusion affirmed on several occasions by both the House and Senate Intelligence Committees This armed aggression--which predated by well over a year the United States decision to provide similar assistance to the Nicaraguan opposition in an effort to deter the ongoing effort to overthrow the government of El SalvadOr-oviolates article 2 4 of the United Nations Charter and numerous other prohibitions against aggression It gives the United States a right of collective defense under Article SI of the United Nations Charter and indeed may create a legal obligation under Article 3 of the Rio Treaty to assist El Salvador to meet the armed attack Enclosed is my Opinion Editorial 'Government Under Law and Covert Operations as well as a just completed piece 'The Iran-Contra Hearings and Intelligence Oversight in a Democracy This latter piece raises important issues that l believe should he addressed as to whether the current public hearings are the most appropriate mechanism for intelligence oversight of covert operations Mr Brendon Sullivan July 9 I987 Page 4 it is important to keep in mind that the views I have expressed over the years on these subjects are my own and in particular should not be attributed to the United States Government the American Bar Association the University of Virginia School of Law or any other organisation with which I am or have been affiliated Thank you for your assistance With best wishes ohn Norton Moore Enclosures 1 Government Under Law and Covert Operations' published as 'The Rule of Luv for the Covert' The Iran-Contra Hearings and Intelligence Oversight in a ee Mr Eugene C Thomas President American Bar Association Dean Richard A Merrill Dean University of Virginia School of Law 613 514 Government Under Law and Covert Operations by John Norton Moore' The level of rhetoric about law violation in the Iran-Contra afflir has been high Some of the public debate has even assumed criminal violation with prominent members of Congress speculating as to length of sentence and calling for Presidential pardons Yet the discussion has been as void of specifics about such violations as it has been pregnant with allegations Without knowing all the facts and the full context of actions it is not possible to make responsible legal judgment is important however that the debate proceed in a more complete context of assumptions about government under law Both the important principle of due process and real-world complexities of the_rulc of law for cavert Operations suggest that the level of rhetoric should be restrained as we focus more clearly on the enduring issues First no one involved in the Iran-Contra affair should be presumed guilty of law violation--much less criminal violation--until found guilty by a court of law Just as Our democratic system requires that government officials operate within the law it also provides that they be accorded a presumption of innocence until a duly constituted court finds otherwise Similarly it should be clearly understood that appointment of an independent counsel does not demonstrate law violation The Ethics in Government Act which Congress courageously did not apply to itself has an extraordinarily loose standard for the appointment of such a counsel This has been borne out by most such counsel reporting that no law violations have occurred within their mandate It should also be understood that there is a major difference between civil and criminal responsibility Criminal responsibility flows only from violation of clearly applicable ore-existing criminal statutes indeed if individual criminaI--or even eivil--responsibility flowed inexorably from all nonconformance with statutes the members of Congress would be guilty of multiple offenses as they repeatedly ignore their own budget act Most importantly the structure of law as it applies to covert operations is highly technical and complex and the public debate has been as simplistic as the law is complex For example the public discussion of legal issues has assumed that the Arms Export Control Act applies to presidentially authorized special activities Special activities however for reasons of their extreme sensitivity and secrecy have their own legal structure and it may well be that this and many other laws enacted for quite different settings do not apply to such activities Given the strong constitutional underpinnings of special activities as presidentially directed if particular statutory restrictions are constitutionally valid at all certainly they would need to be unambiguous in their application Similarly much of the public discussion has assumed that the failure to provide notice to the intelligence committees constitutes a violation of the shall inform 'in a timely fashion' language of the Intelligence Oversight Act of 19 0 But this ambiguous language papered over a serious underlying constitutional dispute between Congress and the Presidency as to whether the President must notify Congress of all special activities Moreover Congress conceded by the Act that not all such activities must be reported in advance and in that setting the more reasonable interpretation of 'timely' would seem to relate functionally to the reason for great secrecy rather than a mechanical passage of time The Carter Administration seems to have interpreted the Act this way as it spent months planning the tan hostage rescue operation with no reporting under the Act These Executive Branch concerns about reporting all- special activities in advance to committees of Congress reflect enduring policy concerns about the ability of Congress as an institution to maintain secrecy This institutional concern has been shared by the constitutional framers George Washington as our Nation s first President and by numerous administrations since both Democratic and Republican Moreover a policy requirement for extraordinarily sensitive covert operations is to hold knowledge to the smallest possible group whether in or out of Congress Informing members of Congress of all such operations not only increases the absolute number of persons with information but may also have a multiplier effect as Executive Branch personnel associated with Congressional relations become involved Whatever the policy wisdom of not reporting certainly the failure to report under the ambiguous Intelligence Oversight Act is not a legal scandal and it is probably within the President s power both as a matter of statutory and constitutional law To the same effect most of the numerous 'Boland Amendments' limiting assistance to the Contras clearly do not apply to the activities in question and the one that may be applicable has been embroiled in a dispute as to whether it applied to activities of the National Security Council and more importantly is by its terms fact-sensitive including whether particular funds were available to an agency or entity of the government within the meaning of the law Whatever the policy wisdom of proceeding in the face of legal ambiguity as well as other policy issues in linking the Iranian and Contra operations policy shortcomings do not show that those who 2 615 616 acted did so illegally Whatever the final resolution of a host of technical legal issues raised by the affair due process suggests that the professional reputation of our public servants not be by a post-Watergate mob that convicts of criminal violation when there may be no law violation civil or criminal We should remember that the essence of McCarthyism is the unfounded allegation Second whatever the final resolution of legal and policy issues in this case the Administration should take this occasion to appoint a full-time general counsel to the National Security Council staff After years of criticism by international lawyers who urged the addition of legal experts to the National Security Council Dr Zbigniew Brzezinski added an excellent lawyer to the staff who served about half-time as a legal specialist and that legal presence has been continued and augmented under the Reagan Administration There should however be a clearly designated full-time general counsel on the staff with an office of one or two national security law specialists and that office should operate under procedures that ensure its involvement in all national security activities overt and covert It is simply a fiction that all national security issues particularly those arising in crisis management settings will inevitably be reviewed by general counsel in the major departments The absence of full involvement of knowledgeable lawyers in national security decisions has for years harmed our national foreign policy under both Democratic and Republican administrations Such involvement is not required solely to prevent illegal actions as important as that may be but also to provide relevant policy advice on associated political and implementation issues If such an enhanced presence were needed two decades ago it is now imperative given the extraordinary growth of national security law over the last two decades in the future any foreign policy makers who do not seek legal counsel before a significant new activity have only themselves to blame for subsequent legal problems Third our Nation is likely to have no ability to conduct covert operations if it conducts its post-mortem of failed operations as the Iran affair has been handled It is understandable and probably desirable once the public concern about the Iran-Contra affair had reached the level of hysteria that the Administration request appointment of an independent counsel and Congress establish special Senate and House Committees to investigate For the future however we should use the capable mechanisms established by law during the I970s' sweeping reorganisation of intelligence oversight That is allegations about illegality and other improprieties in special operations should be investigated solely by the Senate and House Select Committees on Intelligenceh the President's Intelligence 3 Oversight Board and the Attorney General Following such investigations any illegal conduct should be known to that American people In the meantime an Adminstration and the Congressional Committees should 'neither confirm nor deny' allegations about special activities We cannot expect as a Nation to retain the ability to conduct covert operations if allegations about with Perhaps lealted by our adversaries can trigger a public orgy of self-flagellation That is a pattern of public disclosure and multiple investigations about the specifics of special activities triggered simply by allegations of policy mistakes 0r legal impropriety would cripple our ability as a Nation to have options that may sometimes be needed to avoid either war or capitulation to a ruthless enemy with no such constraints There is an additional reason that public debate is not the appropriate forum to reach conclusions about covert operations By the nature of such operations an Administration is usually not able to disclose the detailed information and precise contest in which it acted without disclosing intelligence sources and methods or betraying those who have trusted as perhaps at great personal risk Thus inevitably public debate about special activities is a struggle in which the American government as a whole must defend itself with both hands tied behind its back The result is likely to be not an informed public but a misinformed public condemning its leaders on partial information Finally and perhaps most importantly we must understand and deal with an underlying structural problem of enhanced Congressional activism triggering unintended confrontations with the Presidency during national security crises when the Nation can least afford to be immobilizing itself In significant measure this structural weakness contributed to escalation of the Iran-Contra affair rather than damage limitation During the HBO and l960s Congress acted with the Presidency to deter potential adversaries in resolutions such as the I962 Cuban Resolution In a post Vietnam- Watcrgate setting however Congress has more frequently sought to constrain American actions Frequently these constraints which have hugely multiplied in the last two decades have undermined rather than enhanced deterrence Certainly the to-date double reversal of Congress on support for the Contras is not a stable basis for a coherent American policy or credible deterrence Even more seriously the pattern of Congressional activism has fueled potentially catastrophic constitutional confrontations with the Presidency as Congress has aggressively embodied in legislation such as the War Powers Act and the intelligence Oversight Act its views of appropriate Congressional powers Yet in each case its view differed 4 617 618 from the Presidential view and the President cannot either as a matter of effective conduct of the Presidency or consistency with his oath to uphold the Constitution simply acouiesce in what may be felt by the Executive Branch to be a usurpation of separation of powers In this setting it is not surprising that strongly committed Executive Branch officials however mistakenly might seek to interpret ambiguities in favor of Presidential prerogative and stable policy Nor is it surprising that real-world inadequacies and ambiguities for protecting secrecy in current oversight mechanisms for sensitive special activities would encourage a risky policy choice in withholding prior notice from Congress Most dangerously a continuation of Congressional activism in legislating Congress's version of separation of powers in foreign poiiey--legislation that constitutionally cannot alter the underlying constitutional reality-- may some day trigger a direct constitutional clash between Congress and the President in a national security crisis when the Nation has no margin for error Surely government under law requires a more sensitive accommodation of separation of powers in foreign affairs than Congress writing its own ticket Congress should as part of the general introspection from the Iran-Contra affair reflect on its own contributing role At minimum our Nation needs a more effective legal structure to protect our most sensitive categories of national security information from either Congressional or Executive Branch leaks Such reform could enhance broadened participation both in policy formulation and oversight of sensitive special activities More broadly Congress and the President should establish a joint Executive-Congressional Commission appointed half by the President and half by Congress to explore non-binding guidelines--as opposed to rigid statutory both branches might accept across a spectrum of foreign policy process issues from the war powers to intelligence oversight reporting to encourage the Congressional-Executive consensus on procedures for interbrattch coordination our Nation must have for an effective foreign policy No governmental task is more imperative for our national security 'J ohrt Norton Moore is Waiter L drown Professor of Low and Director of the Center for Law and National Security at the University of Virginia Schaa of Law Formerly he served or Counselor on international Law to the Department of State and Chairman of the American Bar Association Standing Camntittee on Low and Notionai Security The Iran-Contra Hearings and Intelligence Oversight in a Democracy by John Norton Moore' From George Washington to Ronald Reagan American presidents have understood the importance of intelligence Following the surprise attack at Pearl Harbor and the American involvement in global war the nation built and has maintained a strong foreign intelligence capability Without such a capability verification and thus arms control would be virtually impossible enhanced fear of surprise attack would reduce stability and require higher arms expenditures the nation would be largely defenseless against foreign intelligence operations the national defense effort would be blinded and the nation would lose a range of options between diplomacy and war But just as our democracy requires an effective foreign intelligence capability so too it requires careful oversight of that capability Covert activities particularly must be undertaken only after a careful vetting to ensure that they are truly in the national interest and are authorized according to law Intelligence failures such as the recent Iran-Contra affair must receive careful review so that the same mistakes will not be repeated And any allegations of illegality or impropriety of course must be investigated Intelligence oversight however is not like oversight of the social security program or the Department of Agriculture that can proceed fully in the open Rather it must respect the requisite secrecy of the intelligence process Failure to do so can severely harm the nation's capabilities in intelligence No one can review the evidence to date in the' Iran-Contra affair without understanding that serious mistakes were made particulary the repeatednbut understandableumistake made by virtually all the democracies to seek to bargain with terrorists for the release of hostages seized just for that purpose by radicals who trample both democracy and human rights That mistakes were made however does not justify further mistakes in our process of oversight 619 620 In my judgement the nationally televised lramContra hearings are--and will be regarded by history--as a serious mistake in efforts at intelligence oversight The motivation of the hearings and the professionalism of the distinguished panel of some of the Nation's most able legislators is not in doubt and is not the issue Rather the issue is whether publicly televised oversight hearings are the best form of oversight of covert operations taking into account both the need for effective intelligence and effective oversight The answer is a clear no The Iran-Contra hearings are a bad precedent in intelligence oversight for at least five reasons First to publicly reveal the details of failed American intelligence operations- of 1Which the Iran- Contra affair is not the first and will not be the last--will have a severe chilling effect on the ability of the nation to carry out intelligence functions in the future Will other nations be willing to cooperate with the United States in secretive operations if they believe such operations can become public knowledge Will vital sources of human intelligence become more difficult for the United States to recruit Will foreign intelligence services be as willing to share information with the United States or to suggest possible opportunities for United States intelligence The answer to all these and other such questions is surely negative for effective American intelligence if other nations perceive that our process--or even possible process--of oversight review of failed intelligence is to hold nationally televised hearings relishing in the details of all aspects of the operations Second because of the difficulty of fully discussing covert operations publiclynor they would not need to be covert-and the inevitable need to protect sources and methods any public debate is likely to be distorted and one-sided in which the intelligence communitynand the Executive branch as a wholev-may well be unable to fully present the ease for their actions For this inescapable reason it is as likely that public debate about failed intelligence Operations will misinform as that it will inform The broadside against the President's Intelligence Oversight Board that emerged during the hearings is a good example The Board was created in the wake of the Church Committee hearings as a mechanism for ensuring intelligence community compliance with law and particulary in recent years it has had an important impact Moreover it seems to have been the only entity within the United States Government to have even raised the legal issues during continuation of the failed operations For its effort however it and its legal counsel were publicly pilloried and not on the merits but 2 on an attack against the counsel's credentials Even more wrongly the Nation has been presented with a distorted view of an important check tn the process of intelligence oversight Third the hearings while nominally in pursuit of legislative oversight in many respects have the appearance of a clockwork orange trial by grand inquisitors for the titillation of a national audience While the constitutionally permitted purpose of Congressional hearings is solely to support legislative function the overall hearings give a strong impression of greater interest in demonstrating individual impropriety or wrongdoing As such the hearings are dangerously close to an abuse of Congressional power Even more importantly no court yet conceived has thought of interrogation of those called before it by multiple accusers some with what could be regarded in other settings as a conflict of interest in demonstrating wrongdoing Nor does due process permit preparation of the accusers case in secret or denial of the right to cross-examine or make a full statement Even more importantly the interrogation proceeds in an atmosphere of prejudgment about the law And the judging panel reveals startling asymmetries in knowledge of the legal complexities of the case and opinions about the law Many simply assume that shredding of intelligence documents proves criminality Others make the assumption without legal analysis that one or more of a confusing array of Roland Amendments has been violated Yet shredding does not prove criminality and there are very fundamental legal issues concerning the relevant Boland Amendments most particularly whether their real ambiguities concerning scope of applicability were intended by Congress to prohibit efforts at third nation or private support for the Contras and whether any ambiguities should be and would be interpreted in favor of continued Presidential power Despite an absence of findings about the law judgments about witnesses are solemnly delivered before a national television audience with no opportunity for rebuttal Despite the professionalism and integrity of the Iran-Contra hearing panel and staff nationally televised hearings such as this one do present pressure for personal or partisan advantage to which lesser legislators might succumb lf failed intelligence operations are in the future to be tried by this new televised star chamber then we will inevitably destroy the careers of fine Americans whose crime has been to misread an ambiguous stream of congressional pronouncements or indeed even to do their investigative duty as required by the law As the Nation bitterly learned in the McCarthy Committee hearings trial by adversary televised congressional hearings may destroy the reputations of fine 621 622 Americans at little gain in legislative knowledge It is a precedent we should carefully review and that Congress should limit Fourth if the Iran-Contra hearings are to provide broader legislative investigation of compliance with legal constraints on private seetor support for competing factions in the Central American War then they should do so on an even-handed basis It is inevitable that an inquiry focusing solely on support for the Contras and ignoring the extraordinary efforts by and on behalf of the Sandinistas and the FMLN guerrillas in El-Salvgdor will have the appearance of an ideological imbalance if one is a fit subject for a publicly telcVised national inquiry it is hard to imagine the grounds on which contending efforts are to be ignored in such an investigation if of course there is a genuine legislative purpose in such hearings as opposed principally to a focus on allegations of individual wrongdoing - Finally the displacement of the normal intelligence oversight mechanisms established after the Church Committee hearings can only weaken those mechanisms that must do the important job of intelligence oversight on a day to day basis This objection also applies to investigation of failed intelligence operations by an independent counsel Our current intelligence oversight mechanisms are workable and include the bipartisan House and Senate select committees on intelligence the Attorney General and the President s Intelligence Oversight Board if we are to strengthen these agencies in their oversight role they must be permitted to conduct the review of failed operations and investigation of any illegalities or improprieties As long as that review includes rcvicutl by a bipartisan Congressional entity there cannot be any serious concern that an Administration will simply cover up its own failures The public need to know can be fully met by issuance of public reports where evidence of illegalitics or other improprictics should be revealed And certainly legislative facts needed for the legislative process can be assembled in the existing bipartisan select committees as well as in a public ad hoc committee For the future American Presidents should simply neither confirm nor deny allegations concerning covert operations and should refer allegations of improprieties or illegalities in such operations to the normal oversight mechanisms And Congress which fully participates in that process should endorse it as the appropriate mechanism No other Nation seems to have had the poor judgement to review its intelligence failures completely in public The Federal Republic of Germany has a small Parliamentary Oversight Committee 4 to provide intelligence oversight Other democracies have similar effective yet secret processes Nothing inherent in democracy or our desire for effective oversight requires that we periodically publicly cannibalize our intelligence processes or subject those who have served the nation to trial by television the Tower Commissioo may well be correct that even our two select committees should be consolidated Underlying the mistake in investigating the Iran-Contra failure by public ad hoc Congressional Committee is a more pervasive problem The framers intended that checks and balances apply to all branches Congress included While it is not clear in the Iran-Contra hearing that Congress has overstepped its'lcgal bounds it is dangerously close to usurping both executive functions in intelligence and judicial functions in assessment of any individual wrongdoing Yet there seem to be few real-world checks on growth of legislative power in the foreign affairs field and elsewhere Congress has passed laws such as the War Powers Resolution that are at Man in part clearly unconstitutional The growing confrontation across a broad range of foreign policy issues between Congress and the Presidency is increasingly harming the foreign policy effectiveness of the Nation The problem is serious for effective American foreign policy and is getting worse As one possible remedy I believe that the Congress and the President should establish a Congressional-Executive Commission half appointed by Congress and half by the President to review the full range of issues in Congressional-Executive coordination in foreign policy Such a Commission should review not only the constitutional underpinnings and legal issues but issues of appropriate constraints on the eaercise of Congressional power particulary issues of effectiveness and effect on deterrence and modalities of enhancing consensus between Congress and the President on a bipartisan basis Whatever the resolution of the broader range of issues we should abandon the sad precedent of review of failed intelligence operations by public ad hoc Congressional Committee The writer is Walter L Brown Professor of Law at the University of Virginia School of Law and a former United States Ambassador 623 APPENDIX 1-- 5- Depa'tn ex' 3 r' J seen - S f icc of the 5 - The Honorable Lee H Hamilton Chairman Select Committee to Investigate Covert Arms Transactions with Iran U 5 House of Representatives Room H-419 Capitol washington D C 20515 Dear Mr Chairman In a letter to the Attorney General of September 23 1987 you solicited suggested changes in_'1aw policy or-procedure' which might help avoid another Iran Contra situation We appreciate this opportunity to comment and to suggest a change which is not new but which is especially propitious in view of the Iran Contra matter and investigation The Congress should take one step which would decrease the likelihood of a recurrence We believe that the creation of a joint Congressional Intelligence Committee such as that proposed in both the 99th and 100th Congresses by Congressman Henry J Hyde would go far toward eliminating the environment which might contribute to a future Iran Contra situation Reducing the total number of persons with access to classified information and storing that information in a single secure repository would strengthen Executive branch confidence in the Congress' legislative role in the intelligence process Congress in turn would clearly benefit from this increased confidence by the receipt of timely and detailed reports of intelligence activities and a renewed ability for in-depth cooperation Aside from the establishment of a joint intelligence committee the Department believes that the introduction of any other legislative measures is unnecessary I hope you would agree that the Iran Contra matter was an exceptional situation which lends scant support to the proposition that a massive revision of the intelligence statutes is required 524 2 In addition attempts to effect a wholesale revision of these statutes would require tremendous time and effort with no guarantee of beneficial as this is an area of constitutional law which remains uncertain at the core In contrast the creation of a joint intelligence committee is a practical measure which could be implemented swiftly and with obvious positive results The Department of Justice is prepared to assist in whatever way we can in working with the Congress to establish such a committee sincerely Joha R Bolton Assistant Attorney General - 8 - 21 625 APPENDIX Laurence L Trac 'ul '1r h x It s rt 1' 1 If Lu 11 I 2 - 11' 1 qu 1 1 I I ll IIrr II I ll-s rr 1 Il s-rrlr ITwhat I believe may he Iran-Contra hearings -1 rnITiDuring the final da's at Fascell made a number fice and later with Congressman Jack Brooks report by the General Accounting 3-51ce and erroneous accusations about the Public As a former member of the Office I t and the shy help you in the preparat oE you report Although I am currently doing consult ng Department51 Defense no one in the Administration as write 1 letter and I have not cleared it with anyone in I I- Men - if 11 h- 1 a a wrurri whi r- I bona fides to comment on the l'c Diplomacy I was an army Colonel Deputy Assistant Secretary of airs from June 1980 until December 1 the request of the Department of Sta Office of Public Diplomacy where I a Advisor to Ambassador Otto Reich until my ret 3 and departure from government in May 1386 20 months that I was at the Department of State I gave ov ee hes on Central America created the display of captured do ume ts that President Reagan opened on March 13 1935 the principal author of the Administration's -d1srr1buted publications he Soviet-Cupan Conne Ame 1ca and the Caribbean the Blue Book e to Democracy 1n entra1 America the Silver de oped the now famous slide presentation that Lt th and others in government used extensively to brief 3 If I-bl IJI 1 41 41 I 1 I In H ull' L1 I '3 11 1 1ll II rl I Ir f'Ih 1r1' hi I 11 rr-I -L '11 1 12 1 0 1 rrII Uh-fl LI 1'11 1 1 Ow II ru-H m l'tfIipam II FL CI AD Report or Legal Opinion makes the very serious Ofrice of Public Diplomacy engaged in prohibited 1 Ila 1 14 Lu fl 1 0 a ities designed to influence the media and the Administration's Latin American policies this accusation is dubious the methodol questi naole and it is surprisinj th men w- d end so such a flawed ana he report belowH'I rr In Ir I l'll' Ff Eb f'U IT 1 H'u 11 11 but626 like to comment on the dangerous underlying assumption of the GAO finding which appears to be that the Executive Branch has no right to inform the public of developments in the foreign policy sphere In a democracy it is a fundamental respon31bility of the elect i leaders of the nation to keep the electorate informed of the dangers facing the country and the responses being taken by these elected leaders to solve such problems If an Admin1stration dis_eminates false inf rc atlcn to the public that is indeed propaga nda and the Congress and the media have a solemn responibility t d- all it their power to put and to such dishonest practices But an intensive effort to inf rm the public is both a right and a obligation of any Administration and it has been em arcisod fregsently in the past The GAG Report appears to be an attempt to limit this inherent ight duty f the Executive Branch An excellent example of an intense public diplomacy campai carried out by the Executive Branch on a foreign policy problem was that conducted 1 he Carter Administration on the Panama Canal Treaty Bresident Carter felt deeply about the issue and decided to go directly to the A1erican people with his side of the controversial issue It was a political success Although many in this country disagreed with the Carter policy I do not recall anyone in Congress calling on tr GAO to investigate a propaganda effort Th- public was well-served by the national debate that ensued for the American people came to understand both the costs and the benefits of the reaty and were better able to advise their repr sentatives in Congress of their position on the issue That is the essence of democracy It was for the same objective--increasing public awareness of a critical issue--that the Public Diplomacy 0 fine was formed in July 1933 I was clear to those of us working in Central Amer1car affairs that th public was not well-informed on the area had little knowledge of U15 policy objectives in Central America and little awareness of the threat posed to U13 security interests ty Soviet expansionism in the region It was concluded that we in the government were at fault for we had failed to develop the means by which we could communicate the issue of Central America clearly to the Amerisan people Hence the decision to create an int er- agency' organization that would draw talent from throughout the Reagan Administration with a presidential mandate to get the story to the American people of what was happening in Central America he decision was made to place the organisation in the tate Departm nt The Public Diplomacy Office did not engage in prohibited covert prop-agenda activities as the GAO alleges but did indeed carry out an aggressive campaign to increase public knowledge about Central America As the debate over aid to the Contras intensified did cu efforts to let t e public know who these young Nicaragusns were why they were fighting and what the consequences could to U13 security if the Soviet Union succeeded in establishing a Cuba in Central America Even critics of the Administration acknowledge --at the Offic eperformed effec ively and I am proud of the role p1ayed in helpin n3 to educate the public of the dangers faced by thi cturtry because of Soviet ambition and Sandi nista du licity 527 Given the criticism of the Office by the GAO perhaps we did too good a job as there are apparently some in Congress who wish to keep the public in the dark Having travelled throughout this country speaking on Central America I can assure you that the American people want more not less information about a region they know intuitively could soon become a battlefield or their sons The respected Roosevelt Center for American Policy Studies in it1 1337 study Trouble at our Doorstep found that the American people tel1e that neither the government nor the media are providing them with sufficient information upon which th e1 can make common sons judgements about Central America The Congress has been unswerving in its declarations that 3 3 interests cannot be permitted to be threatened by a permanent Covi1t military presence in Central America ing served in tietnam ertsihly d ot want to see young Americans fight anl die in Central America in the future because the Congress is unwilling to send arts to young Nicaraguans who are willing to fight for their country and thereby fight our battle for us The SAC Report apparently was inspired by the discovery of a memo written in hatch 1335 by Jonathan Miller of our iffire to Pat Buchanan in the White House in which Miller spoke of a White Propaganda campaign Among the triumphs for the office according to the memo were the p1acing of an article by Dr John Guilmartin of Rice University in the Wall Street Journal and arranging a favorable story the Contras by Fred Francis of NBC The CAC concluded from this memo apparently without checking wit either Gpilmartin or Francis that this constituted 1 covert propaga nda Had the GAO looked beyond the memo the investigators wou1 nave discovered that Dr Guilmartin as Lt Col Guilmar tin had been one of the United States Air Force's leading authorities on helicoptu1 doctrine and tactics and that any newspaper would have been hag l to publish his expert opinion on the military implication of th- delivery of Hi-24 HIND gunships by Moscow to the Sandinistsr As a ons1ltan to the Public Diplomacy Office he had done a rporb study for us on the subject and submitted the Op Ed piece to the Journal on his own with no help asked or required from us The allegation that we helped Fred Francis establish contacts aith Contra leaders is laughable Fred is one of the best connected reporters in Hashington with far better and more extensive contort with the the I Contra leadership than anyone in the Public Dip1omscy He required no help from us Why did Miller include such statements in his now- celebrated mem- to Buchanan He was probably exaggerating our accomplishments it an effort to curry favor for the Office with the White House not an uncommon tactic in the bureaucratic battles of Washington Jonathan has a eardor11c ser se of humor and he may have been just hicding as he told Ambassador Reich in October 1987 See Washington Fort Cototer ll 193 Certainly a memo of this nature orli be perceived as a smoking gun but it should have been the beginning not the end of the investigation trail The GAO appears t-o presume guilt then looks for facts to fit the a grip i assumption 528 mnnochnm numwa awn Hum mum om amonmm mum no mmum Par Um muUHIn ovaDQE hum wn doom onumnm mHoB arm zm monmw uncannI now run Um mnnanun om unmnm mm m5 Wyn- man Impuwh Jun nuomm nmwuw mun im tonwma n m umuMnraman man an 05m ma Hm Umm Inm m mn 3mm mam moan Hun n mn m inn wm mom Omonmm mrnumn xmu anmmwum on om moan mu mum uvunn mun mUocI wn on 0mm nm mun Mn Hanuwmm rm ammnu 0m mouawnn arm mUocn munmwm anaww om mm UnvanEmsw m munmm Um nUHwn Wman macaw twanwsa rm joimcmn Em mULnu memwm mum mu me mmn nm 0mmwn nu innxwum awn nmuwnmw wwmum xmum nmuu we mn nmamummn Roman a no rm rm mum Um mn umm mum anumn no num cunnmu UK nImmnHum 0m H rm mmapmuvmnm Hm nu munwmmuu mun owno wannw aocwm #mcm Umm mUUownwma we arm mum nnwanmw ruwno m3 m3 Hz an arm 2mm mruwnu H nn Ha Human nw mtmmu Dana H mm no wmnmovmwuw mo mivwn 0m mun Um Hm nwomwua Hm an Han Mn cocwm an mom on moHB om Hm om wm mnoa nmpuhuo Um UmoUum irww nwnmunm Mm wmu nmI om mum iwmn mum umwum nu Unum nrmuw numm 300m MUCH Hun awmnornmumm rum amxwaca mwoi om HSI nonawrwo no rm haUHwn th nmnnIuI OI am wILnnr 2H 0cm Ecmn Um 03 m5 uI m DH 1131 If If InIm mHmIIUnnIm Hm ERANI r nuHoan d m raga mm L- 1m ammo-w M wam 3 me out man LEM cm In Jenn HILDI cm toenail v Min neutron elm emu tau 3n Hull an mutton MEMORANDUM U S HOUSE OF REPRESENTATIVES sneer commute To mvesnoar COVERT TRANSACTIONS WITH IRAN UNITED suns wasnmo'ron or 2051 realize-inn July 23 1931 To Chairman Hamilton John Nields FROM Robert A Bermingham 4 HM I an cur-ro- am mt on mun-In cousin MM Lien um cm coo sir RE Allegations Re Contra Involvement With Drug Smuggling Sgpopsis Our investigation has not developed any corroboration of media-esploited allegations that U S government condoned drug trafficking by Contra leaders or Contra organizations or that Contra leaders or organizations did in fact take part in such activity The Select Committee on Narcotics Abuse and the Crime Subcommittee of the Judiciary Committee have been conducting investigation in this area but to date have not developed concrete evidence The Crime Subcommittee and the Senate Foreign Relations Committee are continuing their inquiries as is the Special Counsel It is recommended that after coordination with Chairman Innouye the Joint Committee issue a statement to the above effect and pledge cooperation with the Senate and House ongoing investigations Details During the course of our investigation the role of U S government officials who supported the Contras' and the private resupply effort as well as the role of private individuals in resupply were exhaustively examined Hundreds of persons including U S government employees Contra leaders representatives of foreign governments U S and foreign law enforcement officials military personnel private pilots and crews involved in actual operations were questioned and their files and records examined Despite numerous newspaper accounts to the contrary no evidence was developed indicating that Contra leadership or Contra organizations were actually involved in drug trafficking Sources of news stories indicating to the contrary were of doubtful veracity There was no information developed indicating any U S government agency or organization condoned drug trafficking by the Contras or anyone else The scope of our investigation does not specifically include determining whether the Contras have been independently or individually involved in drug trafficking The Senate Foreign Relations Committee particularly Senator Kerry the House Select Committee on Narcotics Abuse and Control under Rep Rangel and the Crime Subcommittee under Rep Hughes of the Judiciary Committee have been looking into this specific subject for some time They have travelled to Central America interviewed witnesses there and in Miami and have held hearings Rep Rangel is quoted in the Washington Post 7 22 87 as stating his investigation which started in June of 1986 and includes reams of testimony from hundreds of witnesses developed no evidence which would show that Contra leadership was involved in drug smuggling His Committee is to give its information to the Crime Subcommittee of the Judiciary Committee which will continue to investigate whether U S government officials deliberately ignored drug dealing by individuals who carried supplies to the Contras The Judiciary has engaged a Miami-based investigator DEA and Justice have issued statements disclaiming any concrete evidence of such activities by U S government officials Contra leaders or Contra organizations Dave Faulkner Investigator Senate select Committee advised that the Senate investigation was also substantially negative with regard to Contra drug smuggling On 1 21 87 Faulkner and the writer conferred with Hayden Gregory Counsel of the Crime Subcommittee of the Judiciary He confirmed that his committee has been and continues to investigate the question of U S government-sponsored Contra organizations being involved in drug smuggling His investigation including interviews in Central America and Miami of many of the persons named in the newspapers as suspects has been inconclusive to date He confirmed that several of those involved have also been questioned or deposed by the ongoing investigation by 631 Senator Kerry Gregory confirmed the newspaper account that BEprESEntatiVE Rangel's committee is deferring to the Judiciary In this matter He also stated he has to date developed no pertinent information above the level of street talk During the course of our investigation we examined files of State NSC CIA DEA Justice Customs and FBI especially those reportedly involving newspaper allegations of Contra drug trafficking We have discovered that almost all of these allegations originate from persons indicted or convicted of drug smuggling Justice has stated that such persons are more and more claiming as a defense that they were smuggling for the benefit of the Contras in what they believed was a U S government-sponsored operation Typically they furnish no information which can be corroborated by investigation In addition to the above-mentioned negative file reviews interviews with employees of these U S agencies have also been negative Contra leaders have been interviewed and their bank records examined They denied any connection with or knowledge of drug trafficking Examination of Contra financial records private enterprise business records and income tax returns of several individuals failed to locate any indication of drug trafficking It is known that the Special Counsel is looking into this area and that the FBI has pending investigations regarding similar allegations Conclusion It is felt that additional invesrigation of these allegations is unwarranted in view of the negative results to date the questionable reliability of the accusers the fact that two Congressional committees are already deeply involved in such investigations and that the matter is currently under investigation by the Special Counsel 632 Egg if EM urter r Collum WJQ 444% Michael DeWine Members House Select Gomittee to Members Senate Select Committee Investigate Covert Arms Transactions on Secret Military Assistance to with Iran Iran and the Nicaraguan Opposition 633 Sec oan Supplemental and Additional Views This document is from the holdings of The National Security Archive Suite 701 Gelman Library The George Washington University 2130 H Street NW Washington D C 20037 Phone 202 994-7000 Fax 202 994-7005 nsarchiv@gwu edu