THE IRAN--CONRTA HEARINGS HEAD Excerpts: ‘There’s No Reason to Pay a Price (for Iran Talks)’

WASHINGTON â€”  Following are excerpts from testimony Friday by Secretary of State George P. Shultz before the congressional committees investigating the Iran-contra affair:

Shultz Versus Casey

Republican Rep. William S. Broomfield of Michigan presses Shultz on the vigor of his efforts to dissuade President Reagan from accepting the proposal by his National Security Council staff to sell arms to Iran.

Question: . . . You saw the President personally on this matter in January of 1986. You even, I believe, offered to resign at that time. Are you confident that you went far enough in attempting to persuade the President not to pursue this unwise program that was being promoted by the NSC staff? And I’m wondering, should you have threatened to resign more forcefully at that time?

Answer: I don’t think that the President was in any doubt about my views. Nor was he in any doubt about (Defense) Secretary (Caspar W.) Weinberger’s views. So they were presented to him forcefully and fully. So I don’t know whether--I don’t think there are any more arguments I could have thought of. . . .

Q: Mr. Secretary, the Iran arms sales have almost certainly resulted in just the kind of damage you predicted. . . . Can the damage to United States relations in the Arab world and to our policy on terrorism be remedied?

A: It has been remedied. I think we had a rough spot, but the basic validity of the President’s policies is shown by the fact that people have welcomed the fact that we continue to assert them and support them. . . .

Q: Are you comfortable, Mr. Secretary, with your position as secretary of state, following this process of self-examination that we’ve had?

A: Well--are you a psychiatrist or something?

Q: . . . Did you ever try to work out directly with the President the problems you were having with (the late CIA) Director (William J.) Casey?

A: Well, this was a period of--a rather intense period, with fast-moving events, and I met with the President a number of times. . . . But my focus was not so much on individuals as it was on substance: The substance of what you (the President) are being told is not accurate.

Q: Do you feel the President continued to rely too much on Bill Casey as a result?

A: Well, he was the director of central intelligence, so naturally he had more access than any other individual to this immense and impressive flow of information into the analytical capabilities that go with it. So you have to look to the director of central intelligence as a principal person, without a doubt. That doesn’t mean that--that the intelligence estimates can’t be challenged, and they were. . . . For instance, I challenged the idea that Iran had dropped off in its use of terrorism. . . .

Q: . . . Why didn’t you have more influence with the President?. . . Apparently he was relying on Bill Casey.

A: Well, I think the President was relying on himself. You seem to miss the point that the President is a very decisive person. . . .

Q: Were you ever denied the ability to meet with the President when you considered it necessary?

A: Never. . . .

(Broomfield ask s if it would be reasonable to require the President to notify the majority and minority leaders of both chambers of Congress about “serious and very important covert activities . “)

Q: . . . Even the most serious secrets of our country ought to be discussed with the leadership of both the House and Senate. How do you feel about that?

A: Well, I believe, as a general proposition, in a system of separation of powers . . . which on the other side of the coin is a system of shared powers. That process of sharing is hard and it needs to be worked at. And there’s no way to make a formula about it. . . . For the most part, everything is open, and should be, that’s our system.

You’re focusing on a certain class of activities that cannot be open, and everybody agrees they cannot be open. And how do we keep each other informed about that in a manner that keeps the activities secret? And it’s a problem that we haven’t solved--yet. . . .

You cannot have a system in which the President is required to notify people before he acts in all cases; it won’t work.

(Republican Sen. William S. Cohen of Maine presses for details of the debate over the content of the televised speech last Nov. 13 in which Reagan attributed the arms sales to Iran to a desire for improved relations with that country.)

Q: . . . When you were debating the issue of not going forward or letting the President go out on the stage and give a speech to the people with incorrect or indeed false information, who was waging that battle against you or with you?

A: I was in favor, right from the beginning, of full disclosure of the facts, so I wasn’t opposed to the idea of a presidential speech or press conference, although . . . there was obviously need for a better assessment. It was more a question of what was the content.

Q: Well, were you the only person arguing, during that debate, that the content should be changed? Were there other people, allies, on your side, to say: “Mr. President, you can’t go out with information like this and present this to the American people?�

A: Well, I don’t know. I just am able to testify about what I did. . . .

Q: Mr. Secretary, if the hostages were not involved, could you conceive of the President agreeing to sell arms to the Iranians in order to open up “a new dialogue� with the Iranians?

A: Well, I obviously felt that such a thing was very ill-advised. . . . I don’t think it’s the kind of price we should pay. There’s no reason to pay a price.

A Watergate Parallel?

Republican Rep. Dick Cheney of Wyoming takes exception to those who find parallels between the Iran-contra affair and the Watergate scandal, which he described as a political crime.

Q: . . . Why should the committee . . . believe that the events you described yesterday are any different fundamentally than the kinds of conflicts that occur from time to time in administrations over policy between the State Department and the NSC?

A: There was a particular operational role that was undertaken by the staff of the National Security Council that was, in a sense, not knowable. . . . It causes you to say: “How do we design our procedures so that, if some operation is undertaken, it is undertaken by people who are accountable in a kind of formal sense?�

. . . I think it would be a mistake, however, to lay down some absolutely flat rule, because I’m sure there’ll be times when it is the judgment of the President . . . that here’s an occasion when it would be very useful to have the national security adviser go do something or other, but it ought to be gone about in--in such a manner.

(Cheney suggests that Casey’s strong feelings about recovering the hostages stemmed from the fact that one of them was William Buckley, the former CIA station chief in Beirut, who was murdered by his captors.)

Q: I don’t find it surprising that . . . people in the agency, and Mr. Casey, would feel very strongly about the importance of trying to recover, if you will, freedom for one of their own.

A: Absolutely. And I share completely his concern, not only about Mr. Buckley, but other Americans who are taken hostage. And we need to work in a strong, intense way to do something about our hostages. But I think we have learned from all this--I hope it has sunk in--that there are some things that are not a good idea to do. It’s not a good idea to publicize and make it clear to hold the hostages that there’s practically nothing we wouldn’t do to get them released. That’s counterproductive.

Q: I would agree with that.

A: And if you pay for hostages, you just encourage taking more. . . .

(Democratic Sen. Howell Heflin of Alabama asks whether a dialogue with so-called moderates in Iran could have resulted in a meeting between top U.S. and Iranian officials.)

Q: Are there problems with that type of approach? . . .

A: These seem to be sort of fantasizing by people about how things might go. . . . It’s sort of inevitable, as I was saying yesterday, because of the strategic situation, that the U.S.-Iranian relationship will change. It will probably go through some sort of process that winds up with a high-level exchange of some sort, or meeting. . . .

Q: . . . Let me ask you about the evaluation and discussion . . . pertaining to our direct sale of arms to Iran. . . . Was there any evaluation of the effect of 4,000 TOWs (anti-tank missiles) upon the Iran-Iraqi war that you heard any discussion about?

A: Well, senator, I didn’t know about the sales and so on as they occurred, so I wasn’t part of such a discussion. . . .

(Democratic Rep. Dante B. Fascell of Florida asks about the State Department office that was to lobby for aid for the contras.)

Q: As a matter of fact, of course, that office reported directly to the NSC, or at least was coordinated by the NSC. Did you know that?

A: . . . I have learned more as a result of your probing than I knew at the time. . . .

Q: . . . Were you informed of what they were doing at all? . . .

A: I couldn’t supervise their day-to-day activities. . . . But I think in the context of a government effort . . . you could expect them to interact with people on the NSC staff. Nothing unusual about that.

Q: No, it’s not. Except looking at the material and evidence we have, it looks like the whole thing was being run by (Lt. Col. Oliver L.) North out of NSC.

‘Wring Somebody’s Neck’

Republican Sen. Paul S. Trible Jr. of Virginia cites a June 10, 1986, communication between (John M.) Poindexter and his dismissed aide, North, rejecting a suggestion that the government of Brunei be given the number of a bank account holding funds to aid the Nicaraguan contras. It should not be disclosed, Poindexter said, “that we had access to the accounts.�

Q: Would you like to respond to that?

A: . . . It’s just another example of the kind of deception that was practiced, because our information was that there was an account number belonging to the freedom fighters, and the money would go to the freedom fighters. They gave us that impression knowing, according to that note you just read, that the account belonged to them. . . .

I feel like I’d like to wring somebody’s neck.

(Republican Rep. Henry J. Hyde of Illinois suggests that Shultz had depicted a foreign policy in disarray and a President impervious to arguments against the Iran arms sales.)

Q: I cannot believe if you had been that forceful and that committed to opposing this flawed initiative, as much as Poindexter and North were committed to advancing it, you couldn’t have stopped it dead in its tracks. I ask you if that’s not so?

A: I doubt it very much. . . .

(Democratic Rep. Peter W. Rodino Jr. of New Jersey presses Shultz to explain why he did not urge President Reagan to find out more about the Iran-contra affair before he discussed it in a televised speech last November.)

Q: Would not that have been a proper responsibility on your part, knowing how deeply you felt and the enormous consequences of a President going before the American people and being looked upon as lying or deceiving them?

A: First of all, I want to comment on the President’s soundness of judgment. . . . I have come to have a profound respect for his capacity to make good decisions and be decisive. . . . I didn’t agree with his judgment in this case. . . . The President’s perception was that what he had authorized and what he believed was taking place was an initiative with respect to Iran and there was the potential benefit from that of the release of our hostages. . . . Whenever I found out about anything specific, it was arms linked to hostages. . . .

(Democratic Rep. Jack Brooks of Texas questions Shultz about the admission of Assistant Secretary of State Elliott Abrams that he had misled Congress in testimony about a $10-million contribution by Brunei to the contras.)

Q: Did you or any other official of the executive branch instruct Mr. Abrams not to testify truthfully in regard to this matter?

A: . . . Anybody that works for me should know that they must not lie and must not mislead. . . . Elliott had a piece of information that he could not reveal--to do so would have been a breach of faith with the country involved. There are all sort of ways to handle it when you are in such a session as Elliott found himself in. . . . A perfectly acceptable thing to the committee would have been to say: “Senator, I don’t want to testify on this. I’d like to come back.� . . . Elliott made a mistake and he knows it. . . . Then he corrected it in another meeting. Elliott is a combative person. That’s one of his endearing qualities. . . .�

Q: . . . I personally do not agree with your high regard for him. . . . I thought you made a fatal error as far as his usefulness to your Administration, but that’s your choice. The way I look at it, if you want him, you got him.