Carlucci Strips 6 Aides of Duties : Reagan 'Upset' by Fraud, Backs Administration

By JAMES GERSTENZANG

June 22, 1988 12 AM PT

Times Staff Writer

TORONTO — President Reagan declared Tuesday that he was “very upset” by the unfolding revelations in the Pentagon scandal but disclaimed any responsibility for the reported abuse in major weapons contracts awarded during his military buildup, saying: “You can’t be down there watching several million people.”

In defending his Administration, the President said: “It should be understandable how such things can happen in something as big as our government is.”

The issue of wrongdoing in the Defense Department’s procurement system is a particularly sensitive one for Reagan, who often pledged during his 1980 presidential campaign that he would eliminate waste, fraud and abuse at the Pentagon. In addition, many believe that his Administration’s unprecedented military buildup contributed to the potential for abuse.

First Comments

Reagan’s remarks, made in response to a barrage of questions on the scandal during a news conference at the end of the three-day summit conference of the major industrial democracies, were his first extensive comments on the case. Federal agents are continuing to investigate allegations of massive bribery and fraud in the expanding probe.

When asked whether he felt responsible for any misdeeds in the awarding of the multimillion-dollar Pentagon contracts, Reagan replied: “I think all of us are disappointed and upset that such things could happen.” He said that “we are accountable.”

But he added: “On the other hand, I think there are some things you can see, and something as complex as that whole process and the number of corporations and all--corporate heads probably are surprised at what they’re learning, also--because you can’t be down there watching several million people and the total of all of the companies and the Defense Department every day and what they’re doing or what phone calls they’re making.”

“No one would think that we should be tapping all of those phones . . . just on the suspicion that someone might be out of line,” he said.

Reagan defended his senior Pentagon officials, who he said “were appointed because of their business skill.” Many had held previous positions in the defense industry and have returned to work for companies with which the Pentagon does regular business.

However, he said, “if I gave (the) impression that this is minor in some way, not at all. I don’t feel that way at all. As a matter of fact, I’m very upset.”

Praises Investigators

Reagan, speaking to reporters in the ballroom of the Royal York Hotel here, praised the investigators for conducting their inquiry without disclosing it to senior officials, “including me,” because “they had no idea where this leveled off or how far it went or how high it went.”

When asked whether alleged mishandling of classified weapons information may have hurt national security, the President said that it is too early to tell. “We can’t judge yet whether there’s something specific in all of these things that might have in some way lessened the recovery of our defensive strength,” he said.

Reagan also rejected speculation that any political fallout from the scandal would harm the presidential campaign of Vice President George Bush. Aides have tried to distance Bush from questions about the ethics of other Administration officials, most notably those of Atty. Gen. Edwin Meese III.

Risk of Embarrassment

Nevertheless, for Reagan, the emerging scandal raises the risk of particularly acute embarrassment. He frequently has pointed to the results of the more than $1 trillion he pumped into the Defense Department before Congress, smarting over the failure to trim the budget deficit, forced a leveling off in funding levels.

Indeed, at his news conference, the President reiterated his assertion that when he took office, half of the nation’s military airplanes could not fly for lack of spare parts and fuel. He added that the Navy was similarly hampered, citing a weakened state of the military forces as evidence of the need for the historic buildup he oversaw.

But when the investigation is completed, Reagan said, “I don’t think they will find that we were derelict in our duty.”

Gun Control Issue

At his news conference, televised nationally in the United States, Reagan also indicated that “there’s some certain things I would go for” in the area of gun control.

When asked about the case of columnist Carl Rowan, who wounded a teen-ager he discovered swimming in his back-yard pool, Reagan said that he advocates delays in gun purchases to allow investigations of the prospective gun owner.

“I would like to see that generally, and I think that all states ought to take a look at that system,” he said.

Reagan added that “I think maybe there could be some restrictions, that there had to be a certain amount of training taken” before a gun could be sold.

Letter From Convict

But he made it clear that he does not favor restricting the right to gun ownership in general, saying “we ought to pay heed” to a letter he received as California governor from a convicted burglar who wrote to him that if citizens--prospective burglary targets--no longer had weapons, “there will be hundreds of very happy people here in San Quentin.”

On other topics:

--Reagan said he was not underestimating the seriousness of the drought that is ruining crops throughout the Midwest and pointed out that he has established a task force to study the situation. “They’re out there finding out and, outside of praying for rain, there isn’t anything I can do until we hear from them,” he said.

--The President also said that he does not think former aides John M. Poindexter and Oliver L. North, key figures who have been indicted in the Iran-Contra scandal, are “guilty of any law-breaking of any kind.” However, when asked whether he would commit himself to not granting a pardon to them, he said only that “they would live the rest of their lives under a shadow of guilt” if they are pardoned before trial. “So I have no intention of . . . “ he said, without finishing the sentence.

--Reagan refused to say whether he has “given up” on using force in his efforts to oust Panamanian strongman Manuel A. Noriega.