Obama’s $400M Iran repayment vs Iran Contra: Which one is worse?

WASHINGTON- (Originally published by Talk Media News) – The Obama Administration’s recent $400 million cash transfer to Iran and the Reagan-era Iran-Contra scandal may be similar because American hostages ultimately were set free, but that’s where the similarities may end.

“I don’t see how you can possibly compare the two,” said former Massachusetts governor and 1988 Democratic presidential nominee Michael Dukakis. “In the current case, we owed money to Iran that we never paid them because the Shah was ousted. Everybody agrees that the money was owed, and it was paid at the time agreement on the Iranian nuclear issue was reached. Because of U.S. sanctions, it was impossible to use the Iranian banking system to pay our debt.”

Dukakis told TMN that the Iran-Contra scandal was far more serious than the recent cash transfer because the Reagan administration violated federal law and the involved parties lied to Congress in subsequent hearings.

“Iran-Contra was a whole different thing,” Dukakis said. “Congress had voted to prohibit the Reagan administration from providing any further aid to the Contras in Nicaragua. Notwithstanding Congressional action, the Reagan administration deliberately broke the law, funneled money to the Contras through Iran, and lied to the Congress about it. That wasn’t just a scandal. It was a flagrant violation of U.S. law.”

Dukakis blamed the Eisenhower administration for initially fomenting dismal relations between the United States and Iran. Dukakis referenced early 1950’s CIA initiatives, which retroactively replaced Iran’s democratically elected leader with Shah Mohammad Reza Shah Pahlavi, who was later overthrown during the 1979 Islamic Revolution.

Dukakis said had the United States opted against interfering in Iranian politics, relations between the two nations might have turned out completely different.

“In 1953 an earlier Republican administration in clear violation of the UN Charter and international law used the CIA to overthrow the democratically elected government of Iran and consigned the Iranian people to a 27-year dictatorship which, among other things, put the democratically elected Iranian prime minister under house arrest for the rest of his life,” Dukakis said. “If we hadn’t done that, a democratic Iran would now probably be our closest ally in the Middle East.”

The Obama administration reportedly airlifted funds to Teheran in January 2016 and consistently maintains that the payment is compensation for an arms deal that was subsequently revoked after the Shah was overthrown in 1979. The cash transfer, which consisted of Euros and Swiss Francs, is the first installment of a $1.7 billion package, Obama told reporters.

The Reagan administration facilitated the sale of small-scale conventional arms from Israel through a third party to Iran between 1985-1986 to help secure the release of seven American hostages being held captive in Lebanon by the Iranian-backed terrorist group Hezbollah.

Proceeds from the sale were subsequently diverted to the Nicaraguan Contras, who were engaged in an effort to overthrow that country’s Marxist Sandinista-controlled government. Congress previously banned financial assistance to the Contras vis-à-vis the Boland Amendment due to concerns over human rights abuses.

Richard E. Vatz, a professor of Political Persuasion at Towson University in Maryland, also said there are few similarities between the two scenarios.

“The analogy is weak,” Vatz said. “President Reagan was not proven to be directly involved, and there were complex elements, including the Iran-Iraq War wherein the United States was trying, I believe, to foster its strategic interests.”

Another crucial difference is that Reagan was upfront with American people and took responsibility for the Contra scandal whereas President Obama attempted to conceal the cash transfer and subsequently denied that the payment was authorized to secure the release of American hostages, Vatz said.

“Also the transparency of the situation with President Reagan addressing the country and not defending Iran-Contra stand in contrast to President Obama’s complete stealth and efforts to deny the fact of the $400 million deal in addition to its quid pro quo component,” Vatz said.

Daniel Pipes, founder and CEO of the nonprofit Middle East Forum, said the two scenarios are similar in that both constitute ransom payments as well as attempts to improve relations with Iran.

“The two are similar in not just paying a ransom to win the release of American hostages but also to improve relations with the Islamic Republic of Iran,” Pipes said.

Pipes said the scenarios differ in that Iran-Contra was conducted in complete secrecy whereas the more recent Iran cash transfer was a concealed action carried out in conjunction with a public agreement. Pipes also said news of the Iran-Contra scandal caught the public off guard whereas revelation of the cash transfer confirmed existing suspicions of foul play.

“They differ in that Iran-Contra was a totally clandestine operation and the $400 million this year was a clandestine part of an overt activity,” Pipes said. “That one came as a shock; this one confirms suspicions publicly aired at the time of the transfer.”

The Iran-Contra scandal led to the indictment and in some cases the conviction of several high-ranking Reagan Administration officials, many of whom were later pardoned. Below are a few examples:

Lt. Col. Oliver North, who became the public face of the scandal, was convicted of aiding and abetting obstruction of Congress, authorizing document destruction and accepting illegal gifts, but the convictions were later overturned by a federal appellate court, largely as a result of him having been granted limited immunity. National Security Adviser Robert McFarlane pleaded guilty to withholding information and was given two years probation. McFarlane was later pardoned by President George H.W. Bush. Secretary of Defense Caspar Weinberger was indicted for perjury and obstruction of justice and while awaiting trial was also pardoned by President George H.W. Bush.

To date no one in the Obama Administration has been charged pursuant to the cash transfer.