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WHILE THE arms-for-hostages deal with Iran (Iran-Gate) and the supply of military aid to the Nicaraguan Contras (Contra-Gate) are generally referred to under the umbrella term Iran-Contra, the two distinct events occurred on two separate continents. It was only when the idea of using the proceeds from the Iranian arms sales to provide aid to the Contras, after Congress passed the Boland Amendment banning such action, that the two distinct operations became connected. The cover-up that followed irrevocably tied the two events together in the minds of the American people. By the time all investigations into the Iran-Contra affair were completed, the total cost to the American people reached $48.5 million

Iran-Contra is definitely one of the worst foreign policy fiascos in American history. While the administration of Ronald Reagan was involved in damage control, little was accomplished in the area of foreign policy. Even though Reagan was not removed from office, the popular president's reputation was tarnished; and he never quite recovered from the loss of public trust. Immediately after the Iran-Contra scandal broke in November 1986, Reagan's approval ratings fell by an unprecedented 21 percent. When Howard Baker replaced Donald Regan as chief of staff in February 1987, he agreed to accept the position only if he were allowed to conduct an investigation into affairs at the White House. Baker concluded that the president was not in control of the White House or of the executive branch.

Iran-Gate

Until the Shah of Iran was deposed in early 1979, the United States shared an amicable relationship with this oil-producing Muslim country, However, when the Ayatollah Khomeini gained power, the United States became the “great satan” to his followers. In November 1979, 52 American hostages were taken at the United States embassy in Tehran, the Iranian capital. They were held for 14 months. During this period, President Jimmy Carter banned all trade with Iran. In retaliation for Carter's briefly harboring the ailing Shah, the Iranians refused to release the hostages until Reagan became president at noon on January 20, 1981. Within minutes, the plane carrying the hostages left Iran for Germany. The Iranian government under Khomeini was well known for its aid to terrorist organizations and was thought to be responsible for the taking of additional American hostages on a number of occasions. The Reagan administration emphatically stated that the United States would not trade arms for hostages and would not concede to terrorist demands. In the spring of 1983, the State Department announced Operation Staunch, which was designed to use American influence to keep other countries from selling arms to Iran. Records show that as early as 1981, the Reagan administration was considering selling arms to Iran, even though the White House was well aware of the Iranian connection to the terrorist murder of 241 U.S. Marines in Beirut, Lebanon, and despite the fact that the Iranian government had sanctioned the taking of American hostages and had committed numerous acts of terrorism.

Contra-Gate

On July 17, 1979, the regime of Anastasio Somoza collapsed in Nicaragua, and the National Liberation Front, a coomunist party known as the Sandinistas, seized power. In February 1981, the Reagan administration announced that it was suspending all aid to Nicaragua. However, Reagan's administration was committed to furthering conservative goals in Central American, and realization of those goals involved supporting rightist governments against leftist governments whenever possible. Reagan decided to increase military aid to El Salvador, Honduras, and Guatemala. His actions in Nicaragua, however, went beyond traditional military aid. Central Intelligence Agency (CIA) operatives were used to train anti-Sandinista or Contra guerrillas and were heavily involved in intelligence initiatives, including mining Nicaraguan harbors.

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