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The October Surprise Mysteries

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Walsh's Iran-Contra investigation had already begun to suspect that the origins of the 1985-86 arms sales to Iran could be traced to 1980. When Walsh's investigators subjected former CIA officer Donald Gregg to a polygraph exam, Gregg, who had served as Vice President Bush's national security adviser, was asked about his alleged participation in the October Surprise operation and was judged to be deceptive in his denials. [Final Report of the Independent Counsel for Iran/Contra Matters, Vol. I, p. 501]

Second Thoughts

In retracing these investigations in 2010-12, I also discovered that there was much greater doubt inside the House task force than its dismissive conclusions suggested. For instance, chief counsel Lawrence Barcella told me in e-mails that so much incriminating evidence against the Republicans arrived near the end of the task force's investigation that he asked the task force's chairman, Rep. Lee Hamilton, to extend the inquiry for three more months.

However, Barcella said Hamilton declined to go through the necessary reauthorization of the task force and instead ordered him to proceed with the final report, which was published on January 13, 1993, and concluded that there was "no credible evidence" behind the suspicions. In 2010, when I asked Hamilton about why he had rejected Barcella's request for an extension, the centrist Indiana Democrat said he had no recollection of such a proposal.

Barcella and Hamilton also differed on whether Barcella had forwarded to Hamilton an extraordinary report from the Russian government about what Moscow's intelligence files showed about the alleged contacts between Americans and Iranians in 1980 and beyond.

The report, which had been requested by Hamilton and was addressed to him, was provided by Sergey V. Stepashin, chairman of the Supreme Soviet's Committee on Defense and Security Issues. It was translated by the U.S. Embassy in Moscow and forwarded to the House task force on Jan. 11, 1993, just two days before the task force's final report was to be released.

The Russian Report contradicted the task force's findings. As described by the Russians, the 1980 hostage negotiations boiled down to a competition between the Carter administration and the Reagan campaign offering the Iranians different deals if the hostages were either released before the election to help Carter or held until after the election to benefit Reagan.

The Iranians "discussed a possible step-by-step normalization of Iranian-American relations [and] the provision of support for President Carter in the election campaign via the release of American hostages," according to the U.S. Embassy's classified translation of the Russian report.

Meanwhile, the Republicans were making their own overtures, the Russian Report said. "William Casey, in 1980, met three times with representatives of the Iranian leadership," the report said. "The meetings took place in Madrid and Paris."

At the Paris meeting in October 1980, "R[obert] Gates, at that time a staffer of the National Security Council in the administration of Jimmy Carter, and former CIA Director George Bush also took part," the Russian Report said. "In Madrid and Paris, the representatives of Ronald Reagan and the Iranian leadership discussed the question of possibly delaying the release of 52 hostages from the staff of the U.S. Embassy in Teheran."

Both the Reagan-Bush Republicans and the Carter Democrats "started from the proposition that Imam Khomeini, having announced a policy of 'neither the West nor the East,' and cursing the 'American devil,' imperialism and Zionism, was forced to acquire American weapons, spares and military supplies by any and all possible means," the Russian Report said.

According to the Russians, the Republicans won the bidding war. "After the victory of R. Reagan in the election, in early 1981, a secret agreement was reached in London in accord with which Iran released the American hostages, and the U.S. continued to supply arms, spares and military supplies for the Iranian army," the Russian Report continued.

The deliveries were carried out by Israel, often through private arms dealers, the Russian Report said. [For text of the Russian report, click here. To view the U.S. embassy cable that contains the Russian report, click here.]

Disappeared Document

After I discovered the Russian Report in late 1994 after gaining access to the task force's unpublished files, I was told by Barcella that he had stuck the document into one of the cardboard storage boxes with the expectation that it would disappear into a vast government warehouse like the closing scene of "Raiders of the Lost Ark."

But I was surprised to be told by Hamilton in 2010 that he had never seen the document, until I shipped a PDF file to him. After all, it had been addressed to him and represented possibly Moscow's first post-Cold War collaboration with the United States on an intelligence mystery. So, after speaking with Hamilton, I went back to Barcella who acknowledged by e-mail that he didn't "recall whether I showed [Hamilton] the Russian report or not."

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Robert Parry broke many of the Iran-Contra stories in the 1980s for the Associated Press and Newsweek. His latest book, Secrecy & Privilege: Rise of the Bush Dynasty from Watergate to Iraq, can be ordered at secrecyandprivilege.com. It's also available at
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