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President Reagan acknowledges mistakes of Iran-Contra Scandal

By NORMAN D. SANDLER

WASHINGTON -- President Reagan told Congress and the nation Tuesday the failure of his secret overtures to Iran was the 'one major regret' of his presidency, but offered no apology and said, 'The goals were worthy.'

Delivering his sixth State of the Union address in a packed House chamber, Reagan confronted the Iran arms scandal at the outset, telling assembled lawmakers and a nationwide television audience he accepts 'full responsibility' for the policy ploy that went sour.

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'We did not achieve what we wished,' he said, 'and serious mistakes were made in trying to do so. We will get to the bottom of this and I will take whatever action is called for.'

Trying to shake the grip of the scandal that has undercut his popularity and public confidence in his leadership, Reagan warned the country must not become obsessed with 'debating the past' and allow partisanship to keep the nation from moving ahead, both at home and abroad.

Many of the policy goals Reagan presented in his 35-minute speech to the 100th Congress echoed the agenda he has pursued since taking office in 1981, with an added emphasis this year on assuring the nation is more competitive in the global marketplace and not a 'trade patsy.

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Reagan, who has stayed out of the public eye as the controversy has festered for two months, laid out a concise, and essentially unchanged, defense of the clandestine overture to Iran, which his foes -- and some friends -- have plainly labeled an arms-for-hostages swap.

After a brief recitation of the domestic economic achievements and progress in reasserting the nation's position of 'leadership in the world' during his six years in office, Reagan said:

'Though we have made much progress, I have one major regret. I took a risk with regard to our action in Iran. It did not work and for that I assume full responsibility.'

Reagan won vigorous applause from the Republican side of the aisle throughout the speech, while Democrats were restrained, sometimes to the point of being chilly.

Rep. Dante Fascell, D-Fla., said, 'the Republicans, in their enthusiasm to show strong support for the president, overdid it. ... It became almost clackish.'

While Reagan spoke of dealing weapons to Iran, he did not directly mention efforts to divert money from the secret arms sales to support the Nicaraguan Contra rebels -- the disclosure that pushed the foreign policy controversy into the realm of political scandal.

Nor did the president specify what 'mistakes' were made in carrying out his Iran initiative, or who made them -- two of the major issues now being explored by a federal special prosecutor and a pair of Watergate-style committees created by Congress.

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Administration officials have blamed the cash-for-the-Contras scheme on National Security Council staffer Lt. Col. Oliver North, who Reagan fired Nov. 25, but also described later as 'an Amercian hero.'

Reagan, who had beenurged by some Republican leaders to use the speech to apologize for the affair, did not. White House chief of staff Donald Regan, asked by reporters about that omission, said, 'I don't think you're going to get him to.'

Pointing to the basement, where the NSC has its offices, Regan added, 'The mistakes were made down there.'

The president, greeted by a standing ovation and interrupted by applause almost 40 times, began by noting the approaching bicentennial of the Constitution and the presence of a new House speaker, Democrat Jim Wright of Texas, who introduced him.

Reagan, who had prostate surgery three weeks ago, appeared fit and relaxed as he also acknowledged the new Democratic majority in the Senate and pledged to Wright and Senate Democratic leader Robert Byrd of West Virginia 'harmony and good will' in moving the nation ahead.

'This Congress can make history,' said Reagan, who is beginning his final two years in office with both the House and Senate in Democratic hands for the first time in his tenure.

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Despite Reagan's olive-branch appeal for bipartisanship in foreign policy, Byrd, delivering the Democratic response, made it plain the 'Iranian misadventure' has not been put to rest.

'The administration has the obligation to tell the American people exactly what led to the arms-for-hostage deal and what happened to accountability in the White House,' Byrd said.

Sen. John Glenn, D-Ohio, was more explicit, saying, 'The president still has not apologized or even admitted he made a mistake in giving guns to the Ayotollah (Ruhollah Khomeini, Iran's leader).'

But Sen. Richard Lugar, R-Ind., said, 'I thought he hit it (the Iran scandal) head-on' by calling the arms deal 'a noble vision' that failed and by taking responsibility.

On foreign affairs, Reagan punched two favorite themes -- his desire for a nuclear arms accord with the Soviet Union that does not jeopardize the nation's security, and the need to halt the spread of communism, especially in Latin America by aiding the Contras battling the leftist Sandinista government of Nicaragua.

The president said the opportunity for a major arms deal during his Iceland summit with Soviet leader Mikhail Gorbachev was 'dashed because they sought to cripple our Strategic Defense Initiative' -- his 'Star Wars' anti-missile defense plan. While vowing 'SDI will go forward,' Reagan said there is 'a moment of rare opportunity' at U.S.-Sovet arms talks in Geneva.

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On the Contras, Reagan said the rebels, now receiving $100 million in U.S. aid after Congress had banned direct assistance for about two years, 'never asked us to wage their battle.'

But he declared, 'I will fight any effort to shut off their lifeblood and consign them to death, defeat or a life without freedom. There must be no Soviet beachhead in Central America.'

On the domestic front, Reagan said he would send Congress details soon on two major programs, for a 'new national welfare strategy' and 'to help free the elderly fron the fear of catastrophic illness,' as well as proposal for budget reform and a package of ideas to improve 'competitiveness.'

In defending his decision more than 18 months ago to seek better relations with Iran through clandestine contacts, Reagan referred explicity to the fate of American captives in Lebanon -- although he has maintained deals for their freedom were a side benefit of the sale of weapons to Iran, not a major objective.

Three Americans were released by their pro-Iranian captors after U.S. weapons deliveries to Iran, but more Americans were seized, including three taken last weekend, raising to eight the number of U.S. citizens missing in Lebanon.

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At that time, Reagan's critics said the escalation in hostage-taking was directly linked to the perception fostered by the arms deals that ransom could be extracted.

Discussing the decision he made in August 1985 to reach out to 'moderate' Iranians who might be more friendly that the extremist leaders of the Khomeini government, Reagan said, 'The goals were worthy.' He continued:

'I do not believe it was wrong to try to establish contacts with a country of strategic importance or to try to save lives. And certainly it was not wrong to try to secure freedom for our citizens held in barbaric captivity.'

A standing ovation led by Republicans greeted the declaration, and Secretary of State George Shultz, who opposed the arms sales and has said he was cut out of major deliberations on the deals, joined other Cabinet members in applauding.

Surveying the fallout of the failure, Reagan said, 'Much is at stake here, and the nation and the world are watching to see if we go forward together in the national interest or if we let partisanship weaken us.'

Saying there must be no doubt about American policy, he declared, 'We will not sit idly by if our interests or our friends in the Middle East are threatened, nor will we yield to terrorist blackmail.'

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Wrapping up his references to the affair -- only about 300 words from a speech running more than 5,000 -- Reagan challenged the lawmakers: 'Now, ladies and gentlemen of the Congress, why don't we get to work?' The presidential address, the 199th such message from a president to Congress, was notable by one absence -- there was no direct statement from Reagan on the 'state of the union.' But he sounded a clear call for his economic agenda, saying, 'Let's roll up our sleeves, got to work, and put ?n*

fu1merica's economic engine at full throttle.'

While devoting considerable time to foreign affairs, Reagan gave short shrift to his conservative social agenda, although he did mention returning to /uu?

Reagan, defiant on the subject of Central America and careful to avoid any mention of the diversion of profits from the Iran arms sales to the rebels in Nicaragua, invoked the pledges of three Democratic presidents -- Franklin Roosevelt, Harry Truman and John Kennedy -- to resist the spread of communism in the Western Hemisphere.

'Some in this Congress may choose to depart from this historic commitment, 'but I will not,' he said.

'Nicaraguan freedom fighters have never asked us to wage their battle,' he said, 'but I will fight any effort to shut off their lifeblood and consign them to death, defeat or a life without freedom.'

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On the subject of superpower relations, Reagan linked improvements to 'more responsible Soviet conduct around the world' and predicted Washington and Moscow could be at 'a moment of rare opportunity for arms reduction.'

But recriminations from the Iceland summit in October continued, with Reagan again charging hopes for progress were dashed by Soviet efforts 'to cripple our Strategic Defense Initiative.'

Calling the multibillion-dollar 'Star Wars' effort 'the most positive and promising defense program we have undertaken,' Reagan, in a blunt message directed as much as Congress as the Kremlin, promised, 'SDI will go forward.'

'I must tell this Congress that I will veto any effort that undercuts our national security and our negotiating leverage,' he said. The last Congress drastically reduced the 'Star Wars' budget and Democrats have vowed to fight the large increase Reagan asked for in the budget he submitted earlier this month.

The centerpiece of the domestic agenda Reagan, cast in more conciliatory terms and under the heading 'quest for excellence,' was a plan to revitalize the nation's schools, scientific base and industrial backbone 'by guaranteeing that government does everything possible to promote America's ability to compete.'

Reagan sounded a call for a nationwide crusade to position the nation for the 21st century through increased emphasis on research and development, worker training, deregulation, relaxed antitrust laws, aggressive trade policies and other reforms to make its industries better able to compete.

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Although he said this effort should be measured not in dollars but 'involves the expenditure of American spirit and just plain American grit,' administration officials said his proposals to Congress will include a $1 billion-a-year training program for dislocated workers and a 100 percent increase in the budget of the National Science Foundation over five years.

Equally close to home, Reagan promised to send Congress formal proposals in the weeks ahead to make good on two promises contained in his 1986 State of the Union address: a new strategy to overhaul the 'social monster' of a $132 billion-a-year welfare system and a plan to ensure elderly Americans are protected from the cost of catastrophic illness.

The latter plan was to have been in final form by Tuesday. However, senior administration officials have been divided over the scope and nature of the catastrophic health plan, with movement conservatives - represented in the Cabinet by Attorney General Edwin Meese and Energy Secretary John Herrington -- opposing any program that would expand government programs at the expense of private insurance companies.

The officials also said Reagan, who paid only lip service to the economic problems of farmers toward the end of his speech, also will send Congress a plan to stem the skyrocketing costs of farm subsidy programs by reducing the incentives to overproduce and capping payments to individual farmers to $50,000.

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In a departure from past practice, Reagan made no salute to 'heroes' seated in the gallery with his wife, Nancy. Nor, in a further part with tradition, did he rededicate himself to a deeply cherished priority of the political right: a ban on abortion.

While there was no mention of the issue in his speech, administration officials said Reagan would send Congress legislation to make permanent an annual ban on federal funding for abortions except in cases where the life of the mother is at stake.

The measure also would ban federal funding of family planning groups, such as Planned Parenthood, that perform abortions or provide referral services to pregnant women.

The speech, crafted with help from master presidential wordsmith Kenneth Khachigian, credited policies of the first Reagan term with the current round of sustained, if sluggish, economic growth.

Reagan boasted 'great success in restoring our economic integrity' and asserted his policies 'rescued our nation from the worst economic mess since the Depression,' but said, 'There's more to do.'

To begin with, he vowed to protect gains of the past -- the fiscal restraint forced by the Gramm-Rudman balanced-budget law and tax reductions first won in 1981 -- and again asked for greater authority to whip the budget into shape.

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Many of the priorities outlined in his speech and in a formal legislative message to Congress were carryover proposals that died or were killed in previous years. Others -- deficit reduction and arms control key among them -- are goals that have eluded Reagan for the last six years.

With polls providing evidence his credibility has been damaged by the Iran affair, a major question had been how far Reagan would go in assuming responsibility for a foreign policy, however well-intentioned, gone awry.

Before Tuesday, the closest he had come was a Dec. 6 admission that 'mistakes were made' in the execution of his arms-to-Iran overture. At least one draft of the State of the Union address recommended he take personal responsibility for those errors.

Throughout his political career, Reagan has relied on his Hollywood-honed communicative skills to overcome adversity. His characteristic optimism persisted Tuesday, but was expressed against a backdrop of public doubt.

A Washington Post-ABC News poll showed 80 percent of Americans believe Congress -- not Reagan -- will lead the nation for the next two years. In a New York Times-CBS News poll, 71 percent doubted Reagan would achieve the goals set in his speech, while 52 percent believed he has lied about Iran.

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