Israel Said to Have Sold Arms to Iran in ’81, with U.S. Blessing

Secretary of State James Baker said Sunday that it is possible that the Reagan administration allowed Israel to sell billions of dollars worth of U.S.-made arms to Iran in 1981 when such sales were banned.

Appearing on the CBS-TV news program “Face the Nation,” Baker was commenting on a front-page story to that effect published Sunday in The New York Times.

“I don’t know if it is not true. I don’t know if it is true,” Baker said, when asked about the report. Baker, who was Ronald Reagan’s White House chief of staff at the time, said the arms transfers “could have happened” without his knowledge.

While insisting that he does not “have any recollection” of the transfers, Baker suggested more than once during the program that the arms sales could have been “a favor to Israel” to help “Israel earn some money.”

“We do cooperate with Israel on matters such as this,” he explained.

The Times report, quoting senior Reagan administration officials, as well as Israeli officials, said the arms flow began after the Iranians released American hostages seized at the U.S. Embassy in Teheran in 1979.

The hostages were freed on Jan. 20 1981, the day Reagan was sworn into office.

Iran, locked in war with Iraq at the time, was desperately in need of weapons and spare parts for the U.S.-made military equipment it acquired during the reign of the Shah.

According to the Times report, the United States specifically authorized the Israeli sales for between six and 18 months.

“But the United States watched them continue after that, even as the Reagan administration aggressively promoted a public campaign, known as Operation Staunch, to stop worldwide transfers of military goods to Iran,” said the Times story, which was written by Seymour Hersh.

‘SOMEBODY IN THE WHITE HOUSE’

Baker told “Face the Nation” that “the secretary of state is the person who is empowered to approve the export of technology.”

At the time of the alleged Israeli arms sales to Iran, Alexander Haig was U.S. secretary of state. In 1981, Haig denied “categorically” that U.S. military equipment was provided to Iran.

But in a January 1991 PBS television interview, Haig acknowledged that Israel might have shipped some American arms to Iran “through the good offices of somebody in the White House staff.”

Officials at the Israeli Embassy here had no immediate comment on the Times report.

Israel served as the middleman in a secret arms-for-hostages deal between the Reagan White House and Teheran, which burgeoned into the Iran-Contra scandal.

But no U.S. hostages were being held by Iran or by Islamic groups under its influence in 1981, when Israel allegedly sold it American arms with White House approval.

Hersh’s report appeared as Congress prepared to investigate allegations that Reagan compaign officials made a deal with Iran to hold the U.S. Embassy hostages captive until Reagan’s inauguration.