Links in a Chain of Disaster: Israel-u.s.-iran-contras Connections

Israel confirmed Wednesday that it supplied $12 million of U.S. arms to Iran “in response to an American request,” but emphatically denied knowing that any of the funds paid by Iran were transferred to the Contras, the Nicaraguan rebel force supported by the Reagan Administration in their attempt to overthrow the Sandinista government of Nicaragua.

Israel’s policy and the need to keep it secret from Knesset members was vigorously defended by Vice Premier and Foreign Minister Shimon Peres in a lengthy statement Wednesday morning to a Knesset angered and dismayed by the government’s clandestine actions.

Israel’s official acknowledgement contained in a statement released here shortly after midnight Wednesday, local time, differed in several particulars from the statements made several hours earlier by U.S. Attorney General Edwin Meese, at a White House press conference.

Meese said that some $10 – $30 million of the money Iran paid for arms received from the U.S. were deposited by “representatives of Israel” in Swiss bank accounts set up by the Contras. He said the money was the amount Iran paid over the $12 million cost of the weapons, which were transferred from the Department of Defense. Meese referred several times to “representatives of Israel” in that connection and promptly corrected himself after referring once to “representatives of the Israel government.”

Peres, who was Prime Minister when the transactions with Iran occurred, addressed the Knesset in response to seven urgent agenda motions on the issue, severely critical of the government. Several were introduced by leftist factions, which were the most vociferous in their condemnation. But there was strong criticism as well from Labor and Likud MKs. Only Yuval Neeman, leader of the ultra-nationalist Tehiya Party unconditionally supported the government’s position.

PERES DEFENDS U.S. OBJECTIVES

Flaying his critics as “hypocrites… who presume to speak in the name of a lofty morality,” Peres strongly defended the Reagan Administration’s objectives which, according to Meese, were to end the Iran-Iraq war, reduce Iranian support of terrorism and free American hostages held by pro-Iranian groups in Lebanon.

“In life,” Peres said, “there are often agonizing conflicts and contradictions between equally pressing moral claims”, and in the Iran affair, Israel acted “solely out of moral consideration.” He cited as a parallel Israel’s decision last year to free 1,150 terrorists and other security detainees in exchange for three Israel Defense Force prisoners of war in the hands of terrorists in Lebanon.

He said he had nothing but admiration for President Reagan, who “does not rest for one moment” in his efforts on behalf of American hostages. “Israel was asked to help secretly and it was glad to do so,” Peres said. There was no question of “American pressure,” he said.

He dismissed the idea that the arms Israel sent Iran at the behest of “the friendly U.S. Administration” could tilt the balance in the Gulf war. The official government statement described them as “defensive arms and spare parts.” According to Peres, $12 million worth of arms was insignificant compared to Iran’s massive supplies from other countries. China alone, he said, sent Iran some $3 billion worth of military equipment.

Peres said he himself was “as disgusted as anyone” by the regime of the Ayatollah Ruhollah Khomeini in Teheran, which has assailed Israel in the most violent terms ever since it took power in 1979. At the same time, Peres stressed that Israel has “no obligation to Iraq” which he charged has become “a center for the PLO” and could send “dozens of divisions” against Israel at anytime in the future.

Peres disclosed the he spoke to U.S. Secretary of State George Shultz by telephone Tuesday and also to Meese, though he did not say when. He observed that neither had accused Israel of “intrigues in Washington.” He also insisted that Israel had no pecuniary interest in the arms deal. It did not make “a single penny” and did not act out of any self interest, he said.

Meese said at his press conference Tuesday that “all shipments in which the United States was involved were made through Israel.” But he said Israel had made two shipments of arms to Iran on its own, one in August or September 1985 and one in November 1985. He said the U.S. “condoned” both shipments after the fact and that the second shipment had been sent back by Iran. He did not elaborate.

Peres defended the government’s failure to inform the Knesset or even a subcommittee of the Knesset’s Foreign Affairs and Security Committee about the arms shipments. He said he had faced a clash between moral imperatives: democratic supervision of the executive and betrayal of an ally’s secret. Had it been Israel’s secret alone, it would have been brought to the Knowledge of Knesset members, Peres said.

ANGER OVER ARMS TRANSFER POLICY

But the mood in the chamber was angry. Haim Ramon, the ranking Laborite in the Knesset Finance Committee, castigated the government’s arms transfer policy. He spoke of “the darkest regimes in South America” as Israel’s customers for weapons and noted that Israel was “still selling arms to Somoza when the Sandinistas were at the gates of Managua.” He was referring to the late Gen. Anastasio Somoza-Debayle, the Nicaraguan dictator, ousted by the Sandinista led revolution in July, 1979.

Yossi Sarid of the Civil Rights Movement (CRM) said that by selling arms to Iran, Israel had “given direct encouragement to the most extreme element in the Middle East” and it was “an encouragement of terrorism.”

Elazar Granot of Mapam demanded, “How do you know that these arms have not reached the Hezbullah?” a reference to the pro-Khomeini Islamic terrorist group in Lebanon.

Mordechai Virshubsky of Shinui called the arms deal “a blow to the good name of Israel and to its national security.”

The post-midnight government statement followed an urgent meeting between Premier Yitzhak Shamir, Peres, Defense Minister Yitzhak Rabin and their aides Tuesday night.

It was apparently decided that Israel must respond to Meese’s allegations about its transfer of funds to the Contras in time for U.S. television prime time newscasts.

RESPONSE TO MEESE’S ALLEGATIONS

The statement said: “Israel confirms that it helped transfer defensive arms and spare parts from the U.S. to Iran, this in response to an American request. The payment for this equipment was transferred directly by an Iranian representative to a Swiss bank according to the instructions of U.S. representatives. These funds did not pass through Israel.

“The government of Israel was surprised by the announcement to the effect that part of these funds were transferred to the Contras. This matter is not connected at all to Israel, and the Israeli government had no knowledge of it. Obviously Israel was not and is not prepared to serve as a conduit for such a transfer.”

Observers here are wondering whether Israel’s denial of a key part of Meese’s statement would heighten tensions between Jerusalem and Washington. The Reagan Administration, for the moment, is embattled and on the defensive and there is no knowing what revelations may emerge in the course of Congressional hearings and the Justice Department’s own investigation of the arms sales and transfer of monies to the Contras.

President Reagan, who addressed the press briefly before Meese, admitted he had not been informed of “one aspect” of the implementation of his arms sales policy, which “was seriously flawed.” He announced that his National Security Advisor, Vice Admiral John Poindexter, had resigned and that his aide, Marine Corps Lt. Col. Oliver North, has been dismissed from the National Security Council staff.

North, believed directly involved in support of the Contras and of rebels seeking to topple the Marxist government of Angola, was a key figure in the Iran arms deal and transfer of funds to the Contras.