October Surprise

[Guest Stephen Turner]

The aleged conspiracy was to postpone the release of the hostages held by Iran, until after the 1980 election, thus preventing an "October surprise" that would have aided Carter. The most public face of the story is that in Oct 1980, an agreement was reached, after long negotiations, to unfreeze Irans monetary assets, for the safe return of the hostages-But not until after Reagans inauguration on Jan 20th 1981. They were, as a matter of fact, released minutes after Reagan was sworn in as President.

It is aleged that William Casey and other representatives of the Reagan Presidential campaign made a deal at two sets of meetings, in July, and August at the Ritz hotel in Madrid to delay the release of Americans, thus damaging Carters chances of a second term. In an interview two months earlier, Reagan had said that he had a "secret plan"involving the hostages, he continued, "My ideas require quiet diplomacy, when you dont have to say what it is your'e thinking of doing"

[John Simkin]

This is the entry at Wikipedia:

Proponents of the theory, such as Barbara Honegger, a researcher and policy analyst with the 1980 Reagan/Bush campaign (interviewed in link), allege that William Casey and other representatives of the Reagan presidential campaign made a deal at two sets of meetings in July and August at the Ritz Hotel in Madrid with Iranians to delay the release of Americans held hostage in Iran until after the November 1980 presidential elections. The idea was that Reagan's opponent, the incumbent President Jimmy Carter, whose team had been negotiating, wouldn't gain a popularity boost (an 'October Surprise') before election day. The allegations included a date-specific allegation that William Casey met with an Iranian cleric in Madrid, Spain, and much of the tardy investigations have centered on whether, at the weekend in question he was actually at a Bohemian Grove retreat in California. Though William Casey was probably in London following the alleged meetings, critical pages of his daybook diary were unaccountably missing when the investigators came to look for them over a decade later.

Carter was at the time dealing with the Iran hostage crisis and the hostile regime of the Ayatollah Khomeini. Those who assert that a deal was made allege that certain Republicans with CIA connections, including George H. W. Bush, arranged to have the hostages held through October, until Reagan could defeat Carter in early November, and then be released. The hostages were in fact released on the very day of Reagan's inauguration, twenty minutes after his inaugural address.

Two months earlier, in a campaigning interview, Ronald Reagan had said that he had a "secret plan" involving the hostages. "My ideas require quiet diplomacy," he had responded when pressed, "where you don't have to say what it is you're thinking of doing."

A 1983 Congressional probe into the Reagan campaign's theft of White House briefing books on the eve of a presidential debate (see Debategate) disclosed that Reagan campaign manager William Casey (later appointed as Director of Central Intelligence in the Reagan administration) was receiving highly classified reports on closely-held Carter administration intelligence on the Carter campaign and the Democratic president's efforts to liberate the hostages.

A PBS Frontline documentary in 1990 brought a sound bite unavoidably to the surface in detail, as did a 15 April 1991 New York Times article by Gary Sick. In 1991, while playing golf with George Bush in Palm Springs, Ronald Reagan gave reporters a sound bite. In 1980, he had "tried some things the other way," that is, to free the hostages, he told them. When pressed he said that the details remained "classified." The remark was widely publicized and linked to Reagan's 1980 campaign remark undisclosed "secret plan" to free the hostages, with the unanswered question of how a Presidential candidate in 1980 had received "classified" information

Separate House and Senate investigations were further delayed until 1992. William Casey, the alleged go-between, was dead by then, and it seemed impossible to account for all his moves during the summer of 1980, when he is said to have conferred with agents representing the Ayatollah Khomeini's government.

If the allegations are true, some believe that dealing with a hostile foreign government to achieve the defeat of a domestic administration would have been an act of treason.

According to Sick's theory, Oliver North was the administration's scapegoat, taking responsibility in order to conceal the "treason" of Reagan and Bush. A PBS documentary, "The Secret Government," hosted by Bill Moyers, detailed the "off the shelf, self-financing, independent covert operations" entity mentioned by North, and tracing it to its cold war beginnings won an Emmy for best documentary film.

Former CIA agent Richard Brenneke has also claimed that Swedish prime minister Olof Palme was assassinated in 1986 because of his refusal to take part in the Iran-Contra scandal. According to this source, the arms-trade would have been part of the agreement of the October Surprise. Licio Gelli, headmaster of the P2 lodge, would have taken part to this assassination.

[John Simkin]

The connection between Ted Shackley and October Surprise began in 1979. Shackley had expected to become director of the CIA. However, Jimmy Carter’s appointment of Stansfield Turner, had blocked his advance up the ladder. The same was true of all those involved in the illegal covert operations in the 1960s and 70s. The only way back for Shackley (he resigned from the CIA in 1979) was for the removal of Carter. In 1980 he had regular meetings with George Bush where he advised him of his election strategy. Bush did not get the nomination but when he became Reagan’s vice presidential candidate, Shackley continued to advise him.

Shackley told Bush that Carter was attempting to negotiate a deal with Iran to get the American hostages released. This was disastrous news for the Reagan/Bush campaign. If Carter got the hostages out before the election, the public perception of the man might change and he might be elected for a second-term.

According to Barbara Honegger, a researcher and policy analyst with the 1980 Reagan/Bush campaign, William Casey and other representatives of the Reagan presidential campaign made a deal at two sets of meetings in July and August at the Ritz Hotel in Madrid with Iranians to delay the release of Americans held hostage in Iran until after the November 1980 presidential elections.

Reagan’s aides promised that they would get a better deal if they waited until Carter was defeated.

On 22nd September, 1980, Iraq invaded Iran. The Iranian government was now in desperate need of spare parts and equipment for its armed forces. Carter now proposed that the US would be willing to hand over supplies in return for the hostages.

Once again, the CIA leaked this information to Reagan/Bush. Shackley now suggested a strategy that would make it impossible to do a deal. One way was to leak the story to the press. On 17th October, The Washington Post reported rumours of a “secret deal that would see the hostages released in exchange for the American made military spare parts Iran needs to continue its fight against Iraq”.

These stories continued to be published throughout the rest of the campaign. One Washington Post report quoted French officials as being shocked by news that Carter was willing to be blackmailed by the Iranians into “providing spare parts for American weapons”. A couple of days before the election Barry Goldwater was reported as saying that he had information that “two air force C-5 transports were being loaded with spare parts for Iran”.

This of course was not true. This publicity had made it impossible for Carter to do a deal. Reagan on the other hand, had promised the Iranian government that he would arrange for them to get all the arms they needed in exchange for the hostages. According to Mansur Rafizadeh, the former U.S. station chief of SAVAK, the Iranian secret police, CIA agents had persuaded Khomeini not to release the American hostages until Reagan was sworn in. In fact, they were released twenty minutes after his inaugural address.

The actions of Reagan and the CIA spent at least an extra 76 days of imprisonment. One of these hostages, Cynthia Dwyer, was kept back until the Iranian negotiators got further assurances on the deal. The arms the Iranians had demanded were delivered via Israel. By the end of 1982 all Regan’s promises to Iran had been made. With the deal completed, Iran was free to resort to acts of terrorism against the United States. In 1983, Iranian-backed terrorists blew up 241 marines in the CIA Middle-East headquarters.

The Iranians also once again began taking American hostages in exchange for arms. On 16th March, 1984, William Francis Buckley, a diplomat attached to the U.S. Embassy in Beirut was kidnapped by the Hezbollah, a fundamentalist Shiite group with strong links to the Khomeini regime. Buckley was tortured and it was soon discovered that he was the CIA station chief in Beirut.

Shackley was horrified when he discovered that Buckley had been captured. Buckley was a member of Shackley’s Secret Team that had been involved with Edwin Wilson, Thomas Clines, Carl E. Jenkins, Raphael Quintero, Felix Rodriguez and Luis Posada, in the secret “assassination” program.

Buckley had also worked closely with William Casey (now the director of the CIA) in the secret negotiations with the Iranians in 1980. Buckley had a lot to tell the Iranians. He eventually signed a 400 page statement detailing his activities in the CIA. He was also videotaped making this confession.

Casey asked Shackley for help in obtaining Buckley’s freedom. Shackley had good reason to want to get Buckley out of Iranian hands. However, he was unhappy about not being rewarded for his help getting Reagan elected in 1980. He had expected to be appointed director of the CIA. That job instead went to Casey, the key figure in the “arms for hostages” negotiations. How was Shackley to be rewarded?

What we know is that just three weeks after Buckley’s disappearance, President Reagan signed the National Security Decision Directive 138. This directive was drafted by Oliver North and outlined plans on how to get the American hostages released from Iran and to “neutralize” terrorist threats from countries such as Nicaragua. This new secret counterterrorist task force was to be headed by Shackley’s old friend, General Richard Secord.

This was the basis of the Iran-Contra deal. Reagan could not afford to replace Casey with Shackley as director of the CIA. However, there were other ways of rewarding Shackley for his covert actions on behalf of Reagan in Iran.

Talks had already started about exchanging American hostages for arms. On 30th August, 1985, Israel shipped 100 TOW missiles to Iran. On 14th September they received another 408 missiles from Israel. The Israelis made a profit of $3 million on the deal. Why should this money go to the Israelis? It would be a better idea to give this business to Shackley and his mates.

In October, 1985, Congress agreed to vote 27 million dollars in non-lethal aid for the Contras in Nicaragua. It had already been decided to use this money to finance the selling of arms to Iran. Some of the profits could then be used to provide money and arms to the Contras and the Mujahideen in Afghanistan.

The following month, Shackley traveled to Hamburg where he met General Manucher Hashemi, the former head of SAVAK’s counterintelligence division at the Atlantic Hotel. Also at the meeting on 22nd November was Manuchehr Ghorbanifar. According to the report of this meeting that Shackley sent to the CIA, Ghorbanifar had “fantastic” contacts with Iran.

At the meeting Shackley told Hashemi and Ghorbanifar that the United States was willing to discuss arms shipments in exchange for the four Americans kidnapped in Lebanon. What Shackley did not put in his CIA report was that there were two other men at this meeting at the Atlantic Hotel. They were Oliver North and Leslie Aspin, a British arms dealer.

The problem with the proposed deal was that William Buckley was already dead (he had died of a heart-attack while being tortured). The date is not known but it was sometime between June and October 1985.

The Aspin arms deal with Iran never took place. Instead, Shackley and Secord began organizing these arms deals. Shackley recruited some of the former members of his CIA Secret Team to help him with these arm deals. This included Thomas G. Clines, Raphael Quintero, Ricardo Chavez and Edwin Wilson of API Distributors. Also involved was Carl Jenkins and Gene Wheaton of National Air. The plan was to use National Air to transport these weapons. For some reason, Wheaton and Jenkins fell out with Shackley. In May 1986 Wheaton told William Casey, about what he knew about this illegal operation. Of course Casey already knew what was going on and refused to take any action.

Wheaton now took his story to Daniel Sheehan. He also contacted Newt Royce and Mike Acoca, two journalists based in Washington. The first article on this scandal appeared in the San Francisco Examiner on 27th July, 1986. The Secretary of Defense, Casper Weinberger, was now asked about if it is "true that foreign money, kickback money on programs, was being used to fund foreign covert operations." Weinberger denied all knowledge of the matter.

On 5th October, 1986, a Sandinista patrol in Nicaragua shot down a C-123K cargo plane that was supplying the Contras. Eugene Hasenfus, the only one wearing a parachute, survived the crash (two other Americans, Buz Sawyer and William Cooper died when the plane hit the ground). Hasenfus told his captors that the CIA was behind the operation. He also provided information on two Cuban-Americans running the operation in El Savador. This resulted in journalists being able to identify Raphael Quintero and Felix Rodriguez as the two Cuban-Americans mentioned by Hasenfus.

Shackley was able to keep his name out of the scandal and actually won damages from Daniel Sheehan.

However, there were others who knew the truth about what had been going on. This included William Casey who conveniently died on 6th May, 1986.

Another person who knew the truth was John Tower and John Heinz. In November 1986, Reagan persuaded Tower to chair the President's Special Review Board to study the actions of the National Security Council and its staff during the Iran-Contra affair. Heinz had chaired a three-man presidential review board that probed the Iran-Contra affair. Coincidentally, both John Heinz and John Tower died in plane wrecks on successive days in 1991 – Tower in Georgia, and Heinz in Montgomery County.

[Pat Speer]

Shackley told Bush that Carter was attempting to negotiate a deal with Iran to get the American hostages released. This was disastrous news for the Reagan/Bush campaign. If Carter got the hostages out before the election, the public perception of the man might change and he might be elected for a second-term.

According to Barbara Honegger, a researcher and policy analyst with the 1980 Reagan/Bush campaign, William Casey and other representatives of the Reagan presidential campaign made a deal at two sets of meetings in July and August at the Ritz Hotel in Madrid with Iranians to delay the release of Americans held hostage in Iran until after the November 1980 presidential elections.

I wasn't aware of this part of the story. Is there evidence that Shackley told Bush what was up? My understanding was that it was Robert MacFarlane who sold out Carter, much as it was Henry Kissinger who sold out Johnson in 68.

[John Simkin]

Shackley told Bush that Carter was attempting to negotiate a deal with Iran to get the American hostages released. This was disastrous news for the Reagan/Bush campaign. If Carter got the hostages out before the election, the public perception of the man might change and he might be elected for a second-term.

According to Barbara Honegger, a researcher and policy analyst with the 1980 Reagan/Bush campaign, William Casey and other representatives of the Reagan presidential campaign made a deal at two sets of meetings in July and August at the Ritz Hotel in Madrid with Iranians to delay the release of Americans held hostage in Iran until after the November 1980 presidential elections.

I wasn't aware of this part of the story. Is there evidence that Shackley told Bush what was up? My understanding was that it was Robert MacFarlane who sold out Carter, much as it was Henry Kissinger who sold out Johnson in 68.

When information about the Iran-Contra scandal first emerged in 1986, both Ronald Reagan and George H. W. Bush were in serious trouble. The fact that it happened could not be denied. The issue then became very similar to Watergate: “What did he know, and when did he know it.” Reagan’s story was that he was kept in the dark about the whole event. The American public went along with this story. Some commentators believe this was psychological. Democracy would have been completely undermined if it had been confirmed that two presidents in a short period of time had been involved in illegal activities and had lied about it.

Bush was another matter. He was only the vice president and it would not be traumatic for the country to see him impeached. For example, remember the response when Spiro Agnew was forced to resign? Bush was also more likely candidate than Regan to have come up with this idea. Bush had been a former director of the CIA, an organization that had been heavily involved in the scandal. Questions were asked about whether Bush was the man who had organized the Iran-Contra deal. If so, he would have had to have worked very closely with the CIA. Journalists therefore investigated Bush’s relationship with the CIA. They discovered that throughout 1980 he had been having regular meetings with Ted Shackley.

A former senior CIA officer, John Murray, suggested that Shackley had some sort of control over Bush. He suspected it was something to do with illegal covert activities that had been carried out when Bush was director of the CIA. (pages 317-318, David Corn, Blind Ghost)

Shackley also had a deep hatred for Jimmy Carter. He told friends that if Ford defeated Carter in 1976, he would be appointed as director of the CIA. Instead of that, Carter won and blocked him from further promotion and he was forced to retire from the service in 1979.

Journalist discovered that Shackley and Bush continued to have a close relationship after he left the agency in 1979. They met on a regular basis during Bush’s attempts to become the Republican presidential candidate. (His wife, Hazel Shackley, even worked for Bush during this period).

In March, 1980, a CIA asset, Michael Ledeen, wrote an article suggesting that Stansfield Turner had been mismanaging the CIA and that if Bush won in November, Shackley would become the new head of the agency (New York Magazine, 3rd March, 1980).

In August, 1980, Reagan selected Bush as his running-mate. Shackley’s meetings with Bush now became more frequent. In an interview with David Corn, Chi Chi Quintero told him that during the campaign, Bush was meeting Shackley “every week” (page 358, David Corn, Blind Ghost).

In October, 1980, Shackley joined the company owned by Albert Hakim (he was paid $5,000 a month as a part-time “risk analyst”). It seems that Hakim was keen to use Shackley’s contacts to make money out of the Iran-Iraq War that had started the previous month. This just happens to be the same time that William Casey and other representatives of the Reagan presidential campaign are having meetings with the Iranians in order to delay the release of Americans held hostage in Iran until after the November 1980 presidential elections.

Is it also a coincidence that later Hakim joined forces with Richard Secord and Thomas Clines (Shackley’s former deputy in the CIA) to provide Iran with the weapons as a result of Reagan winning the 1980 presidential election?

Just before the election Michael Ledeen wrote an article claiming that Billy Carter, the President’s brother, had visited Libya in 1979 and accepted from the Qaddafi government a $50,000 payment and a $220,000 loan related to an oil deal (New Republic, 1st November, 1980). It was later revealed that at this time Shackley and Ledeen had become business partners. The story also appears to have come from one of Shackley’s old contacts, Giuseppe Santovito, head of SISMI, the military intelligence service of Italy. It is also at this time that Ledeen arranges for $20,000 to be placed in Shackley’s bank account in Bermuda (page 359, David Corn, Blind Ghost)

It was clear that if Bush was going to survive he had to try to disguise his relationship with Shackley. In fact, to really protect himself, he had to make sure that Shackley was not identified as one of the main organizers of the Iran-Contra deal.

Both the House and Senate set up select committees to investigate the Iran-Contra affair. At first Shackley was seen as a prime suspect. He was a colleague and business partner to the main operators. He had been closely linked to Edwin Wilson (the main reason why Stansfield Turner had brought his career in the CIA to an end). Also, along with Secord, Clines and Quintero, Shackley had been involved in the Nugan Hand Bank scandal (Alfred McCord, The Politics of Heroin: pages 461-478 and Leslie Cockburn, Out of Control, pages 103-104).

Bush was also identified as someone who must have known about the Iran-Contra deal. There was documentary evidence that Bush attended the meeting on 6th August, 1985, when National Security Advisor Robert McFarlane outlined the deal to trade U.S. arms for American hostages held by the Iranians.

Bush also attended the meeting on 7th January, 1986, where George Shultz and Casper Weinberger expressed their opposition to the deal signed the previous day by Reagan to sell TOW missiles in order to win the release of the American hostages.

When asked how he did not know about the Iran deal, Bush claimed: “I may have been out of the room at the time” (page 14, Joel Bainerman, The Crimes of a President).

There was also documentary evidence that Bush attended a meeting with Amiram Nir, Israel’s advisor on terrorism at the King David Hotel in Jerusalem on 29th July, 1986. Also at the meeting was Bush’s aide, Craig Fuller. He kept notes of the meeting. He reported that Nir told Bush that he had been active throughout the past year “to gain the release of the hostages, and that a decision still had to be made whether the arms desired by the Iranians would be delivered in separate shipments or for each hostage as they are released.” Bush and Reagan did what they could to stop this document being sent to the John Tower investigation. Bush’s first defence was that he could not remember the meeting at King David Hotel. Later, he admitted he did remember it but did not understand what Nir was saying. Amazingly, the Tower Commission believed him.

In a PBS Frontline documentary, Ramon Milian Rodriguez, a convicted financier for the Meddellin drug cartel, talked about Felix Rodriguez’s role in the CIA involvement in the drug trade: “If Felix had come to me and said I’m reporting to… Oliver North, I might have been more sceptical. I didn’t know who Oliver North was and I didn’t know his background. But if you have a CIA, or what you consider to be a CIA-man, coming to you saying, ‘I want to fight the war, we’re out of funds, can you help us out? I’m reporting directly to Bush on it,’ I mean it’s very real, very believable, have you have a CIA guy reporting to his old boss.”

According to one report, the first telephone call that Eugene Hasenfus made after his plane was shot down was to Bush’s staff (The Progressive, May, 1987).

Then there was the handwritten note from November from George Bush to Oliver North that thanked him for his “dedication and tireless work with the hostage thing with Central America”. When asked about this note, Bush said “he didn’t recall why he sent it”. As Joel Bainerman pointed: “Why can a doctor be sued for malpractice of his profession but a national leader can just say he forgot, and no further investigation is required” (page 22, The Crimes of a President).

One person whose name appeared on several documents concerning the Iran-Contra affair was Donald Gregg, Bush’s National Security Adviser. Gregg had also been the CIA liaison to the Otis Pike committee. He was a man who Bush believed could keep secrets.

In 1985, Gregg sent Felix Rodriguez (a member of Shackley’s Secret Team) to El Salvador to aid the Contra re-supply effort. General Paul Gorman, the head of U.S. military forces in Central America, wrote a memo to the U.S. ambassador in El Salvador. In it he said: “”Rodriquez is operating as a private citizen but his acquaintanceship to the VP (Bush) is real enough, going back to the latter days of DCI (Director of the CIA)” (The Progressive, March, 1989).

The problem for Bush is that too many people knew about his relationship with Felix Rodriquez (Leslie Cockburn, Out of Control, page 224). Bush was eventually forced to admit that along with Gregg he had met with Felix Rodriguez three times. However, he argued that he had not discussed Nicaragua with him (CBS 60 Minutes, March, 1987). He also defended Gregg’s decision to deny these meetings with Rodriguez. According to Bush, Gregg had not lied, he merely “forgot” about these meetings.

At the Senate Foreign Relations Subcommittee on Narcotics, Terrorism and International Operations, headed by John Kerry, Richard Brenneke, a CIA operative, claimed that Donald Gregg was the Washington contact for a complicated arms/drugs deal that was part of the Iran-Contra operation. This story was leaked to Newsweek magazine. Bush responded to the story by claiming that it was Kerry who had leaked these “slanderous allegations” to the magazine. Bush added that “this guy whom they are quoting is the guy who is trying to save his own neck” (The Washington Post, 17th May, 1988). This is indeed ridiculous because Brenneke had not been charged with any offence.

Bush’s story eventually became that Gregg was working on his own initiative and that he was unaware of his role in the Iran-Contra affair.

The links between Bush and Shackley failed to go away. The role of Felix Rodriguez was particularly embarrassing as it provided another association with Shackley. The same was true of Chi Chi Quintero, Thomas Clines and Luis Posada. All four men had worked for Shackley since the early 1960s. They had also been active covert operators when Shackley was taking orders from George Bush during the period when he had been director of the CIA. (Leslie Cockburn, Out of Control, pages 121-122, 181-83)

It was reported in the Miami Herald that two men, one an arms dealer and the other a security consultant, had been working for Dr. Mario Castejon, a politician from Guatemala. They told the reporters that Shackley was used as a channel to the Agency regarding the Contra-Iran deals (The Miami Herald, 26th March, 1987).

Shackley denied the story. Congressional investigators did not believe him and sent him a subpoena requesting all documents he had related to various companies and individuals. It was during this period that evidence emerged that Shackley had met General Manucher Hashemi, the former head of SAVAK’s counterintelligence division, and Manuchehr Ghorbanifar, at the Atlantic Hotel in Hamburg, on 22nd November, 1985. Shackley had no option to admit to this meeting.

Cameron Holmes, the lead investigator, was convinced that Shackley was deeply involved in the Iran-Contra scandal. As he explained when he was interviewed by David Corn: “How could Shackley be the one person in this mob unaware of what was going on? Why was he so insistent he had not picked up a single whiff of the Contra operation or the Iran initiative? There was no crime in knowing. Shackley proclaimed his ignorance too much.” (page 390, David Corn, Blind Ghost).

Holmes was shocked when special counsel Lawrence Walsh decided not to pursue Shackley. He was not even called as a witness. Walsh did not even take Shackley’s deposition until after Congress had finished its hearings on the affair.

However, Thomas Clines told David Corn in 1992 that in 1985 he was purchasing arms for the Contras in Lisbon when he had a call from Richard Secord. He told him that Shackley had suggested that he knew a better arms dealer in Lisbon than the one Clines was using (page 391, David Corn, Blind Ghost). This confirms that Shackley played a role in the Iran-Contra affair. As did Bush. I suspect that it was a leading role but they knew that as long as they stuck together, they would survive. The only possible problem was that their underlings would give evidence against them if they were brought to trial. Thanks to Lawrence Walsh and the George Bush pardons, this never happened.

[T. Casey Brennan]

...My understanding was that it was Robert MacFarlane who sold out Carter, much as it was Henry Kissinger who sold out Johnson in 68.

I'm on the forum now, and I got a nice letter of support from Henry Kissinger some years back; it's posted at:

http://danielfry.com/index.php?id=1905

Best,

T. Casey Brennan

http://tcasey.inri.net