Iranscam's

By Jacob V. Lamar Jr

Even Christmas brought no respite. Ronald and Nancy Reagan exchanged gifts (a red robe for her, a horse blanket for him) and on Saturday flew off to Palm Springs, Calif., for a week's vacation, but in the Oval Office the President kept a low profile. Perhaps the holidays would quell the furor over the Iran arms scandal, if only temporarily. But Iranscam offered only more grim tidings: continued inertia and infighting at the White House, increased squabbling between the Administration and Capitol Hill over how to clear up the mess, questions about the health of CIA Director William Casey and the emotional stability of Lieut. Colonel Oliver North, and a wave of Yuletide firings at the National Security Council. While the scandal progressed, seemingly with a momentum of its own, Reagan grew more and more isolated. "It is really sad watching this," sighed a White House confidant. "It is painful."

Surveys by Pollster Richard Wirthlin show the President's popularity inching up again, giving Reagan some cause for holiday cheer. The polls seem to have persuaded the President's strategists that the further away their boss is kept from the controversy, the sooner it will die. Perhaps to that end, the President last week appointed David Abshire, U.S. Ambassador to NATO, to a new Cabinet-level post: coordinator of White House responses to the congressional investigations and other probes into the U.S. weapons sales to Iran and the diversion of profits to the Nicaraguan contras.

Reagan's only substantive public statement on Iranscam last week provoked a minor uproar on Capitol Hill. In a speech to a businessmen's group, the President made the ill-conceived proposal that the Senate Intelligence Committee provide him with its findings on the Iran-contra matter. That way, said Reagan, the White House could declassify the information and release it "so the American people can judge for themselves" what the scandal is about. Since the still incomplete probe has found no evidence of presidential complicity in any misdeeds, the report might exonerate Reagan in the eyes of the public.

The President's suggestion was ridiculed by Senators who felt Reagan was trying to take credit for their investigation. "He ordered his Administration not to tell the Intelligence Committee what he was doing," said Vermont Democrat Patrick Leahy. "Now he wants the Intelligence Committee to tell him what his Administration was doing." Leahy added, with exasperation: "Even Alice in Wonderland doesn't get this twisted around."

The President seems to have maintained his resolve against firing any more of his aides. "Reagan is about as rigid as I've ever seen him," says a longtime ally outside the Administration. "He doesn't want to throw anyone overboard to satisfy Washington's considered wisdom. He thinks that he is being well served by his present staff." Chief of Staff Donald Regan apparently feels his job is once again secure. Several aides say the haunted, hunted demeanor that Regan displayed in the early days of the controversy receded after a Dec. 11 meeting with the President. Regan "hasn't told anybody what happened in the talk," says a White House staff member, "but he's been very chipper since then."

Indeed, the President appears to be as fond of Regan as ever. At an office party celebrating Regan's 68th birthday the week before Christmas, the President and his chief of staff sipped champagne together and traded Irish jokes. Some White House aides believe that the furor over Iranscam has only increased Regan's determination to stay on. "Before this he was planning to leave sometime in 1987 and write a book," says an Administration official. "I'm sure he's not going to leave voluntarily now. He's determined to show he can make it."

Nevertheless, some think that Regan's appearance before the Senate Intelligence Committee earlier in December may return to haunt him. "Regan's entire testimony on the Hill was premised on his inability to recall anything," says a presidential aide. "That didn't work in Watergate, did it?" Others consider it a bad sign that Regan did not accompany the First Couple to California, since the President often mulls over difficult issues -- particularly personnel problems -- during his New Year's vacation.

While Regan is fighting for his job, another of the President's men is involved in a more serious battle. Casey's doctors said last week that the lymphoma tumor they had removed from the CIA director's brain proved to be malignant. There were early reports that Casey, 73, had not regained full, normal brain functions and that his recovery was proceeding at a discouragingly slow pace. At week's end a hospital spokesman said Casey was "fully conscious and able to sit up," but few in Washington expect him to return to the CIA for more than a token appearance at his old desk. Though the President has said nothing about replacing Casey, two names are frequently mentioned as possible successors: Lieut. General William Odom, director of the National Security Agency, and retired General Brent Scowcroft, one of Reagan's appointees to a commission studying the NSC.

Attorney General Edwin Meese is coming under heavy fire for his efforts to block an FBI investigation into the contra supply network. The Justice Department claimed at first that Meese had asked FBI Director William Webster to delay the bureau's probe for ten days last fall lest it adversely affect negotiations to free U.S. hostages in Lebanon. Last week the Justice Department admitted that the investigation was shut down for 26 days, until Nov. 26 -- the day after Meese disclosed the connection between the contras and the Iran arms deals. The new disclosure aroused further suspicion that Meese knew about the diversion of funds long before he announced it.

While Reagan and his top aides try to tough out the scandal, the NSC, the White House agency responsible for the Iranscam debacle, is undergoing a brutal purge. Frank Carlucci, who takes over as National Security Adviser this week, is reorganizing the chain of command and moving the agency away from an operational role back to its original function as an advisory group. Carlucci has hardly set foot in the NSC offices, but his deputies have been wielding sharp axes as they moved to cut the staff from 180 to about 150.

Some NSC staff members have been given notice by telephone, without the courtesy of personal meetings. One staffer was told he could not have a few weeks to look for another job but would have to clear out immediately. Another learned of his demotion when he read about it in the Washington Post. The head of Carlucci's transition team, Kenneth Adelman, director of the Arms Control and Disarmament Agency, steadfastly refuses to apologize for the harsh tactics. "The trade-off was speed," he says. "We had two weeks to do this job, and we felt that staff morale was best served by ending uncertainty quickly."

Departing NSC aides charge that many of the changes are being made simply for public relations purposes. A case in point, says one staffer, is the abolition of the NSC's office of political-military affairs, where North worked. "Somebody will have to perform the same function, synthesizing differing views from Defense and State, so they'll have to transfer the same job and give it a new name," he says. "They're changing the trim and the hubcaps and calling it a new model."

If the holiday season offered little solace to the Reagans, January looks even darker. The President will have to contend with prostate surgery next week, followed by stepped-up congressional investigations that could continue to paralyze his Administration. While the Iranscam probes might not turn up any dramatic revelations, they will constantly remind the public of Reagan's Iran policy and his inability to manage his own staff. Unless this once formidable President can find a way to restore his mastery over events, his gloomy Christmas will turn into an unhappy new year.

With reporting by David Beckwith/Washington