‘We’re Snookered Again!’ Regan Says He Told Reagan : Called for End to Iran Arms Sales

WASHINGTON — Blunt-spoken Donald T. Regan testified today that he repeatedly urged President Reagan to break off arms sales to Iran, once telling him, “We’ve been snookered again.”

And when it became known late last year that money from those sales had been diverted to the Nicaraguan contras , Regan said, he pushed for making a clean breast of the story despite the opposition of former National Security Adviser John M. Poindexter and the doubts of the late CIA Director William J. Casey.

Regan, who was fired in February as Reagan’s chief of staff after being blamed by the Tower Commission for allowing “chaos” to descend on the White House, was the next-to-last public witness in the long congressional Iran-contra hearings. He is to be followed by Defense Secretary Caspar W. Weinberger on Friday.

Kept in the Dark

Regan said he never knew that Lt. Col. Oliver L. North, a member of the National Security Council staff, was conducting covert operations, including the transfer of Iranian arms sales profits to the contras.

Asked his reaction when he learned last November, he replied in a single word--”horror.”

Recounting his version of the arms-sales history, Regan said that on Dec. 7, 1985, at a meeting with the President, Secretary of State George P. Shultz and Weinberger, he had said “we weren’t getting anywhere” with Iran despite the arms sales and had recommended: “Why bother, cut your losses, get out of it.”

Enter McFarlane

Instead, he said, the President sent former National Security Adviser Robert C. McFarlane to London to talk with Iranian representatives to see whether the attempt at better relations could be salvaged. He said McFarlane returned “quite disgusted with the sleazy type of characters that he had met there.”

Yet, when the matter of arms shipments came up again the following month, Regan endorsed further shipments. “It seemed again a worthwhile effort,” he testified.

One thousand TOW missiles then were shipped to Iran from the United States, but the hostages were not released.

Then, said Regan, he told the President that “I thought we ought to break it off, that we’d been snookered again. And how many times do we put up with this rug-merchant type of stuff? Or words to that effect.”

Seemed to Understand

Regan said the President seemed to share his view.

“Did he instruct anyone to terminate their activities?” asked Terry A. Smiljanich, the associate Senate committee counsel.

“No,” Regan said.

“There was a pause then, and I sort of lost track of what was going on.” He said the budget then occupied his time.

Among Regan’s disclosures and quips:

--Iran was running a “bait-and-switch” operation, with hostages the bait and Reagan the victim.

--He is certain that Reagan did not know of the diversion of arms-sales proceeds until Meese told the President last Nov. 24, the day before Meese announced discovery of the fund diversion on television.

“This guy was an actor and he was nominated at one point for an Academy Award,” Regan said of the President. “But I’d give him an Academy Award if he knew anything about this” and hid that knowledge so skillfully.

--He said he doubted Reagan would have approved of the fund diversion if he had known about it.

--”It didn’t occur to me that men of that caliber (Poindexter and North) would be destroying documents or . . . clean up the record.”