Bush's Iran-contra Diary Says He Was Out Of The Loop Walsh Said He Would Still Investigate. Bush's Lawyers Said The Diary Showed No Misconduct.

Posted: January 16, 1993

WASHINGTON — The White House released excerpts of President Bush's Iran-contra diary yesterday, saying they bolstered his claim that he was "not in the decision- making loop" in the Reagan administration arms-for-hostages scandal.

The transcript of Bush's dictated recollections from Nov. 4, 1986, to Jan. 2, 1987, shows that he fretted that the affair might cost him the presidency in 1988.

Calling the scandal "the biggest political test - or test of any kind - that I've ever been through," Bush worried in December 1986 that "if it continues like this - it would make it extremely difficult to get the nomination."

Also released was a transcript of Bush's five-hour deposition given to Iran-contra investigators on Jan. 11, 1988. Throughout the lengthy interview, Bush said he could not recall key details of the affair.

The White House said the diary was discovered by Bush aides in September 1992, but the President's lawyer withheld its existence until after the election so the issue would not be thrown back into the spotlight.

The material was released with the hope that a careful examination of the materials would prove that Bush did not lie about his role in the scandal, and

allow the President to leave office next week free of a political cloud that has dogged him for more than six years.

The Iran-contra affair involved the secret sale of weapons to Iran in exchange for the release of American hostages held in Lebanon by pro-Iran Shiite Muslim groups, and the diversion of money from those sales to support the anti-communist contra rebels in Nicaragua.

The controversy erupted anew four days before the election, when a new Iran-contra indictment again raised questions about Bush's truthfulness.

Iran-contra independent prosecutor Lawrence E. Walsh said yesterday that he was continuing his investigation into Bush's role in the affair and why the White House failed to disclose the diary's existence when first requested five years ago.

"We have reviewed the report generated by the President's lawyers and the selective release of his diaries. Because our investigation is ongoing, we are not free to comment on the accuracy or completeness of the report," spokeswoman Mary Belcher said.

The existence of the diary was disclosed by the White House only last month, prompting Walsh to charge that Bush might have improperly withheld the notes.

Walsh, angered by Bush's Christmas Eve pardon of former Defense Secretary Caspar E. Weinberger and five other Iran-contra defendants, said Bush had become the "subject" of an investigation into a possible high-level cover- up.

But a review conducted by attorneys representing Bush in the matter concluded yesterday that the failure to turn over relevant portions of the diary was inadvertent and that there was "no misconduct" by Bush or White House aides.

Former Attorney General Griffin Bell, who is heading Bush's legal team, also said the lawyers found no evidence of intentional gaps in the diary.

Bell also revealed that a "diligent search" of Bush papers turned up additional documents that would be turned over to Walsh. The documents found were not described.

Walsh earlier had said he had not been given all portions of the diary relevant to Iran-contra, but yesterday a source close to the special counsel said Walsh was now satisfied that he had all the diary notes.

In the diary, Bush said on Jan. 1, 1987: "I am not in the decision process . . . not on personnel and not on major decision matters - unless I am sitting in at the time the President makes a decision, then I can speak up. . . . The facts are that the vice president is not in the decision-making loop."

The notes also reaffirm Bush's public claim that he and then-President Ronald Reagan were unaware that profits from the weapon sales to Iran were diverted to arm the Nicaraguan contras. Congress had banned such aid.

"I know that I have told the truth. I know that I am not going to desert the President and I know that he has told the truth," Bush said on Nov. 25, 1986, the day the diversion was disclosed by the White House.

Bush dictated the notes on an almost-daily basis from Nov. 4, 1986, to chronicle his run for the presidency in 1988. The start of the diary coincided with both the 1986 congressional elections and the first public disclosure of the secret Iran deal.

Although Walsh in 1987 had requested all of Bush's personal papers relating to Iran-contra, the then-vice president had never been made aware by his lawyers that the request included diaries, according to the report prepared by Bell's legal staff. The report also noted that Walsh's investigators failed to ask Bush during the 1988 deposition whether he had any diaries or other related materials.

According to the Bell report's account, Bush never told his vice presidential legal staff that he was dictating a diary, which he sent to a trusted aide in Houston to transcribe. The aide sent the tapes and transcripts back to Washington, where Bush stored them in a safe at the vice presidential mansion and later, when he became president, in a White House safe.

A personal secretary found the tapes in the safe in late September 1992, told Bush they were relevant to Iran-contra and Bush turned them over to his White House counsel, C. Boyden Gray.

Gray "decided unilaterally," according to the Bell report, to hold onto the tapes until after the election. His justification was a statement from a Walsh assistant in September that an earlier request for additional Iran- contra materials could be postponed until after Election Day. In mid- December, Gray's office told Walsh about the diary.

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