Original subtitles

Previously on "Fiasco"...

While President Jimmy Carter is engulfed

by a hostage crisis in Iran,

a new religious movement in the United States

finds traction

and a kindred spirit with a familiar face.

After Carter suffers a landslide defeat

in his bid for a second term, he remains determined

to negotiate the release of the hostages.

But it's the newly inaugurated President Reagan

who welcomes them home.

Right next door to the White House, in Washington, D.C.,

is another building that's never gotten

quite as much attention.

The Old Executive Office Building

was built more than 100 years prior.

It was actually the Department of the Navy

and the Department of War.

At the time, the National Security Council staff

was all located on the third floor of the building.

The National Security Council,

or NSC for short, was a body of senior advisors

who had the President's ear on foreign policy.

The NSC had its own staff,

whose job it was to monitor world events

and keep the President informed

of any incoming threats to America's national security.

My office was probably 20 feet by 20 feet,

with 15-foot ceilings. I had a big sofa.

I could spend the night. I had a bar.

Those were days when you could smoke cigars

in the office and drink scotch.

Oliver North's office was not like that.

Colonel North, please rise.

Do you solemnly swear--

Before Oliver North

became associated with an international scandal,

he was a little-known junior aide on the NSC staff,

a young Vietnam vet with no previous experience

as a government bureaucrat.

Starting in 1981, North had his own office

in the Old Executive Office Building.

Room 392.

He was actually stuck up in a room

that was carved out of other rooms.

His office was uncomfortable, it was hot, it was cramped.

Most people in government at the time,

even those with top secret security clearance,

had no idea this room even existed.

Ollie had three or four computers,

four or five phones.

He had more electronic equipment

than anyone else in the NSC. It was a bit sci-fi.

We're still talking 5 1/4 floppies in this time.

There were no hard drives.

Whenever there was a hint of danger

anywhere in the world, a little bell would go off,

and some days room 392 was filled with the din of bells.

North's office was definitely a little command center,

and it enabled him to have,

you know, international conversations,

secure conversations, whatever he wanted,

while dealing with three different computers

at the same time.

You know, it was sort of a real-time picture

of global terrorism.

I came to the National Security Council

six years ago

to work in the administration of a great president.

How did Oliver North find himself

so close to the center of American power?

There were many problems.

Sometimes we succeeded and sometimes we failed.

What was he doing

behind the closed doors of room 392?

And what part did he play in paralyzing the administration

of a wildly popular president?

But at least we tried.

And I want to tell you that I for one

will never regret having tried.

I'm Leon Neyfakh.

This is "Fiasco," the story of Iran-Contra.

We have every right to dream heroic dreams.

Those who say that we're in a time

when there are no heroes,

they just don't know where to look.

You can see heroes every day.

Ronald Reagan glided into office in 1981,

thanks in part to the missteps of his predecessor,

Jimmy Carter.

I'm told that tens of thousands of prayer meetings

are being held on this day,

and for that I'm deeply grateful.

But he was also really good at playing the part.

We are a nation under God,

and I believe God intended for us to be free.

He had star quality,

and he just came across as presidential.

Reagan had this special charm about him,

this appealing factor.

In this springtime of hope,

some lights seem eternal. America's is.

It was almost like if it was on camera

and you were watching him on television,

you had the sense that he was right there with you,

leaning over a fence.

I have a letter with me.

The letter came from Peter Sweeney.

He's in the second grade,

and he said, "I hope you get well quick

or you might have to make a speech in your pajamas."

The image of Ronald Reagan that voters

had probably uppermost in their minds

by the time he entered politics in the middle of the 1960s

was as a TV star.

Ain't you supposed to be good with a gun?

Good enough.

On Sunday nights,

Reagan was on the General Electric Sunday Night Theater.

For General Electric,

here is Ronald Reagan.

Good evening. Tonight, Jack Benny,

with Zsa Zsa Gabor, stars on the "General Electric Theater."

He was a comforting figure

on your television screen every Sunday night,

on this show that was,

you know, among the most popular

in the late 1950s and early 1960s.

Once upon a time there was a girl,

and of course there was a boy who fell in love with her.

When Reagan decided to make the jump to politics,

it became clear that he was bringing

his acting experience with him.

His acting skills were inherent in his communication.

He had a cadence to the way he spoke.

For example, he often starts his sentences--

very frequently- by saying "Well,"

and he cocks his head a little bit.

Well. Well. Well. Well. Well.

He told me that was a stage pause

that allowed him just a fraction of a second

to think through how he wanted to start the sentence.

And so I actually started writing that

into his speeches.

Well, now to get on with the business at hand.

After an assassination attempt in 1981...

...Reagan showed such grace and humility

that his approval ratings with both parties increased.

I'd like to say a few words directly to all of you

and to those who are watching and listening tonight.

The warmth of your words, the expression of friendship,

and yes, love, meant more to us than you could ever know.

Amid the upheaval of the late 1970s

and early '80s,

many Americans saw Reagan as an almost mythical leader

who would bring the country back to a simpler time.

Reagan was a man of very strong convictions,

but they were also very broad convictions.

He believed in military strength.

He was fiercely anti-Soviet, fiercely anti-communist.

In his mind he was a rescuer. He was a hero.

He was gonna rescue America from communists,

from liberals, from chaos.

Our forbearance should never be misunderstood.

Our reluctance for conflict should not be misjudged

as a failure of will.

When action is required to preserve our national security,

we will act.

Reagan's convictions, broad as they were,

had a galvanizing effect on the people around him.

He knew how to make people want to follow him

My name is Oliver North,

lieutenant colonel of the United States Marine Corps.

The National Security Council is, in essence,

the president's staff. It helps to formulate

and coordinate national security policy.

When Oliver North was first starting out at the NSC,

Vietnam was still fresh on his mind.

Since graduating from the Naval Academy in 1968,

I have strived to be the best Marine officer that one can be.

Following his graduation,

North joined the Marine Corps and deployed to Vietnam.

Ollie is an extraordinarily patriotic man,

and he is a Marine in every fiber of his being.

In combat, my goal was always to understand the objective,

follow orders, accomplish the mission

and to keep alive the men who served under me.

During both of his tours of duty,

North wrote letters to his family,

updating them about life in Vietnam.

He expressed frustration about what he saw

as Washington's reluctance to support the war.

"I wish the politicians would get off their fat,

soft posteriors," he wrote, "and clear this mess up."

In 1971, when North returned from Vietnam,

he continued to speak out.

Yes, I have a question for Captain North.

Did you ever yourself witness

the mistreatment of Viet Cong prisoners

by either American or South Vietnamese troops?

I never witnessed a single ear being cut off,

a single round being fired at a man without a rifle,

a single piece of ordnance dropped at, on,

or near a village of any type

or a single civilian being maltreated

by either South Vietnamese or American personnel.

Is that specific, sir?

North would later say

that the war was not lost in Vietnam.

It was lost in Washington.

In 1981,

he moved there himself and began work at the NSC.

Ollie North came across reporters' radar early,

but no one quite knew what he did.

Well, it turned out

that he was a special operations aficionado,

a counterterrorism aficionado.

And over time, he made that his specialty

in the National Security Council.

After years of military duty,

the job was North's first opportunity

to test his patriotic principles

off the battlefield,

from inside the halls of Washington, DC.

And thanks to a Soviet-sponsored civil war

raging south of the American border...

Ah!

...North had quite a bit of work ahead of him.

I started my career as a foreign correspondent

in the Middle East,

covering the Iranian revolution and the Iranian hostage crisis.

So I was immersed in Iranian affairs at the time.

And a few years later, when I got to Washington,

my editors asked what subjects I wanted to focus on.

And I said, "I don't care what it is

"as long as it has nothing to do with Iran.

I'm sick and tired of that country."

They said, "Fine.

"We want you to cover Central America.

That will have nothing to do with Iran at all."

And so I began to learn about Nicaragua.

And here is where we get to the Contra part

of the Iran-Contra scandal.

-Solo el pueblo! - both] Solo el pueblo!

You see, Ronald Reagan

held a pretty simple view of the world.

There were the good guys, and there were the bad guys.

And the president of Nicaragua, Anastasio Somoza,

was one of the good guys.

But around the time Reagan began his march

to the White House in the 1970s,

the Central American country was rocked by revolution.

My fellow Americans, I must speak to you tonight

about a mounting danger in Central America

that threatens the security of the United States.

As Reagan described it to the American people,

this was a clash between the Soviet-backed Sandinistas

and a counterrevolutionary force called the Contras.

Using Nicaragua as a base, the Soviets and Cubans

can become the dominant power in the crucial corridor

between North and South America.

It was framed as a classic battle

between communism and democracy.

But it was never really that simple.

Nicaragua was the classic Central American dictatorship.

It had been ruled for several generations

by the Somoza family.

It was a thoroughly repressive and corrupt and nasty regime.

To maintain the peace of a country

is a way of protecting the people.

Neutralizing those who break the peace

is also a form of protecting the people.

I grew up in a household that was firmly antisomocista.

However, right,

I had relatives all over the political spectrum.

My name is Victoria González-Rivera.

I grew up in Nicaragua during the Sandinista Revolution

and the Contra War.

Many Nicaraguans supported the Somozas.

And they did horrific things-- human rights abuses

and massacres.

But many people were willing to look the other way

if they thought that it benefited them economically.

The Somoza regime was, of course, for many years,

a close ally of the United States.

And in the 1950s and the 1960s,

if a regime was anti-communist,

that was essentially all anyone in Washington needed to know.

Good afternoon. From the steps

of New York City Hall,

your city station brings you the official reception

to the president of Nicaragua,

the honorable Anastasio Somoza.

I feel very proud to say

that the Nicaraguan people and President Somoza

are the best friend the United States have

and will ever have in Latin America.

America's friendship with the Somoza regime

was put to the test just before Christmas of 1972

when Nicaragua's capital city, Managua,

was all but destroyed by an earthquake.

This, now, is the tragedy of Managua.

The thousands and thousands of men,

women, and children,

who have been told that they have to leave their city,

because it's no longer safe.

The whole of the center of the city

is gradually being eaten up my flames.

It's the faces of the children involved

that reflect the tragedy of a great disaster like Managua

more than all the pictures of shattered buildings

and blazing fires.

I was just three, almost four years old.

You know, it changed a lot. It changed Nicaragua forever.

There was great concern because, of course,

so many people died.

Under the rubble of these buildings,

there still lie countless thousands of bodies

which are decaying and presenting

a major health risk.

Bulldozers combed the streets

in search of bodies buried beneath the rubble.

And as the city burned,

Somoza declared martial law.

Approximately 80%

of all the buildings have been badly damaged,

and they have to be surveyed to see

if they are safe to inhabit. We are going to live in tents

until we make an appreciation of the situation,

and the government will have

to decide what they're going to do.

Throughout the week, there's been a nonstop stream

of relief aircraft

coming here with food and medical supplies.

Food and water are still desperately needed.

And there's criticism that the supplies,

which have been coming in,

are not going to the people for whom they were intended.

In the aftermath of the earthquake,

the Somoza government was accused

of stockpiling foreign aid

and engaging in various other forms of fraud.

What do you need at the moment?

Right now, what is your most urgent need?

Hospital beds.

We have people here with fractures untreated.

No treatment for four days. No food for four days.

I saw people drinking sewage water.

It felt very heavy.

You know, like, the air felt heavy,

like something was going to happen.

There was always this sense of...

The war is coming. The war is coming.

In response, a revolutionary group

called the Sandinistas started to gain momentum.

The Sandinistas take their name from national hero

Augusto Sandino,

who fought against a United States intervention

in Nicaragua in the 1920s.

The idea was obviously

that Nicaragua needs to be ruled by Nicaraguans,

and it was very much an anti-imperialist position.

-Solo el pueblo! - Solo el pueblo!

You know, they were influenced by socialists,

socialist thought, by the Cuban Revolution

in particular.

They trained in the mountains of Nicaragua

and, over time, built up their military strength.

This is a war against Somoza.

You know, these are young men, groups,

who want to do something and change this country.

How long do you think this war will now last?

I give it a week.

In Nicaragua, the rebellion continues.

These men, apparently rebel fighters,

were not known in this neighborhood,

and no one claimed them for burial.

The Red Cross burned the bodies in the streets.

They were concerned about the spread of disease.

The brutality of Somoza's regime pushed

even moderates in Nicaragua to support the Sandinista cause.

He's killing innocent people.

Witnesses have seen with their own eyes

how they have killed men, women and children.

He's a monster. He's an assassin.

Somoza is defiant.

This week he told reporters, "I will not resign."

If they had the support

of the people, I wouldn't be here.

And if Somoza doesn't go?

We'll keep on fighting.

In 1978, President Carter stopped aid

to Somoza's government,

citing human rights violations.

The Americans now believe, in effect,

that you've got to go, that they will no longer

continue to support you in power.

As far as I've heard officially,

the United States is not in favor of my overthrow.

The Sandinistas saw this as an opportunity

and launched an emboldened campaign

to overthrow the dictator.

The Sandinista guerrillas have launched

what they call their Final Offensive.

Led by Commander Eden Pastora,

the Sandinistas seized the national palace

while the legislature was in session.

They overpowered the building

and took 2,000 government officials

and employees as hostages.

After the storming of the palace, it was clear

that Somoza had lost his grip on power.

So our parents send us off

to live with my grandparents.

We end up in Seattle,

and we don't know what is happening to our parents.

Sandinista rebels are fighting Nicaraguan troops

again in Managua today.

Nicaragua was on the news every single night,

so we're watching it on TV.

We even witnessed my street on television,

because that's where a lot of the fighting was taking place.

My grandma is a wreck,

and she's trying to get the U.S. Embassy

to tell her where her daughter is.

Finally, after a year of war,

Somoza fled Nicaragua, and the Sandinistas declared victory.

The weeks of rumors became fact today

as President Anastasio Somoza of Nicaragua resigned.

The president turned in his resignation

early this morning.

And an aide who was present at the bunker

said the President

tearfully hugged staff members one last time.

The Sandinistas took control of Nicaragua in 1979,

the same year that a parallel revolution took hold in Iran.

Both countries were one-time U.S. allies turned enemies...

...which made 1979 a distinctly destabilizing year

for American dominance across the world.

But even as global tensions simmered,

it felt like peace had come to Nicaragua.

The euphoria wouldn't last long.

Soon, a new armed conflict was brewing in Nicaragua,

one that the new American president

would be watching very closely.

As the Sandinistas took power,

they confronted the instability

left by the Somoza regime.

Because the departing Somocistas

took with them all the cash and gold reserves

they could carry,

Nicaragua's agriculture and industry

have been in a bad way.

Many people tend to romanticize revolutions.

They forget about the unintended consequences.

Queues for food have become a common sight,

because the government has been unable

to eliminate shortages in certain basic commodities.

We are trying to fight for the creation

of a social democratic system in this country.

The revolution was a revolution of young people,

and so inevitably,

all these young people went on to make mistakes,

in part because they-- they didn't know any better.

As the Sandinistas struggled to create a government,

those who opposed them began to organize.

Over time those ragged remnants of Somoza's army

coalesced

in a not very well organized, not very well funded,

not very coherent set of forces.

They called themselves the counterrevolutionaries.

They were trying to overthrow the revolution.

And their shorthand name became "the Contras."

The Nicaraguan Democratic Force

is the largest Contra group

opposing the Sandinista government.

We're fighting for the democratic rescue

of the Nicaraguan Revolution.

Some of these people

may be former national guardsmen.

some are simple peasants

trying hard to become professional soldiers.

We need food, boots, arms, everything.

But the main thing we need here is the real support

of the democratic governments. We need help.

The Sandinistas officially took control of Nicaragua

around the same time Ronald Reagan took office,

and he did not conceal his contempt for them.

There are atrocities going on in Nicaragua,

but they're largely the work of the institutionalized cruelty

of the Sandinista government.

America has to see the true face of Nicaragua.

For Reagan, the newly leftist Nicaragua

represented the presence of an enemy

in America's backyard.

And it reflected an escalation of the decades-long

Cold War conflict that Reagan ad inherited.

We anticipated a world of peace and cooperation.

The calculated pressures of aggressive communism

have forced us, instead, to live in a world of turmoil.

After World War II, to be an American president

meant playing a lead role in the clash

between the East and the West,

between capitalism and communism.

The Communists' drive to impose

their political and economic system on others

is the primary cause of world tension today.

The conflict played out

in nearly every corner of the globe.

The contest in Vietnam is part of a wider pattern

of aggressive purposes.

We can have differences without being enemies in war.

And in the 1970s,

what had been a Cold War began to heat up.

The Soviet Union, in the aftermath of Vietnam,

had begun extending its influence

all over the Third World.

There is no Soviet domination of Eastern Europe,

and there never will be under a Ford administration.

We demand that the Soviets withdraw

from Afghanistan.

I pledge to you that we will do

everything we can to win this great struggle.

The Reagan administration saw a Cold War

domino theory kind of world,

one in which it was a zero-sum game

between the American side and the Soviet side.

Will we support freedom in this hemisphere or not?

Will we defend our vital interests

in this hemisphere or not?

Will we act while there is still time?

To have the Sandinistas in Nicaragua,

I think Reagan felt that they could very well

provide a foothold for communism in this hemisphere.

As Ronald Reagan was fond of telling the American public,

"You'd have a wave of refugees fleeing the communists..."

More than a quarter of a million refugees

have fled Nicaragua since the Sandinistas took control.

Hundreds of thousands of refugees

fleeing communist oppression to seek entry into our country.

We don't want to see the map of Central America

covered in a sea of red,

eventually lapping at our own borders.

We must act now.

One of the perennial challenges

for American diplomacy

and American intelligence during the Cold War was:

What do you do when there is a hostile force

or an unfriendly government somewhere in the Third World?

Ronald Reagan's solution was to overthrow

the Sandinista government

and make it clear to all the other insurgents

that the United States

was going to draw the line against revolution

and that everybody was gonna suffer,

and they should just give it up.

And so, in December of 1981,

Reagan secretly authorized the CIA to help the Contras

in their fight against the Sandinistas.

They are the moral equal of our Founding Fathers

and the brave men and women of the French Resistance.

We cannot turn away from them,

for the struggle here is not right versus left.

- It is right versus wrong.

The CIA began supplying the Contras with weapons

as well as money and strategic advice.

For months, the Reagan administration

had a guiding hand in Nicaragua's civil war.

And, for a while, the CIA's activities went undetected.

But then...

the extent of the CIA's involvement in Nicaragua

came under scrutiny

when Newsweek published an explosive cover story

on the operation in 1982.

Sources in Washington reveal

CIA officers have directed

and funded the war against Nicaragua,

CIA employees executing the more damaging attacks.

More and more members of Congress are asking questions

and demanding answers

about the United States' role in Nicaragua.

I would hope and pray

that the policy of this government

would be the policy of diplomacy

and not gunboat diplomacy.

It's important for a director of the CIA or,

for that matter, anyone who's head

of an intelligence agency,

to make certain that members of Congress

are fully informed of covert operations.

We are not doing anything

to try and overthrow the Nicaraguan government,

and anything that we're doing in that area

is simply trying to interdict the supply lines,

which are supplying the guerillas in El Salvador.

What can happen is you can get individuals

that will abuse the power of this country

and will do things that ultimately could be damaging

to our national security.

That was the whole purpose of the Boland Amendment.

The secret war hasn't brought Central America

closer to peace

or Nicaragua closer to democracy.

What it does do is provide the Sandinistas

with the perfect excuse to foist unfair elections,

a huge Army, censorship,

and the draft upon the Nicaraguan people.

The Boland amendment specifically banned the CIA

and other U.S. intelligence agencies from supporting

anyone trying to overthrow the Sandinista government.

Its purpose was to keep the United States

out of Nicaragua,

lest it became another Vietnam.

By and large, I think that what

this committee has done

is in the interests of our government.

Once again, when the going gets tough,

the United States quits.

That's the message we're going to broadcast

to the rest of the world

if we in fact cut off our assistance

to the Nicaraguan resistance.

Silly, foolish, dangerous, tragic, naive,

sad--it's all of those things, and even more.

It is, by now,

a familiar American predicament:

If we abandon the rebels

to whom we've given encouragement, arms and money,

they will be left high and dry.

It happened in Vietnam, Cambodia, Iran, and Lebanon.

But if we continue to support the Contras,

and they continue to war on the economy

and civilians of Nicaragua,

then we will be subsidizing violence against people

who happen to be living in the wrong place at the wrong time

who have done us no harm.

The debate over the Boland Amendment

coincided with a major PR campaign

by the Reagan administration to rally public support

around the anti-communist Contra cause.

These men are not putting their lives on the line

to restore a dictatorship of the past.

These men are fighting for freedom.

If we give them the aid they need,

the Nicaraguan people can win this battle

for freedom on their own.

To do so, the CIA started to assemble

a group of Nicaraguan counterrevolutionaries

who could lend a public face to the struggle.

Edgar Chamorro had moved to Miami from Managua,

and in his free time,

he was meeting with a group of fellow Nicaraguan expats

to discuss their country

and strategize about their possible return.

The man told Chamorro his name was Tony Feldman

and that he was calling from the National Security Agency.

Mr. Feldman didn't mention a connection to the CIA,

but it's safe to assume that he had one.

The man told Chamorro

that the Nicaraguan Democratic Force,

known as the FDN,

was recruiting a panel of new leaders.

The panel would be a military and political hybrid

made up of Nicaraguan expats

who were dedicated to rolling back the Sandinistas.

With that, Chamorro became a Contra.

He returned to Central America,

where his task was to sell the Contra cause

both to the American public and to his countrymen.

He gave interviews, distributed fliers,

and established a pro-Contra radio station,

broadcasting out of Honduras.

In Nicaragua, the war between the Contras

and the ruling Sandinistas continues.

The Reagan Administration

continued to find ways to support the Contras.

At least for now, it seemed the White House

was taking a quiet approach

to Reagan's fervent anti-communism crusade.

Then, in 1983, the CIA did something quite a bit noisier.

In a pre-dawn strike,

the Contras blew up fuel storage tanks,

turning most of the country's oil reserves into flames.

By helping the Contras attack

a major port about 100 miles north of Managua.

It was the Contras who took the credit,

but CBS news has learned

it was Americans who led the raid.

Publicly, the Pentagon won't talk about those actions,

and privately the American military just keeps doing them.

The law of the land,

as embodied in the Boland Amendment,

is not being fully adhered to.

If the law is being violated in the Congress,

then we do have a clear responsibility

to bring our government into compliance.

The bombing of the port in Nicaragua

was a turning point

for the Reagan administration's ability

to operate effectively and covertly

in the war against the Sandinistas.

Nicaraguans are still attempting to repair

the oil storage tanks

damaged in the biggest attack yet from the outside.

The bombing provoked congress to further tighten

the restrictions on the White House's ability

to help the Contras.

But instead of shifting their focus away

from Nicaragua completely,

the Reagan White House found a loophole,

one that led them straight to the National Security Council.

It turned out that the law said no intelligence agency

may give this kind of support to the Contras.

But it didn't say anything about someone

who wasn't an intelligence agency.

Somebody had the quite brilliant idea:

"Well, you know, the National Security Council

isn't an intelligence agency."

And so in 1984,

Lieutenant Colonel Oliver North

was assigned a new brief: Nicaragua.

Ollie North had already been tangentially involved.

Now he became the point man, formally put in charge of,

as I think he later said,

"Keeping the Contras together, body and soul."

It was a covert paramilitary war,

but it was the most overt covert war

in the history of the CIA. Everybody knew about it.

It was being conducted essentially out in the open.

Once the funding was cut off,

then you had the real covert operations that began.

As part of an early training mission,

in the spring of 1984,

North traveled to Central America

to meet the Contras' military leaders.

Upon his return, North earnestly told his colleagues

that he made a commitment to them.

"I told those guys I'd come through for them," he said.

The Contras,

the Nicaraguan Freedom Fighters,

are people--living, breathing, young men and women--

who have had to suffer a desperate struggle

for liberty, with sporadic and confusing support

from the United States of America.

North's dedication to the Contras

stemmed in part from his experience of Vietnam,

a war that had been over for years,

but retained a grip, not just on North,

but on the whole country.

There was, at the time, still a Vietnam syndrome.

Before Vietnam,

the United States had never lost a war.

When American troops left Saigon in 1975,

it was the start of a new era in American foreign policy,

one defined by a traumatic military defeat.

The concern was

that we were basically risking the possibility

of a greater war in Central America,

in our own hemisphere, and that concerned all of us.

The country was torn asunder

by the devastating effects on human life,

both in Vietnam and for U.S. citizens

and on our social and political system.

And so the mantra of, really,

almost the entire United States

was no more Vietnams.

But to Oliver North,

the Contras looked like anti-communists

who needed America's help.

And soon after taking up their cause,

the young lieutenant colonel began to form a bond

with someone who felt

just as strongly about protecting them:

CIA Director William Casey.

If that regime succeeds in consolidating itself,

we can expect that Managua

will become the terrorist capitol of this hemisphere.

-Casey would drop by room 392.

Often, he would call North on the phone over a secure line.

I readily admit that I was action-oriented,

that I took pride in the fact that I was counted upon

as a man who got the job done.

But despite his zeal for the Contras,

North started to realize he needed a little help.

It was beginning to be a job too big for just one man.

So Casey went about looking for private actors,

most of them veterans of earlier covert wars,

people who weren't in the CIA or in the military,

who might volunteer to come back

and work off the books on unofficial operations.

Casey and North considered their options

for filling the job at hand.

The candidate had to be someone they trusted.

It also had to be someone committed to the cause.

Most importantly, it had to be someone well-versed

in covert operations.

It was around the end of 1984.

I got contacted by the government

to come back and work on a minor little project.

I guess I must have been temporarily insane.

I agreed to do what I could, and the rest is history.

My name is Richard Secord.

I'm a retired U.S. Air Force general.

In the world of unconventional warfare,

Richard Secord was almost universally recognized

as a master of covert air operations.

Covert operation, by definition,

is an operation that is absolutely secure

and very tightly controlled so as to maintain the cover

until it's decided to uncover it.

It's very simple.

Secord had a reputation for being effective, intense,

and extremely impatient with bureaucracy.

By the time CIA Director Bill Casey called him,

Secord had 28 years of combat experience,

both in guerilla wars in Asia

and in conventional air operations in Iran.

I was in charge of a lot of air operations

and learned the trade pretty well, I think.

You have to have true teamwork,

and you have to be quite comfortable

with small unit operations,

because they don't involve a lot of people.

Secord's career in government had been cut short

after allegations surfaced

that he was involved in a secret arms dealing network

that, among other things, tried to sell explosives

to Libya's dictator Muamar Gadafi.

But that's a different fiasco.

It was quite a long haul,

and I wouldn't change much of it.

The secretary of defense himself, Caspar Weinberger,

officiated at my retirement ceremony,

so I guess I didn't retire in disgrace.

Bill Casey was well aware of Secord's past

and more than willing to look beyond it.

They were looking for a "bridging operation,"

as they called it,

the creation of a covert airlift operation

to take the place of the CIA airlift

that was hauling arms and other supplies

to the Contras in the field in Nicaragua.

With Secord officially on board,

Oliver North had an outside channel

that he could use to provide logistical support

for the Contra forces.

Together, they would keep the resistance alive,

body and soul.

There are now three times as many Freedom Fighters

fighting the Sandinistas

as there were Sandinistas fighting Somoza.

Our first requirement was to put together a ragtag,

if you will, Air Force.

Our main operating base was in El Salvador

at the Ilopango Air Base.

It became apparent early on

that we were gonna have to help out

on the procurement of weapons too.

And so I hired some old friends

from my military days.

Logistics are truly the sinews of war.

It's not just the muscle of war.

It's the beginning and the end.

If you don't have adequate logistics,

you're not going to make it.

By 1985, Secord and North had developed

a fully functioning airline operation,

whose sole purpose was to deliver food

and weapons to the Contra forces.

But the operation wasn't going to fund itself.

And with the Boland Amendment in place,

Congress wouldn't be funding it either,

at least not any time soon.

So it was time for North to get creative. Again.

Our friend and patron, the president of the United States.

One of the underappreciated parts of this story

is that even when Congress said,

"We want to cut off United States funding to the Contras,"

Congress forgot that it couldn't stop

the president of the United States

from doing fundraising on his own.

I want to begin by saying that I'm honored to be

in the presence of those who are here from Nicaragua

and all the rest of you, too.

The Nicaraguan Refugee Fund Dinner,

April 1985.

Six years ago, many of you were part of the fight

to overthrow an oppressive regime

that had ruled your country for decades.

In many ways,

it looked like a typical fundraising gala.

And she just said, "I love you Mr. President."

Isn't that nice?

But this gala was different,

and it's one of the key moments in our story,

because it brought together several elements

that would set the Iran-Contra scandal in motion.

Shortly after the gala, North was approached

by two prominent Republican fundraisers

who had attended the event:

Spitz Channell and Richard Miller.

They were interested in raising money for the Contras

and offered a new and more efficient way to do it.

They looked around for private donors.

American anti-communists who might be willing

to give some of their own money to the cause.

To North, the plan offered a potential gold mine

of private funds that could be directed

to the Contra forces in Nicaragua.

He put together a slideshow, where he showed the Sandinistas

to be evil and the Contras to be wonderful.

He started meeting with donors and giving them the slideshow

and tugging on not only their heartstrings

but their purse strings to convince them

that they should be supportive of the Contra War.

He would tell them,

"Federal law prohibits me from asking you for money.

"But, of course, this guy sitting right next to me

will ask you for it."

And that is how these operatives believed

they were somehow adhering to the law.

That operation did serve an important political purpose.

Because anytime a reporter like me asked,

"So, where are the Contras getting their money?"

people in the Reagan administration could say,

"Well, there are these wealthy private donors.

"You need to go talk to this lady in Dallas

"or this man in Massachusetts. These people are really worried

about Nicaragua, and they're giving the money."

It may have been repetitive, but it worked.

In 1985 alone, North and his fundraising partners

raised over $10 million for the Contras.

Flush with cash, North now had to find a way to store it.

For that, he turned to Richard Secord,

who had some experience with this kind of thing.

Secord created a network of Swiss bank accounts

that would keep operations running smoothly and unnoticed.

Secord referred to this conglomerate

simply as "The Enterprise."

North, ever the patriot, called it "Project Democracy."

And, at least for the time being,

Congress wasn't calling it anything at all.

Gadafi used to be far away,

but now he sits on our doorsteps

supplying arms and terrorist experts

to the communisis in Nicaragua,

only two hours away from our borders.

All of this, only two hours away from where we live.

Support the President on Nicaragua.

By 1985, Project Democracy

was drawing from 16 different bank accounts

located mainly in Switzerland.

We had contracts with a number of companies

throughout the world.

Here is terrorism we can do something about

if we support the President on Nicaragua.

The money trail was so intricate

that even North had trouble following it.

But that didn't mean he had any problem spending it.

The aid itself paid for hiring planes, pilots, trucks.

It enabled the U.S. government to bribe the Honduran military

to continue to let the United States use its bases.

We used to call Honduras the USS Honduras,

because basically it was a landed U.S. destroyer

that was serving as a base for the Contra War.

North and Secord now had a system

for keeping the Contras going,

but there was still the need for more money.

And so they continued to look towards Congress.

There is a vote coming up in Congress

of utmost importance.

And I have to tell you, I need your understanding and support.

After losing a vote for Contra aid

in April of 1985, the Reagan Administration

became even more determined to overturn the Boland Amendment

and to push Congress to fund the Contras.

Now comes the crucial test

for the Congress of the United States.

Will they provide the assistance the Freedom Fighters need

to deal with Russian tanks and gunships,

or will they abandon the democratic resistance

to its communist enemy?

To achieve this,

they needed all the public support they could get.

What the Sandinistas have done to Nicaragua

is a tragedy.

But we Americans must understand

and come to grips with the fact that the Sandinistas

are not content to brutalize their own land.

They seek to export their terror

to every other country in the region.

Whether it was true or not, the media campaign worked.

And in February of 1986, Congress approved

$100 million in aid for Reagan's freedom fighters.

Through this aid, we'll say to the free people

of Central America, "We will not betray you."

This funding package was a landmark victory

- for the Reagan White House.

And it was a badly needed windfall for the Contras.

The Freedom Fighters of Nicaragua

have pinned down the Sandinista Army

and bought the people of Central America precious time.

We Americans owe them a debt of gratitude.

The bridging operation had been a success.

With congressional aid about to start flowing again,

Project Democracy had served its purpose,

and Lieutenant Colonel Oliver North

had proved his mettle.

There were other problems on the horizon.

But for now, Ronald Reagan was content to focus

on defeating communism in Nicaragua.

We can succeed in turning the tide

to Democracy in Nicaragua.

We must succeed.