Revisiting President Reagan’s Iran Arms-for-Hostages Initiative

The Wall Street Journal published an important story about the Obama administration’s decision in January to ship $400 million, which was first converted into Swiss and Dutch currencies, to Iran on board a cargo plane. The plane delivering the money had reportedly arrived at Tehran’s Mehrabad airport on the same date that four U.S. citizens were released by the government of Iran.

This money was owed to Iran for over thirty-five years, dating back to U.S. weapon sales that the Shah’s government paid for, but had not yet been delivered before the revolution. Under President Jimmy Carter, Iran was the number one recipient of all global arms exports. For example, between 1976 and 1978, over $8 billion (in current dollars) worth of weapons were delivered to Iran each year. Thus, the $400 million provided in January 2016 was the first shipment of $1.7 billion (this includes interest) that Obama announced concurrently with the nuclear deal: “Iran will be returned its own funds, including appropriate interest, but much less than the amount Iran sought.”

Immediately, charges of paying a ransom for the release of the U.S. citizens was leveled at the White House from opponents of the nuclear deal. Sen. Tom Cotton accused Obama of paying “a $1.7 billion ransom to the ayatollahs for U.S. hostages,” while Sen. Mark Kirk announced: “Paying ransom to kidnappers puts Americans even more at risk.”

Presidential attempts to secure the release of U.S. citizens believed to be under Iranian control have a notorious history. President Ronald Reagan’s Iran arms-for-hostage scandal is poorly understood by many, and even among current U.S. government staffers and officials that I speak with. The shorthand historical memory is that, “Reagan gave weapons to Iran for hostages.” Actually, the initiative was partially an effort to counter purported growing Soviet influence within Iran, which a 1985 Special National Intelligence Estimate had warned of. One potential source of leverage that could be reestablished was weakening the total arms embargo that had been in place since 1980. Another side aspect of the arrangement was to raise money—in direct violation of the Bolan amendments—that would support the Contra rebels fighting the Sandinista government in Nicaragua.

Still, as the masterful Office of Independent Counsel for Iran/Contra Matters report led by Lawrence Walsh makes clear, President Reagan hoped to secure the release of U.S. hostages being held in Lebanon in exchange for U.S. weapons. The scandal stained the president’s reputation, after he first went before the American people and proclaimed “We did not—repeat—did not trade weapons or anything else for hostages, nor will we,” but four months later admitted “what began as a strategic opening to Iran deteriorated, in its implementation, into trading arms for hostages. This runs counter to my own beliefs.”

The final outcome of the arms-for-hostages disaster was two U.S. citizens released (Reverend Benjamin Weir and Father Lawrence Jenco) and two new hostages taken (Frank Reed and Joseph Cicippio). In exchange for no net gain in released U.S. citizens, President Reagan authorized the delivery to Iran—from U.S.-supplied Israeli stockpiles—the following advanced weapons:

Aug. 20, 1985: 96 TOW missiles

Sep. 14, 1985: 408 TOW missiles

Nov. 24, 1985: 18 HAWK missiles

Feb. 18, 1986:  500 TOW missiles

Feb. 27, 1986: 500 TOW missiles

May 25, 1986: HAWK spare parts

Aug. 3, 1986: HAWK spare parts

Oct. 28, 1986: 500 TOW missiles