Gates' CIA Nomination Put in Dangerous Limbo : Intelligence: With hearings delayed, he has to endure months of questions, rumors about his agency activities.

By MICHAEL ROSS

July 21, 1991 12 AM PT

TIMES STAFF WRITER

WASHINGTON — When President Bush nominated Robert M. Gates to become director of the Central Intelligence Agency last May, Republican lawmakers were quick to dismiss suggestions that old questions about Gates’ alleged role in the Iran-Contra scandal might threaten his confirmation.

“Iran-Contra is history now,” Senate Minority Leader Bob Dole (R-Kan.) declared confidently.

But history, as the Administration discovered last week, has an inconvenient way of repeating itself. The unexpected admission by a former CIA official that he had lied to Congress about the agency’s knowledge of the Iran-Contra scandal has suddenly rejuvenated the investigation led by independent counsel Lawrence E. Walsh, who may finally be on the verge of providing new answers to some old and nagging questions about the worst political scandal of the Ronald Reagan years.

And Gates, the CIA’s former deputy director, who now serves on the White House National Security Council, suddenly has found himself in a remarkably similar position to that of 1987, when he was first nominated to head the CIA. He withdrew his name then when he was faced with questions about his knowledge of the illegal diversion of profits from the sale of arms to Iran to the Contra rebels in Nicaragua.

This time, with the support of the President and most members of the Senate Intelligence Committee, Gates has indicated that he will not withdraw. “If I did not have a clear conscience,” committee Chairman David L. Boren (D-Okla.) quoted Gates as having told him, “I would not have accepted the nomination when the President offered it to me.”

Boren, who has been one of Gates’ strongest supporters, insisted that the nomination is not yet in jeopardy. But, with the committee now having voted to delay the start of Gates’ confirmation hearings for two months, the appointment is in what even supporters admit is a dangerous limbo. “We still believe the nomination will go through, but we know there is more than one way it could be killed,” an Administration source concedes.

Any proof that Gates knew more about the diversion than he admitted to Congress in 1987 would, of course, be fatal--not only to the nomination, but to Gates’ 23-year-long career in government service. But even in the absence of such proof, the steady trickle of rumors, innuendoes and leaks about other CIA activities in which Gates may have been involved ultimately could prove just as lethal.

None of the disclosures revealed so far seems likely to kill the nomination. But, like a deadly poison administered slowly over time, they can be expected to have a cumulative effect. Between now and Sept. 16, when the twice-delayed Senate hearings are finally scheduled to start, Gates could “bleed to death from a thousand little nicks,” said committee member Warren B. Rudman (R-N.H.).

Even without the latest Iran-Contra revelations, Bush’s decision to renominate Gates was bound to stir controversy. Unlike his predecessors, Gates is the first nominee for CIA director to come from within the agency since Congress began to get serious about intelligence oversight in the mid-1970s.

The last three directors--Stansfield Turner, William J. Casey and William H. Webster--all came from the outside, which meant that their confirmation hearings tended to focus on what they planned to do once they got to the agency. With Gates, who was Casey’s top deputy at the time Iran-Contra was revealed, the focus inevitably has been less on what he would do than on what he already has done.

The fact that Gates withdrew his nomination, allowing questions about his knowledge of Iran-Contra to go unanswered the first time around, only deepened the controversy. Even supporters, such as Sen. Frank H. Murkowski of Alaska, the committee’s ranking Republican, concede that Gates has a “perception” problem.

“He was in (the agency), he came up (for nomination) and he went down,” Murkowski said. “Some controversy has to be expected.”

What was not expected was the confession by Alan D. Fiers, the former head of the CIA’s Central American task force, in a plea bargain with Walsh’s prosecutors in federal court on July 9. Admitting that he misled Congress about the CIA’s role in the Iran-Contra cover-up, Fiers said that at least two senior CIA officials besides himself and Director Casey knew about the diversion months before it became public--Clair E. George, who directed covert operations at the agency, and Jerry Gruner, chief of the CIA’s Latin American division.

Although Fiers’ testimony did not implicate Gates, the new director-designate was informed by Walsh that he too might be a “subject” in a grand jury investigation--a legal term that means prosecutors consider his activities worth looking at but do not currently regard him as a “target” of a criminal inquiry.

Like an electric shock, the Fiers plea to charges of misleading Congress jolted the moribund Iran-Contra investigation back to life. Only a week earlier, following the Supreme Court’s refusal to reinstate the conviction of Iran-Contra figure Oliver L. North, leading Republicans had been calling for Walsh’s dismissal.

“There’s a time for everything under the sun and Walsh’s time has come and gone,” said Rep. William S. Broomfield of Illinois, the ranking Republican on the House Foreign Affairs Committee. Now, Walsh is talking about expanding his team of prosecutors and delivering more indictments in the fall.

In the Senate Select Intelligence Committee, the news landed with an impact comparable to that of a laser-guided smart bomb. “To tell the truth, it shocked the (expletive) out of us,” an aide to a Republican panel member said.

The White House initially tried to brush aside the news, with Bush angrily accusing the senators of scurrying “like a covey of quail” in the face of unproven allegations about Gates. But the President quickly discovered that none of the seven Republicans on the committee was willing to turn the Gates controversy into a partisan fight. They joined with Boren and the seven other Democrats to recommend unanimously that the confirmation hearings be postponed until Fiers, George and other witnesses could be subpoenaed.

“We have a responsibility to meet,” Murkowski said. “We have an obligation to ask all the tough questions first.”

The committee’s investigation already has cleared Gates of one allegation: A former Israeli intelligence officer, Ari Ben-Menashe, had charged that Gates was involved in an alleged scheme by Reagan’s 1980 campaign to delay the release of the 52 American hostages then being held by Iran until after the November presidential elections. But using times and places provided by Ben-Menashe, investigators determined that Gates was never at any of the alleged meetings.

“In everything we’ve looked at so far, we have found Bob Gates to be right down the wire in what he has told us,” said Rudman, who added that nothing yet uncovered by the committee contradicts Gates’ claim that he did not learn of the Iran-Contra cover-up until it was publicly disclosed in November, 1986.

But, as critics of the nomination point out, there is also a growing body of circumstantial evidence that suggests it would have been very difficult for Gates not to have known about the cover-up.

Among the information that could hurt Gates was the disclosure this week that he received regular briefings on the CIA’s relations with the Contras from Fiers. The briefings were said to have focused on authorized, legal activities undertaken by the CIA to aid the Contras--not on the illegal transfer of arms bought with the profits made from the secret sale of weapons to Iran. But some committee sources said privately that they doubt Fiers would have kept Gates uninformed about a matter he discussed with George, Gates’ immediate subordinate, and with others at the agency.

Others have suggested that Casey deliberately kept Gates out of the loop on Iran-Contra by dealing directly with George and others on the operations side of the agency.

However, Thomas Polgar, an ex-CIA official who is among the witnesses the committee plans to question, argued that keeping Gates out of a loop as big as Iran-Contra is “almost inconceivable.”

“Gates got all the intercepts,” classified cables that in some instances are known to have contained references to Iran-Contra, Polgar noted. “How could Casey have controlled that?”

Those who still support Gates’ nomination said that he should be confirmed unless the committee can prove that he knew about the Iran-Contra cover-up. Those who oppose it suggested that the burden of proof should be on Gates to show that he did not know about it.