Iraqgate: Mother of All Phony Scandals

"This is a bigger cover-up than Watergate ever was… It involves the decision by George Bush to arm Saddam Hussein."

Vice President nominee Albert Gore Jr., Oct. 25,1992

‘We did not find evidence that U.S. agencies or officials illegally armed Iraq…. We also considered whether the Justice Department’s earlier work…. was subverted for political purposes, and found that it was not…. I found no evidence of corruption or incompetence…. On the contrary, the work of the Department and other agencies has by and large been thorough, persistent, and careful."

John Hogan, counselor to Attorney General Janet Reno, in final report of special task force investigating alleged Bush administration crimes involving Iraq, made public Jan. 23, 1995

So the last word is in. At least, it will be the last word for all but the looniest of conspiracy theorists. The great "Iraqgate" scandal of 1992-a cavalcade of claims democrats and big-shot journalists that the Bush administration secretly and illegally armed Saddam Hussein’s Iraq, then lied to Congress and obstructed justice to cover it up-has been found phony, by none other than the Clinton administration.

John Hogan, a longtime close aide to Attorney General Janet Reno, whom Reno chose in June 1993 to get to the bottom of Iraqgate, has now issued a carefully documented 119-page report, summarizing the work of nearly 20 prosecutors and investigators over 15 months.

The bottom line: no evidence of Bush administration crimes, no evidence of a cover-up, no evidence of a "decision by George Bush to arm Saddam Hussein," no evidence of obstruction of justice.

As Hogan notes, with admirable understatement, "Neither I nor the Justice Department have any stake in protecting earlier administrations from embarrassment."

Indeed, the embarrassment should belong to those in the Clinton administration and in Congress who helped concoct the phony scandal.

The Hogan report should also shame many of the nation’s leading news organizations and journalists, as well as U.S. District Judge Marvin Shoob of Atlanta. They magnified Iraqgate into a front-page sensation, an edifice of error-filled reports and commentaries in the months leading up to the 1992 election.

Led by a disgraceful succession of columns by William Safire of The New York Times-who tossed off demonstrable falsehoods and unsubstantiated smears by the dozen-many journalists fell hook, line, and sinker for patently implausible Iraqgate conspiracy theories spun by the likes of the notoriously flaky Rep. Henry Gonzalez (D-Texas).

Not far behind Safire in flogging Iraqgate were Mike Wallace of CBS News’ "60 Minutes," Ted. Koppel of ABC News’ "Nightline," teams of reporters at The Los Angeles Times and U.S. News & World Report, and editorial writers at The New York Times and The Washington Post.

Wallace, for example, began the "60 Minutes" broadcast two days before the Nov. 3,1992, election by reverentially introducing Gonzalez (then the House Banking Committee chairman) and uncritically airing his outlandish claims: "What I hear you saying, Mr. Chairman, is that Dick Thomburgh, when he was attorney general, and William Barr, now that he is attorney general, have been involved in obstruction of justice."

In 1992, unfounded allegations were repeatedly splashed across the front pages, with headlines like "Secret Effort by Bush Helped Hussein Build Military Might" (The Los Angeles Times). Editorials claimed that "the Bush administration’s effort to arm Iraq months before the invasion of Kuwait… almost certainly violated the law" (The New York Times) and that "the attorney general [William Barr] …. is the leading suspect" in the alleged cover-up (The Washington Post). And Safire asserted that Bush, Barr, the whole top echelon of the administration, and the leaders of Great Britain and Italy were part of a global "criminal conspiracy."

But last week, you had to dig deep inside the same newspapers to learn that all such charges had been found phony by the Clinton administration, in a report validating the conclusions of earlier investigations that the media either reviled (in the case of 1992 reports by the Bush Justice Department and by retired U.S. District Judge Frederick Lacey) or buried (in the case of the 163-page report by the Democratic-controlled Senate Intelligence Committee staff in February 1993).

Then there are the folks at the Pulitzer Prize Board who nominated Douglas Frantz and Murray Waas (then of The Los Angeles Times) as finalists in national reporting "for documenting the clandestine effort of the U.S. government to supply money and weapons to Iraq in the 1980s and up to the weeks before the Gulf War." Finalists in fiction, maybe.

And the folks at the Columbia Journalism Review who, in a March/April 1993 article by Russ (not to be confused with Russell) Baker, effusively endorsed the view of "most" reporters "that the so-called Iraqgate scandal is far more significant than either Watergate or Iran-contra." These are the people who are supposed to police irresponsible journalism!

Iraqgate began with legitimate (if debatable) criticisms of the Reagan-Bush policy of seeking normal economic relations with, and arguably appeasing, Saddam Hussein’s brutal regime before its August 1990 invasion of Kuwait. But in the 1992 election year, these criticisms flowered into a gargantuan and multifaceted conspiracy theory.

The central claims were that Bush had plotted to arm Iraq, mainly by secretly and illegally helping it use U.S.-guaranteed agricultural credits to buy weapons and feed its nuclear program; that the Bush administration had conspired to that end with the Italian government and the top management of its Banca Nazionale del Lavoro; and that the Bushies had covered all this up, not only by lying to Congress, but also by obstructing justice in a gigantic bank fraud case involving BNL, in which the Justice Department supposedly sought to make the manager of BNL’s Atlanta branch, Christopher Drogoul, the fall guy in the prosecution of a scheme in which Iraq fraudulently obtained $4 billion in loans and U.S.-backed credits through BNL/Atlanta.

Judge Shoob, a John Sirica wannabe, threw fuel on the scandal’s flames in the form of a succession of error-littered innuendoes impugning the integrity of BNL prosecutors of all ranks, and suggesting that the Justice Department had rigged the prosecution to make Drogoul the scapegoat and to hide a far broader conspiracy.

Safire, meanwhile, claimed without qualification that the Justice Department’s "corrupt Criminal Division" and Attorney General Barr had fixed the BNL case and obstructed justice "for political purposes." Such heroics earned Safire much praise, from folks like Los Angeles Times media critic David Shaw, who uncritically parroted Safire’s fantasies while gushing that this "well-credentialed conservative [was] one of the most respected and influential columnists in Washington."

(For details on all this, see my "Mediagate: Anatomy of a Feeding Frenzy," in the November issue of The American Lawyer. )

Now comes John Hogan with a devastating rebuttal to Shoob and others who smeared (among others) the BNL prosecutors: "[A] number of conscientious, hard-working attorneys and agents, both in the United States attorney’s office and in the criminal division, gave their best efforts to one of the most complex fraud cases that the department has ever confronted. They won difficult conviction’s and rendered the country a substantial service."

The report is about as definitive as such things can be. Hogan acknowledges choosing not to spend the years it would take to chase every remotely relevant rumor to the very end. And some fault him for doing less than all he could to convince the skeptics who still suspect that something deep and dark remains hidden. But such criticisms miss the forest for the trees. As Kenneth Juster, a former Bush State Department senior official (now at Arnold & Porter), put it last year, "Suffice it to say that after five years of hearings and investigations by various executive branch, congressional, and judicial bodies, during both the Bush and Clinton administrations, there is no proof that the Iraqgate charges are true." And now, there’s a newly documented avalanche of proof that they are false.


Will the conspiracy theorists ever give up? Well, "Gonzalez responded to the Hogan report by issuing a new smear about Bush administration officials "concealing the facts." And Safire, in an astonishingly brazen column on Sept 9, 1993, wrote this about Hogan’s interim conclusion that BNL/Rome had not known of Drogoul’s fraud: "In what may be an unspoken quid pro quo, the Clinton administration has moved to quash any revelations about Bush’s Iraqgate scandal." The quid? "George Bush privately assured Bill Clinton that he would not criticize the new president during the first year of his new term."

So don’t hold your breath for apologies. Safire, for one, is off to the next fire. In a Jan. 23 column on the Whitewater investigation, he was flirting with the scurrilous canard that Clintonite Vincent Foster Jr. just might have been murdered, and suggesting that "the body may have been moved."

Is there no shame?