Icy report on Iran-contra. Congressional panels hold Reagan responsible for fostering a climate that was conducive to `secrecy, deception, and disdain for law'

Congressional committees have concluded that President Reagan was responsible for an ``environment'' within his administration that led to the widespread deception and abuses of authority in the Iran-contra affair. A 690-page report released yesterday by the Senate and House panels that investigated the affair finds that ``the ultimate responsibility for the events in the Iran-contra affair must rest with the President.''

Daniel K. Inouye (D) of Hawaii, the chairman of the Senate committee, said there was clear evidence of ``dereliction of duty'' by the President, but he added there was no evidence that could lead to impeachment.

Yet the report faulted the President's performance in unvarnished terms. Describing the Iran-contra affair as ``a perfect example of how to destroy that trust'' that must exist between the branches of the American government, the report concludes that President Reagan had created or sanctioned an atmosphere in which laws were defied and the public and Congress deceived.

Most of the Republicans on the two panels issued a minority report denouncing some of the majority's findings. (Minority report, Page 36.)

Senator Inouye, however, defended the majority report as a ``fair, balanced, and comprehensive document.''

Rep. Lee H. Hamilton (D) of Indiana, chairman of the House committee, termed it ``thorough'' and ``dispassionate.''

Yet it is one of the most critical congressional assessments of a sitting US President in American history.

``The Iran-contra affair was characterized by pervasive dishonesty and inordinate secrecy,'' the report states.

The report chronicles in detail the process by which American arms were secretly shipped to Iran beginning in 1985, and how some of the profits from those transactions were secretly funneled to the Nicaraguan contra rebels.

The overall picture that emerges is of a flawed policy, ineptly executed, yet cloaked in obsessive secrecy. The report, and statements by individual committee members, strongly suggests that several US laws were broken by administration officials, members of the National Security Council (NSC) staff, and private citizens connected with the affair.

The report says that ``at the operational level, the central figure in the Iran-contra affair was Lt. Col. [Oliver] North, who coordinated all of the activities and was involved in all aspects of the secret operations.''

``North, however, did not act alone,'' the report adds, noting that former national-security adviser John Poindexter gave his ``express approval'' to North's covert operations to aid the contras.

Colonel North, Admiral Poindexter, and others are the subjects of a criminal investigation by special prosecutor Lawrence Walsh. Yesterday Mr. Walsh said his investigation ``has its own momentum now'' independent of what the congressional committees did. ``We have a large base for our own action,'' he added.

The report says the committees' investigation was hampered by failures of memory, the destruction of key documents, and the death of former Central Intelligence Agency director William J. Casey before he could be questioned.

Nevertheless, it concludes that ``Casey encouraged North, gave him direction, and promoted the concept of an extra-legal covert organization'' capable of conducting secret operations outside the normal channels of government.

North is said to have recruited a number of private citizens to raise funds for the contras and to shuttle arms to the Iranians and weapons to the rebels, while administration officials were repeatedly denying such actions were taking place.

``The common ingredients of the Iran and contra policies were secrecy, deception, and disdain for the law,'' the report charges.

``A small group of senior officials believed that they alone knew what was right. They viewed knowledge of their actions by others in the government as a threat to their objectives. ... When exposure was threatened, they destroyed official documents and lied to Cabinet officials, to the public, and to elected representatives in Congress. They testified that they even withheld key facts from the President.''

The report notes that Attorney General Edwin Meese III first made the Iran-contra affair public. But it criticizes his preliminary investigation into the affair, charging that his laggardly pace left time for vital evidence to be destroyed.

Mr. Meese's ``fact-finding inquiry departed from standard investigative techniques,'' the report concludes, adding that his ``lapses placed a cloud over the attorney general's investigation.''

The report cites public statements by President Reagan that were ``wrong'' and notes that ``the President has yet to condemn [the] conduct'' of his subordinates who subverted the law, destroyed documents, and lied to Congress.

``By his continued silence,'' Mr. Inouye said at a press conference yesterday, ``the President creates the impression that he does not find these actions objectionable.''

On the question of whether the President knew of the diversion, the report says the evidence is ``not conclusive on the issue of his responsibility.''

``The President created or at least tolerated an environment where those who did know of the diversion believed with certainty that they were carrying out the President's policies. ... It was in such an environment that former officials of the NSC staff and their private agents could lecture the committees that a `rightful cause' justified any means, that lying to Congress and other officials in the executive branch itself is acceptable when the ends are just, and that Congress is to blame for passing laws that run counter to administration policy.''