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Editor’s Note: The following story is the third part of a new Consortiumnews.com series on the October Surprise mystery, a history-changing case that started 30 years ago last week when Iranian radicals overran the U.S. Embassy in Tehran and held 52 Americans hostage for 444 days:

In fall 1980, as President Jimmy Carter struggled to free 52 American hostages in Iran and as American voters focused on a crossroads election, key supporters of Republican candidate Ronald Reagan were confident not only of Reagan’s victory but that the hostages wouldn’t be released until after Reagan was sworn in.

That confidence has been one of the sub-plots linked to the political mystery known as the October Surprise case, which centered on allegations that Republicans went behind Carter’s back to contact Iranians and sabotaged his hostage negotiations, thus guaranteeing Reagan’s resounding victory.

The accumulated evidence – including government documents and statements from some two dozen witnesses – now points to a conclusion that the Reagan campaign did develop covert contacts with Iranian officials and that those dealings did undermine Carter’s efforts. The hostages were freed after Reagan’s was sworn in as President on Jan. 20, 1981.

An October Surprise conclusion that the Republicans were guilty of a political dirty trick bordering on treason also puts into a more sinister light those crystal balls of GOP operatives who foresaw the hostages returning only after Reagan got into office.

While those predictions might be explained away as lucky guesses or astute analyses, the timing assessment from three figures in particular raise eyebrows: former Secretary of State Henry Kissinger, neoconservative activist Michael Ledeen and legendary CIA officer Miles Copeland. All three have been linked to the October Surprise mystery.

Copeland, who had taken part in the CIA’s covert operation to oust Iranian Prime Minister Mohammed Mossadegh and replace him with the Shah back in 1953, told me during an interview in 1990 that he and some of his old CIA colleagues, including Iran hand Archibald Roosevelt, were in touch with Republicans regarding Carter’s Iranian hostage crisis of 1980.

Copeland said the CIA old boys drafted their own plan for a hostage rescue and passed it along to both the Carter administration and to former President Richard Nixon and Kissinger. However, after Carter’s own failed rescue attempt in April 1980, Copeland said the Republicans in his circle concluded that a second rescue attempt was both unfeasible and unnecessary.

These Republicans were talking confidently about the hostages being freed after a Republican victory in November, Copeland said.

“There was no discussion of a Kissinger or Nixon plan to rescue these people, because Nixon, like everybody else, knew that all we had to do was wait until the election came, and they were going to get out,” Copeland said.

“That was sort of an open secret among people in the intelligence community, that that would happen. … The intelligence community certainly had some understanding with somebody in Iran in authority, in a way that they would hardly confide in me.”

Copeland said his CIA friends had been told by contacts in Iran that the mullahs would deliver the hostages to Reagan.

“At that time, we had word back, because you always have informed relations with the devil,” Copeland said. “But we had word that, ‘Don’t worry.’ As long as Carter wouldn’t get credit for getting these people out, as soon as Reagan came in, the Iranians would be happy enough to wash their hands of this and move into a new era of Iranian-American relations.”

In the interview, Copeland declined to give more details, beyond his assurance that “the CIA within the CIA,” his term for the true protectors of U.S. national security, had an understanding with the Iranians about the hostages. (Copeland died on Jan. 14, 1991, before I could interview him again.)

Kissinger’s Crystal Ball

Though Copeland was coy about describing Kissinger’s precise role in the October Surprise case, Kissinger was among the Republicans who was confidently looking forward to a hostage release once Reagan took office.

After this year’s death of longtime CBS anchor Walter Cronkite, one of our readers was examining Cronkite archival footage and was surprised to find a clip of Cronkite leading a discussion of CBS correspondents on Election Night 1980 about why Reagan had won a landslide after the pre-election polls had shown a much closer race.

Correspondent Leslie Stahl noted how the coincidence of the first anniversary of the Iran hostage-taking falling on Election Day had forced Americans to relive the year-long humiliation and thus they turned to Reagan, a perceived hard-liner who would confront American adversaries.

That comment reminded Cronkite of an earlier interview he had done with Henry Kissinger who, Cronkite said, was “suggesting tonight that he thinks that Reagan being in the White House will help get [the hostages] back and he bets they’ll get back shortly after the Inaugural. Well, that’s still some time. That means that Henry Kissinger must be thinking in terms of long negotiations in order to put the package together.”

As it turned out, of course, Kissinger’s prediction was right on the money. Immediately after Reagan was inaugurated on Jan. 20, 1981, the hostages were freed and Reagan basked in the perception that his tough-guy persona had done the trick.

But Kissinger wasn’t just some distant observer when it came to the hostage crisis. He had been there from the outset, in 1979 when he worked with Chase Manhattan Bank chairman David Rockefeller – who had been the Shah’s banker – to pressure President Carter to admit the exiled Shah into the United States for cancer treatment.

According to Rockefeller’s autobiography Memoirs, Kissinger’s role was “to publicly criticize the Carter administration for its overall management of the Iranian crisis and other aspects of its foreign policy” while other Rockefeller associates made private demands for the Shah’s admission.

Carter’s decision to relent – and let the Shah in – provoked radical elements in Tehran to target the U.S. Embassy for a takeover. When they stormed the Embassy on Nov. 4, 1979, the hostage crisis began.

A Lingering Presence

Over the next year, Kissinger remained a behind-the-scenes figure in the crisis, as Copeland noted in the interview.

“There were many of us – myself along with Henry Kissinger, David Rockefeller, Archie Roosevelt in the CIA at the time – we believed very strongly that we were showing a kind of weakness, which people in Iran and elsewhere in the world hold in great contempt,” Copeland said. (By 1980, Roosevelt also was working for Rockefeller as a consultant.)

The Rockefeller group was in contact with Reagan’s campaign director William Casey who was at the heart of the October Surprise mystery, with a number of witnesses claiming that Casey met secretly with cleric Mehdi Karrubi and other Iranians involved with the hostage crisis.

Evidence from Reagan’s campaign files revealed undisclosed contacts between the Rockefeller group and Casey. For instance, a visitor log for Sept. 11, 1980, showed David Rockefeller and several aides signing in to see Casey at the campaign headquarters in Arlington, Virginia.

With Rockefeller were Joseph Verner Reed, whom Rockefeller had assigned to coordinate U.S. policy toward the Shah, and Archibald Roosevelt, the former CIA officer who then was monitoring events in the Persian Gulf for Chase Manhattan. The fourth member of the party was Owen Frisbie, Rockefeller’s chief lobbyist in Washington.

Kissinger also was in discreet contact with Casey during this period, according to Casey’s personal chauffeur whom I interviewed.

The chauffeur, who asked not to be identified by name, said he was sent twice to Kissinger’s Georgetown home to pick up the former Secretary of State and bring him to the Arlington headquarters for private meetings with Casey that were kept off the official visitor logs.

On Sept. 16, 1980, five days after the Rockefeller group’s visit to Casey’s office, Iran’s acting foreign minister Sadegh Ghotbzadeh spoke publicly about Republican interference.

“Reagan, supported by Kissinger and others, has no intention of resolving the problem,” Ghotbzadeh said. “They will do everything in their power to block it.”

So, when Kissinger spoke to Cronkite on Election Night 1980, he may well have known a great deal about the timing of the hostage release because he was working closely with some of the Republicans who allegedly were arranging the release and the timetable.

The Ledeen Connection

A third figure who has been connected to hostage negotiations with Iranians – and who reportedly foresaw a hostage release after Reagan took office – was Michael Ledeen, a neoconservative intellectual and author.

Journalist Richard Sale, who had worked with Ledeen on an article for The Washington Quarterly, said he and Ledeen were keeping in touch after the publication when Ledeen confidently predicted that the hostages would be released upon Reagan’s inauguration.

In a recent e-mail to me, Sale said he asked Ledeen how he knew about the timing and how the release was being arranged. “I will always remember his smug, ‘All it took was a few phone calls,’” Sale wrote.

When I contacted Ledeen about Sale’s recollection, Ledeen responded by e-mail, claiming “Sale has written outright lies about me, as I told him to his ear. At one point he promised to apologize but never did. I wouldn’t listen to anything he had to say.”

When I asked Sale about Ledeen’s “outright lies” claim, Sale noted that Ledeen offered no specifics of any supposed lies, and Sale denied having “an acrimonious exchange, not ever” with Ledeen. “I would have had no reason to apologize nor did he ever demand one,” Sale wrote in an e-mail.

Other evidence also has linked Ledeen to the October Surprise case. A “secret” draft report by a 1992 House task force which investigated the October Surprise allegations stated that Ledeen and another prominent neocon Richard Perle participated in meetings of the Reagan campaign’s “October Surprise Group,” though “they were not considered ‘members.’”

The campaign’s “October Surprise Group” was assigned the task of preparing for “any last-minute foreign policy or defense-related event, including the release of the hostages, that might favorably impact President Carter in the November election,” according to the task force findings.

The draft report also mentioned a Sept. 16, 1980, meeting on something called the “Persian Gulf Project” involving senior campaign officials, including William Casey and Richard Allen. According to the draft report and Allen’s notes, Ledeen also participated in that meeting.

However, both references to Ledeen were removed from the House task force’s final report that was overseen by task force chief counsel Lawrence Barcella, a longtime friend of Ledeen’s.

Ties That Bind

The Barcella-Ledeen relationship dates back several decades when Barcella sold a house to Ledeen and the two aspiring Washington professionals shared a housekeeper. According to Peter Maas’s book Manhunt regarding Barcella’s work as a prosecutor on the case of ex-CIA officer Edwin Wilson who collaborated with Libya, Ledeen approached Barcella about the case in 1982.

Ledeen, who was then working as a State Department consultant on terrorism, was concerned that two of his associates, former CIA officer Ted Shackley and Pentagon official Erich von Marbod, had come under suspicion in the Wilson case.

“I told Larry that I can’t imagine that Shackley [or von Marbod] would be involved in what you are investigating,” Ledeen told me in an interview years later. “I wasn’t trying to influence what he [Barcella] was doing. This is a community in which people help friends understand things.”

Barcella also saw nothing wrong with the out-of-channel approach.

“He wasn’t telling me to back off,” Barcella told me. “He just wanted to add his two-cents worth.”

Barcella said the approach was appropriate because Ledeen “wasn’t asking me to do something or not do something.” However, Shackley and von Marbod were dropped from the Wilson investigation.

Ledeen’s associate, Shackley, also had a connection to the October Surprise case in 1980, having worked with then-vice presidential candidate George H.W. Bush on the Iran hostage issue. [For more on Shackley’s role in the October Surprise case, see Robert Parry’s Secrecy & Privilege. For a document on Shackley’s October Surprise work with Bush, click here.]

In the context of Barcella’s role on the House task force, the Ledeen connection raised another conflict-of-interest question, after task force investigators were told that Barcella’s friend, Ledeen, was an informal member of the Reagan campaign’s “October Surprise Group.”

Like the Wilson case, it appears that Ledeen convinced his friend Barcella to go in a different direction. When the House task force’s final report was released in January 1993, the draft’s references to Ledeen were all deleted. [To read a portion of the “secret” draft report, click here.]

In my recent e-mail exchange with Ledeen, he said, “Yes, I believe I spoke to Larry Barcella about the October Surprise investigation. … And I undoubtedly told him what I have always said, namely that, to the best of my knowledge, the October Surprise theory is nonsense.”

Ledeen also denied having any contact with William Casey before 1981 and added, “I was not involved in the Reagan campaigns. I was not in any ‘Persian Gulf Project’ or ‘October Surprise Group.’ I can't answer your questions about alleged Republican contacts with Iran because I don't have any reason to believe that there were such contacts. If there were, I don't know anything about them.”

In an e-mail to me, Sale noted that Ledeen’s sweeping denials must always be taken with a grain of salt. Sale wrote that when Ledeen is confronted with troublesome evidence, he behaves as if “disinformation is perfectly permissible and deserved. Michael’s tragedy is that he has chosen to service such ignominious causes.”

Ledeen and other defenders of Ronald Reagan’s legacy did win out in the House October Surprise task force’s conclusions. With Barcella and his team deleting the references to Ledeen and concealing other incriminating evidence, the task force – headed by Reps. Lee Hamilton, D-Indiana, and Henry Hyde, R-Illinois – rejected the allegations of Republican dirty tricks regarding the Iran hostage crisis.

However, it turned out that even chief counsel Barcella had doubts about those findings. He told me years later that so much evidence poured in near the end of the investigation that he lobbied Hamilton to extend the inquiry for several months so the new material could be evaluated. Barcella said Hamilton turned him down and insisted that the debunking report go forward.

For Official Washington in early 1993 – as the iconic Ronald Reagan struggled with early Alzheimer’s disease and the well-liked George H.W. Bush left office – it was easier to sweep the disturbing evidence of Republican misconduct under the rug.

But the October Surprise mystery -- and the curious predictions of a hostage release upon Reagan’s inauguration -- have never been fully explained.

[For the fullest account of the October Surprise case, see Parry’s Secrecy & Privilege, or the first two parts of the Consortiumnews.com series, “How Two Elections Changed America,” and “The Crazy October Surprise Debunking.”]

Robert Parry broke many of the Iran-Contra stories in the 1980s for the Associated Press and Newsweek. His latest book, Neck Deep: The Disastrous Presidency of George W. Bush, was written with two of his sons, Sam and Nat, and can be ordered at neckdeepbook.com. His two previous books, Secrecy & Privilege: The Rise of the Bush Dynasty from Watergate to Iraq and Lost History: Contras, Cocaine, the Press & 'Project Truth' are also available there. Or go to Amazon.com.

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