SLOWLY, slowly, the administration appears to be inching out of the Iran morass and toward higher ground. Over the weekend, President Reagan admitted that mistakes were made in the execution of his Iran policy.
In congressional testimony Monday, Secretary of State George Shultz went further, identifying the diversion of profits from Iran sales to the Nicaraguan contras as illegal.
Unless there are additional dramatic revelations yet to come, this is not a scandal of Watergate proportions that is going to topple Mr. Reagan.
Although some headlines continue to dub the current mess ``Irangate,'' or ``Northgate,'' there are some important distinctions between Watergate and the ineptness that led to the present uproar.
First, the personalities are very different. Mr. Reagan enjoys a lot more popularity than did Richard Nixon. Reagan is outgoing, usually open and good-humored, whereas there was a dark and brooding side to Nixon that sometimes troubled the electorate.
Second, the motives are very different. Watergate was an effort by the presidential inner circle to get the dirt on Democrats, thereby achieving the President's reelection. The motive was narrow and self-serving.
The motive behind President Reagan's Iran initiative was to get American hostages free and to engage in a dialogue with some alternative political factions in Iran. The motive behind the diversion of funds to the contras was to help those combating the repressive Marxist regime in Nicaragua.
While individual Americans may not agree with those objectives, they are not base goals for the administration to pursue.
It is the manner in which those objectives were pursued that caused such public revulsion. The administration made arms shipments to Iran, a country engaged in state-sponsored terrorism, when it was urging other countries to boycott Iran. It gave weapons to one participant, when it was proclaiming and urging neutrality in the Iran-Iraq war. By skimming off funds for the contras, it circumvented the law and the will of Congress during a period when Congress had precluded military aid to the contras.
Aside from these questions of principle, the unsophisticated execution of this ill-fated initiative had all the hallmarks of a Laurel and Hardy comedy.
But the motivation was nevertheless not narrow and self-serving; it was to further foreign policy objectives in which the Reagan administration believed.
A third distinction between all this and Watergate is the manner in which the respective administrations are handling the public outcry.
The Nixon administration undid itself by lying and trying to cover up. The Reagan administration may have been initially mesmerized by the thunder of the criticism. But slowly it is beginning to recapture cautious momentum. President Reagan, Vice-President George Bush, and Mr. Shultz have admitted mistakes. Defense Secretary Caspar Weinberger has talked of bad advice given the President.
There is stilted cooperation with investigations by Congress and the Justice Department, though it still remains unclear why the President has not called John Poindexter and Oliver North into the Oval Office and asked them what in the world they did, and why they did it.
Discussion of these distinctions between the Iran debacle and Watergate is in no way intended to diminish the stupidity of shipping arms to Iran, or to whitewash the wrongdoing of skimming off funds for the contras.
The damage done by the Iran initiative is immense. The policy of the United States on terrorism is in a shambles. The cause of the contras may have been set back severely. An administration weakened at home may find it more difficult to deal with the Soviet Union on the critical question of nuclear arms reductions. America's allies may have doubts and questions about its current reliability.
Secretary Shultz manfully tried to get the administration of foreign policy back on track on Monday. He pointed out that he is meeting with foreign leaders, and even after testifying Monday was flying off to Britain and Brussels to meet with America's allies in Europe.
That is where the emphasis should be, on seeking to reassure the world that the US is not paralyzed and that its foes should not seek to take quick advantage of it.
But the minuet in Washington between administration, and Congress, and press, and people, and courts, is far from over.