US needs diplomatic boost out of scandal

Needed: a rescue of American foreign policy. The Iran arms scandal not only has undermined the Reagan administration's antiterrorism strategy. It has severely disrupted policy on a number of diplomatic fronts, creating confusion on Central America, incoherence in the Middle East, and deadlock on arms control.

Whether President Reagan can surmount his present difficulties sufficiently to reinvigorate foreign policy in the next two years is problematic.

Diplomatic observers suggest that Reagan has strong incentive to restore his presidency by demonstrating leadership on foreign policy. The most obvious area for action is arms control agreement with the Soviet Union, which could be a crowning achievement of the Reagan administration.

But diplomatic experts say a reinvigoration of foreign policy will depend on a number of things:

A well-functioning National Security Council staff. New national-security adviser Frank Carlucci is reorganizing the NSC, but it will take time for the new team to function smoothly and effectively.

A strong secretary of state. George Shultz appears to be emerging from the Iran scandal in a fairly strong position. But the State Department has been outmaneuvered in the past, and it is not clear whether it can reassert its authority.

Mitigation of competing bureaucratic interests. Bitter conflicts among government agencies, above all between the State and Defense Departments, have frustrated policymaking and execution.

A politically effective, knowledgeable voice within the White House (or elsewhere) that can advise the President and argue with him if necessary. It is doubted the present cast of players can perform such a role.

A resolution of the Iran arms affair that does not immobilize the White House and the President's ability to perform. In the wake of the Iran-contra scandal, Mr. Carlucci is moving swiftly and decisively to restructure the NSC so that it can perform its role of coordinating administration policy. Some staff aides are being let go and others are coming aboard.

Carlucci, who officially assumes his post Jan. 2, is also making clear that the NSC henceforth will not engage in covert operational activities, as did former national-security adviser John Poindexter and Lt. Col. Oliver North with respect to arms sales to Iran and the diversion of funds to the Nicaraguan contra rebels.

Despite these changes, widely welcomed, foreign policy experts voice concern that it will continue to be hard to shape diplomatic and arms initiatives as long as the internal squabbling persists and the department heads remain the same. For instance, Assistant Secretary of Defense Richard Perle, who has repeatedly blocked arms accords with Moscow, remains at the Pentagon.

At the State Department an effort appears under way to build up Mr. Shultz's stature. Officials say Shultz is the only individual whose prestige has been enhanced following the Iran arms scandal: (1)because in internal councils he opposed the sale of arms to Iran and (2)because he did not know of the diversion of funds to the contras.

``A lot of loyalists - like Pat Buchanan - are out to get him,'' says one US official, ``but his stature is at an all-time high. ... He's the only one with a shred of credibility in the administration who's staying on to recover the damage, so it's a matter of boosting his morale.''

Some independent analysts are skeptical that Shultz and the State Department have enough authority to carry through major initiatives, especially an arms agreement.

``To say you're going to restore power at the State Department is hard, because you don't have policy mechanisms for this,'' says John Steinbruner, director of foreign policy studies at the Brookings Institution. ``They have played a reactive role for so long that I doubt they will be assertive.''

Zbigniew Brzezinski, national-security adviser in the Carter administration, goes so far as to say that all the key foreign policy players have to be changed, including the secretaries of State and Defense and the head of the Central Intelligence Agency. ``Shultz has been hurt and cannot recoup,'' he says. ``Until there's a change everything will be stuck.''

The Iran scandal is deemed especially tragic if it ends up consuming White House attention and frustrating movement on arms control. Nuclear arms experts say that, despite the failure of the Reykjavik summit meeting, the superpower leaders outlined a major arms deal and are astonishingly close to achieving agreements on medium-range nuclear weapons in Europe as well as on strategic (intercontinental) nuclear weapons.

Bridging the last gap - the issue of strategic defense - is the most difficult, however.

The Soviets are prepared for a 50 percent cut in strategic nuclear weapons if the US reaffirms the ABM (Anti-Ballistic Missile) Treaty and agrees to an antisatellite testing ban. But Reagan wants a ``loose'' interpretation of the ABM Treaty which will permit the US to test and develop components of his Strategic Defense Initiative in space.

The dilemma is how to persuade Reagan that he can secure a nuclear arms agreement without abandoning his visionary plan, which could not be realized in the next 10 years in any case.

A common view in Washington is that neither Shultz, Carlucci, nor presidential arms adviser Paul Nitze can play an assertive devil's-advocate role in the Oval Office. Someone like Sen. Paul Laxalt, a close friend of the President, needs to perform this ``adversarial'' function, it is felt.