Behind White House fa,cade. `Business as usual' stressed, but Iran-contra keeps butting in

The White House is struggling to shape a business-as-usual image amid the continuing Iran-contra crisis. President Reagan is out front with an array of legislative issues - from catastrophic health care to welfare reform. Yesterday he sent to Congress a package of proposals aimed at boosting US competitiveness.

But try as the White House will, it cannot dispel the mood of uncertainty and anxiety that pervades the administration as a result of the Iran-contra affair or deflect news media attention from it. Behind the scenes, White House and other administration officials are bracing for what are expected to be weeks and months of adverse political fallout for the Reagan administration.

Recent and impending developments fuel the air of concern:

The investigation by the Tower Commission, appointed by the President to probe the National Security Council operations that led to the Iran fiasco, has proved to be more exhaustive than expected. The panel is examining a mass of secret memos from a White House computer. Its report, due next Thursday, will be several hundred pages long.

While the report may not contain a ``smoking gun,'' administration sources say, it will be damaging to the President as well as his aides. According to press accounts this week, for instance, the President revised his statement to the Tower panel on the issue of approving the 1985 Israeli shipment of arms to Iran.

White House chief of staff Donald Regan continues to be the target of criticism by the President's political friends and some White House officials. The President, who has staunchly refused to ease Mr. Regan out, now appears to have opened the door to his possible resignation. Asked by reporters this week whether Regan would remain, he replied, ``Well, this is up to him.''

Vice-President George Bush, who played the ``good soldier'' in supporting the President as the Iran scandal unfurled, has begun to distance himself from the White House policy that ultimated in the diversion of Iran arms sale funds to the Nicaraguan rebels.

But Mr. Bush's own involvement in the Iran-contra affair is also under scrutiny, and his recent statements have raised questions, including why he did not warn the President of the diplomatic and political pitfalls of the arms-for-Iran policy.

Robert Gates, deputy director of the Central Intelligence Agency, this week underwent sharp questioning by the Senate Select Committee on Intelligence on his appointment as central intelligence director. He is expected to be confirmed, but Democratic and Republican lawmakers have voiced skepticism about his nomination in light of the CIA's role in the Iran affair.

Reagan allies are frustrated by what they see as a gradual debilitation of the presidency. They have tried to convince the President that his chief of staff should resign, but Mr. Regan is said to be determined not to leave under a cloud.

``Don Regan's self-interest is involved,'' a former Reagan campaign aide says. ``It's clear he doesn't understand Washington or politics. As long as he's in charge, as long as he's the guy responsible for bringing choices to the President, no matter how much talent you bring to the White House, there's no way to succeed [in restoring Reagan's authority].''

The White House, for its part, is endeavoring to dispel a perception that it is preoccupied with the Iran affair. White House spokesman Marlin Fitzwater says that no internal meetings are being held on the subject and that top aides are concentrating on the President's agenda and the many staff changes under way.

``The whole Iran affair has moved outside the White House - with the Tower people and [special investigator Lawrence] Walsh,'' says Mr. Fitzwater. ``There's been such a turnover of people that no one remembers Iran. So there's little impact inside except in the [press] briefing room. ... The media will be covering Iran and that's fine, but we'll be doing other things.''

Fitzwater says officials are confident the Tower report ``will not hurt the President or the new White House.'' But, he adds, the report has to be ``credible'' and ``tough'' from the White House point of view, laying out all the facts before the American people.

Following recent surgery, Mr. Reagan is back into the normal pattern of meetings with White House aides, private groups, congressional leaders, and foreign visitors. Next week he will begin short trips outside the capital to talk about deficit reduction, job training, drugs, and other issues.

Despite White House efforts to focus on other issues - and despite the public's declining interest in the Iran affair, as measured in opinion polls - the timetable of coming events guarantees that the scandal will continue to command attention in Washington. The Tower report will be followed in the spring by hearings in the House and Senate investigating committees.

These investigations will take months. Then the committees will issue their reports, which will also receive extensive media coverage. In fact, Republicans with sensitive political antennas are concerned that Democratic leaders will maneuver to have the committee reports released just as the Iowa caucases and New Hampshire primary loom in early 1988.

This is why the President's closest friends are still plumping for a new chief of staff and for some bold presidential move to help put the Iran issue behind.

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