WASHINGTON — The Reagan Administration came under new criticism Sunday from both congressional leaders and foreign allies, who charged that the White House acted improperly when it swapped arms shipments to Iran for American hostages in Lebanon.
Arab diplomats, echoing similar complaints from European countries, said their governments are upset by the discovery that the Administration has been secretly sending military hardware to Iran while pressuring other countries to halt their arms sales to the Tehran regime.
"This country has always declared openly that it would not negotiate with terrorists," Jordanian Ambassador Mohammed Kamal said in an interview. "Now it has lost credibility."
Attacked by Byrd
The leader of the Senate's new Democratic majority, Sen. Robert C. Byrd (D-W.Va.), criticized the Administration for hiding the operation from Congress by using the National Security Council staff to run it.
The outgoing chairman of the Senate Foreign Relations Committee, Sen. Richard G. Lugar (R-Ind.), said he also was troubled that the arms-for-hostages deal was run by the NSC over the objections of Secretary of State George P. Shultz.
Shultz, who reportedly opposed the hostage deals from the time they were first discussed in 1985, remained publicly silent. But a State Department spokeswoman, Sondra McCarty, said a published report that he might resign over the issue was "pure speculation."
"He should not resign," said Lugar, who spoke with Shultz on Saturday. "In my judgment, he will not resign. And, at least in the conversation I had with him--it touched a lot of other subjects--he sounded very lively."
In Difficult Position
The secret arms deal put Shultz in an especially difficult position, State Department officials said, because he has spearheaded the Administration's effort to cut off Iran's access to Western weaponry for its war with Iraq. On Oct. 1, one aide recalled, Shultz met with Arab foreign ministers at the United Nations and assured them that the United States was doing its best to stop arms shipments to Tehran.
"He's been vociferous about it," the aide said, "not just to the Arabs, but particularly to the Europeans, who were the ones who wanted to sell the arms."
Besides Jordan, diplomats from three other friendly Arab countries said Sunday that their governments are upset over the dealings with Iran, but they said they could make no public comment.
'Damage Control' Operation
Officials said the State Department has launched a "damage control" operation to try to reassure friendly countries that they were not told lies. But the drive has been hobbled, one aide said, by the fact that "we don't know what was going on ourselves."
Sources familiar with the operation said Shultz and a few senior State Department officials were aware that the arms shipments were under way but--because of their opposition--were cut out of the negotiations with Iran and insulated from detailed knowledge of the deals.
Lugar said on ABC's "This Week With David Brinkley" that he has asked Shultz about that. "I think the secretary of state ought to be heavily involved," he said. "This is one query that I had to him which he could not respond to: Why aren't you right into the thing and trying to help shape it?"
Both Byrd and Sen. Sam Nunn (D-Ga.), the senior Democrat on the Senate Armed Services Committee, said they intend to investigate President Reagan's decision to put the arms deals in the hands of the National Security Council staff. Several sources have said Reagan put the NSC in charge because, as an arm of the President's personal staff, it is not required to report to Congress--unlike the CIA and other government departments.
"I think they're attempting to circumvent the Congress," Byrd said on NBC's "Meet the Press." "They're trying to avoid coming up and explaining what's going on. I think this is a serious mistake, and I think we ought to take a look at the law. Perhaps the laws ought to be changed (to require the NSC to report to Congress)."
"We have some profound legal inquiries as to whether any laws have been violated," Nunn said on the ABC program. "And we really have another question: that is the decision-making process in this Administration. In an effort to cut Congress out, have they also cut out the CIA, the Joint Chiefs (of Staff), the State Department and Defense Department? And if so, who's making the decisions?"
Several officials said the Administration has increased its reliance on the NSC staff for such secret operations not only in Iran but also in Central America, where a private aerial supply network for Nicaraguan rebels was organized with encouragement from a NSC aide, Col. Oliver L. North. The secret air operation was exposed because Nicaraguan troops shot down one of the supply planes last month, capturing an American crewman.
Comes to Grief