WASHINGTON — The end of Donald T. Regan's two-year reign as White House chief of staff Friday came only months after he was hailed as the most powerful presidential aide since Dwight D. Eisenhower's Sherman Adams.
The departure of the silver-haired ex-Marine had been forecast long before the Tower Commission's devastating chronicle of the efforts to ransom American hostages with arms shipments to Iran was released Thursday, but the report sealed his doom.
The coup de grace followed weeks of criticism from Capitol Hill, where Regan had trampled on congressional sensitivities in his heyday, as well as increasingly pointed evidence that First Lady Nancy Reagan favored his departure.
While the Tower Commission faulted Regan for failing to take control of the Iran- contra affair, Mrs. Reagan was understood to have become furious at Regan's efforts to hasten the President back to work and into the spotlight after his prostate surgery last month. Tension reportedly escalated to such a point that Regan twice hung up on the First Lady during telephone conversations.
In recent days, the grumbling from Congress had grown into a full-throated chorus of resignation demands from Republicans and Democrats alike.
With Regan's departure, the embattled President loses one of the few Administration figures who had moved into his closest inner circle without benefit of longtime ties back in California.
As Treasury secretary during the first four years of the Administration, Regan was surpassed only by Defense Secretary Caspar W. Weinberger and Secretary of State George P. Shultz as a Cabinet power.
Pushed Tax Cut
Some of the most staunchly conservative Republicans had disapproved of his nomination to the Treasury post because Regan, a millionaire Wall Street executive, was discovered to have contributed to campaigns of some liberal Democrats. The opposition was quieted, however, when he became a pivotal figure in pushing through Reagan's tax cut and other Administration economic programs.
His troubles began shortly after he moved to the White House in February, 1985, exchanging jobs with then-White House Chief of Staff James A. Baker III.
A longtime congressional staff member said Friday, "The decline of the Reagan Administration began the day Jim Baker left the White House.
"Regan was impossible on the Hill," he added, referring to Capitol Hill, "an utter disaster. He did not understand Washington, he did not understand politics, he had no political judgment. I don't know of one single fan the man has on the Hill. He not only didn't hobnob and make friends with members (of Congress), he wouldn't even return their telephone calls. The general feeling is that he is more carried away with himself than with the President."
In one of his better known congressional relations gaffes, he went before the U.S. Chamber of Commerce and upbraided Congress on the budget deficit, saying lawmakers were "afraid to come to grips with the problem" and further declaring: "I am challenging them to do it."
The remark displeased Reagan loyalists. "He didn't say the President or the Administration was challenging them," one presidential friend sniffed. "He said he was. I couldn't believe it."
Ironically, Administration sources said Friday, Regan had in the months immediately preceding the Iran-contra fiasco begun to improve his relations with Congress, and there was even scattered admiration for the way he stood his ground with powerful members of the House and Senate.
"He was just as good as they were," said one Administration source, who asked not to be identified. "He's just as good as they are, and, in a lot of cases, better."
Shared Irish Heritage
Regan, because he shared the President's Irish heritage, modest background, sense of humor and the perspective of a man past middle age, became the aide perhaps closest to the President personally.
Publicly, at the outset, he downplayed his own importance, comparing himself to a caddy whose role it was to tee up the ball for the boss.
But, in the White House, where every nuance is scrutinized, critics quickly found evidence of excessive ego.
One observed Friday that Regan subtly elevated his position in the hierarchy of the executive mansion's office wing.
"He did not refer to himself as the White House chief of staff," the source said. "He referred to himself as the chief of staff to the President of the United States." Inside the White House and the Administration, that little change implied dominion over the Cabinet and the sub-Cabinet.
Staff members were nonplussed when protocol was altered to emphasize Regan's importance.
"I was shocked," one Reagan loyalist said, "when, at the signing ceremony for the new tax bill, there was included in the booming introductions before the President came out: 'The chief of staff to the President of the United States.' Old-timers couldn't believe it. The guy has absolutely no political touch."