WASHINGTON — President Reagan's recently developed argument that he was not covered by the law that once barred direct aid to Nicaragua's rebels has created new problems for a presidency already seriously damaged by the Iran- contra scandal.
"The implication that the President is above the law or the law doesn't apply to him gets him into much more unsettled waters and gives him uncomfortable exposure," said one longtime presidential adviser.
Republicans and Democrats alike say that Reagan's influence in Congress is waning on a host of issues, including trade, the budget and defense policy, because of the Iran-contra scandal. "It's really hurt him on Capitol Hill," said Rep. Robert T. Matsui (D-Sacramento).
Rep. Steve Gunderson (R-Wis.) said that the White House has yet to focus on trade or budget legislation and failed to lobby him on recent arms-control amendments, even though he was a swing vote. "In the necessity of focusing on Iran-contra," Gunderson said, "they have been handcuffed in their ability to set an agenda and focus on other issues."
Some Democrats are trying to capitalize on Reagan's weakness. Rep. James J. Florio (D-N.J.), in a speech Thursday on the House floor, accused Reagan of "transparent cynicism" for once insisting that he was detached from the Administration's effort to organize private support for the contras but now acknowledging that he initiated it.
"I have waited in vain to this point," Florio said, "for someone to utter the word 'lie.' The American people were being lied to by their President, and no one has said anything."
But not even the most partisan Democrats are suggesting impeachment. Former Democratic Chairman Robert S. Strauss declared: "I don't know of a living soul, including myself, who wants to impeach this President."
At the same time, Strauss, who has close ties with several present and former Reagan Administration officials, said that the President, "by changing his strategy from 'I don't know anything' to 'I know everything but nothing was illegal,' had made "a major mistake." He said it would further damage a presidency that already is "bleeding to death."
And, as a measure of the degree of concern within the Administration, some Reagan advisers do not dismiss the possibility that Congress ultimately will entertain thoughts of impeachment. "There's always the fear that these things develop a momentum of their own," the longtime presidential adviser said.
'Nothing Left' to Impeach
An aide to a Democratic senator said that Democratic senators who met Thursday discussed grounds for possible impeachment. The searing consensus, the aide said, was: "Impeach what? There's nothing left."
Rep. George Miller (D-Martinez) said that impeachment, although "conceivable," remains highly unlikely. But he added: "The Administration could end up being riddled with indictments. It could have more vacancies than Palm Springs in the summertime."
Until recently, Reagan had insisted for months that he had had little knowledge of the covert Administration operation that assisted the contras' private aid network from late 1984 to late 1986, a period when Congress had banned U.S. military support for the Nicaraguan rebels.
After congressional hearings developed substantial testimony that Reagan had had detailed knowledge of the plans, he conceded that he had been "kept briefed." But he said the congressional ban, which specifically applied to agencies "involved in intelligence activities," did not cover him or his national security advisers in the White House.
Shift Called a Mistake
Sen. Pete Wilson (R-Calif.) called the shift of signals a major mistake. "They would have been better advised to be more forthcoming and stick to the same story from the outset," he said.
But Thomas C. Griscom, Reagan's communications director, insisted: "Nobody's saying the President is above the law." And, he said, the law banning support for the contras "is silent as it relates to the President."
That opinion is widely debated. For example, Lawrence H. Tribe, a constitutional law expert at Harvard University, argued in a National Public Radio interview that the law does apply to the President. Although Reagan remains popular, he said, "the Constitution is blind to popularity."
And, according to many members of Congress, Reagan is growing less popular with each new disclosure of his involvement in the Iran-contra affair.
"The President has hurt himself in our home districts," Matsui said. "There's no enthusiasm for him. We're not getting pressure from hometown constituents to support the President."
Simpson Sees No Impact
Some Republicans disagree. "I know this is sacrilegious," Senate Minority Whip Alan K. Simpson (R-Wyo.) said, "but I see no impact at all . . . .
"The same people who have been Reagan-bashing for years are doing it again," Simpson said. "This goes back to his days as governor of California--'Reagan's a flip-flopper.' What's new? The faces don't ever change. The litany is obsessive."