Transcript: Chapter 26

Howard Baker: I will be on the job Monday. Full time. And in the meantime Jim Cannon and Tom Griscom will be my transition team.

Narrator: What Baker's transition team was told by Don Regan's White House staff that weekend shocked them. Reagan was "inattentive," "inept," and "lazy" and Baker should be prepared to invoke the 25th amendment to relieve him of his duties.

Morris: The incoming Baker people all decided to have a meeting with him on the Monday morning, their first official meeting with the president and to cluster around the table in the Cabinet Room and watch him very, very closely to see how he behaved, to see if he was indeed losing his mental grip. They positioned themselves very strategically around the table so they could watch him from various angles, listen to him and check his movements and listen to his words and look into his eyes. And I was there when this meeting took place. And Reagan who was, of course, completely unaware that they were launching a death watch on him, came in stimulated by the press of all these new people and performed splendidly. At the end of the meeting they figuratively threw up their hands realizing he was in perfect command of himself.

Howard Baker: Ladies and gentlemen, is this president fully in control of his presidency? Is he alert? Is he fully engaged? Is he in contact with the problems? And I'm telling ya, it's just one day's experience and maybe that's not enough, but today he was superb.

Reporter: And Mrs. Reagan? The issue of Mrs. Reagan's involvement in West Wing decisions?

Howard Baker: I haven't talked to Mrs. Reagan today. I intend to do that later today. (laughter) I intend to do that later today. But let me say, I've known Nancy Reagan a long time too. And I did speak to her on Friday, and I expect (ring) -- there's the phone now. (laughter).

Howard Baker, Chief of Staff: From moment one at the White House with Ronald Reagan, I came away convinced not only was he fully in command, fully competent, but that he was not being well served by the arrangements in the White House, but that he was fully capable of discharging that job in a very, very effective way. And I still think that.

Morris: He was an old tired man. He'd been guilty of neglect of proper supervision of the people who work for him but when he was shocked into real awareness of his job and his duties, he performed as well as ever.

Narrator: Reagan was shocked by the findings of a commission he had appointed. It held him responsible for a lax management style and for trading arms for hostages. Something he still refused to admit. One of Howard Baker's first tasks in rescuing the presidency was to get Reagan to admit his mistake. He found an ally in Nancy Reagan.

Lou Cannon, Biographer: That's where Nancy Reagan really shines. She understood that he needed this public credibility. That's her great role, not getting rid of Regan. She went beyond protecting him to really leading him to this bitter cup of apology that he had to drink from.

Reagan: A few months ago I told the American people I did not trade arms for hostages. My heart and my best intentions still tell me that's true, but the facts and the evidence tell me it is not. As the Tower Board reported, what began as a strategic opening to Iran deteriorated, in its implementation, into trading arms for hostages. This runs counter to my own beliefs and to administration policy and to the original strategy we had in mind. There are reasons why it happened, but no excuses. It was a mistake.

Cannon: But once he had apologized to the American people and the American people more or less forgave him, you know, I mean not totally, you know. He was never he never got back quite the luster, but he... but he got enough of it back that he was able to... that he was able to govern and to be at ease with himself.

Narrator: A year later Don Regan got his revenge. He wrote a book.

Howard Baker: I said, "Mr. President, we will have a press flap about this, and I think I should talk to the First Lady." He said, "I think you should." I said, "Would you set it up?" And he said, "Why don't you set it up?" [CHUCKLE] And I did, I called her and I went upstairs and took the galleys with me, and couldn't figure out what I was, how I was going to open the conversation, but finally I just blurted out, "Nancy, Don Regan says here that you talked to an astrologer." And she said, "Well, I did."

Joan Quigley, Astrologer: Nancy was very concerned with the president's safety after the assassination attempt. And I am a very modern scientific astrologer. And, and I have at my command all the technical resources of the space age really in computers that I use. And I do very technical work.

Trader: Five hundred points down, Emil. You said "I don't see straight?" Five hundred and two points down.

Narrator: The stock market crashed in October 1987 -- another set back for Reagan.

Trader: What happened here?

Narrator: Black Monday raised doubts about the soundness of Reagan's economic policies. On Reagan's watch tax revenues would double. But they never kept up with spending. The national debt nearly tripled. Although most Americans benefited, the gap between the richest and poorest became a chasm. Donald Trump and the new billionaires of the 1980s recalled the extravagance of the captains of industry in the 1880s. There were losers. Cuts in social programs created a homeless population that grew to exceed that of Atlanta. AIDS became an epidemic in the 1980s.

Nearly 50,000 died. Reagan largely ignored it. In the trying months following the Iran contra affair, biographer Edmund Morris had an insider's look at the president.

Morris: This was around October of 1987. He writes in his diary, "Dick and Patty came after dinner and things immediately livened up as soon as they arrived." That's on a Friday night. The following day he writes in his diary. "Oh, I was mistaken. They didn't come down until lunch time today." He's talking about his wife's brother and wife, intimates who visited the White House a lot. They were members of the family circle. The schedule said, Mrs., Dr. and Mrs. Richard Davis will be joining the first family after dinner tonight. So Reagan writes it down after dinner as though they showed up. He says, things livened up when they came. In other words, he was so divorced from real... reality at that time that he didn't even realize that these people did not show up. Which is funny, but it's also scary.

White House Announcer: Ladies and gentlemen, the president of the United States.

Narrator: Gorbachev's visit two months later was seen during Reagan's presidency as its triumphal moment. In retrospect it may have been the first of many.

Gorbachev came to sign a treaty eliminating the intermediate range missiles in Europe. To accept Reagan's zero option so scorned six years earlier. At Reykjavik he had tried to link these reductions to Reagan's giving up SDI. Now, eager for an agreement, he accepted Reagan's terms.

Reagan: Thank you. It was over six years ago, November 18, 1981, that I first proposed what would come to be called the zero option. It was a simple proposal, one might say disarmingly simple.

Narrator: For the first time in the nuclear age, a treaty would reduce nuclear weapons. Another, cutting long-range missile forces in half, would be ready for President Bush to sign. Building up to build down produced results that made the goals of the freeze movement seem modest.

Howard Baker: It was historic. And I remember him expressing his pleasure that it was done, and I remember him pushing me hard for how the Senate was going to treat it. But I don't think I ever heard him crow about that. Thinking back on it, Ronald Reagan never crowed about anything. I don't think I ever heard him make an immodest statement about his own achievements. He was very straightforward and very modest man.

Narrator: The vocal conservatives now wrote off Ronald Reagan.

Columnist George Will accused him of accelerating America's "intellectual disarmament" and "succumbing fully to the arms control chimera." Others called him a "useful idiot for Soviet propaganda" and an "apologist for Gorbachev."

Morris: It was a historic achievement, and he was very pleased and happy about it. But I think he regarded it as an interim step in the progression he was making toward his real goal, which was the elimination of totalitarianism from the surface of the earth.

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