"Real and Illusionary Events"

By Ed Magnuson.

In what seemed at the time to be a significant scoop, the Wall Street Journal last Aug. 25 carried a story that began, "The U.S. and Libya are on a collision course again, and the Reagan Administration is preparing to teach the mercurial Libyan leader another lesson." White House Spokesman Larry Speakes described the report as "unauthorized but highly authoritative." That was enough to send U.S. news organizations scrambling after a yarn that promised to involve terrorist plots and possible U.S. retaliation.

Given the bloody history of recent terrorist attacks and the resulting U.S. bombing raid on Tripoli and Benghazi in April, American reporters had good reason to go after the story. But they were chasing a will-o'-the-wisp. The Washington Post claimed last week that the rumors over Libya had been instigated by the Administration in a "secret and unusual campaign of deception" to destabilize Muammar Gaddafi.

The newspaper's famed Watergate sleuth, Bob Woodward, unearthed a damning document to back up the charge: a memo from National Security Adviser John Poindexter to President Reagan. In it Poindexter outlined a plan that "combines real and illusionary events -- through a disinformation program -- with the basic goal of making Gaddafi think that there is a high degree of internal opposition to him within Libya, that his key trusted aides are disloyal, that the U.S. is about to move against him militarily." According to the Post, this disinformation policy was approved on Aug. 14 at a meeting of the National Security Planning Group, made up of Reagan, Poindexter and nine officials from relevant departments. The President later signed a National Security Directive putting the plan into effect.

As news of the high-level hoax stirred a furor in Washington last week, the Reagan Administration denied that it had orchestrated a campaign to mislead the public. "We didn't tell any lies," said the President, although he admitted "there are memos back and forth . . . I can't deny that." A quick report from the Senate Intelligence Committee seemed to support Reagan's disavowal. Whether or not some Government officials leaked false information, explained a member of the committee's staff, there was no deliberate policy behind it.

The Administration readily acknowledged its policy to mislead Gaddafi as to U.S. intentions -- a deception the President endorsed. "We would just as soon have Mr. Gaddafi go to bed every night wondering what we might do," said Reagan. Secretary of State George Shultz agreed. "Frankly, I don't have any problems with a little psychological warfare against Gaddafi," said he. Citing the example of Winston Churchill's efforts to mislead the Nazis about the site of the D-day landings during World War II, the Secretary said of the situation with Libya, "We don't have a declaration of war, but we have something pretty darn close to it."

Misleading Gaddafi was one thing, but what troubled Washington's press corps was the idea that it had been duped as well. Wall Street Journal Managing Editor Norman Pearlstine stood by the basic thrust of his paper's story: that the U.S. believed Libya had resumed sponsoring terrorist acts, and was exploring ways of deterring Gaddafi. But Pearlstine "deplored" the Administration's "attempt to mislead the Journal and its readers" about the "likelihood of employing some of these options." A New York Times editorial summarized the reasons for the journalistic outrage: "All media, all Americans, are vulnerable because they must trust their Government to some degree. The deliberate abuse of that trust is a scandal of the first magnitude."

Administration spokesmen continue to insist the raw intelligence about Gaddafi's activities was accurate, if overblown. The sources for the Wall Street Journal story, they said, had glossed over the relative value of the intelligence information and the U.S. military's readiness to respond. The Journal story quoted a "top official" as saying Gaddafi "seems to have gone off his rocker again." Other officials claimed he was involved in terrorist plots in Cyprus and Berlin. But the Poindexter memo contended that "Gaddafi is temporarily quiescent in his support of terrorism." The Journal wrote that Administration officials were convinced the U.S. air strikes had "sparked several mutinies in the Libyan military" and even quoted unnamed officials as claiming the Libyan air force "had to send hired Syrian pilots to crush the rebellions." Whether or not this occurred, the Poindexter memo noted that by mid-August Gaddafi was "firmly in control in Libya."

The Journal also reported that the U.S was considering a joint action with France to drive Libyan troops out of Chad. According to the Post, a State Department planning paper about the deception campaign had suggested that a scheduled trip to Chad by a U.S. general "provides an opportunity for disinformation to reach Gaddafi that the U.S. and France are developing contingency plans for a 'Chad Option.' " Finally, the Journal claimed that the "Sea Wind" exercises, long-planned U.S.-Egyptian maneuvers under way in the Mediterranean at the time of its Aug. 25 story, "are intended to keep the Libyans off balance and to assemble forces in case a quick, punishing strike at Libya is needed." A White House memo to CIA Director William Casey underlined the point. It suggested that "overt (military) operations will also be required to give credibility to rumors that the U.S. intends to take further military action."

Most U.S. news organizations grew increasingly skeptical at the time that anything substantially new was afoot. The Pentagon denied plans for impending military action, and even Poindexter quietly cautioned reporters that the Journal story had been inflated. The story in TIME's Sept. 8 issue referred to all "the rumors" and said, "The shadowboxing smacked of psychological warfare to keep Gaddafi off balance."

For an Administration that has campaigned relentlessly against leaks of secret information, exploiting rumors seems an odd tactic. Last week reporters learned of the existence of a new FBI team that had been formed to track down anyone who leaked classified information to the press. One of its immediate assignments, ironically, will be to uncover the source of the Post expose. Yet in light of the disinformation drive, the nation might be better served if the post-Watergate FBI plumbers gave lie-detector tests to the loose talkers before, rather than after, they babbled to reporters.

While the Administration fretted about leaks, its disinformation schemes could damage U.S. attempts to persuade reluctant allies to act in concert against terrorism. Vermont Senator Patrick Leahy pointed out that the U.S. may someday have to justify action against terrorists "on the basis of undisclosed intelligence materials. To be successful, we have to protect our credibility." Indeed, a White House official admitted after the turmoil over the deception disclosures, "In this town truth is perception, and we are perceived as not being credible." It was obvious last week, as it should have been all along to the Administration, that in the long run any deliberate deceptions ultimately do more harm to the U.S. than they could do to Gaddafi.

With reporting by Barrett Seaman and Bruce van Voorst/Washington