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Selects: Iran-Contra Affair: Shady in the 80s, Part 1
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Fundraising the Illegal War: Saudi Millions and a Tax-Deductible Nonprofit
At 28:59 · chapter starts 27:45
With official funding cut off, the Reagan team turned to private fundraising, holding dinners and events for business elites where the pitch was simple: communism is bad for your company, open the checkbook, and here's a photo with the President. The approach worked. They also created the National Endowment for the Preservation of Liberty, a nonprofit whose sole purpose was to receive and pass on illicit funds to the Contras — and whose donors could claim tax deductions on those contributions. Chuck notes the nonprofit's dismal 52% program expense rate: $6.3 million raised, only $3.3 million to the Contras, with $3 million consumed by 'operations.' Saudi Arabia became the biggest single donor, contributing $32 million over two years, leaving Contra factions flush with cash but with no idea how to convert it into weapons.
Lieutenant Colonel Oliver North, tapped to run the entire covert Contra support operation, had no prior experience in covert operations whatsoever — he was learning as he went.
The National Endowment for the Preservation of Liberty raised $6.3 million from business elites to fund the Contras — and donors could deduct every dollar from their taxes. Only $3.3 million actually reached the Contras. Three million went to 'running' the nonprofit.
The National Endowment for the Preservation of Liberty raised $6.3 million for the Contras but only $3.3 million reached them — a shockingly low 52% program expense rate.
Over just two years, Saudi Arabia alone donated $32 million to the Contra rebels, giving loosely affiliated factions millions they had no way to spend on arms.
