Richard V. Allen resigned yesterday as Ronald Reagan's foreign policy adviser for the remainder of the presidential campaign, even though Reagan aides declared that he is innocent of conflict-of-interest charges.
Ed Meese, Reagan-Bush campaign chief of staff, said that charges raised by a Wall Street Journal article Tuesday had been investigated and that "it is clear that any allegation or implication of improper conduct is untrue."
Nevertheless, Meese said, in order to avoid distracting attention from the real issues in the final few days of the campaign. Allen had decided to step aside.
Campaign sources said that in fact, Allen's position had been eroding since last summer when a magazine revealed that he had once served as a consultant to a lawyer for fugitive financier Robert Vesco.
The Wall Street Journal article said, in effect, that while a member of the Nixon administration in the early 1970s, Allen had carried on private business negotiations involving a possible position as a consultant to Japanese companies. The story said Allen had later claimed the right to benefit from a $120,000-a year account that an associate had obtained from Datsun, contending his activities had led to the other man's getting the account.It also said Allen had given a Japanese friends secret information from a U.S. trade commission where Allen was serving. It implied that he was on the U.S. government payroll while carrying on all these activities.
Allen called the implication of conflict of interest "baseless." He asserted, and civil service records confirm, that during the entire period in question, he was in fact a private citizen not working for the government. He was in the Nixon administration for the first 10 months of 1969 and again from the summer of 1971 to midsummer of 1972. But in between he was out of the government had in private business, and it was in that interim that all the activities described in the Journal story occured.
Allen did belong during this interim period to the government advisory commission on international trade and investment, now defunct. But he said, and other members and staffers confirmed, that members, including Allen, were unpaid and were free under the terms of their participation to carry on their normal personal business activities. Members also said that the commission material Allen sent to his Japanese friend was actually pretty widely circulated and not really all that secret.
Although Meese said yesterday that Allen "continues to have the full confidence of Ronald Reagan and the campaign organization," it was unclear whether Reagan, if elected, would make Allen his national security adviser, as many had previously believed.
On the campaign plane, Reagan press secretary Lyn Nofziger wound up in a shouting match with reporters over his reufsal to say whether Allen would be considered for an administration post. "I am not going to prejudge Allen," shouted Nofziger. But he said that Reagan "has access to a wide range of foreign policy experts."
Henry Kissinger, an old foe of Allen from the days when both were on the National Security Council in the Nixon administration, has been playing a growing backstage role in the campaign in recent weeks and was one of the principal architects of Reagan's recent proposal for a SALT III pact with Russia.
However, it is not believed by well-placed sources in the Reagan camp that he now will step forward as a potential security adviser or secretary of state. Rather, some see him as a possible special envoy in certain situations of importance.
Some sources within the campaign said that it is just conceivable that Allen may re-emerge after the election,but others say this is unlikely and in fact has been for some time, despite Nofziger's remarks.
They point to last summer's article in Mother Jones magazine which drew attention to the fact that Allen, after setting up an international consulting firm, Potomac International, upon leaving the government in 1972, had been paid $10,000 a month for about six months by Howard Cerny, a lawyer for Robert Vesco, for consultations on international trade. Vesco later fled the country after charges he bilked investors.
President Carter's press secretary, Jody Powell, referring to Allen's current job as a consultant to Nissan U.S.A., said the real issue is that Allen is "a top national security adviser working for the Japanese." Allen's connection with Nissan has been know here for at least two years.
Stories in The Washington Post and elsewhere revealed that as a private consultant since 1972, Allen had once registered as a foreign agent for the Overseas Companies of Portugal, which some viewed as a front for the former colonialist government of Portugal; that he is a consultant to Datsun's U.S. subsidiary, Nissan, U.S.A.; that he was a consultant for several years to Tokoyo Electric Power at $40,000 a year, and an occasional consultant to Lockheed and the Industrial Research Institute of Japan; and that he was accused at a Senate hearing of having sought a $1 million campaign contribution to a Nixon reelection fund from a Grumman official in return for White House aid in selling planes to Japan. He denied this charge and it has never been proven.
The Oct. 28 Wall Street Journal article declares that on several occasions in 1970, Allen wrote a friends, Prof. Tomotsu Takase, warning him on the basis of closed trade commission hearings that a protectionist wave was sweeping the United States.
It said Allen provided Takase with confidential information from the hearings and advised him to foster a big lobbying effort in the United States on behalf of Japanese industry. Allen doesn't deny writing such letters, but says nothing in them was really secret, and that he, like all commission members, was unpaid and free to engage in private business.