The administration seemed to teeter on the verge of collapse as Congress began hearings on the scheme and Independent Counsel Walsh geared up to investigate. Reagan gave a vintage speech on March 4 in which he admitted to the country that his administration had traded arms for hostages: "There are reasons why it happened but no excuses. It was a mistake." But he asserted that he was kept in the dark about the details. He denied any knowledge of the illegal diversion of funds to the Contras and no credible evidence was found to contradict him. If Reagan had known about or approved the diversion of funds, it could have been considered an impeachable offense. But chances are he would have survived. "I don't even think he would have been impeached by the House, let alone tried and convicted by the Senate," says Walsh. "He was just terribly popular, and this was a very questionable action by Congress."

"Another time, another era"
But there were other problems. By midway through his second term, the septuagenarian president seemed markedly less vigorous. He seemed able to rise to the biggest occasions, such as his summits with Gorbachev. But he curtailed his working hours and spent more time at his Santa Barbara ranch.

Yet, amid peace and prosperity, Reagan's popularity rebounded, and superpower relations reached new levels of harmony. In May 1988, Reagan strolled through Red Square with Gorbachev and proclaimed that he no longer considered the U.S.S.R. an evil empire. That phrase, Reagan said, belonged to "another time, another era." Within a year of his January 1989 departure from Washington, the Berlin Wall came down. Just as he said it would.

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