No. 10 - Iran Contra Affair Ronald Reagan was one of America's most popular presidents, but a political scandal known as the Iran Contra affair that unfolded during his second term threatened both his image and his administration. Iran-Contra began as an effort to improve U.S.-Iranian relations, but quickly deteriorated into an arms-for-hostages deal involving Hezbollah and the diversion of funds to Contra rebels in Nicaragua. No evidence linked President Reagan to the secret operations directly, but there was widespread speculation among the American people about his involvement. Several of his top aides were indicted, but all were later pardoned.
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