Regan Resigns; Ex-Sen. Baker Selected as New Chief of Staff : Reagan Acts Swiftly After Tower Report

President Reagan, reacting swiftly to the Tower Commission’s indictment of his conduct of his Iran- contra policy, accepted the resignation Friday of White House Chief of Staff Donald T. Regan and replaced him with former Senate Majority Leader Howard H. Baker Jr.

Baker, 61, the former Republican senator from Tennessee whose genial style contrasts sharply with the imperious Regan, abandoned his own potential 1988 presidential campaign to take over a White House staff that has been rocked by scandal.

“The President asked me to accept the most sensitive position in his personal entourage and to be his chief of staff, to organize the White House on his behalf,” Baker said. “I didn’t see how I could turn that down.”

Brief Letter

Regan, 68, who had become the most powerful White House aide in three decades only to bear a large part of the Tower Commission’s blame for mismanaging the Iran-contra affair, gave Reagan a resignation letter that was stunning in its brevity.

“Dear Mr. President,” Regan wrote, “I hereby resign as Chief of Staff to the President of the United States. Respectfully yours, Donald T. Regan.”

Virtually all of Reagan’s other official and unofficial advisers, including Nancy Reagan, had urged Regan’s resignation as a vital step if the President is to remain effective during the final two years of his Administration.

Years of Experience

With the choice of Baker, the President opted for a chief of staff who offers many of the qualities that critics complained were lacking in Regan: years of experience in Washington, long and warm ties to members of the House and Senate and a proven ability to get along with the wide range of conflicting forces that operate in Washington.

In addition, Baker has great familiarity with a broad range of foreign and domestic issues, and is well-known and respected abroad. Other politicians also consider him to be one of the leading members of the Republican Party.

Regan, by contrast, had joined the Reagan Administration after many years on Wall Street.

“You can hear a sigh of relief all over Washington,” said Sen. Nancy Landon Kassebaum (R-Kan.). “This may be the best news I’ve heard since 1987 began. This is an excellent choice.”

“With Howard Baker in the White House, the President should have a greater opportunity to get back in charge,” said Sen. Alan Cranston (D-Calif.). “It’s a good beginning, but there’s a long way to go.”

Vice President George Bush said in Bedford, Mass.: “I think he’ll do a wonderful job. . . . He will fulfill the President’s program.”

‘Unquestioned Integrity’

In a written statement, the President praised his new chief of staff, who served as Senate majority leader during the first four years of Reagan’s presidency, as “a man of unquestioned integrity and ability.”

“I am enormously pleased that he is willing to take on this responsibility and to help me organize the White House staff for an aggressive two years of work,” Reagan said. “Howard and I have been friends for a number of years. I have the utmost respect and admiration for him.”

In the statement, the President saluted Regan as “a friend and associate who has always put the nation’s interest first.” He said Regan “came to me many months ago to say he would like to return to private life in the near future.

After Tower Report

“However, after the revelations about Iran, he indicated he would like to stay and help me and the Administration through the investigations. Last week he indicated that with the release of the Tower Board report, he felt he would like to go through with his original plans to return to private life.

“I am therefore accepting with regret his resignation as chief of staff, effective today.”

Elsewhere, sentiment toward the departing chief of staff was less favorable. A former White House official, speaking on the condition that he not be identified, said of the former chief of staff: “He kept the President sanitized. He kept dissenting voices from coming near him, playing to whatever he thought the President needed to hear.”

The shift in the uppermost level of the White House staff brings to Reagan’s side an entirely new lineup for his final 23 months in office.

Reagan--as did President Jimmy Carter before him--built his presidential campaign around the theme that it was time to bring to the White House a team of new faces who could successfully do battle with entrenched bureaucrats and special interests.

Old Washington Hands

Now his White House staff is led by old Washington hands. In addition to Baker, Reagan recently named as his national security adviser Frank C. Carlucci, a former career Foreign Service officer who served as deputy director of the Central Intelligence Agency under Carter, a Democrat.

Beyond those two appointments, other recent personnel shifts have given the President a new White House spokesman, chief domestic policy adviser, director of communications and assistant for political affairs and intergovernmental relations.

Until he accepted the job, Baker was a potential rival of Bush’s for the Republican presidential nomination in 1988, although he had not announced his candidacy. Baker said Friday that he would not run for the presidency.

‘Long-Time Friends’

Mrs. Reagan said in a statement issued almost simultaneously with the White House announcement--if not minutes before it--that her husband and Baker were “long-time friends” and that she was “delighted he will be with us.” She made no reference to Regan.

The First Lady’s role in Regan’s departure was substantial. The two were reportedly no longer on speaking terms after she orchestrated an effort to force him from office last December, and Regan was said to have hung up on her in recent telephone conversations.

The manner in which the White House disclosed the shift belied its importance. Announcements of major personnel changes within the Administration are generally made by the President, with the departing and incoming aides at his side.

Rack of News Releases

But Regan’s resignation and Baker’s appointment, climaxing a tumultuous week for the President, were disclosed on two pieces of paper--Regan’s terse letter and the President’s four-paragraph statement--that were placed without fanfare in a rack of news releases in the White House press room.

Reagan had long since returned to his residence from the Oval Office, and Regan had gone home.

Late in the afternoon, after the President and Regan had departed the White House West Wing, where their offices are situated, Baker arrived to meet with Dennis Thomas, one of Regan’s chief aides.

Campaign by Aides

Regan’s departure capped a campaign by some of the President’s closest aides that began shortly after the initial revelation that funds paid by Iran for U.S. weapons may have been diverted to the anti-Sandinista rebels in Nicaragua.

By Wednesday, on the eve of the publication of the report by the Tower Commission that investigated the Iran affair at Reagan’s request, the President appeared to have yielded to the pressure to remove Regan and was actively looking for a successor.

But former Sen. Paul Laxalt (R-Nev.), a longtime Reagan confidant who was said to be on the list of candidates for the job, told the President that he wanted to withdraw his name from consideration. At about the same time, former Transportation Secretary Drew Lewis was offered the job but turned it down, according to sources close to Reagan.

“Laxalt offered Baker’s name and the President thought long and hard about it,” one source said. “He touched base with some people yesterday, including Ed Meese,” the attorney general.

Spoke by Telephone

The source, speaking on the condition of anonymity, said Reagan spoke Thursday afternoon by telephone with Baker, who was in Florida, and won his assent.

On Friday, another source said, Reagan conferred at the White House with Laxalt, political adviser Stuart Spencer and Richard B. Wirthlin, the Republican pollster. “Regan tried to wedge his way (into the meeting) without success,” the source said.

Regan was said earlier this month to have obtained from Reagan a gentlemen’s agreement that he could remain in his post as long as he wanted. But as the fire storm grew around him, this source said, it was understood that the deadline had been drastically moved up and that he had only until Monday.

Draws Up Resignation

Then, as word of the shift began circulating in Washington, the chief of staff drew up his one-sentence resignation letter and called White House spokesman Marlin Fitzwater to his office.

“I just had this delivered to the President,” he said, ordering Fitzwater to make it public, a White House official disclosed.

Said a former White House official: “He was obviously very angry and obviously in a hurry.”

Regan is the first White House chief of staff to resign under fire since H. R. Haldeman left the Richard M. Nixon White House during the Watergate scandal. At that time, Baker was vice chairman of the Senate Watergate Committee.

Regan’s departure quickly overshadowed the initial White House reaction to the Tower Commission report.

‘Rightfully Angry’

Earlier in the day, Fitzwater said the President was “rightfully angry about the mismanagement described in the report,” and would make changes.

Hours later, the first change became apparent.

Staff writers Jack Nelson, Sara Fritz, Lee May and Karen Tumulty contributed to this story.