Final answer:
The Reagan administration sold arms to Iran as part of the Iran-Contra scandal to secure the release of American hostages held by Lebanese groups. The proceeds from the arms sales were then illegally used to fund the Contras in Nicaragua.
Step-by-step explanation:
The Reagan administration sold arms to the Iranian government during the Iran-Contra scandal because Iranian leaders agreed to help pressure Lebanese groups holding Americans hostage to release the hostages. Despite a US embargo against Iran and the animosity between Israel and Iran, the deals went through because there was a desire to secure the release of American hostages taken by Hezbollah in Lebanon. The profits from these illegal arms sales were then funneled into supporting the Contra forces in Nicaragua, which was against the law at the time.
Why the Reagan Administration Sold Arms to Iran
The Reagan administration was willing to violate its own policies and deal with a hostile nation to ensure the safety of American citizens. The arms-for-hostages deals were covert actions that not only violated U.S. laws concerning negotiations with terrorists but also contravened constitutional concepts regarding presidential authority. Subsequent revelations of these actions and the use of the arms sale proceeds to support the Contras led to the scandal being known as the Iran-Contra Affair.