An old plane sits grounded atop a lush hillside on Costa Rica’s Pacific coast. The battered Fairchild C-123, built in 1954 and now part of a popular open-air bar, is the perfect place to nurse a cold cerveza, watch the sunset, and remember a bizarre chapter in history: the Iran-Contra Affair, which from this Central American vantage point would more accurately be called the Contra-Iran Affair, with the illegal arms sale to Iran a minor chapter in the 1980s-era U.S. covert funding of armed guerillas (the Contras) bent on bringing down Nicaragua’s Sandinista government.

Part of the Hotel Costa Verde in Manuel Antonio, the Avion Bar is the perfect place for ruminating on that 1980s arms-for-hostages-and-while-we’re-at-it-let’s-fund-some-paramilitaries scandal because the plane itself played a starring role in the fiasco.

The plane was dubbed “Ollie’s Folly” for its connection to Oliver North, chief architect of a covert operation–lodged firmly in the heart of the Reagan administration–that funded and provided military assistance to the Contras.

Though the U.S. government supported the Contras in the early 1980s, Congress cut off all funding in late 1984, afraid that Nicaragua would become the next Vietnam, and alarmed by reports that the CIA had secretly mined Nicaraguan harbors.

Who Needs Congress When You’ve Got Ollie North?
Despite signing into law the bill cutting off all funds to the Contra’s paramilitary operations, Reagan ordered his staff to find a way to help the Contras keep “body and soul together,” in his words. Reagan and his staff–especially those in the National Security Council (NSC), secretly raised $34 million for the Contras from other countries, with an additional $2.7 million from private contributors, and later, with funds from the illegal arms sale to Iran. This money was funneled into a private company called “the Enterprise,” and put under the direction of Lieutenant Colonel Oliver North.

The Enterprise had its own operatives, Swiss bank accounts, airfields, and airplanes, including two Fairchild C-123s, one of which now holds up the roof of the Avion Bar.

For 16 months in the mid-1980s, the Enterprise provided covert aid to the Contras–aid that the U.S. Congress had specifically prohibited. When U.S. and world press caught wind of the operation and reported on it, Reagan, National Security Adviser Robert McFarlane, and other administration officials repeatedly assured the public (and Congress) that nothing illegal or untoward was going on.

The Game Is Up
On October 5, 1986, evidence to the contrary fell to earth over southern Nicaragua. A plane carrying supplies to the Contras was shot down; the two pilots were killed, but Eugene Hasenfus, a former Marine from Wisconsin who’d been hired by the CIA, parachuted to safety, only to be captured by Nicaraguan government forces. Hasenfus’ capture was instrumental in uncovering the U.S. covert operation providing money and military help to the Contras. The plane shot down that October day was the sister plane to the one now reincarnated as a hilltop bar in Costa Rica.

Allan Templeton, owner of the Hotel Costa Verde, was intrigued by the plane’s history and bought it in 2000 for US$3,000. Templeton had the plane moved, at great expense and trouble, to its current perch close to Manuel Antonio, Costa Rica’s most popular national park. The Costa Verde has a taste for giving old modes of transport new life–they also transformed a 1965 Boeing 727 into a high-end ocean-view suite. And they operate what must be one of the few places in Costa Rica where you can get a Hebrew National kosher hot dog. It’s called The Wagon, and it’s housed in an old train car.

But let’s return to the 1980s for a minute. What happened in Nicaragua back then didn’t stay in Nicaragua. Ollie North had a secret airstrip built in Costa Rica to support his covert ops in Nicaragua, then got himself barred from Costa Rica for life for that and for his alleged part in drug smuggling to fund the Contra effort.