so by the leftists Gen. Torrijos named to top government posts. Indeed, the Moscow-leaning Communist Party in Panama is operating openly although all politi cal parties and politicking are outlawed by the Torrijos government. (But a Peking-oriented Communist group has been smashed by the National Guard.)

"MAJOR CAUSE FOR CONCERN

"It was a recent cabinet shakeup by Gen. Torrijos, however, that is causing the most concern among businessmen, who worry that the backgrounds of some of the new ministers are a clear indication of the government's leftish push.

"Most of the new ministers term themselves pragmatic nationalists. "I believe in a social reordering that will bring justice," says Jose Guillermo Aizpu, the new finance minister. "If it's necessary to call that socialistic, then I may be a little bit to the left."

"Even some of the dictator's most avid supporters have been saddened by his appointments of Juan Materno Vasquez to the prime post of minister of government and justice and of Romula Escobar Bethancourt as rector of the University of Panama. Vasquez is a brilliant but controversial jurist known to have been a Marxist, and Escobar is an extreme leftist who numbered among his friends Cuba's late Che Guevara.

"Both are former classmates of Gen. Torrijos, who praises their political expertise and staunchly defends them. 'As an adolescent one gets to be an anarchist by virtue of social injustice,' the dictator says. 'But if after reaching 30 he still follows that line, he is a fool.'

"Gen. Torrijos firmly declares: "Those who oppose us brand us Communists. But the humble classes of people who make up nine-tenths of our population are more concerned with the intentions of the government than its origin.' Then he adds, "The first rule of government is not to fall.'

"Following this rule, the dictator stumps the interior by helicopter to increase his popularity among peasants and workingmen. To keep the oligarchy in hand, he exercises an old tactic of dictators-fear.

"Even if criticism of the government weren't a crime-and it is-there wouldn't be any place to voice it. The six daily newspapers are run by publishers appointed by the government. All political meetings are banned. Former politicians are afraid even to be seen talking with a foreign newsman. Through an intermediary a meeting is arranged with a former president. But on the way to the site the reporter is taken on a twisting path through back streets so that anyone following will be thrown off the trail.

"Many Panamanians insist that their phones are tapped and complain of harassment by the government. It is well-known that the government has built a network of informants. The investigative arm of the National Guard openly appeals for additional informers. In a series of newspaper ads, it urged that "suspicious persons" and "important information" regarding "security of the country” be reported to the Guard.

"Government spokesmen insist that no political prisoners are being held. Other sources, maintain that at least 200 are in Panama's jails. Just after the 1968 coup, there were an estimated 1,600.

"WELL-TRAINED, LEAN AND MEAN

"But plotting against the government continues despite arrests and other harsh restrictions imposed by the Guardsmen, whom one U.S. military analyst describes as "well-trained, lean and mean." One recent plan to topple Gen. Torrijos was postponed at the last moment. But many Panamanians opposed to the dictator say any change in government depends largely on the U.S.

"Some are bitter because the U.S. hasn't at least choked off funds that help the general stay in power. And a former holder of a high Panamanian political post says the U.S. is "morally obligated to intervene."

"Except for a handful of Congressmen who charge that the Soviet shadow is beginning to reach across the Panama Canal, U.S. officials generally disagree with the theory that Washington should intervene. These officials note that President Nixon's approach is to deal with governments as they are.

"Because of the restraints against politicking and criticism, there apparently isn't anyone closer than Miami who has a chance of overthrowing Gen. Torrijos. The most likely prospect is Arnulfo Arias, the legally elected president of Panama.

"BATTING AVERAGE: THREE FOR THREE

"Mr. Arias is perhaps the most popular and controversial political figure ever to emerge in Panama. A former wealthy plantation owner and Harvard-trained surgeon, he has always drawn strong support among the nation's poor. But some in the oligarchy scorn him, and the National Guard has always fought him. He has been elected president three times, only to be ousted by the Guard on each occasion. The last time he served as president for only 11 days. Now nearing 70, Mr. Arias lives in exile in Miami.

"Mr. Torrijos, a major in a province garrison at the time, surfaced as one of the instigators of the October 1968 Guard revolt against President Arias. Subsequently, Mr. Torrijos emerged as the leader. In December 1969 while the general was on a trip to Mexico, a group of colonels in the Guard staged a countercoup-brief and unsuccessful. Gen. Torrijos hustled back to Panama, marching triumphantly into the capital just in time to intercept telegrams intended for his would-be successors.

"Moving to strengthen his political base, Gen. Torrijos appointed as provisional president Demetrio B. Lakas, a Panama contractor and trusted friend. Speaking in a Texas accent after seven years spent in that state, President Lakas bridles at talk that the general now is turning to the left. 'I will never follow a Communist,' the president declares, 'but I will follow a man with social sensibility.

"A suggestion of this 'social sensibility' came a year ago. In a letter to Sen. Edward Kennedy, Gen. Torrijos predicted the emergence of 'a new type of military' in Latin America 'convinced of the value of peaceful changes that promote the replacement of old structures.'

"EXCEDRIN HEADACHE-LATIN STYLE

"Today Gen. Torrijos doesn't give any indication he plans to restore constitutional government at any time soon. 'One thing proved in the America's,' he says, 'is that the parliamentary systems and political parties are obsolete museum figures.' He contends that 'every country has to look for its own brand of aspirin to cure its own headaches.'

"Indications that the general was setting out on a deliberate course to cross the U.S. began appearing months ago. First, he refused to renew an agreement on U.S. use of the Rio Hato air base, from which Americans now have withdrawn. Then he told the Peace Corps to go home. And he recently announced that Japan was interested in bidding on construction of a new sea-level canal across Panama, a waterway that many authorities believe will soon be needed to handle increasingly larger ships.

"Whatever his differences with the U.S., Gen. Torrijos is getting some plus marks at home. His government attracts bright young men with advanced degrees from U.S. universities who are pleased at the social challenges and the lack of bureaucratic red tape. To get laws passed, all they have to do is persuade the general to issue a decree. "Technicians and intellectuals disappear from the political arena when a government is dangerous. Here there is a remigration of brains,' says Hernan F. Porras, the minister of commerce and industries.

"The streets of the capital are free of garbage-long a political issue-and the gross national product of Panama has reached $1 billion and grows in real terms at a rate of 4% to 5% a year. Per-capita annual income approaches $625, ranking third or fourth in Latin America.

"THE ROLE OF THE CANAL

"The canal is a big contributor. In payrolls and purchases, it adds about $160 million a year to the Panamanian economy. The U.S. has lent Panama $100 million in the past 10 years, much of it since Gen. Torrijos has taken power. "How much of the prosperity is due to government pump-priming isn't known. It has borrowed heavily from abroad, and some observers suggest that Panama may be nearing a credit crunch. 'What happens when the money runs out?' one observer asks.

"The government, however, is beginning a push for tourists and is trying to attract more foreign investments. A wave of such investments is coming in from South America, Europe and Japan, and U.S. companies have already invested $1 billion here.

For peace and prosperity we are giving up certain intangibles, like freede of speech and the other political rights,' a Panamanian businessman says Bra soon we get to the point where the sacrifice of intangibles no longer is eque the tangibles we have gained is the big question.'"

Gen. Omar Torrijos, the real power behind the Government of Panama. In his Minister of Foreign Affairs Juan Tack, have been holding many meeting and speaking of their demands for the terms of a new treaty.

The Miami Herald, in its issues of July 7, 1971, carried an article under the headline of "Panama's New Dictatorship Often Arbitrary, Repressive" which is as follows:

"PANAMA'S NEW DICTATORSHIP OFTEN ARBITRARY, REPRESSIVE

"(By Don Bohning)

"PANAMA.-Among the slogans of Panama's military-controlled government is one that proclaims: 'Revolution Without Dictatorship, Liberty With Order.' "It might be more accurately read: 'Revolution With Dictatorship, Order Without Liberty.'

"And there is even some questions as to the authenticity of the 'revolution to which Gen. Omar Torrijos, Panama's unchallenged ruler, and his military colleagues pay repeated lip service.

"Panama today is a military dictatorship; one that can be, and often is, as arbritrary and repressive as any in the hemisphere.

"In fairness, there have been positive actions since the 6,500 man National Guard, Panama's only military force, seized power Oct. 11, 1968.

"Hitherto unknown political stability has been imposed. The country is prospering economically. The government has professed an awareness of, and an interest in, the problem of the underprivileged both in the cities and the country. side. And, what seems to have made the greatest impression on some, the streets are cleaner and the garbage is being picked up regularly.

"Before the guard seized power, Panama had what ranked among the most venal and corrupt political systems in the hemisphere.

"By contrast, government by the guard initially looked almost puritanical. That image is fading, as rumors of corruption, nepotism and immorality grow and are too widespread to be dismissed.

"Where freedom of the press was previously abused, it now is nonexistent. Although there is no formal censorship, newspapers publish only what the gov ernment sees fit to print.

"Political activity is banned. And, although Torrijos made vague noises about the beginning of a return to constitutional government late in 1970, there has been no recent indication that he now has any plans to do so.

"Perhaps the most distasteful of all is the atmosphere of fear in which much of the politically aware population finds itself living.

"Recent newspaper advertisements, inviting abuse, called upon the citizenry to protect the ‘national security' by reporting suspicious activity or persons and 'important information.'

"It is presumed that telephones are tapped by the government, and conversations are cautious. Once politically active Panamanians are fearful of being seen with foreign newsmen.

"Of the 19 hemisphere countries Gov. Nelson Rockefeller's fact-finding mission for President Nixon visited in the summer of 1969, Panama was the only one where the Secret Service found the mission conference room bugged.

"An extensive system of informants also is said to be active, reporting to the National Guard G2 or intelligence section, headed by Lt. Col. Manuel Noriega, an ambitious officer with a reputation for ruthlessness.

"In some instances it is known that physical pressures have been exerted on prisoners at various 'houses of interrogation' operated by the guard in Panama City and Tocumen International Airport.

"Even American citizens have not been immune from arbitrary arrests by the guard, including Robert Frizell, a Chiriqui province land-owner, who the government apparently thought was implicated in some kind of antigovernment activity although he repeatedly denied it.

"Frizell was held incommunicado for several days last October. He was released Nov. 3 for lack of evidence.

"So that is the National Guard control that Panamanians are cynically dis›elieving when the government professes no knowledge of such things as the ecent disappearance of Father Hector Gallego, a young Colombian activist priest kidnaped in remote Santa Fe parish in the Panamanian interior.

"Neither has the United States escaped the arbitrary action of the military government, including the expulsion of the Peace Corps contingent from the country early this year.

"The commonly accepted, although unofficial version, is that the Peace Corps departure was ordered by Panama in retaliation for the arrest in the Canal Zone by U.S. authorities of a Panamanian citizen on drug trafficking charges. He was then sent to the United States to stand trial.

"For those Panamanians who hope for a change, the prospect is dim.

"Torrijos and the guard are firmly in control. They have neutralized all possible sources of opposition, including the university.

"Anti-government elements at the university have been purged, and progovernment groups have been created to replace them.

"Political parties are banned, and the commercial class is cowed.

"The only remaining independent institution that could effectively challenge the government is the Roman Catholic Church. It is for that reason that the case of Father Gallego is being followed with more than passing interest."

Mr. Speaker, I believe it is the inherent right of the people of the United States to be informed of what is happening in what could become a volatile situation; that should these negotiations be allowed to continue without the refutation of any of the statements that are being made by Gen. Omar Torrijos and Foreign Minister Tack in the name of the Republic of Panama, we are in danger of being placed in a position of having to defend our right to operate the Panama Canal under the Treaty of 1903.

I urge the Members of Congress and the public to express their opinions to the President and the Senate on the giving away of our rights now being exercised under a legitimate treaty to operate the Panama Canal in the territory known as the Canal Zone.

What will happen to the approximately 5,525 housing units now occupied by American citizens and non-American citizens who are employees of the Panama Canal Company? What will happen to the schools and other buildings located in the Canal Zone? Should the area known as the "Canal Zone" be wiped out under a new treaty, all of this property, including the Panama Canal, would be located in the Republic of Panama, subject wholly to its laws. What would stop the expropriation of the Panama Canal by the present Government of the Republic of Panama should the authority of the United States in the Canal Zone be abdicated? Only armed force by the United States could stop it. The negotiators representing the United States must be made to understand that such agreements as are now being suggested will not be tolerated by the people of the United States.

Mr. FASCELL. Our next witness today is the Honorable William L. Scott, Representative from the State of Virginia. We are very pleased to have him here today to give us his testimony.

STATEMENT OF HON. WILLIAM L. SCOTT, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF VIRGINIA

Mr. SCOTT. Thank you, Mr. Chairman. It is good of the subcommittee to permit me to come here and present my views.

We receive a considerable amount of correspondence, as I am sure every congressional office does, from people who are concerned with what they term the giveaway of the Panama Canal and the Canal Zone. There is a concern that the negotiations being carried on between this Government and the Government of Panama will result in our losing jurisdiction over the canal and its being put under international control.

I would hope that the Government, acting through the State Department, will not do this. I have some reservations as to the validity

of the treaty and the ratification by the Senate being sufficient to convey Government land without any House action. I think a resolution of the House expressing the sense of the House that this should not be done is very much in order.

We know and I think every Member of Congress is aware of the strategic importance of the Canal Zone and the use of the canal itself by ourselves and by friendly nations in the event we did have a war. I have some reservations about the strength that the international organization would have in maintaining the canal for the free world in the event of war.

So, I was happy to join with the sponsors of this resolution. I do hope the subcommittee and the full committee of the House will see fit to adopt the resolution and recommend it to the House for favorable consideration.

Mr. Chairman, I ask that my prepared statement be made a part of the record at this point.

Mr. FASCELL. With no objection, we will certainly do that, Mr. Scott. (Mr. Scott's prepared statement follows:)

STATEMENT OF HON. WILLIAM L. SCOTT, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF VIRGINIA

I appreciate the opportunity afforded me to testify in support of legislation which resolves in substance that the United States maintain and protect its sovereign rights and jurisdiction over the Panama Canal and that the United States government in no way forfeit, cede, negotiate, or transfer any of these sovereign rights, jurisdiction, or territory to any other sovereign nation or to any international organization. My own measure is H. Res. 238.

The United States government was obligated by Article I of a Treaty between the United States and Panama in 1903 to maintain the independence of the Republic of Panama in perpetuity. A provision calling for permanent peace and friendship between the two countries was incorporated in Treaties of 1936 and 1955 in lieu of the Article I of the 1903 treaty, however all three treaties allow the United States to defend and fortify the Panama Canal in perpetuity.

The Panama Canal has for almost 57 years played a vital role in the strategic and commercial life of the United States. It has served us well during World War I, World War II, the Korean War, the Cuban crisis, and during our involvement in Vietnam as a transport route between the Atlantic and Pacific Oceans. Approximately 70% of the 12,000 ships transiting the Canal each year for commercial purposes are en route to or from U.S. ports.

We have built, operated, maintained and defended the Canal, not only for ourselves but for the other countries of the world. Since the canal was opened in August 1914, it has been available to ships of all nations at all times on equal terms. It has served to strengthen the security of the United States and of the free world. It has been a stimulus to world trade and provided increased economic opportunity for many nations. To date, we have paid the Republic of Panama nearly $50,000,000 in gratuities and have invested a total of $5,000,000,000 in the waterway.

Ceding sovereignty of the Canal to Panama could have disastrous results. Any hostile regime there could not only arbitrarily deny our naval forces transit from ocean to ocean and thus destroy a vital link on our chain of defenses but could also permit traffic threatening our national security. The curtailment of our commercial shipping through the canal would result in tremendously increased costs to U.S. consumers-for the alternate routes around Cape Horn or the Cape of Good Hope would add thousands of miles to each voyage. Any action at this time which would afford an opportunity for an increase in shipping costs by action of a foreign power, when we are operating under emergency conditions to improve our competitive position in the world market, would certainly not be in the best interest of the United States.

For all the above reasons, I urge the Committee to favorably report one of the measures now under consideration to maintain United States sovereignty over the Panama Canal Zone.