future is heavily mortgaged to foreign (principally U.S.) lenders. Integration of the Canal Zone into the mainstream of Panamanian life may also present real difficulties. These circumstances, together with the concerns expressed by current employees of the Canal Company, make us apprehensive about the Panamanians' ability to manage the Canal efficiently and reliably and their willingness to work with the United States in furthering the best interests of this collaborative enterprise. The treaties are premised upon the kind of reciprocal relationship that should facilitate close cooperation, but the desire to cooperate must come from both sides if the transfer of authority is to be carried out smoothly. The prospective problems alluded to above are not insuperable. They will, however, warrant careful monitoring, and we should enter into our new relationship with Panama mindful of this reality. Other objections to the Canal pacts are plainly spurious. Because of our obligation to maintain the regime of neturality, it is sometimes claimed that even during a declared war we would be powerless to prevent our enemies' warships from sailing through the Panama Canal. But this misses the point. As several of the military officers appearing before you have explained, the critical strategic factor would not be our legal right to bar hostile passage, but our military capacity to prevent the enemy ships from reaching the Canal in the first place. Doubts have also been expressed about the acceptability of the economic features of the agreements-specifically, the reference in Article XIII of the basic treaty to Panama's right until the year 2000 to receive (a) a royality of 30 cents per ton of cargo transiting the Canal, (b) an annuity of $10 million per year, and (c) a cumulative additional amount of up to $10 million annually if revenues permit. These doubts can easily be satisfied. Payments to Panama during the entire time that we retain jurisdiction over the waterway will come from tolls paid by countries using the Canal rather than from the U.S. Treasury. No appropriations will be required, and no American tax dollars need ever be expended. Finally, criticism has been made of the provision whereby the United States agrees not to construct a new canal in any country other than Panama. Why, it is asked, should we forego the right to negotiate the Nicaragua or Colombia, or any other nation, for the building of a new sea level canal? There are several answers. Under Article XII(2) of the initial treaty Panama has in exchange for our promise given up the right to permit any power other than the United States (such as the Soviet Union) to dig a canal crossing its territory. More important, engineering studies comparing the various alternatives (most notably the 1970 report of the Atlantic-Pacific Interocean Canal Study Commission headed by former Treasury Secretary Robert B. Anderson) have all concluded that the most suitable routes lie in Panama. What is more, the cost of the conceded favorite of these routes was recently estimated by the Canal Company's accountants at $5-6 billion. At an interest rate of 7 percent the carrying costs alone for construction of this canal would be at least $350 million annually, double the current yearly income of the existing canal. No foreseeable increase in traffic or tolls could justify such an outlay. The most pervasive and deeply felt objections to the treaties, however, stem from another source. Many Americans view the Panama issue against the backdrop of a succession of U.S. foreign policy setbacks in recent years. Still attempting to comprehend the Vietnam tragedy, these Americans wish to see an end to yielding and retreat by the United States. Many Americans who could not locate Panama on a map know beyond argument that U.S. enterprise and industry built the Canal against frightful odds, and that the U.S. has since maintained that waterway for the benefit of all nations. Why then, they wonder, should we now relinquish control? We are sympathetic to these concerns. But the question of Panama is peripheral to our disillusioning post-war experience. It is the wrong issue to choose to demonstrate that we remain strong and resolute. Panama is the smallest and weakest of nations. We are not "giving" the Canal to Panama. We are, rather, assuring our ability to protect it. By acting positively now to modify our relationship with Panama-in an atmosphere free from crisis, and while we are still able objectively to assess the long-term risks and benefits-we will be demonstrating strength, not weakness. It is just this ability to distinguish between symbol and reality, to plan for future needs, and to take timely action to advance our basic interests that is the essence of a strong and effective global policy. As Secretary of Defense Brown has remarked: "The Canal is for shipping, not slogans." In taking this position, we are unimpressed by the assertion that the U.S. owes anything to Panama by way of reparations for past injustices. The treaties should be judged purely on the basis of their projected impact on the interests of the United States and Panama. In the opinion of the Ripon Society the treaties mark a step forward, an improvement over what currently exists. They present us with an opportunity to modernize an outdated arrangement that has come to threaten the very purposes it was designed to promote. We believe that the agreements should be ratified. CONCLUSION The 1903 Treaty was the product of its era, a period of territorial expansion during which the U.S. emerged as a world power and American hegemony in the Caribbean became an indisputable fact. Panama's sweeping concessions to the United States were not unusual at the time. Britain, Germany, France, Belgium, and other countries were obtaining comparable rights in other parts of the world. But while most such colonial enclaves have disappeared in recent years-submerged in a tide of nationalism in large measure encouraged by us-the U.S. continues to enjoy its original status in the Canal Zone. What is at issue in Panama, more than anything else, is our country's conception of its international role. Some Americans would pick Panama as the right place to "draw the line," to show the world that the United States cannot be pushed around. But this is to substitute pride, soured by the bitterness of past defeats, for reason. Building the Panama Canal early in the twentieth century was a great American accomplishment, requiring ingenuity and audacity. It was, as Senator Baker noted at the outset of these hearings, one of mankind's most memorable achievements, the moon shot of its day. Keeping it open and secure in the future, however, will constitute another impressive feat, one demanding both intelligence and tact. Last fall the New Yorker published a cartoon in which one of the patrons of a local drinking establishment exclaimed to his the bartender: "For thirty years I never thought about the Panama Canal. Now I can't live without it!" We have had an opportunity over the past year to think long and hard about the Panama Canal. In light of the many other foreign policy problems presently confronting the United States the time has come to resolve this matter and to turn our energies back to wider concerns of international affairs. Mr. Chairman, based on examination of the agreements before you, we are satisfied that they are fundamentally sound and in the best interests of both this country and Panama. The Ripon Society therefore recommends approval of the treaties at the earliest possible date. APPENDIX A THE RIPON SOCIETY, Washington, D.C., October 21, 1977. To Republican Members of the United States Senate. We think it is important that any fruitful public discussion of the proposed treaties initially recognize that the Canal is becoming less intimately intertwined with our vital national interests, as it is of declining military and economic strategic importance. Neither the supertankers upon which America depends for its petroleum supply nor the 13 large aircraft carriers upon which we depend for our security, can fit through the Canal; our nuclear submarines do not use the Canal, and indeed, according to press reports, only 12 U.S. Navy ships transited the Canal in the four year period of 1971-75, and less than 7 percent of all foreign trade coming in or out of U.S. seaports passes through the Canal. However, to the extent that our national interests are involved, we believe that the most significant factor compelling support of the proposed treaties is that ratification will maintain-if not enhance our national security. The proposed Panama Canal Treaty reaffirms America's legitimate interest in the security of the Canal, for it expressly grants to the United States the right and obligation to be the primary defender of the Canal's security until the end of this century and to maintain the fourteen U.S. military bases in the Canal Zone. On the other hand, we believe the arguments of treaty opponents to be without substantial merit. Their prime objection concerns the vague wording of Article IV of the Treaty Concerning the Permanent Neutrality and Operation of the Panama Canal (Neutrality Treaty), in which after December 31, 1999 and in perpetuity, the U.S. and Panama "agree to maintain the regime of neutrality established..." by the treaty. Contrary to the claims of treaty opponents, surely this phrase would suffice to provide the legal basis for any American military action on behalf of the Canal's neutrality, were that ever necessary. That the Neutrality Treaty would establish this adequate legal basis was clearly underscored in the October 14, 1977 Statement of Understanding between President Carter and General Torrijos. Indeed, as a practical matter, the United States has often relied on treaty language far less specific than that of the Neutrality Treaty to justify the use of U.S. military force around the globe in the post-World War II years. Actually, the danger is not that ratification of the treaties will diminish our national security-but rather that failure to ratify would have just such an effect. Virtually every informed observer agrees that a U.S. rejection of the treaties would substantially increase the likelihood that left-wing Panamanian guerrillas would move quickly to sabotage the Canal or that internal political pressures would force the Panamanian Government to renounce the current treaty. And that the Canal is eminently susceptible to sabotage and is essentially indefensible has been admitted by the Chairman of the U.S. Joint Chiefs of Staff. America's refusal to adopt the treaties could foment an international crisis. The United States could be faced with a sabotaged Canal, a repeat of the bloody 1964 Panamanian riots, and perhaps a new and hostile Panamanian Government. Under such circumstances, negotiating a new treaty could prove impossible; employing force to secure the Canal could prove disastrous to our image in the eyes of the world. Ratifying the treaties and averting this specter would not, however, mean that the U.S. was being blackmailed by Panama. The treaties should be ratified because of their intrinsic merit. They will, as noted, contribute to the security of the Canal, but in addition their ratification will signal to all of Latin America that the United States is willing to implement its stated policy of regarding Central and South American nations as sovereign partners. Ratification will not erase overnight the lingering, effects of the Monroe Doctrine and Theodore Roosevelt upon American policy toward these nations. It will however represent a significant step toward achieving an enlightened relationship with those nations who have long regarded America's continued presence in Panama as a vestige of colonialism and the Canal as the fruit of gunboat diplomacy. We are deeply concerned that the imperatives of ratification will be obscured by a jingoistic campaign. While there obviously are those who oppose the treaties for sincere but, in our opinion, misguided reasons, we are distressed by those who shortsightedly seek political advantage in protesting what is speciously termed an American "giveaway." A reasoned public debate about the merits of the new treaties would, we feel, convince a majority of Americans that ratification would be in the public interest. The impending emotional campaign could preclude this kind of debate and, we fear, cause an uninformed American citizenry to resist ratification of the treaties. Republican Senators can take the lead in attempting to educate the public about the treaties and in advocating their ratification. This would surely enhance and broaden the appeal of the Republican Party as a whole. If instead Republican Senators become the critical and successful obstructionists to ratification, and if the Canal were sabotaged or some other crisis occurred as a result of American rejection of the treaties-a plausible turn of events-Republicans would doubtless_bear the public blame. By voting to ratify the Panama Canal treaties, Republican Senators can avail themselves of a special opportunity to act in a responsible and enlightened manner-an action, we believe, that is in their and the country's best interests. Respectfully, APPENDIX B GLENN S. GERSTELL, President. BIOGRAPHICAL INFORMATION ON PETER VINCENT BAUGHER Peter Vincent Baugher is an attorney at Schiff Hardin & Waite law firm in Chicago, Illinois. He was Law Clerk to Judge Philip W. Tone, United States Court of Appeals for the Seventh Circuit, in 1973-74. Born in Chicago in 1948, Baugher received his legal training at Yale Law School (J. D. 1973), and his undergraduate education at Princeton University (A.B. 1970), where he studied in the Woodrow Wilson School of Public and International Affairs. Baugher is Chairman of the National Governing Board of the Ripon Society and serves on the Republican National Committee's Advisory Council on National Security and International Affairs. He is a member of the Chicago Council on Foreign Relations, the American Council on Germany, the Economic Club of Chicago, and a variety of other professional, civic, and community associations. Baugher serves on several boards of directors, including those of the Chicago Educational Television Association (WTTW/Chicago Public Television), WFMT, Inc. (which owns and operates WFMT-FM radio and Chicago Magazine), and the Princeton Club of Chicago. JANUARY 1978. STATEMENT BY REV. JESSEE L. JACKSON To The Foreign Relations Committee, U.S. Senate, Wednesday-January 25, 1978 MR. CHAIRMAN: The conclusion of a treaty between Panama and the United States which redefines the colonial relationship between our two countries and affirms soveignty of the Panamanian government and people over the "Canal Zone" is an act that is long overdue. The old relationship, which has been in existence for three quarters of a century, is an anachronism left over from the era of "gun-boat diplomacy." Along with U.S. domination of the Panama Canal Zone, the racist practice of segregation was imposed upon the Panamanian people. "White-Only" restaurants, gasoline stations and other public accommodations, segregated public schools, discrimination in employment and pay scales became part of everyday practice in the Panama Canal Zone under the protective arm of the United States military. Beyond the insult to the Panamanian people of having a foreign colonial enclave of special privilege inside the Panamanian Republic was added the insult of a humiliating system of Apartheid patterned in every detail after the Southern states of our country. Here is a classic example of racism and colonialism wedded under American military occupation. The American flag flew over this zone inside the sovereign territory of the Panamanian Republic, and today a Panamanian living in this zone, when tried in a court of law, is tried in an American court. If found guilty, he has to appeal his case, not to the courts of the Republic of which he is a citizen, but to the Federal Court of the United States in Louisiana. Those who are insisting that the present Panamanian government "honor" the old treaty of 1903 are to be reminded that the United States has a poor record of honoring treaties, especially as it regards the native American Indian population. We might add to this the Social Contract which the government had with the Black population of the United States as represented by the 14th and 15th Amendments, which were brutally and consistently violated in every Southern state from the period of the overthrow of Reconstruction, beginning in 1876, until the passage of the Civil Rights Act of 1964. This is undoubtedly one of the worst records of treaty violations to be found anywhere in the modern world. It is a matter of historical fact that the Panama Canal Treaty of 1903 (The HayBuneau Varilla Treaty), authorizing the United States to construct an interoceanic canal through Panama, was a treaty signed by the Secretary of State and the representative of a French Canal Construction Company. The Panama Canal is a magnificent achievement of engineering technology; however, the diplomatic history and political maneuvers associated with the building of the canal, which resulted in establishing United States colonialism in the Republic of Panama, are as sordid and disgraceful as the canal is magnificent. Mr. Chairman, I firmly believe that we as a nation should never become so sinful as to commit the ultimate sin-the desire to own another nation. Even President Woodrow Wilson in 1915 called the nation's attention to the fact that the United States "had engineered a fake revolution in Panama as the pretense for securing the right to build the canal ** and has alienated all of Latin America in the process." A responsible Congress, carrying out its oath of office of responsibilities to the people of the United States, should have responded to President Wilson's comments at that time by restoring the Canal Zone to the sovereign Republic to which it belongs. But nearly 50 years later, in 1964, United States troops, stationed in Panama as part of the Southern Command, were shooting down Panamanian high school students in the riots that resulted from their trying to raise the Panamanian flag on a flag pole in front of Balboa High School. When we visited and spoke to the student body at Balboa High School last November, we saw a vivid example of the chauvinist attitudes that have poisoned the minds of our American students in the Canal Zone. Before the student assembly program began, the school band played the "Star Spangled Banner" but did not play the Panamanian national anthem. In this school English is the only language of instruction and there are only a token number of Panamanian students. A couple of miles away, but still in the Zone, is Paraiso High School for Panamanian students. All of them are bilingual, speaking Spanish and English. This year Paraiso High School is being closed. Its students will be transfered to Balboa High School, where instruction will continue to be only in English. The tragedy is that our American students are being taught attitudes of superiority that blind them to the great opportunity they have to learn another culture and grow in the process. In an age of growing internationalism, these students are being encouraged to be closed-minded and provincial. They undoubtedly get these attitudes from parents, and the public school officials have been impotent to correct them. The demands coming from the Panamanian people and the government of Panama for a new treaty covering the Panama Canal Zone and the Canal itself leave the United States three options: (1) The United States can militarily occupy the Panama Canal Zone as a way of asserting its determination to reject the demands of the Panamanian people, or (2) The United States can follow, as it has followed, a "hard line" that is short of military confrontation but frustrates and alienates the people of Panama in their effort to reclaim sovereignty over an important part of their country, or (3) The United States can participate with representatives of the Panamanian Government in working out a new and just arrangement respecting the mutual selfinterest of our two countries. The first two options will not work toward any good end. A small nation determined to exercise its sovereign independent rights as a nation will eventually win in a military confrontation with an oppressor because world public opinion is on its side. It would be a wasteful misadventure to try the military option. Nor is anything to be gained by following the policy designed to frustrate and alienate the people of Panama. This would eventually alienate the whole of Latin America. So many countries-Costa Rica, Venezuela, Colombia, to name but a few-have their foreign trade tied into the operation of the Panama Canal that they regard the canal as a "natural resource" of the Latin American Continent and fully support their sister Republic. The third option, a new treaty of mutual respect and justice, is the United States' only viable course. Mr. Chairman, in our visit to Panama we saw evidence of a developing nation of just 12 million people supporting the effort of the Government to improve the general economic well-being. Reforms in health care over the past several years have expanded facilities into the rural areas for the first time; and the beginning of the development of the Cerro Colorado Copper Works will improve Panama's balance of payments condition and reduce unemployment. We were told about the considerable increase of students in higher education during this decade, especially in engineering, whose enrollment went from 300 students in 1970 to 5,000 today. New housing is being constructed for low-income families as this developing society comes to grips with acute housing shortages in the urban centers, a general characteristic of countries emerging from colonialism. The new governmental structure eliminates the old unicameral legislative body of 43 representatives, most of whom lived in Panama City. This has been replaced by redistricting the whole country into 502 districts; each legislator must live in the district from which he or she is elected. This certainly broadens the base of what we would call "representative government" and is an important reform. There are also problems associated with the transfer of the Canal Zone to Panamanian sovereignty. There is reason to be concerned about the several thousand people who, it is estimated, will lose their jobs as the work force currently employed in the operation of this Zone is reduced in size. Many of these are black Panamanians, whose families first came to Panama from the English-speaking West Indies at the turn of the century, when the Canal was being built. They have historically formed a kind of middle stratum among the work force, in that they did not enjoy equal pay with white Americans working in the Zone but generally had a higher income than the average Panamanian family in this semi-colonial country. These Black Panamanians are also apprehensive about the possibility that racist attitudes will be revived in this situation. General Torrijos discussed very frankly with our delegation certain judicial procedures that are viewed as repressive by some, in that certain capital crimes are handled in military courts rather than in the civilian judicial system. He was proposing to the executive council changes in the procedure that would remove such cases from the military to the civilian courts. So there are problems, but they are problems that only a sovereign government, fully in charge of its national territory, can fully address. They are not problems that need to preoccupy the U.S. Senate as it deliberates ratification of the treaty. After all, we have 10 million unemployed in the United States, and the estimated |