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impartially, but with an effort to get everything we can on both sides of the issue.

Senator DOLE. I think that is certainly the very best attitude. I know a number of Senators who have not made a judgment who are looking toward the leadership of the chairman as they have in the past to determine and address the facts.

I hope I have not upset the Senator from Ohio. But it seems to me that when we have information that should be available to the public that, yes, members of this committee should make it available.

Thank you.

The CHAIRMAN. Thank you very much, Senator Dole.


We expect to have Senator Scott here in just a couple of minutes. The committee will stand in recess for a very few minutes to await the arrival of Senator Scott.

[A recess was taken.]

The CHAIRMAN. Senator Scott, we welcome you here today.

I believe that every Senator has a copy of your statement.

Would you care to go ahead with your presentation now, or wait until a few more Senators arrive?

Senator SCOTT. I would be happy to do whatever the Chairman prefers. I would be glad to defer for 10 minutes or so. But if the Chair would want me to, I will go ahead right now.

The CHAIRMAN. Since we still have quite a few witnesses yet to be heard today, why don't you proceed? I feel quite certain that our members will be returning shortly.


Senator SCOTT. Thank you, Mr. Chairman.

I am aware of the time delays and the intervention in the committee's work today by the recess that was necessary.

I appreciate very much the opportunity of appearing before the Foreign Relations Committee and to express my personal views on this important matter of the Panama Canal that is under consideration. I am aware that the administration in urging ratification has stressed the long period of negotiations under four Presidents, emphasized the support of Latin American countries, and the need to yield to world opinion to relinquish the Canal Zone to Panama.

However, in this country sovereignty resides in the people and not in the President or in the officials who negotiated the proposed treaties. Therefore, it would seem that the will of the people should be reflected in our decision.


There is little doubt that the American people are opposed to the ratification of these treaties, and I have great faith in the collective wisdom of a majority of the people.


My own mail is roughly 5 percent in favor of the treaties and 95 percent in opposition. I expect that each Senator's mail is quite heavy. So, perhaps in the final analysis, rather than the White House educating the American people, the President and the Department of State may receive an education in American government. I would certainly hope that this would be the case.

My views are based not only on mail from constituents, but upon two recent trips to Panama and South American countries; a thorough reading and rereading of the treaties and background information, although not to the extent that I would like; upon independent investigations; listening to the testimony before the Subcommittee on Separation of Powers of our Senate Judiciary Committee; and finally studies made by the Library of Congress.

There appear to be many objectionable provisions in the canal treaty which, in my judgment, should either be eliminated or clarified, such as the prohibition against the United States constructing a new canal anywhere within the isthmus, either inside or outside of the territorial limits of Panama, without the consent of Panama, and the doubtful interpretation of "expeditious passage."


However, the beginning of article I of the Panama Canal treaty, to my mind, is by far the most objectionable feature because it provides for the abrogation of all prior treaties with the phrase, "This treaty terminates and supersedes" the treaties of 1903, and then it lists other dates and says, "all other treaties, conventions, agreements and exchanges of notes between the United States of America and the Republic of Panama concerning the Panama Canal.”

Under the 1903 treaty we guaranteed the independence of the new country of Panama, and I believe that was something of great value to the new country in 1903. We paid $10 million and agreed to an annual payment of $250,000 to obtain both title to the Canal Zone and sovereignty over it. Other actions taken by our Government to perfect our title included the purchase of the French canal properties for $40 million; what was tantamount to a quitclaim and recognition of our title from Colombia a few years later for the sum of $25 million; and the purchase of private rights from owners and squatters that were expressly excluded from the 1903 treaty. All this, however, would be vitiated by the first sentence of article I of the present canal treaties.

It is true that under numbered paragraph 2 of article I, Panama grants to the United States for the remainder of this century "The rights necessary to regulate the transit of ships through the Panama Canal and to manage, operate, maintain, improve, protect and defend the canal." But we would be doing these things for property belonging to Panama, rather than for American property, as the situation is today.


Mr. Chairman, we all know that a valid contract must contain consideration. We speak of something of value flowing from one party to the other, of mutuality. But in my judgment, these treaties are for the

benefit of Panama alone. I find no new benefit that accrues to the United States.

It does not appear, Mr. Chairman, that there is any serious concern within the executive branch of Government as to the role of the Congress under article IV of the Constitution. As the chairman well knows, the second paragraph of section 3 of the article provides: "The Congress shall have power to dispose of and make all needful rules and regulations respecting the territory or other property belonging to the United States."


To determine the proper role of the House under article IV, I requested a study be made by the Congressional Research Service which responded with what I believe to be an excellent and objective legal memorandum dated August 4, 1977, concluding that precedent indicates that Congress has exclusive power to dispose of property within the Canal Zone. I ask, Mr. Chairman, to include a copy of this memorandum in the record.

The CHAIRMAN. Without objection, that will be done.

[See appendix.]


Senator SCOTT. Attorney General Bonaparte, in an opinion dated September 7, 1907, and I will omit the citation, stated that sovereignty over the Canal Zone was not an open or doubtful question and applied what he stated was the first rule of construction, "That plain and sensible words should be taken to mean what they say."

The Attorney General added:

The omission to use words expressly passing sovereignty was dictated by reasons of public policy, I assume; but whatever the reason the treaty gives the substance of sovereignty, and instead of containing a mere declaration transferring the sovereignty, descends to the particulars "all the rights, power, and authority" that belong to sovereignty, and negatives any such "sovereign rights, power, or authority" in the former sovereign.

Now, Mr. Chairman, I realize that some of our people in the executive branch are attempting to convey the impression that we do not possess either title or sovereignty, but this is contrary to the opinion of Secretary of State Hay in 1904 who stated:

That the grant accomplished by the treaty was a grant of land and sovereign rights thereover, and not a mere concession of privilege, is shown by the granting clauses and also by the references to the grant of subsequent clauses of the treaty.

Later he said in the same opinion, the same letter:

It cannot escape observation that the Legislative Branch of the government of the Republic of Panama by legislative enactment declared the Zone to be "ceded to the United States," and dealt with accordingly.

Still later he stated:

The United States at all times since the treaty was concluded has acted upon the theory that it had secured in and to the Canal Zone people the exclusive jurisdiction to exercise sovereign rights, power, and authority.

Mr. Chairman, I ask that this entire letter of Secretary Hay be inserted in the record.

The CHAIRMAN. Without objection, it is so ordered. [The information referred to follows:]


[Supplied by Senator Scott]


DEPARTMENT OF STATE, Washington, October 24, 1904.

MR. MINISTER: I have the honor to acknowledge the receipt of your communication dated August 11, 1904, advising this Department that you have received instructions from the Republic of Panama "to take steps looking toward the obtaining of a satisfactory settlement of the difficulties which have unexpectedly arisen between the authorities of the Republic and the governor of the Canal Zone, owing to the interpretation given by the latter to some of the clauses of the agreement concerning the isthmian canal concluded between the two countries on November 18 last."

The action of the Zone authorities, of which complaint is made, was taken pursuant to orders, copies of which are herewith transmitted, issued by direc tion of the President of the United States, and therefore it is inaccurate to attribute said orders to the governor of the Canal Zone.

I have read with the care and consideration its importance required the argument set forth in your communication in support of the contention that the United States is acting in excess of its authority (1) in opening the territory of the Canal Zone to the commerce of friendly nations; (2) in establishing rates of customs duties for importations of merchandise into the Zone; (3) in establishing post-offices and a postal service in said Zone for the handling of foreign and domestic mailable matter.

The right of the United States to adopt and enforce the provisions of said orders is dependent upon its rights to exercise the powers of sovereignty as to the territory and waters of the Canal Zone, and whether or not the United States is authorized to exercise sovereign powers in that territory is to be determined by the terms of the convention of November 18, 1903, between the Republic of Panama and the United States, referred to in your communication as the Hay-Varilla convention.

The United States cannot accede to the proposition advanced by you as follows: "As an indispensable antecedent of the Hay-Varilla convention must be regarded the Hay-Herran treaty, concluded January 22, 1903."

Whatever could or would have been the effect of the stipulations of the proposed treaty with Colombia, known as the "Hay-Herran treaty" is rendered unimportant by the fact that said treaty was not concluded, but was rejected by Colombia.

I note your reference to the provisions of said proposed treaty with Colombia (Art. IV):

"The Government of the United States * * disclaims any intention *** to increase its own territory at the expense of Colombia or of any of the sister republics of Central and South America; it desires, on the contrary, to strengthen the power of the republics on this continent, and to promote, develop, and preserve their prosperity and independence."

The policy thus announced did not originate with the proposed treaty with Colombia. It is the long-established policy of the United States, constantly adhered to; but said policy does not include the denial of the right of transfer of territory and sovereignty from one republic to another of the Western Hemisphere upon terms amicably arranged and mutually satisfactory, when such transfer promotes the peace of nations and the welfare of the world. That the United States may acquire territory and sovereignty in this way and for this purpose from its sister republics in this hemisphere is so manifest as to preclude discussion.

The Government of the Republic of Panama having seen fit to object to the exercise by the United States within and over the Canal Zone of the ordinary powers of sovereignty, this Government, while it cannot concede the question to

be open for discussion or the Republic of Panama to possess the right to challenge such exercise of authority, considers it fitting that the Republic of Panama should be advised as to the views on the subject entertained by the United States and the reasons therefor.

The United States acquired the right to exercise sovereign powers and jurisdiction over the Canal Zone by the convention of November 18, 1903, between the Republic of Panama and the United States.

The character and extent of the grant of governmental powers to the United States and the resulting right and authority in the territory of the Zone are set forth in a separate article, as follows:

"ARTICLE III. The Republic of Panama grants to the United States all the rights, powers, and authority within the Zone mentioned and described in Article II of this agreement and within the limits of all auxiliary lands and waters mentioned and described in said Article II, which the United States would possess and exercise if it were the sovereign of the territory within which said lands and waters are located to the entire exclusion of the exercise by the Republic of Panama of any such foreign rights, power, or authority."

Let us test the existing controversy by the provisions of this article. "If the United States *** were the sovereign of the territory," would it possess the right and authority to regulate commerce therewith, establish customs-houses therein, and provide postal facilities therefor? This question must be answered in the affirmative.

If it were conceded that the abstract, nominal "rights, power, and authority of sovereignty in and over the Zone" are vested in the Republic of Panama, there would still remain the fact that by said Article III the United States is authorized to exercise the rights, power, and authority of sovereignty "to the entire exclusion of the exercise by the Republic of Panama of any such sovereign rights, power, or authority."

If it could or should be admitted that the titular sovereign of the Canal Zone is the Republic of Panama, such sovereign is mediatized by its own act, solemnly declared and publicly proclaimed by treaty stipulations, induced by a desire to make possible the completion of a great work which will confer inestimable benefit upon the people of the Isthmus and the nations of the world. It is difficult to believe that a member of the family of nations seriously contemplates abandoning so high and honorable a position in order to engage in an endeavor to secure what at best is a "barren scepter."

Under the stipulations of Article III, if sovereign powers are to be exercised in and over the Canal Zone, they must be exercised by the United States. Such exercises of power must be, therefore, in accordance with the judgment and discretion of the constituted authorities of the United States, the governmental entity charged with responsibility for such exercise, and not in accordance with the judgment and discretion of a governmental entity that is not charged with such responsibility and by treaty stipulations acquiesces in "the entire exclusion of the exercise by it of any sovereign rights, power, or authority" in and over the territory involved.

Article II of the convention provides that "the Republic of Panama grants to the United States in perpetuity the use, occupation, and control of a zone of land and land under water for the construction, maintenance, operation, sanition, and protection of said canal."

The Panamanian authorities now contend that the words "for the construction, maintenance, operation, sanitation, and protection of said canal," constitute a limitation on the grant; that is to say, that the grant is confined to the purposes so stated. The position of the United States is that the words "for the construction, maintenance, operation, sanitation, and protection of the said canal" were not intended as a limitation on the grant, but are a declaration, and appropriate words of conveyance.

A document evidencing a grant or transfer usually sets forth a description of the property granted, the inducement leading up to the grant, the compensation, and appropriate words of conveyance. The compensation for the grant under consideration is set forth in Article XIV of the treaty, as follows:

"As the price or compensation for the rights, powers, and privileges granted in this convention by the Republic of Panama to the United States, the Government of the United States agrees to pay to the Republic of Panama the sum of ten million dollars ($10,000,000) in gold coin of the United States * *

Article I of the treaty provides that "the United States guarantees and will maintain the independence of the Republic of Panama."

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