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estimate how much of the Taxpayers money has been spent by the U. S. State Department to consummate an idea which was created by a few bureaucrats, and once created, had to be supported to the bitter end, however wrong the original idea might have been.

The Communist Connection:

Time was when many U. S. Congressmen thought the Soviet Union might be the prime mover behind the Panama Canal give away. Soviet strategists have made no secret of their ambition to control the four narrow sea passages which interconnect the worlds oceans. These are the Straits of Malacca and Bering, the Suez Canal and the Panama Canal.

Torrijos has visited Castro. These two have offered each other cooperation and support. Exactly what Castro has sent to Panama is anyone's guess. Our intelligence agencies don't tell us and neither does Panama G-2 Chief Colonel Manuel Noriega.

The Economic Pact signed on July 19, 1977 between the Soviet Union and the Republic of Panama is prima facie evidence of the Soviet Union's and Torrijos' common, long-range objectives. Thus far, there has been no U.S. publicity on the Soviet Panama treaty whose provisions include establishing a Soviet bank in Panama, the building of a hydro-electric plant and comparable economic ties.

The American people do not know if there is a communist connection. They do know
there are grounds for suspicion. The most recent polls indicate that 86% of our
U. S. citizens oppose a give away of the Canal, the prime objective of the new treaty.
Surely 86% of the American people can't be wrong and, in the final analysis, the
American people will be heard.

SOVIET UNION AND PANAMA SIGN HISTORICAL PACT:

For years, conservative organizations and prudent leaders have said, "The Russians are coming to Panama sooner or later." These prophecies have now been fulfilled. On July 19, 1977, according to a press story appearing July 20 in a Panamanian newspaper, the CRITICA, the Soviet Union and Panama signed an Economic Pact involving millions of rubles. This is significant since the Soviet Union and Panama do not have "official" diplomatic relations. According to the Soviet Panama Treaty, some of the agree conditions include the following items:

1. The Soviet Union will construct in Panama a hydro-electric plant to provide a base for improving the Panamanian economy;

2. The Soviet Union is permitted to build, open and operate a bank on Panamanian territory;

3. The Soviet Union may utilize Panama's "Colon Free Zone" as an outlet for Soviet merchandise; which includes Old France Field in the Canal Zone;

4. The Soviet Union has agreed to purchase 50, 000 tons of sugar from Panama under conditions described in the Pact beginning in 1978.

Torrijos' brother-in-law signed this pact for Panama and stated, "the signing of this document has great historical significance; not only for our country but for the American continent, who are always facing strong forces that represent a philosophy that is contrary to the destiny of Latin America." Thus, as if fore ordained, in some medieval drama, the communist villain has arrived, as many American leaders had forecast. The play has begun, Soviet trade, power and influence are expanding in the Western Hemisphere. Cuba was phase one. Panama is phase two.

Former Commander-in-Chief, Pacific, Admiral John S. McCain, USN Ret., in his statement for the U.S. Senate Subcommittee on the Sepa ration of Powers, candidly stated on July 29 that a Soviet naval task force will be ope rating in the Gulf/Caribbean area in the not too distant future. The floating guests will be most unwelcome visitors we have had in our nation's history. McCain went on to say that the United States should reclaim "Old France Field" in the U. S. Canal Zone, and develop it along with the U. S. Naval Air Station located nearby to establish an air capability to deal with this type of Soviet naval power in lieu of the U.S. Navy's steadily diminishing aircraft carrier capabilities.

Senate Hearings on Panama Stir Emotions: During the hearings before the Senate Subcommittee on the Separation of Powers Committee on Judiciary on July 22, 1977, hearings which Senator Helms accurately forecast would most likely remain secret because the news media would not see fit to report it, the four Senators: Allen, Hatch, Helms and Scott, pressed each witness for the logic behind the "give-away" of the Panama Canal.

During the testimony of former Chairman of the Joint Chiefs of Staff, Admiral Thomas H. Moorer, USN Ret., one Senator blurted in a not so senatorial manner and more out of frustration than in anger, "What the Hell is wrong with the State Department?" Admiral Moorer replied matter-of-factly that this was not his jurisdiction.

Moorer was called the best qualified man in the United States to speak on the Panama Canal, and he was an impressive witness. Senator Allen called Moorer's testimony "unanswerable and unassailable." Moorer stated simply that any Chairman of the Joint Chiefs of Staff "will immediately perceive that it is vital to the United States' interest to retain ownership and control of the Panama Canal."

Moorer recalled how he, as Commander-in-Chief, Pacific had relied on the Panama Canal for support of his forces in Vietnam. Without use of the Canal, "The war in Vietnam would have been much more difficult and costly to conduct, " he said. Then as Commander-in-Chief, Atlantic, he said the Panama Canal was especially needed for rapid transfer of troops and amphibious lift during one of the Caribbean crises and also during the Middle East war of that period. As Chief of Naval Operations, Moorer said, he looked to the Panama Canal as a means of equalizing the strength and providing the balance between the Atlantic and Pacific Fleets. Without the Canal, the United States would have to build a two-ocean Navy costing billions of dollars.

Speaking of the danger of Soviet sovereignty by proxy through Cuba, Moorer said, "I was convinced as Chairman of the Joint Chiefs of Staff--and I remain convinced today-that if the Soviet Union ever gained even proxy sovereignty through Cuba, the U.S.

security as well as U.S. prosperity would be placed in serious jeopardy." Moorer's testimony followed by three days the Soviet-Panama Pact which would indicated Soviet involvement may come in a more direct manner than by proxy.

After listening to Moorer, one Senator recalled that General George Brown had told him the Panama Canal was "important" but not "vital" to U. S. security. Moorer replied that, in his judgment, "it was vital," and the point is, said Moorer, "there is no point in surrendering this vital interest."

The constitutional issue on the separation of powers should be ignored according to one witness, Senator Gravel, and the United States ought to give the "old and obsolete" Canal to Panama and dig a new one at sea-level in Panamanian territory, so that Alaskan oil would have a better flow rate to the U.S. East Coast. "The new canal would also be built for about $5.9 billion. This would be done at U.S. taxpayers expense and then given to Panama to insure Panama's friendship and gratitude," said Gravel. He said Secretary of State Vance was enthusiastic about building a new canal at sea-level.

Senator ALLEN. Your statement previously given to the committee appears on page 53 of part 2 of these hearings. They have just been printed.

Would you prefer that we come back immediately after the vote or break for lunch?

Mr. CRANE. I think, Mr. Chairman, since I have a conflict with a lunch, too, that if it suits the Chair I would prefer to continue after you have voted.

Senator ALLEN. We will continue your testimony then. Mr. Flood, if you can come back, we would like to address a few questions to you; but we will leave that up to you.

Mr. FLOOD. I believe the B-1 voting will keep me busy.

Senator ALLEN. We appreciate your appearance here, Mr. Flood. We appreciate your leadership on this issue. Your leadership has been exceptionally fine. We hope that you will be able to exert your leadership in the House when this issue is brought before the House. Mr. FLOOD. I am just a pale shadow of you, Mr. Chairman. Senator ALLEN. Well, you have done a great job.

We are coming back immediately after the vote.

[Recess taken.]

Senator ALLEN. The committee will be in order.

Mr. Crane, we are delighted to have you come before the committee to give us the benefit of your views. Please proceed.

TESTIMONY OF HON. PHILIP M. CRANE, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF ILLINOIS

Mr. CRANE. Thank you very much, Mr. Chairman.

I am indeed grateful to you and to the subcommittee for permitting me to appear and testify today.

I would like to make a reference to my distinguished colleague who left the room earlier, who was appearing today jointly with me. I am referring to Congressman Dan Flood, who, as you know, has had a long-time active interest in this issue, undoubtedly more so than any other Member of the House. His counsel on this question carries greater weight certainly than my own, and probably more than any of my colleagues in the House.

I might relate a quick anecdote, if I may. Before doing so, I would make a unanimous consent request that my prepared statement might be a part of the record.

Senator ALLEN. Without objection, so ordered. [Material follows:]

CONGRESSMAN CRANE'S PREPARED STATEMENT

"THE PANAMA CANAL TREATY: A QUESTION OF JURISDICTION"
SENATE SUBCOMMITTEE ON SEPARATION OF POWERS
SEPTEMBER 8, 1977

Mr. Chairman:

I am indeed grateful to you and the other members of this subcommittee for having me here this morning. To my way of thinking, the proposed Panama Canal treaty is one of the, if not the, most important issues to come before Congress in recent years and not the least of the problems with it is this question of jurisdiction. Unquestionably, the President had the right to negotiate the treaty and without doubt the Senate has an obligation to either ratify or reject it; the question is, will the House of Representatives have the opportunity to pass on it also.

As a sponsor of a resolution calling for authorization by both the House and Senate before any giveaway of U.S. territory or property in the Canal Zone is implemented, I am not exactly an objective, disinterested party to the debate over this question. Morcover, as one who feels that there are enough things wrong with this treaty to warrant its rejection regardless of the jurisdiction question, I have a vested interest in seeing this treaty brought to a vote as many times as possible thereby increasing the chances of its defeat. But, having thus identified my biases, let me stress my real belief, based on the language of Article IV, Section 3, Clause 2 of the Constitution, subsequent Supreme Court decisions and past precedent, that a powerful argument can be made for House participation in the great canal debate.

Just for the record, Article IV, Section 3, Clause 2 states that: "Congress shall have power to dispose of, and make all Rules and Regulations

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