Panama Canal

The Last Ditch
in American Giveaways

By G. Russell Evans

This practical monument to American know-how remains vital to our national interests.

IME, which once provided a cushion of decades, is no longer our ally in Panama. The planned give-away of one of America’s most strategic footholds in a dangerous world—the Panama Canal — stands to be completed Dec. 31, 1999, nearly 40 years past the moment when the United States started down the path of surrender. U.S. sovereignty there is nearing a conclusion in a disturbingly quiet manner.

The beginning of the end was subtle and quiet, also. President Dwight D. Eisenhower decided in 1960 to allow Panama’s flag to fly alongside Old Glory in part of the Canal Zone as evidence of the “titular sovereignty” of the Panamanians. That mistake began a course that would lead to illegal treaties, bad deals and unsavory politics.

There has been a general lack of interest by Americans and the mainstream media in the surrender of the Canal under terms of the 1977 treaties. Overseen by President Jimmy Carter and then Panamanian dictator Brig. Gen. Omar Torrijos, the treaties are especially worrisome, given factors now at work in the isthmus of Panama.

China, the planet’s remaining communist superpower, appears on the verge of becoming gatekeeper of the canal. Hutchison Whampoa Ltd., a huge conglomerate based in Hong Kong, now a part of China, won contracts to operate the vital ports of Balboa and Cristobal at each end of the man-made passageway. Hutchison’s head is Li Kashing, a man known to have close ties with the Chinese government. The company was also given long-term options for other facilities, including several military installations U.S. forces are scheduled to evacuate.

When American firms submitted better bids for the operations, Panamanian President Ernesto Perez Balladares changed the rules, allowing Hutchison to double its bid. This unorthodox process was evidently determined by “bucket loads of money from Asia,” reported El Siglio, a Panamanian newspaper. U.S. Ambassador William Hughes called the bidding unorthodox and unfair.

Without regard to the security of the canal, their own country or the United States, Panamanians have entered into what amounts to a 50-year contract with Hutchison. The Hong Kong company will be in a position to delay “expedited treatment” heretofore guaranteed U.S. warships.

The 84-year-old canal cannot long survive neglected maintenance.

Events could conceivably lead to Rodman Naval Station in the former Canal Zone coming under Chinese control, giving Beijing a base of operations for warships and submarines only 900 miles from the United States.

Regardless of Chinese intentions in our own hemisphere, reasons to reconsider these treaties are plentiful, including their questionable legality and the historic and current importance of U.S. interests in the canal.

The canal saves 8,000 miles and two weeks’ steaming around the Cape Horn route.

The canal saves 8,000 miles and two weeks over the Cape Horn route. It is “the most vital strategic waterway in the world” says retired Navy Adm. Thomas H. Moorer, former chairman of the Joint Chiefs of Staff. “I am astounded when I hear supposedly intelligent officials state that the canal no longer has any strategic value,” says Moorer.

On Nov. 18, 1903, the United States entered into an agreement to guard the independence of the new Republic of Panama. The Americans also provided $10 million in gold and an annual payment of $250,000. Thus the United States purchased the Canal Zone, a 10-mile-wide swath across the isthmus from Panama City to Colon. Eleven years later a self-propelled floating crane, Alex La Valley, passed between the Caribbean and the Pacific’s Gulf of Panama through the completed canal.

‘I am astounded when I hear intelligent officials state that the canal no longer has any strategic value.’

Adm. Thomas H. Moorer

Often called the “eighth wonder of the world,” the canal was an example of U.S. engineering genius. The French had failed, at outlandish costs in men and money, in two previous attempts.

Canal builders became heroes. But it seems Panamanians were never satisfied, despite the protection and economic bonanzas that ensued as hosts to much of the world’s shipping. Threats visited upon Americans and U.S. institutions in the Canal Zone were rewarded when Carter capitulated to Panamanian demands.

President Carter’s first order of business after his inauguration was to sign a memorandum to commence negotiating away the canal. Officials from both nations might pretend they ratified the same treaties, but Panama’s version contains a provision denying unilateral U.S. defense rights. Panama and the United States clearly hid the differences between the treaties in order to avoid a Senate vote on the matter and a plebiscite in Panama.

Meanwhile, and perhaps just as ominous for America’s future use of the canal, reports hold that the once glorious pathway faces eventual failure due to neglect. Two years ago an operations and maintenance study by the U.S. Army Corps of Engineers reported the canal “wearing out ... due to lack of maintenance.” The canal suffered from crumbling concrete and corroding infrastructure and a general “lack of commitment to proper maintenance.” The Corps study was classified “politically sensitive” and not made public.

Desire for profit by bringing in ships and more tolls has delayed maintenance. One critical defect was the inoperable SIP-7 system, designed to prevent draining the canal in case of ship accident or terrorist attack.

There are questions being asked, even in Panama, about the canal’s administration. La Prensa, Panama’s leading newspaper, condemned Balladares “for converting the Canal into a fount of juicy sinecures for the relatives and associates of the president.”

Efforts to negotiate with Panama a U.S. presence in the Canal Zone after 1999 have been halfhearted. Balladares agreed to talks in 1995 but then went looking for better deals with Asians and Europeans.

However, there is time to save the canal. The United States should notify Panama now that operation of the ports by Hutchison is not acceptable. Further, U.S. rights in Panama should be renegotiated, establishing our right to defend the canal and to interdict illegal drugs likely headed for our country. The U.S. Senate and Panama’s Legislature should vote on the same treaty.

Americans need to urge the White House and Congress to initiate corrective measures before the century passes, and one of our greatest accomplishments and advantages fades.

The Legion’s Position

Since the signing of the Panama Canal Treaties in 1977, The American Legion has been concerned about the implications of turning over canal operations to the Panamanian government.

“The Panama Canal is and will remain a vital seaway for United States commerce and naval operations,” notes John A. Brieden III, chairman of the Legion’s National Foreign Relations Commission. ‘The concession of the operation of the ports of Colón and Balboa by the Panamanian government to an entity of the People’s Republic of China would create a situation inconsistent with U.S. national interests.’

The Legion has several resolutions about the Panama Canal and treaties. The most recent is Resolution 178, adopted by delegates to the 1997 National Convention in Orlando, Fla. The resolution concludes:

  1. The United States should take any necessary actions to ensure Panama will be able to operate the Panama Canal efficiently after Panama assumes control.
  2. The United States should take any necessary actions to ensure the Panama Canal is operated efficiently and in a manner consistent with United States national security interests.
  3. Construction of a new canal or major improvements in the existing Panama Canal should be consistent with U.S. national security interests.
  4. The United States should seek an agreement with Panama to continue stationing U.S. armed forces in Panama after 2000 to protect the canal and evolving democratic nations in the region.
  5. The United States should encourage democratic evolution in Panama to help provide stability and a better, freer life for Panamanians.

    G. Russell Evans is a retired U.S. Coast Guard captain and aviator. He is a long-time student of Panama and the Carter-Torrijos Treaties. He has written two books about the canal. The most recent, Death Knell of the Panama Canal?, is now available with introductions by retired Navy Adm. Thomas H. Moorer, former chairman of the Joint Chiefs of Staff.

Reprinted by kind permission:
The American Legion Magazine

Ó October 1998.