|TRANSFER OF POWER|
December 13, 1999
TOM BEARDEN: American troops getting some exercise in Panama, something they've been doing since shortly after the turn of the last century. But when the next century turns, they'll all be gone. At noon, on December 31st, the U.S.-built Panama Canal -- for decades considered a strategic cornerstone of U.S. military and foreign policy -- will become Panama's canal. Roberto Eisenmann is a prominent businessman and former newspaper publisher.
TOM BEARDEN: Did you ever think this day would come, and come in this form, a peaceful transfer?
ROBERTO EISENMANN: No. No. I we were all here in this country born with a desire, with a hope that it would happen. But I have to accept I never thought I would see it my lifetime. And as I'm seeing it, such a peaceful transfer with the majority of this country pro-Yankee, pro-American, it's just too good to be true.
|The Carter-Torrijos Treaties|
BEARDEN: A peaceful transfer seemed very far away back in the 1960s
and '70s, when Panamanians rioted in the streets protesting American
sovereignty over the canal and the zone that surrounds it. Panamanian
Dictator Omar Torrijos threatened to blow up the canal if the U.S. didn't
get out. After protracted negotiations, President Jimmy Carter signed
a treaty with Torrijos in 1977, setting up a process whereby Panama
gradually assumed operational control of the canal, eventually leading
to a complete U.S. pullout.
treaty was highly controversial. The senate ratified it by only a single
vote. But the agreement didn't end the long history of U.S. intervention
in Panamanian affairs. In 1989, the U.S. sent 27,000 troops to arrest
strongman General Manuel Noriega after two U.S. grand juries indicted
him for racketeering, drug trafficking, and money-laundering.
was tried and convicted in a U.S. court, and is serving a prison sentence
in the United States. Ten years and three civilian presidents later,
Panama is counting down
REP. BOB BARR: This is a momentous foreign policy and international security issue. And it's happening without any input from the American people, any education of the American people, any understanding on the part of a large segment of the U.S. population. And yet we are giving away one of the most important national security and international commerce institutions in the world.
TOM BEARDEN: Barr doesn't doubt that the Panamanians can operate the canal from a technical standpoint; Panamanians have dominated its workforce for more than a decade. He's worried about who will actually control it. Barr and others point to a contract that Panama signed with the Panama Ports Company to operate two ports, one on either end of the canal. Panama Ports is a subsidiary of Hutchinson-Whampoa, a Hong Kong company which Barr says has close ties with the communist Chinese People's Liberation Army.
REP. BOB BARR: It's a classic example of how they operate. They move in fairly slowly, pass a lot of money around, bring their people in and get them into positions of influence. They're not afraid to pass money under the table to secure contracts such as we believe Hutchinson -Whampoa did in this particular case.
TOM BEARDEN: Barr believes the Chinese will have a lot to say about
the sequencing of ships through the canal, including U.S. warships,
which have always had
REP. BOB BARR: I think we've made a tremendous blunder here. And that
will come back to haunt us in years ahead as we see diminished U.S.
influence in that part of the world and increased communist Chinese
TOM BEARDEN: Alberto Aleman heads the Panama Canal Commission, a joint U.S.-Panamanian agency that has been running the canal since 1979. He rejects Barr's assertion that the Chinese could control canal traffic.
ALBERTO ALEMAN: That is completely and absolutely false. The only institution that will have and has today and will have in the future, full and complete control of all of the movements in canal waters, even more about the canal because it includes all the ports, it includes our anchorage facilities and anything that moves in canal waters, we are the only ones who has complete and total control.
|Chinese influence on the canal|
TOM BEARDEN: Mark Falcoff is a resident scholar at the American Enterprise Institute and has written a book about the Panama Canal transition.
MARK FALCOFF: The fuss that's been raised about this has to do with the fact that since Hutchinson-Wampoa is a Hong Kong-based corporation, its relationship with the People's Republic of China must be something more than platonic. And I'm sure it is. But that's a very long jump to go from there as to say the canal's going to be in the hands of the People's Liberation Army. The way I always feel about it is that Fort Benning, Georgia, is a lot closer to Panama than is the People's Republic of China. And I haven't any doubt that if either the People's Republic of China, Hutchinson-Whampoa or the government of Panama try anything imprudent, they would wake up breakfasting with the 82nd Airborne.
TOM BEARDEN: Some observers believe the larger threat to the canal's future lies in whether Panama can insulate its operation from the vagaries of domestic politics. Panama is both a first- and third-world country, with a vast disparity in income between rich and poor. Panama City has a downtown full of skyscrapers -- and dreadfully poor barrios in their shadow. Some Panamanians have long believed that if they controlled the canal, its revenue could lift the country out of poverty overnight --that in fact one of the reasons the United States became a superpower is because it controlled the canal. The reality is somewhat different. The locks and dams are 85 years old, and require constant maintenance. The channels must be dredged to prevent their filling up with silt. The U.S. operated the canal on a break-even basis ... but expenses often exceeded revenue. The difference was made up by direct congressional appropriations. Falcoff is worried that future Panamanian administrations will be tempted to tap canal revenue for non-canal purposes.
MARK FALCOFF: I think we all agree that they're perfectly capable of running it as well or better than the existing arrangements. The concern has more to do with insulating the canal from politics. And although there are now some elaborate laws on the books in Panama which apparently assure this, nobody's going to believe it until they see it because of the way public facilities elsewhere in Panama have been run in the past as basically employment agencies for the ruling party.
ROBERTO EISENMANN: I think we've covered the Panama Canal with enough legal framework to avoid that. The Panama Canal laws have been included in our Constitution. It has constitutional hierarchy. And the canal has total independence financially from the main government.
TOM BEARDEN: Poverty poses a physical as well as a political threat to the future of the canal. When the land around the canal reverted several years ago, squatters who practice slash and burn agriculture moved in -- so did extractive industries. When vegetation that anchors the soil is destroyed, silt flowing into the canal increases dramatically. Aleman says the government is working on the problem.
ALBERTO ALEMAN: Making the people who live out of the watersheds to understand their responsibilities, getting new programs to change some of the things on the way they are living -- so that they instead of doing cattle farming, they should go into a type of crops -- those are part of the programs we have put into place.
MARK FALCOFF: I have to be honest. I'm pessimistic. Most of the environmental
reports that I've read and most of the people I've talked to on Inter
|Increasing the canal's size|
TOM BEARDEN: The Panama Canal Commission is exploring the idea of increasing the canal's water supply by building new dams and reservoirs. The longer-term challenge is to keep the canal economically viable. A billion-dollar modernization program is now underway. The Gaillard Cut, the deepest excavation on the route, is being widened to allow ships to pass through simultaneously instead of single-file. But shippers want to build larger ships to reduce costs. Many modern container ships only clear the sides of the canal's locks by two feet on either side, and supertankers are already too large to use the canal. Building new locks would be enormously expensive, perhaps prohibitively so, because higher tolls to pay for them might drive shippers to use alternative routes. The large container ships already pay over $100,000 in tolls per trip.
Taking control of the canal also raises another concern for Panama. It will have to find some way to compensate for the loss of some $350 million a year from the U.S. military. There are fewer than two dozen American military personnel in Panama today, down from a high of 10,000. With them went thousands of jobs -- from boot polishing to secretarial work -- and they're jobs that pay far more than the Panamanian civilian economy. Carlos Worrel is a cook supervisor at the Corazol Base near Panama City. He and the other kitchen workers make $5.85 an hour now, but they know they won't be able to find work at anywhere near that outside. The average wage in Panama is about a dollar an hour. Worrel hopes to open his own restaurant.
CARLOS WORREL: We'll try to get a group of friends that are willing to put together so we can open up our business ourself.
TOM BEARDEN: What do you think about the U.S. military leaving?
CARLOS WORREL: Very sad about it. Real sad about it. I wish they could stay and help the Panamanians people that was working for them all these years. A lot of people still without a job right now.
JUAN CARLOS NAVARRO, Mayor of Panama City: I think our biggest problem as a nation is to create jobs and to create economic opportunity.
TOM BEARDEN: Juan Carlos Navarro is the major of Panama City.
JUAN CARLOS NAVARRO: Yes, it has been very difficult to provide jobs for the workers who are leaving the US military installations, but let me tell you --we'll finally be free and sovereign over our entire territory -- it's an exquisite moment for Panamanian history and I think that this gives us the willpower to charge ahead and to create economical opportunity and employment that can compensate for this momentary loss.
TOM BEARDEN: In fact, Navarro and others see the handover as the seed
of an economic renaissance, for Panama is not just gaining the canal,
but also 365,000 acres land that surrounds it, and about 7,000 buildings
on former U.S. military bases.
A former Air Force base has already been converted into a domestic airport for Panama City -- and its housing has been sold to private citizens who are gentrifying the area. Developing tourism is a high priority. The former U.S. School of the Americas -- a controversial training center for Latin American military -- is being rebuilt as a luxury hotel.
Construction is underway on the causeway the U.S. soldiers were using as a track. Plans are to build several hotels and a shopping mall to cater to tourists whose cruise ships Panama hopes to lure to a new port facility. In the rainforest near the canal, a former U.S. radar tower has been converted into an ecotourism resort. The "Canopy Tower" sits on the top of a hill, and gives visitors the chance to view wildlife from a vantage point above the rainforest. But Falcoff says not all of the former U.S. properties have fared so well. He says the Trans-Panama Railroad is a case in point. The U.S. turned over the railroad in 1979, only to see the Panamanians drain it of resources.
FALCOFF: The Panamanian army took over that agency. And they took all
the money that was to be used to run the railroad and put their relatives
on the agency's payroll. They spent enormous amounts of money on consulting
firms. The actual rolling stock was neglected. In fact, the railroad virtually
ceased to exist as a railroad.
TOM BEARDEN: That is about to change. Panama sold the railroad to a private U.S. company which is preparing to restore rail service. There are several thousand acres that the Panamanians don't want to accept from the U.S -- old firing ranges which contain unexploded ordnance.
JUAN CARLOS NAVARRO: I think it is unconscionable for the U.S. to come to Panama, use the military bases for a century and then walk away from them leaving behind a problem that you know we cannot solve and pay for on our own. Therefore I think it is the U.S.'s moral obligation to clean up those military areas which you dirtied and you polluted while you were here.
TOM BEARDEN: Col. David Hunt is in charge of the U.S. handover.
COL. DAVID HUNT: The U.S. Government has done everything that the treaty required in cleaning up the ranges. There are 7,600 acres that we have been unable to clean up. And they're in three discrete areas. They're very well defined. Panama knows where they are. We know where they are. They need to be preserved until the day that the technology is sufficient to clean them up completely without doing irreparable damage to the environment.
TOM BEARDEN: While the firing range issue is likely to be a bone of contention for years to come, most Panamanians look on the departure of the U.S. with mixed emotions.
ROBERTO EISENMANN: I sometimes compare this to a 20-year old boy who has lived all his life with an overpowering father, and suddenly decides it's time to leave home and go independent. And he sits with his father and makes the deal and says next week I'm leaving the house, and so forth. At the end of the conversation he goes back to his room and he worries sick, 'Will I make it? I wonder if I'll make it. What happens if I don't make it? How do I come back home?' And the father in the other room is thinking, 'I wonder if he'll make it? How can I help him without helping him?' etc. That's the point we are in right now in the U.S. and in Panama.
TOM BEARDEN: But Juan Carlos Navarro isn't worried; he's brimming with hope. On this day the mayor was participating in a birthday celebration for the Curundo Barrio. He says that even in this poor neighborhood, people are looking forward to independence.
JUAN CARLOS NAVARRO: I think that we're full of optimism. I feel very,
very happy that my country's finally becoming whole again, that we're
going to be a sovereign, a free nation, that we're not going to have
any more foreign troops in Panama, and I think that the future is a
challenge, but the Panamanian people are undoubtedly up to it. The
TOM BEARDEN: That future officially begins on December 31st.