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CONTENTS—Continued

MATERIAL SUBMITTED FOR THE RECORD

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World Maritime Choke Points and United States and Soviet Fleets..

Letter to President Carter from Senator Jesse Helms, dated August 12,

1977, concern with State Department proposals.

“Panama Canal Giveaway: A Latin American's View”, by Mario zo.

Bulletin: The American Legion, National Security-Foreign Relations

Division, July-August 1977--

Fact Sheet: Department of State. Basic elements of the agreement in

principle on the new Panama Canal Treaties.-

Proposed treaties: Treaty Concerning the Permanent Neutrality and

Operation of the Panama Canal.-

Memorandum from Senator Hatch to the U.S. Senate Steering Committee,

in response to White House memorandum.

Resolution drafted by the Virginia Port Authority. Concern over the need

to protect the continued use of the Panama Canal for free world shipping-

Senate Joint Resolution 51, Virginia General Assembly. Expressed concern

over encroachments upon the sovereignty of the Panama Canal---

Letters to the President of the United States, Members of Congress, and

the Secretary of Commerce, from Edward S. Reed, chairman, Mid-Gulf

Seaports Marine Terminal Conference, and Robert C. Engram, presi-

dent, Gulf Ports Association -

Chapter 5, Presidential Powers: Foreign Relations from Professor Berger's

book “Executive Privilege: A Constitutional Myth”.

Questions submitted by Chairman Allen to the State Department:

Herber J. Hansell, legal adviser to the Secretary of State.

Richard N. Cooper, Under Secretary of State for Economic Affairs.

Sworn statements of Leland L. Riggs, Jr., retired Special Agent in Charge

of the U.S. Drug Enforcement Administration, dated December 1, 1977-

PANAMA CANAL TREATY

(DISPOSITION OF UNITED STATES TERRITORY)

PART 3

THURSDAY, SEPTEMBER 8, 1977

U.S. SENATE,
SUBCOMMITTEE ON SEPARATION OF POWERS,
COMMITTEE ON THE JUDICIARY,

Washington, D.C. The subcommittee met, pursuant to recess, at 10 a.m., in room 1318, Dirksen Senate Office Building, Hon. James B. Allen of Alabama (chairman of the subcommittee) presiding.

Present: Senators Scott of Virginia and Hatch of Utah.
Also present: Senator Jesse Helms of North Carolina.

Staff present: Quentin Crommelin, chief counsel and staff director; Dr. James McClellan, professional staff (minority); Paul Guller, editorial director; and Melinda Campbell, chief clerk.

OPENING STATEMENT OF CHAIRMAN ALLEN

Senator ALLEN. The committee will please come to order.

The Subcommittee on Separation of Powers of the Judiciary Committee is convened this morning to continue the subcommittee's investigation of constitutional issues arising out of the new proposed Panama Canal Treaties. I am certain that most of those present this morning are aware of the central constitutional issue under investigation; however, perhaps I should again reiterate the proposition which is the focal point of this inquiry.

Article IV, section 3, of the Constitution of the United States provides that 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.” The power given to Congress in that clause appears to be exclusive and, if it is an exclusive power, then the Executive is prohibited from entering into a treaty disposing of U.S. territory except with express congressional authorization; that is, statutory authorization by both Houses of Congress in addition to separate Senate approval through the treaty ratification process.

Additionally, members of the subcommittee are also deeply concerned that the executive department has reached certain financial agreements with the Panamanians for substantial financial assistance outside of the context of the provisions of the treaty itself. These financial agreements, if not embodied in the treaty, will not be subjected to the normal treaty ratification process which would otherwise be the case.

The subcommittee has further learned that the congressional appropriations process itself may in large measure be circumvented in the implementation of proposed financial arrangements with Panama but that, nevertheless, substantial sums of money are proposed to be made available to Panama by unilateral executive branch action. The subcommittee will therefore diligently continue to seek testimony on the full intentions of the executive department with respect to separately negotiated financial and banking arrangements with the Republic of Panama.

EXECUTIVE AGREEMENTS Finally, in continuing its work, the subcommittee will seek to determine the extent to which the operative provisions of the executive department proposal are embodied in the executive agreements rather than in actual treaty language. There are, of course, in fact two treaties: the proposed Panama Canal Treaty itself and an additional treaty which purports to provide for the neutrality of the Panama Canal. Unfortunately, these treaties are in no way to be construed as the whole agreement.

Both treaties are accompanied by very lengthy executive agreements which actually contain the substance of the deal struck with Panama. These executive agreements, once implemented, would be subject to renegotiation and revision—and we find this astonishing-every 2 years.

This subcommittee, I am sure, shares a concern of many that Congress will relinquish forever any control over this country's relation with the Republic of Panama if the executive department is authorized to enter into a plenary relation with Panama based not, in reality, on treaty law but rather based on executive agreements authorized by treaty law but subject to change at the whim of the Executive. In short, the subcommittee wishes to establish by its inquiry the extent to which the Executive would be given a blank check by the new proposed treaties to amend, interpret, abrogate, or replace entirely the lengthy accompanying substantive executive agreements.

I have just returned from Alabama where in the course of the August recess I met with citizens in 37 counties. These meetings were held in most instances at the county courthouses; they were widely announced and well attended. One topic was invariably raised. Notwithstanding drought, unemployment, inflation, high energy prices, low farm prices, and a host of other subjects which could easily have been foremost in mind, virtually every group I encountered wished to know the answer to one question: Would the United States, in fact, give away the Panama Canal Zone? Of the thousands I spoke with, almost no one favored a policy of surrender in Panama.

Many are saying that the people need education and that with education they will come to support the giveaway of the American canal in Panama. In my judgment, the true state of affairs is the exact opposite. Further knowledge will only strengthen the resolve of the people; and, in my judgment, our all-wise Federal Establishment could itself well stand some education from the American citizen who has the wisdom to see the obvious fact that the Panama Canal is vital to the economic stability and military security of the United States, from the American citizen who has the commonsense to recognize the lunacy of paying billions to an unstable pro-Marxist dictatorship for taking over billions in property belonging to the United States, from the American citizen who has the clarity of thought to see the reality behind the sham and the traveling medicine show that has passed for an open discussion of the actual provisions of this proposed new arrangement with Panama.

Perhaps, however, Americans do need education in the fine points of the Panama Canal treaties. That education has been hard to come by of late because throughout the treaty negotiations a veil of secrecy prevented any useful information being made available either to the public or, in large measure, to the Congress. Perfunctory briefings containing no real substance and seeking no advice, to be sure, were conducted. However, until yesterday most of the information this subcommittee has been able to obtain on the new treaty has come from translations of speeches made by the Panamanian negotiators in Panama.

$ 2.262 BILLION IN CASH PAYMENTS By that method we have learned that the Panamanians expect to receive during the next 22 years at least $2.262 billion in cash payments from the United States. The Department of the Treasury, when its representative testified before this subcommittee was apparently unable to advise the committee of any negotiations whatsoever with Panama, yet we could read from translated Panamanian documents that the Export-Import Bank plans to lend Panama $200 million, that the Agency for International Development is to guarantee—and no doubt pay off-housing loans in the amount of $75 million, and that the U.S. Overseas Private Investment Corporation is to guarantee $20 million in loans for a new Panamanian development bank—everyone else has a bank in Panama, why should not the Panamanians?

Finally, the committee has learned—not from the Department of Defense, but from the Panamanians—that $50 million in military aid would be provided to prop up and guarantee the continuance of the military dictatorship now oppressing the people of the Republic of Panama.

But now that the proposed Panama Canal Treaty and Neutrality Treaty have finally been made public—and it has been signed by the President and the Panamanian dictator—there are disclosed even more items about which the American citizen should be educated. The American citizen should learn that in addition to all the other massive payments to be made to the Republic of Panama, as the ultimate insult, it is proposed that we pay to the Republic of Panama $10 million a year for providing police services within the territory which would be ceded to Panama. We trust that during his education the American citizen will share our own disbelief and outrage that our great country proposes to cede United States territory to Panama and then to pay Panama for performing the normal functions of government within that same land.

FOUR U.S. MILITARY BASES TO REMAIN IN CANAL ZONE

We hope, too, that the American citizen will soon learn that out of 14 military bases now in the Canal Zone, only 4 would remain after

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implementation of this treaty and that the 4 retained bases would be under direct Panamanian civil and political jurisdiction, subjecting thereby our Armed Forces to the dictatorial rule of the present Panamanian Government. And although it is true that a status of forces agreement will provide some marginal protection to U.S. soldiers in the Canal Zone, the American citizen should learn that in essence our forces will be made subject to a code of laws based on the autocratic rule of one man and devoid of any constitutional safeguards even remotely resembling those previous American rights now enjoyed within the Canal Zone.

Yes, there is much to learn about this proposal. Does the average citizen now know that the American flag will not be permitted to be flown in a place of honor, even at our military installations, and, according to the speeches of the Panamanian negotiators, will be permitted at our own bases only when inside and when displayed jointly with a Panamanian flag in the position of honor. Perhaps this latter point is trivial, but it typifies this entire proposed agreement: Our flag in a broom closet and our vital canal at the mercy of a banana republic.

So, the Subcommittee of Separation of Powers does intend to continue its investigation of these issues to insure that all the facts are made available both to the Congress and to the people. We will be, I am sure, greatly aided in our efforts by the witnesses scheduled to appear at today's hearings.

Senator Hatch, do you have an opening statement ?

Senator HATCH. Thank you, Mr. Chairman. I do not have a prepared statement. But I would like to say that, when I first examined the Panama Canal issue, I was eager to learn about the reasons for this treaty. I listened to Ambassador Bunker once and to Ambassador Linowitz a number of times. I read everything I could get my hands on. I did everything I could to look at all of the arguments in an objective manner.

This morning I read in the New York Times an editorial asserting that there has not been one substantive argument offered against the treaty. I think this is typical of irresponsible journalism in today's world. We have heard many, many responsible, carefully reasoned, substantive arguments against this treaty right in these hearings.

Last evening I met with one of the most knowledgeable men in America, a man who knows a lot about foreign policy and foreign affairs. He had not even heard of the constitutional issues and arguments that have been raised in connection with this treaty. I think it is deplorable that the press has ignored the serious constitutional problem created by this treaty. Everybody in the House of Representatives who has any constitutional understanding at all knows that the House is being bypassed in contravention of the Constitution of the United States,

In article IV, section 3, clause 2 it says that the transfer of American property requires the consent of both Houses of Congress.

Here is a situation where this provision of the Constitution is being subverted. Briefs prepared by the American Law Division of Congressional Research Service do not support the State Department's position. There has not been one valid precedent presented by the State Department supporting the President's extraordinary exercise of power. Even these briefs indicate that.

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