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Moreover, I was immensely comforted by your comment that both houses of Congress, not just the Senate, must approve any transfer of U. S. property or territory, and that none of this will occur unless and until such Congressional approval is given, and both countries have signed a new treaty.

Let me say again, Mr. President, that you have gone out of your way to be a gentleman. I admire and respect you for your forthrightness, even though we do not agree on this particular issue.

Thank you, sir, for your consideration.




Senator ALLEN. Governor Reagan, I am concerned that there is much more involved in this issue than giving the Panama Canal away and paying the Panamanians to take it.

I feel that this is symptomatic of a trend in this country to give away our very substance to foreign countries, to back down when confronted around the globe. I would like to ask if you feel that, if we make these concessions—when it is not necessary that we do so—that our concessions would encourage other nations to confront us at various points throughout the world and that these concessions would make it harder for us to resist such confrontations in the future.

Governor REAGAN. Senator, I could not agree more.

We are in a climate where we abandoned an ally in Vietnam after we had forced that ally literally to accept the terms of the Paris accords, which were then broken by the enemy. We are withdrawing our troops from Korea. It looks as if we are trying to find a way out of our alliances with the long-time ally, the Republic of China on Taiwan. There is the situation in Puerto Rico. There is Guantanamo, as Senator Scott mentioned.

All of these things are there. It just seems to me that there is no way that this will be seen as a magnanimous gesture; it will be seen as further retreat into isolationism by the United States.

Senator ALLEN. I think it is interesting that full control of the canal being given to Panama purports to be postponed for 23 years. I assume that it was not felt that an immediate giving away of the canal would have had no chance at all of passing.

Do you feel that merely delaying the full operation of the gift of the canal for 23 years changes the principle? Is it not just as wrong to give the canal away fully 23 years from now as it is to give it away immediately!

Governor REAGAN. I agree completely. I also add that there is the threat that, once you have announced your willingness to give it away, it is the same as in the Suez incident, the person you are giving it to can say, "Well, how much trouble will they make if I just accelerate the taking of it?"

They have a psychological point there, once you have said that you are going to give it up anyway.

No, I do not think the time lapse makes any difference at all.

Senator ALLEN. Another thing that concerns me and many others I am sure is our agreement to maintain the neutrality of the canal. Would that permit and require us to see that, in the event of war with Russia, we would have to afford access to the canal to vessels of the Soviet Union ?

Governor REAGAN. That is the Panamanian interpretation of that.

I might add again that, when I was briefed by the ambassadors, they told me and I asked specifically who would declare, who would determine what was a violation of neutrality. Would that be something we could do?

I was assured that all of this was taken care of. But, now, in the translation again of that press conference in Panama, that question was also asked of Bethancourt. The reply was that there was no assurance or no provision in the treaty whatsoever that would allow the United States unilaterally to decide that the neutrality had been violated.

So, again, we come down to which version of the treaty are we going to look at.

Senator ALLEN. I was also impressed in your pointing out that, while the full delivery of the canal to the Panamanians is postponed for 23 years, the fact that we are giving in at this time would encourage them to present the same arguments, the same threats of force, the same demonstraʻions to accelerate this process of withdrawal.

Do you feel that this principal is something in the nature of the camel putting its nose inside the tent and then gradually moving on in to take possession of the full tent?


Governor REAGAN. Yes; because, if we are going to listen to the arguments about 23 years, we had better get back and look at how fast the phaseout takes place. What takes place in the first 30 months ? The assumption by them of control over the Panal Canal Zone.

For example, the Ministry of Housing of Panama will take over the American houses in which American employees are now living. They will take over the schools.

All of this is in there early. So, it is not a case—as I think many people tend to believe-that for 23 years business goes on as usual except that we are going to be teaching them how to run the canal.

Business does not go on as usual. It star's immediately with changes being made, including the provision that, even when we have a joint command in those latter 23 years, only one American flag will be allowed to fly in the Panama Canal Zone. But that will not be the

primary flag; that will be in a secondary position. Their flag will fly first.

There are a great many details in here, none of which seem to favor us, including the implicit understanding that at a certain point our forces cannot exceed theirs. Well, they have close to 9,000 men, supposedly, in their national guard. But over 7,000 of those are policemen. All they have to do is designate them as policemen, and we are down to 1,500 men.

Senator ALLEx. I notice too that the safety, rights, and protection of our American soldiers who are there would be damaged a great deal. Their position would deteriorate because crimes committed by or against our service people would be tried under Panamanian law without the protections that are afforded under our Constitution. All our courts would have jurisdiction over would be offenses between servicemen. So, it would deny this protection to our soldiers there; would it not? Governor REAGAN. That is right. Senator ALLEX. Thank you very much. If there are other questions, let us go the 5-minute route now. Senator Hatch? Senator HATCH. Thank you, Mr. Chairman.

I realize that Governor Reagan has another appointment; I do not think he has that much more time. I do have some more questions, but I think I will withdraw those.

Your statement has been excellent. I think it has erased a lot of the misrepresentations that I know have been made by the proponents of the treaty. I think your analysis has been excellent.

I was in Panama recently and met with the President of Panama and the Minister of Planning and Economic Affairs. They asked me what I thought the chances are for ratification in the Senate. I said that I hope they are not making this an all-or-nothing proposition because I do not believe that it will be ratified in the Senate, certainly when the President ignores the constitutional issues that have been raised.

I took the same position independently that you have taken here today. I would agree that we need to examine the possibility of upgrading the treaty. We need to do everything that we possibly can to create a good relationship not only with Panama but with all of our Latin American neighbors.

One of the major points that you make in your testimony todayand I think one of the most valid points—is that we do not have a cohesive program of foreign policy with regard to our Latin American nations. I would commend you for bringing that forth, Governor.

I want to thank you for your comments here today. I think they have been informative and well reasoned.

Governor REAGAN. Thank you.

Senator Scott. Mr. Chairman, I have no further questions for the Governor. Once again, I personally am glad that you were with us. We have other witnesses and we could ramble on for a long time, but it is not necessary.

Senator ALLEN. Thank you very much, Governor Reagan and Senator Hayakawa. We thought that no debate on this question would be complete without having you express your views. We appreciate you both coming before the committee. We feel that your statement, Gov

ernor Reagan, has been very fine indeed. We hope that we will see the hoped-for, much-desired result of your wise testimony on the opinions and judgments of the distinguished junior Senator from California, our good friend, Senator Hayakawa.

Governor REAGAN. Mr. Chairman and Senators, thank you very much.

Senator ALLEN. Our next witness will be Congressman Flood. I understand that there is a vote in the House and that you will have to leave shortly.

Mr. Flood. Yes; there is a B-1 bomber vote over there.
Senator ALLEN. You may handle your statement as you wish.

I wonder if Congressman Crane would also come up. It may be that we could hear from both of you before lunch and question you jointly.

We are delighted that you both have come before the committee to give us your views. Both of you are recognized authorities on this issue. We certainly appreciate your presence here before the committee.

I might state to you both that the committee certainly supports your position that this matter needs to be decided by both Houses of Congress in addition to the ratification vote in the Senate.

Please proceed, Mr. Flood.



Mr. Flood. Mr. Chairman, I appreciate the opportunity to be here.

I doubt very much that I can add anything material to what you and the committee have heard. Under the circumstances, I do feel that I should be here.

Mr. Chairman, on July 29, as you will recall, I submitted to this subcommittee a statement summarizing my views on the problem of the Panama Canal and outlined a program of action for the United States. There is little of consequence that could be added to the points presented in that testimony. For the benefit of those who have not seen my July 29, 1977, statement, I have placed additional copies on the table.

The announcement on August 11, 1977, of an "agreement in principle” for new Panama Canal Treaties was no surprise to those who have closely followed the canal question, and these include many Members of the Congress. That news was a high point in a plan long in preparation to present the Nation and the Congress with a fait accompli. As such, it represents a real challenge to the Congress in the exercise of its constitutional powers as regards the disposal of territory and other property of the United States in the U.S. Canal Zone, which the Congress has not authorized. For this and other reasons, the Congress must face the challenge head on.

Since August 11, the major news media of the Nation have featured the Panama Canal question with an enormous coverage, a large part of which has been in support of the projected surrender of U.S. sovereignty over the Canal Zone and, ultimately, the giving away of the Panama Canal itself, all without compensation.

Over a period of years, distinguished Members of the Congress in many addresses in the Congressional Record and distinguished witnesses in hearings before cognizant committees have provided an ex

tensive and authoritative documentation on all significant aspects of the canal question; and these have been widely distributed. Prepared by such information to detect and evaluate deceptive propaganda, diplomatic sophistries and other skulduggery, the people of the United States and the Congress are not likely to be stampeded into approving any treaty that surrenders U.S. sovereign control over the Canal Zone or gives away the Panama Canal to any other country or international organization.

One of the most flagrant examples of fallacious prosurrender propaganda so often stressed is that, if we do not surrender the Canal Zone to Panama, the relations of the United States with all of Latin American will be seriously impaired. There could be no greater deception, for major Latin American countries, especially those on the west coast, know Panama well.

Their leaders from Presidents down know what the consequences of such surrender would be for their own economy in the way of increased transit tolls. Attention is invited to the perceptive 1976 article by Dr. Mario Lazo on “Panama Canal Giveaway: A Latin American's View," which I request be included with my remarks.

As stated many times in my addresses in and out of Congress, the most crucial issues involved are not local questions between the United States and Panama, most of which should be handled administratively by responsible officials of the Canal Zone. In contrast, the crucial questions are matters of global significance affecting the security not only of the United States but as well that of the Western Hemisphere and, indeed, of the entire Free World.

In this light, the Panama Canal problem transcends all partisan considerations; and must be considered on the highest plane of national interest if our course is to be sound and our future well-being protected.

As to this angle, Soviet power, understanding the vacuum that would be created by the projected relinquishment by the United States of its sovereignty over the Canal Zone, has already moved toward establishing a beachhead in Panama by means of a July 19, 1977, U.S.S.R.Panama economic pact. This matter was discussed at length in the American Legion National Security-Foreign Relations Bulletin, JulyAugust 1977, major excerpts of which I ask be included in my remarks.

Mr. Chairman, the pact. I believe, is most significant for it includes provision for the Soviet Union to utilize the Panama free zone in Colon, which in turn now includes Old France Field in the Canal Zone, a World War II airfield located within the zone territory and is thus within our defense perimeter.1


When first learning on March 13, 1975, about the lease of Old France Field to Panama, which was not authorized by the Congress, I promptly protested it to the Secretary of the Army as “part and parcel" of the State Department's program for "piecemeal erosion" of the Canal Zone that would invite greater demands. I have had the sterile satisfaction of seeing that prediction and many others fulfilled.

Surrender of the U.S. Canal Zone would undoubtedly have serious

1 Congressional Record, August 4, 1977, p. H8704.

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