Governor RIDLEY. Our labor recruiting office is receiving applications daily for this new work, and we find that about two-thirds of those who apply are Panamanians.

Senator RUSSELL. Is that what you had in mind, Senator Austin? Senator AUSTIN. Yes.

Senator THOMAS. Then the other one-third is made up of Jamaicans? Governor RIDLEY. The other one-third is made of those other two classes-West Indians, who were born in the West Indies, and the sons of such men, who were born on the Isthmus of Panama.

Senator THOMAS. They are citizens of Santo Domingo, Haiti, and Cuba?

Governor RIDLEY. They are citizens mostly from the British West Indies.

Senator THOMAS. Are there any further questions?

Senator ADAMS. I gather Mr. Finley has not completed his off-therecord statement.

(Further discussion off the record.)

STATEMENT OF HAROLD D. FINLEY-Resumed

TREATY COMMITMENT WITH PANAMA

Mr. FINLEY. There is nothing new in this principle of equality of opportunity for Panamanians. It has been going on since 1908. When we came to the treaty of 1936 with Panama, which cleared up many of the pending questions which had arisen since 1903 between the two countries, it was very natural that this equality should have been maintained and continued. It was continued by this exchange of notes to which I have referred, and these notes were submitted to the Senate with the treaty at the time it was ratified.

EFFECT OF HOUSE AMENDMENT

So far as I know, no objection to the provision of these notes was heard at that time from anybody. As you gentlemen are aware, one of the fundamental principles of our foreign policy is that we stand by our commitments. We in the State Department are certain that if this provision against Panamanians remains in the bill, our relations with Panama will be embarrassed. Furthermore, we are convinced that all the American Republics will watch with attentive interest what we do in this matter.

Senator THOMAS. I understand you speak for the State Department? Mr. FINLEY. Yes, sir.

Senator THOMAS. You heard the statement by General Ridley in opposition to this proposed section. Are we correct in understanding that you will reinforce and support his objection to this section remaining in the bill?

Mr. FINLEY. Very much so, with respect to our treaty commitments to Panama.

TELEGRAM FROM LOCAL NO. 227, AMERICAN FEDERATION OF TEACHERS, BALBOA, C. Z.

Senator THOMAS. At this point, without objection, I will read into the record two telegrams which arrived this morning, addressed to myself.

The first one is dated Balboa, Canal Zone, and reads:

Local 227, American Federation of Teachers, the third largest affiliated body of Canal Zone Metal Trades, voted to oppose Lanham amendment to Canal Zone appropriation bill. You are urged by the organization to defeat this amendment. JAMES LYONS, President.

TELEGRAM FROM LOCAL NO. 677, I. B. E. W., BALBOA, C. Z.

The second cablegram is from the same address, addressed to myself, and reads as follows:

We members of organized labor sincerely request your support on Lanham amendment. LOCAL UNION 677, I. B. E. W. Senator RUSSELL. Do you have one union for your employees down there, or do your employees have different unions?

ORGANIZED LABOR IN THE CANAL ZONE

Governor RIDLEY. Practically every union in the country is represented on the Canal Zone by a local, and these locals are all combined into one association under what they call the Metal Trades Council. Senator RUSSELL. I notice that one of the telegrams favors the proposition, and the other is very much opposed to it. I wondered if you had one union for the gold employees and another for the silver employees.

Governor RIDLEY. No. The one which is opposed to it is the teachers' union. That is a local of the general association. It has now voted to oppose this provision. The teachers are Americans and are of course very intelligent people, and they might or might not be affected, dependent on whether or not you call them technical employees. I do not know.

NEED FOR OCCUPATIONAL SURVEY TO DETERMINE PERCENTAGE OF AMERICAN CITIZENS HOLDING SKILLED, TECHNICAL, CLERICAL, ADMINISTRATIVE, AND SUPERVISORY POSITIONS

Senator LODGE. General, I was unable to be here for all of your testimony, and it may be that you have already answered this question; but out of the force in the Canal Zone that can be defined as skilled, technical, clerical, administrative or supervisory employees, what percentage are now American citizens?

Governor RIDLEY. As I explained in my testimony, it is impossible to say. An occupational survey would be necessary, and it would require several weeks to find out.

Senator RUSSELL. The General stated that it was impossible even to arrive at a rough estimate of it; that he is going to place in the record some figures which may assist the committee.

Governor RIDLEY. Pardon me: As I understand, the thing I am to place in the record is a list of our 70 pay-roll designations, with the number of persons, employed.

Senator RUSSELL. That is correct, the 70 pay-roll designations, with the number of persons employed. That might cast some light on the subject. (See p. 50).

QUESTION AS ΤΟ PLACEMENT OF SIMILAR PROVISION IN MILITARY AND NAVAL BILLS

Senator THOMAS. A moment ago, I suggested that section 2 of this bill might become a precedent for the Regular Military Establishment bill and the Regular Army appropriation bill. Since making that statement there has been placed in my hands a copy of the Navy Department bill for the coming year, which has already passed the House. I find that the last section of that bill, section 7, is either identical or practically identical with section 2 of this bill; so my assumption, formerly made, has been verified already. So we are setting a precedent. Whatever we do on this bill probably will be followed by the Naval Committee and the Military Committee; so it is all-important, as I see the matter, to consider it now.

Senator RUSSELL. Language to the same effect has been included in a number of appropriation bills heretofore, for that matter. It is not a brand-new precedent even with the Senate committee, and the Senate has approved some of the language. I can see difficulties in applying it in the case of the Canal Zone, to the instant bill; but for several years there has been legislation limiting the payment of any part of the appropriation carried in an act to those who are citizens of the United States.

STATEMENT BY PRESIDENT ROOSEVELT RELATIVE TO PROVISION IN THIRD LOCKS ACT REQUIRING AMERICAN CITIZENSHIP FOR CERTAIN TYPES OF EMPLOYMENT IN CANAL ZONE

Mr. FINLEY. Gentlemen, last August, when the third-lock bill came before the Congress, it provided that only American citizens should be employed in certain positions. In signing the bill, President Roosevelt made the following statement: This is dated August 11, 1939 [reading]:

STATEMENT BY THE PRESIDENT ON APPROVING H. R. 5129

In view of the special relationship which exists between the United States and Panama on account of the Panama Canal, the Canal administration and the Panama Railroad Co. have for many years granted facilities for employment to Panamanian citizens which were not generally extended to the citizens of other countries.

The order of the Secretary of War dated December 23, 1908, and the Executive orders of February 2, 1914, and February 20, 1920, extended to Panamanian citizens, with respect to the higher-paid categories, opportunity for employment and treatment in employment equal to that extended to American citizens.

Accompanying the general treaty between the United States and Panama, signed March 2, 1936, and ratified July 27, 1939, is an exchange of notes between the two Governments by which the United States has agreed to maintain as a principle of public policy the opportunity for employment and treatment in employment of Panamanian citizens which is set forth in the order and Executive orders noted above.

A provision of H. R. 5129 authorizing and providing for the construction of additional facilities on the Canal Zone, etc., provides "that all new personnel in such construction work occupying skilled, technical, clerical, administrative, and supervisory positions shall be citizens of the United States." It is my opinion that this provision is at variance with the policy to which this Government pledged itself in its note to the Government of Panama of March 2, 1936, the date of the signing of the general treaty, since the order and Executive Orders specifically provided equal opportunities for employment of Panamanian citizens in the very categories in which employment would be denied them under the quoted provision of H. R. 5129.

The new treaty was negotiated to provide a firm basis for friendly and effective collaboration between the two Governments in order that the Canal might fulfill in the most ample sense its functions. With the exchange of ratifications of that treaty the United States and Panama entered into a new stage of their relationship. This relationship will be advantageous and enduring to the extent that each party cooperates loyally and fully in the observance not only of the letter but of the spirit of that treaty.

I am giving my approval to this important bill which by authorizing the construction of a third set of locks will enhance not only our own security but that of this hemisphere. I propose, however, to request the Congress at its next session to amend the present law so as to bring it into conformity with the commitments entered into with Panama which pledge to the citizens of Panama opportunity and treatment in employment in the Canal administration and the Panama Railroad Co. equal to that offered to citizens of the United States. FRANKLIN D. ROOSEVELT.

Senator THOMAS. It is obvious, is it not, that the President's statement has the full support of the State Department? Mr. FINLEY. It has its full support.

Senator THOMAS. And states the position of the State Department? Mr. FINLEY. We understand—may I also have this statement off the record?

Senator THOMAS. Yes, sir.

(There was a discussion off the record.)

SECTION 2 HELD BY STATE DEPARTMENT TO BE BREACH OF AGREEMENT WITH PANAMA

Senator THOMAS. Does the State Department held that section 2 of this bill would be a breach of the agreement between the United States and the Panamanian Government?

Mr. FINLEY. Yes, sir.

AUTHORIZATION ACT FOR ADDITIONAL LOCKS SIGNED AUGUST 11, 1939

(See p. 112)

Senator RUSSELL. When was the legislation authorizing this work passed?

Mr. FINLEY. It was signed by the President on August 11, 1939. Senator RUSSELL. That was the basic authorization for the construction work on the new locks?

Mr. FINLEY. The third set of locks; yes, sir.

Senator RUSSELL. And it contained a provision similar to this section 2, or has the Congress followed the present suggestion that that proviso be repealed?

Mr. FINLEY. No; it has not. And, furthermore, I believe all the bills now pending for construction on the Panama Canal have been amended to provide that only citizens of the United States may be employed.

DIFFERENCE BETWEEN SECTION 2 AND SIMILAR PROVISION CONTAINED IN THIRD LOCKS AUTHORIZATION ACT OF 1939

Senator RUSSELL. What effect does this proviso have here in the appropriation if it is in the basic act? Perhaps that is a technical question of law.

Senator HAYDEN. I was a member of the Committee on Interoceanic Canals that considered this legislation, and there is this much to be said: That distinctions could be drawn between a piece of temporary construction on the Canal and its continued operations over a

long series of years. Now, if we are going to Panama to do a job, and do it quickly, we can get help where we can. Undoubtedly, you could get Americans to go down and live in camps on a job, and more of them than thousands who would go to Panama to live permanently. The conditions are different on an emergency construction job lasting only a short time and the permanent operation of the Canal, and I do not believe the Panamanians would have as much ground to complain about a restriction that as many Americans as possible be employed on a job that we are paying for in the way of new construction and which in the long run will redound to the benefit of the Panamanian Republic as they would about discriminating against their nationals doing ordinary routine work, which they are qualified to do.

EFFECT OF SECTION 2 ON LONG-TIME ALIEN EMPLOYEES

Senator RUSSELL. The Senator from Arizona always makes everything very clear.

I see that there is very little money in this bill for new construction work, and the effect of the House limitation would be retroactive as to employees who have been in the employ of the Canal Authority for a great many years. That is my principal objection to it. I would not favor or be disposed to look with favor on a provision that would reach back and cause the discharge of a man who has been employed for years.

Senator HAYDEN. That would be the view of Senator Bennett Clark, who was chairman of the Committee on Interoceanic Canals: that in this new work where we were starting at scratch, we had to go and employ a large force of men to spend a large sum of money over a short period of years, and then the job was done. Now, laying down a rule for that kind of employment is quite different from passing legislation which is retroactive and dismisses men who have faithfully served the United States over two or three decades.

Senator THOMAS. Have you completed your statement?

Mr. FINLEY. I think in that connection that so far as our treaty commitment with Panama is concerned, we would think that it was as objectionable in any act providing for new construction as in a retroactive way.

MANNER IN WHICH COMMITMENT WAS MADE WITH PANAMA

Senator RUSSELL. I understood you to say that this commitment was contained in a letter from the Secretary of State and was not embraced in the body of the treaty that was approved by the Congress.

Mr. FINLEY. This was an exchange of notes, sir, which accompanied the general treaty, and this exchange of notes was submitted to the Senate with the treaty and was before them for their information at the time the treaty was ratified.

Senator RUSSELL. I recall there was quite an extended correspondence between the State Departments of the Republic of Panama and this country at the time of this commitment, but they did say it was not included in the expressed provisions of the treaty.

Mr. FINLEY. While I am not qualified to discuss this agreement between Panama and the United States from a constitutional point of view, I understand that the Attorney General may be requested to take up that angle. So far as this commitment of the United States