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Statehood for Panama

by L. Craig Schoonmaker, Chairman
Expansionist Party of the United States
September 1999

[Desafortunadamente, nuestro español no es suficientemente sofisticado para presentar esta página en una versión española. Para crear una versión en español crudo por medio de una traducción mecánica, vaya a la website www.altavista.com y utilizase su servicio de traducción "Babelfish". Este servicio puede traducir un bloque de texto de quizás 1,000 o 2,000 palabras cada vez. Si usted recuerda (en inglés, "file") esta página entera en su computadora propia, usted puede transferir el texto entero porción a porción al traductor Babelfish. Perdone nuestra incompetencia lingüística.]

MY MOTHER was born in Ancon (Balboa), the Canal Zone, in 1913, the year before the Canal opened for business. Her father was a paymaster for the Panama Canal Company. As a U.S. citizen raised till age 9 in the Canal Zone, my mother spoke English at home but Spanish with her playmates from the Panamanian side of the street. It greatly surprised me when she told me there were no fences nor walls to demarcate the Canal Zone from Panama proper. One side of the street was the Canal Zone; the other, Panama!

Balboa's tiled roofs

Because my mother (and my late Uncle Jimmy) were born in the Canal Zone, I have always felt a certain fond connection to that small country at the wasp-waist of the American continent and always felt that it should have been offered admission to the Union as a State. But the U.S. was of a very different mindset in those days, and merely leasing the Canal Zone in perpetuity while leaving the rest of the country to its own sovereignty and culture seemed at the time the best thing to do. This decision resulted from a combination of benevolent neglect, relatively enlightened imperialism, and racial and cultural protectionism.

When the family returned to New Jersey, my mother would joke that she was from the South: "We were so far south we called Florida 'North'!" And the Canal Zone had, indeed, some of the racial and cultural attitudes of the Deep South. It might even have been called "the Deepest of the Deep South". Americans and Panamanian children might play together, but they went to different schools and lived largely segregated existences within a "company town" atmosphere where Americans were the bosses and Panamanians were, for the most part, only employees of the lower ranks.

The Canal Commission's Administration Building, Balboa (visible at upper right in the overview above)

Times have changed. The United States in 1903, when Teddy Roosevelt broke Panama off from Colombia, was very different from the United States of 1999. Massive immigration during the 1910s and 20s, refugees from two World Wars and a number of smaller, Communist-led "wars of national liberation", a change in the immigration laws in 1965, and a great diffusion in our sources of immigration thereafter have produced a country vastly different demographically from the one T.R. governed. The civil rights movement that stirred things up in the 1950s and went into high gear with the legislation of the mid-1960s and later has transformed even the Deep South. Panama is, moreover, so tiny (2.75 million people) and the U.S. so huge (270 million and more), that it should not matter to us that Panama is 70% mestizo (mixed Amerindian and white), 14% mixed Amerindian and West Indian, unmixed Amerindian 6%, and unmixed white only 10%; nor that 85% of Panamanians are Catholic and only 15% Protestant; nor that 86% of Panamanians speak Spanish as a first language and only 14% English (tho many are bilingual).

Four ships in the vicinity of the Miraflores locks. Note how tightly they fit in the locks and consider how easily the waterway could be shut down by sinking any two vessels there.

The perpetual lease that Theodore Roosevelt won from Panama as a condition for U.S. assistance in breaking away from Colombia was given an end date during the Carter Administration after debates in which Senate opponents of the treaty had to concede that if the people of Panama ever turned hostile, the U.S. could not protect the Canal Zone from popular guerrilla action. Memories of the Suez Canal's being blocked for years after Egypt sank ships in it during the British-French-Israeli invasion of 1956 came to mind, and the Senate confirmed a new treaty ending our perpetual lease. The renegotiated lease provided for a transition period to full Panamanian sovereignty and management of the Canal.

That period ends very soon: at 12 noon on the last day of this year, December 31, 1999.

Will Panama be able to run the Canal competently? There's been 20 years of transitioning, and the Americans who trained their replacements knew that continued successful operation of the Canal is vital to our economic and military security. So Panamanians have surely been trained well enough. If current forms of government and economic activities prevail, then, Panama can undoubtedly run the day-to-day operations of the Canal without problem.

Repairing a gate to one of the locks

But Latin America is not noted for its stability, and keeping the complex machinery of the Canal working smoothly is not easy. For one thing, it can cost enormous sums. The construction and repair of the Canal have cost the U.S. some $3 billion to date, only 2/3 of which has been recovered. A huge, wealthy country like the United States can easily shoulder all the costs of keeping the Canal in good working order. But Panama is a small, poor country.

Widening the Gaillard Cut

Panama's Gross Domestic Product is only about $18 billion a year, and its 2.75 million people have a per capita income of only $6,700 a year. Even with a steady cash flow, financing a major improvement could be very difficult for an independent Panama.

The Canal is a vital link in the world's shipping routes, so a shippers' boycott is unlikely. But the present Canal can't handle the largest ships (supertankers, giant ore carriers and grain carriers, the biggest aircraft carriers, etc.) and there has been talk for decades of widening it, or supplementing or replacing it with a sea-level canal somewhere in Mexico or Central America.  Shipbuilders resent having to limit their creations to the scale of the locks of a nearly century-old ditch. And shippers of bulk commodities have to balance the economies of scale (one gigantic ship would in most matters be more economical to operate than two or even three much smaller vessels) with the necessity of going around Cape Horn (the southern tip of South America) on some trips if their big ships cannot pass thru Panama, with all the tradeoffs of time, fuel, monotony, and dangerously bad weather the longer passage entails.

The most frequently mentioned routes for a sea-level canal other than one parallel to the current Canal or elsewhere within Panama are the Isthmus of Tehúantepec in Mexico and a path across Nicaragua that would use existing waterways for part of the distance. I can't see Panama being able to create a new canal on its own or even mount a major widening operation involving greatly wider locks more than just wider passages between locks.

Two ships in the unwidened Gaillard Cut, the narrowest part of the Panama Canal

There is no current clamor to create an alternative, sea-level canal to compete with — and perhaps destroy — the Panama Canal economically. But Mexico is now part of NAFTA; the Isthmus of Tehúantepec would be an enormously attractive route for Mexico's own shipping; and a Tehúantepec Canal would shorten the shipping route between the East and Gulf Coasts of the United States  on the one side and the U.S. West Coast and Japan on the other by hundreds of miles and thus speed shipping significantly not just for Mexican and U.S. domestic shippers but also for cargo vessels plying searoutes between Europe and the Far East with stops in Canada and the United States.

A Panamanian route would be more attractive than a Tehúantepec route only for shipping between the west coast of South America and points north and east — and perhaps only for ships making stops along the northern coast of South America and in the West Indies. Those whose destinations were farther north might find a Tehúantepec route more advisable even if slightly longer, for affording them opportunities to pick up coastwise cargo along the way.

Madden Dam

Mexico is a large country with an oil-exporting industry of size that could use a wide new canal for supertankers. It has nearly 100 million people among whom to apportion the costs of a canal; GDP of over $777 billion; and a per capita income of $8,100. It is part of a huge trading bloc, NAFTA, of some 400 million people, and its "best and brightest" have recently weathered initial dislocations produced by Mexican accession to NAFTA and now feel confident they can compete with the world's best. This new entrepreneurial class might well be able to raise the capital within Mexico (especially from the Mexican oil industry), across NAFTA, or even farther afield, from NAFTA's European and Asian trading partners, to create a first-class sea-level canal within a decade.

Indeed, if Mexico's tighter integration with the United States should lead to full-scale merger of Mexico into the Great American Union, there might arise enormous pressure for a sea-level canal wholly within the secure boundaries of an enlarged United States. (See our presentation "Private Action for Mexican-U.S. Union", Mexico.html.)

Mountains towering over ship and tug in Gaillard Cut

Panama has going for it only the shortness of any new canal:  about 50 miles as against perhaps 110 for a canal across the Isthmus of Tehúantepec and 170 for a route slanting across Nicaragua.

Will anyone endeavor to bring all the talk of a sea-level canal to fruition? After all, people have been talking about a sea-level passage across Meso-America for hundreds of years.  The Panama Canal Commission's homepage says

"In 1534, Charles I of Spain ordered the first survey of a proposed canal route through the Isthmus of Panama. More than three centuries passed before the first construction was started."

But the Panama Canal was indeed built, wasn't it? The French struggled for 20 years before giving up; but the U.S. completed the job in 10.

Consider, as well, that the first plan for a tunnel to pass below the English Channel was made, according to a webpage by Eurail / Britrail, by Napoleon's engineer, Albert Mathieu, in 1802,

"incorporating an underground passage with ventilation chimneys above the waves. For obvious reasons the British were nervous. Later, in 1880, the first real attempt at a tunnel was undertaken by Colonel Beaumont, who bored 2,000 meters into the earth before abandoning the project. When work on another tunnel began in 1974, the Beaumont tunnel was found to be in good condition."

Hostility between England and France delayed the Channel Tunnel project for 184 years, but the emergence of the European Economic Community (now European Union) allowed those reconciled countries to agree in 1986 to restart digging in earnest, and the basic tunnel was completed in five years, tho rail service thru the Chunnel did not commence until 1994. The Channel Tunnel cost 8.7 billion pounds (more than $13 billion) and has yet to make money. But, then, the U.S. has recouped only 2/3 of the $3 billion it has spent on the Panama Canal.

Chagres River, source of much of the Panama Canal's water

As the creation of the European Union established the indispensable preconditions for the Channel Tunnel, the accession of Mexico to NAFTA and the restoration of democracy to Nicaragua may have created indispensable preconditions to the creation of a sea-level canal thru one of those countries. Will either of those countries' government embark upon such a huge project? Will private business interests in those countries, in the U.S., or in the form of an international consortium take on such a task?

It would seem to me foolish for Panama to bet that a sea-level canal will not be cut thru Mexico, Nicaragua — or Costa Rica, for that matter — in the foreseeable future.

If Panama is to have any chance of becoming the site of a major sea-level canal, it will in all likelihood have to rely upon U.S. investment and technology to build it.

Would the U.S. be willing to make such an enormous investment of capital and brainpower in a foreign country whose stability is not secure?

Or is Statehood for Panama the only way to guarantee stability enough to reassure potential U.S. investors and builders of a sea-level canal?

Gaillard Cut, a long, level but narrow passage of the Panama Canal. A sea-level canal might look much like this, but wider.

Good for Panama; Good for Us. That statehood would be a good deal for Panama is hard to doubt. U.S. infusions of capital and assistance in all sorts of matters, from infrastructure development (schools, rural electrification, even the completion of the Pan-American Highway thru the Darién rainforest so Panama becomes a north-south as well as east-west crossroads) to education (Panama has an illiteracy rate of about 10%) to health and welfare could produce an enormous improvement in the quality of life for the bulk of Panamanians. What's in it for the United States, tho?

Security. Well, the Panama Canal is (presently and for the foreseeable future) crucial to the security and prosperity of the United States, and a good case can be made that the only way to guarantee that the Canal will never be closed or fall into ruin is to make Panama a State.

Tourism. FreeGate Tourism, a travel company, says this about Panama as a tourist destination:

Spanish cannons at fortifications of Portobelo

"Panama is probably the most famous country in Central America, known for the canal linking the Atlantic and Pacific Oceans which bears its name. Today, however, Panama grows in popularity as a tourist destination. It offers more than just a famous city and canal, it also offers two tropical coasts, dense rainforests, pristine offshore islands, and an array of interesting cultures, all of which are easily within reach of the tourist. Panama City is worth a visit for its fabulous duty-free shopping opportunities, while Taboga Island offers the beach and the San Blas Islands present a Pre-Columbian culture that has remained virtually untouched. For the country-club set, Contadora Islands are not to be missed."

Gatún Lake, the engine that runs the locks

Other Internet sites speak to ecotourism, and Panama's endangered rainforests. The Panama Canal is an amazing engineering accomplishment, but it wouldn't work without the huge amounts of rain produced by the rainforests. These rains fill Gatún Lake and enable the locks to fill. Without these gravity-fed flows, the locks would not work and the Canal would turn into an ugly ditch scarring the cordilleran spine that links North and South America.  With the forest-fed rains, that ditch is a magnificent Canal that lifts ships up and over the mountains from ocean to ocean and hugely shortens the time it takes ships to travel from one side of the United States to the other, or from Japan to Europe: in the words of the seal of the former U.S. Governor of the Canal Zone, "The land divided — the world united!"

Shipping Standards. Panama is a "flag of convenience" country, which means it has lax regulations and low ship-registry taxes that encourage shipowners from many countries to register their ships as "Panamanian" even tho they have no real connection with Panama. This has given Panama an ostensible merchant marine of some 4,350 ships (of at least 1,000 gross tons each). The CIA Factbook homepage on Panama says "its" ships come "from 76 countries among which are Japan 1,236, Greece 418, Hong Kong 273, South Korea 247, Taiwan 227, China 185, Singapore 119, US 112, Switzerland 85, and Indonesia 60" (1997 estimate). This registration has cost American workers many jobs and lowered standards for working conditions and safety across the shipping industry. Bringing Panama into the Union would subject "its" ships to rigorous U.S. standards.

An Asian ship flying the Panamanian flag

Many shipowners would likely switch their registration to another flag of convenience, like Liberia's, but to the extent they do not, standards for the shipping industry would improve. I'm not persuaded that Panama gains much of anything from this noxious flag-of-convenience nonsense. Certainly the crews of most of these vessels are not Panamanian, and the profits of the shipping companies do not flow into Panamanian government coffers. So Panama has little to lose in cracking down on the flag-of-convenience scam, and seamen everywhere have something to gain.

Drug Interdiction and Money Laundering. Panama is a major transshipment point for illegal drugs flowing from South America northward. Panamanian banks are an attractive target for Colombian money-laundering operations. Corruption and ineffective law enforcement by Panamanian authorities have meant that substantial quantities of drugs that could be interdicted get thru to the U.S., where they take a heavy toll in death, crime, and illness; and substantial amounts of drug money that could be seized get back to druglords to fund future operations. Statehood for Panama would bring a sharp increase in seizures of drugs and drug money, and give the U.S. a base of anti-drug operations close to the source of these deadly toxins.

On the map above, note the thin red line down the middle of the eastern end of Panama that ends well before reaching the Colombian border. That is the Pan-American Highway, completion of which has been held up by this stretch of rainforest for decades.

South American Democracy and Development. Completion of the Pan-American Highway thru Darién province should make a substantial impact upon the economic wellbeing of people in much of Colombia and draw them into legitimate activities, away from drug production. (Naturally, some drug smugglers will try to make use of that highway to run drugs up to the United States, but a highway is a much easier route to patrol than dozens or hundreds of fishing ports and remote airfields.) Completion of the Pan-American Highway, which has been hung up for decades by this unconstructed stretch, would speed integration of South American countries in a wider NAFTA ("PAFTA"? — Pan-American Free Trade Agreement?). That in turn would reduce drug production in Colombia, Peru, and Bolivia, and provide a powerful development impulse to reduce human misery and thus the pressures to revolution.

To the extent democracy, stability, and development of Latin America are in the interest of the United States — and they are — the admission of Panama to the Union is very much in our interest.

Bridge of the Americas over the Panama Canal. As this steel structure links the two sides of the Canal,
so might Panama firmly link the United States and South America.

These are some of the ways the United States would benefit from making Panama a State of the Union. Perhaps you have additional arguments to offer in favor of Statehood for Panama. If so, please tell us.

For ideas on ways that private persons can advance the idea of Statehood for Panama, see our "Private Action" pieces on Canada, Britain, the Philippines, and Mexico.

Teddy Roosevelt thought the U.S. could control the Canal Zone in perpetuity without offering the people of Panama statehood. President Carter and the Senate in 1979 decided that even if that were militarily possible, the cost would be too high and the risk to the Canal too great, so ceded the Canal Zone back to Panama and set a date for U.S. withdrawal from the day-to-day operations of the Canal. That Canal is still enormously important to us. If losing control over it on December 31, 1999 would make us less secure in the next century, we had better regain control in the only way we are entitled to do so: by offering Panamanians full integration with the Great American Union, with all the rights of citizens and all the assistance in making a good life that we accord every other part of the Nation.

Make Panama a state!

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