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White to move and mate in two #618 - The Panama Canal [1]
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Date: 2025-01-23
The Crisis in Historical Perspective (1978)
“… . The legal status of the waterway is not to be determined by reference to these abstract concepts,” R.R. Baxter wrote, “but by a consideration of the relations established among Panama, the United States, and user nations by treaty and customary law.”2
Baxter’s point provided the key to answering the question. During the 1970s crisis the 1903 treaty language had to be interpreted in the light of nearly 75 years of United States-Panamanian relations. Examined from this historical perspective, the answer was clear: the United States did not own the Zone or enjoy all sovereign rights in it. The turning point perhaps occurred in the 1936 treaty (examined in Chapter III), which termed the Zone the “territory of the Republic of Panama under the jurisdiction of the United States of America.” The U.S. Senate constitutionally ratified that pact. After Word War II, Washington officials repeatedly recognized Panama’s sovereign powers in the Zone. Every President, starting with Dwight D. Eisenhower, allowed the Panamanian flag to fly with Old Glory in the area, an act not allowed in Alaska or Texas. By 1967 Johnson administration officials searched the record then privately concluded that the United States could not claim full sovereignty in the Zone (see Chapter V). In 1976, Ellsworth Bunker, heading the North American negotiating team, summarized the official consensus of the previous four decades by declaring that Washington did not purchase the Zone in 1903, but paid Panama for certain rights: “We bought Louisiana; we bought Alaska. In Panama, we bought not territory, but rights …. It is clear that under law we do not have sovereignty in Panama.”
Senator Strom Thurmond was mistaken in his belief that “We own it, title in fee simple.”3 If the United States “owned” it, no argument over sovereignty could have arisen, just as no major argument over North American sovereign control of, say, Florida, has occurred since it was purchased in 1819. Of equal importance, the title was not in “fee simple.” The United States at no time claimed that it purchased the Zone outright. After 1903 it paid annual annuities to Panama, a payment which implicitly recognized less than full ownership of the waterway area. In no territorial transaction involving the mainland or such overseas acquisitions as Hawaii or the Philippines did the United States recognize the continuing rights of the sellers by paying annuities.
The Zone cannot be thought of as comparable to either a state or a territory, but more aptly, as Baxter declared, to a “great government reservation.” After the reorganization acts of 1948 and 1950, the Panama Canal company became a corporation controlled by its sole stockholder, the Secretary of the Army, who acted as agent for the President of the United States. No territory, and certainly no state, was ever so controlled. The Secretary of the Army appointed a nine- to thirteen-member board of directors to manage the corporation. Private property in the Zone was virtually non-existent. The governmental corporation owned and operated everything from homes to stores to bowling alleys, partly because of the belief that the land could one day revert to Panama. The same cannot be said about Texas.
2. Baxter, Laws of International Waterways, p. 87.
3. Congressional Record, 93rd Cong., 2nd Sess., March 29, 1974, p. S4730
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