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All Material Copyright by Latin America Data Base. Latin America Data Base News Items [PeaceNet] THE HISTORICAL BASIS OF ANTI-U.S. SENTIMENT IN PANAMA: A BRIEF SUMMARY, 1825-1985 Panama is literally a global crossroads, which explains in large part its distinctiveness from other Central American countries. In contrast to Guatemala, Nicaragua, El Salvador and Honduras, for example, Panama is primarily an urbanized, service economy. About 60% of the country's gross domestic product derive from trade, finance and transportation services. Over half the country's population resides in Panama City and Colon, one at either end of the Panama Canal. The Canal splits the country in half geographically, and of course, has been at the center of Panamanian politics and economy. A brief summary of the country's history follows, providing at least a broad stroke background for understanding Panamanian sensitivity to US policy, and US politicians' remarks. From the time that Colombia won its independence from Spain in 1821, establishing its rule in Panama was problematic. During the 19th century, the Panamanians revolted 50 times against their Colombian masters. When the Panamanian rebels seemed near success (1855-1856 and 1885), the US intervened militarily to protect US interests and end the revolts. 1825: New York businessmen initiated a project to build a canal but failed to obtain financial support. 1846: The United States signed a treaty with New Granada (Colombia) to assure US access to any future canal constructed in the province of Panama. 1849: California Gold Rush. Thousands from the East Coast of US sailed to the narrowest part of the continent to trek through Panama on their way to the riches of California. They preferred that route to the arduous and often dangerous transcontinental trip across the United States. 1851-55: Railroad is constructed across the 48-mile width of Panama, financed by New York capitalists who obtained an exclusive concession from Colombia to construct a railroad across its territory of Panama. The railway reduced the cost of transporting goods, raw materials and passengers from one ocean to the other. 1856-1865: US Army intervened five times to protect the railroad from possible attacks by insurgents rebelling against Colombian rule. 1878: Ferdinand de Lesseps, the Frenchman who had constructed the Suez Canal, began a project to dig a sea-level canal across Panama. After 11 years of effort, he gave up. Throughout 1878-1899 period, the US pressured France to abandon the undertaking, asserting its "rightful and long-established claim to priority on the American continent." 1880s-1890s: Support grew for building a canal through Nicaragua. 1898: Spanish-American War, marking birth of US as imperial power. US military leaders lobby for construction of an interoceanic canal across Panama. 1901: A presidential commission endorsed the Nicaraguan route, despite the more favorable engineering and logistical characteristics of the Panamanian alternative, because the French company that controlled the canal concession in Panama wanted $109 million for its rights. Influential New York attorney William N. Cromwell, and Phillipe Bunau-Varilla, chief engineer of the de Lesseps project and an organizer of the New Panama Canal Company (French company with rights to the canal) acted to change US policy. Cromwell bribed the Republican party to end its support of the Nicaraguan route. He and Bunau-Varilla then convinced the company to lower the prices for its concession to $40 million. 1902: Bunau-Varilla and Comwell managed to push through Congress the Spooner Amendment, which authorized President Roosevelt to buy the New Panama Canal Company's rights for the price of $40 million if he could negotiate a treaty with Colombia. 1903: Secretary of State John Hay pressured the Colombian ambassador to the US to sign a pact that gave the US a 99-year lease on a strip of land across the isthmus in return for $10 million and an annual payment of $250,000. The Colombian Senate rejected the US petition, demanding more money. --After a terrible civil war (1899-1902) had severely weakened Colombia, Panamanian nationalists were ripe for revolt. Working with the US State Department and the Panamanian rebels, Bunau-Varilla triggered an uprising in early November. With the help of the US Navy and liberal bribes paid to Colombian officers who were supposed to crush the revolt, Panama won its independence. --Five days after securing Panamanian independence from Colombia, the first canal treaty with the US was signed. Signing the treaty for Panama was Bunau-Varilla. He produced a treaty that gave the United States control over a 10-mile wide canal zone "as if it were sovereign of the territory." The US was to have "in perpetuity the use, occupation, and control" of the zone. In return, the US was to pay Panama $10 million and assume a virtual protectorate over the new nation. The Panamanian government indignantly protested the terms of the agreement but eventually accepted the pact, fearing that the US might either seize the canal with no compensation or build one in Nicaragua instead. 1903-1914: US Marines were stationed in Panama to protect US interests during construction of the canal. During this period, the United States disbanded the Panamanian army, and assumed the responsibility of defending Panama against external threat. The US established its own postal system, custom houses, and commissaries in the Canal Zone, privileges that seriously undermined the Panamanian economy and injured Panamanian pride. 1904: Panama establishes monetary system based on US dollar. 1908, 1912, 1918: US government and military leaders supervise Panama's national elections. 1914: Panama Canal completed. 1918: Detachment of Marines arrived in province of Chiriqui and stayed for two years to maintain public order. 1925: 600 US Army troops marched into Panama City to break a rent strike. For 12 days, US troops patrolled the streets to keep order and guard US property. 1926: Popular opposition forced Panamanian government to reject largely concessionary treaty with the United States. 1936: Via the General Treaty of Friendship and Cooperation, US relinquished right to unilateral intervention in Panama's political affairs. In that treaty, the US obtained access to additional lands and waters for the defense and modernization of the canal. 1942: US-Panama Base Convention allowed US over 100 new military and telecommunications facilities in Panama, beginning the extensive and permanent US military presence in the Canal Zone. 1947: Popular protests prevented authorization of increased US military presence. 1953: Colon Free-Trade Zone created in Panama based upon proposal by a vice-president of National City Bank of New York. 1955: Treaty of Mutual Understanding and Cooperation permitted US to locate another large military base in Panama in exchange for increased commercial access to the Canal Zone by the local elite. 1960: Panama Canal Zone becomes center for US-sponsored counterinsurgency training. 1964: US authorities prevented Panamanian students from raising their national flag alongside the US flag at a high school in the Canal Zone. Riots ensued, street fighting between US military personnel and Panamanians, resulting in $2 million in property burned or otherwise destroyed (mainly US), 28 dead, 300 wounded and 500 arrested. Of the dead, 22 were Panamanian citizens. Panama broke diplomatic relations with the United States. --The US responded by agreeing to raise the Panamanian flag at the Canal Zone high school and to negotiate a new canal treaty. 1967: After three years of negotiations, the US proposed a treaty that was rejected by Panama. 1968: General Omar Herrera Torrijos comes to power in a coup by the National Guard that threw Dr. Arnulfo Arias Madrid, a member of Panamanian oligarchy, out of presidential office. Torrijos intiated a populist program involving increased government services, support for agrarian cooperatives, and better government relations with the labor movement. He also greatly expanded the national military apparatus (the National Guard was transformed into the Panamanian Defense Forces). Gen. Torrijos instilled nationalism and populism in Panama, and was particularly beloved by the rural poor. His party was the Revolutionary Democratic Party (PRD), based on an alliance among workers, peasants, and political reformers. 1970: Panama passed a banking law that created the ideal conditions for an international finance center. Bank deposits are not taxed, no reserves are required for foreign operations or exchange controls, and profits are exempt from income tax. 1977: Under leadership of Gen. Torrijos, Panama and the United States reached an agreement over the ownership and operation of the Panama Canal. Provisions include: 1) Right of US to manage and operate the canal until the year 2000; 2) perpetual US authority to protect and defend the canal; 3) all key bases and training areas operated by the United States to remain under US control until the year 2000; 3) appropriation of territorial jurisdiction by Panama in 1982 over the Canal Zone (five-mile area on either side of the canal); 4) perpetual right of the United States to build a new sea- level canal ten miles to the west; 5) an increase of toll fees received by Panama from $2.3 million to approximately $70 million annually; 6) establishment of a nine-member canal commission, composed of five US members and four Panamanian members, to manage the canal (in 1989, to change to four US and five Panamanian members). 1981: Torrijos was killed in an airplane crash. Many suspected CIA involvement in the crash because of Torrijos' nationalist politics and friendly relations with Cuba. 1982: Ricardo de la Espriella enters as president of Panama, marking a move to the right with increasing influence of the National Guard. 1984: Canal commission voted 5 to 4 to increase the canal budget by $15 million to provide higher salaries to the US employees of the canal. The five US members of the commission argued that US employees needed higher salaries because they no longer enjoyed privileges at the US commissary. Panamanian canal workers were not granted a raise and 500 were fired for budgetary reasons. Incidents of this nature have continued to the present, sparking complaints in Panama City that the nondiscrimination clauses of the canal treaties were being violated. --For the 1984 elections, the military and the PRD chose Nicolas Ardito Barletta, former World Bank president, University of Chicago- trained economist, and friend of George Shultz and Henry Kissinger. Backing Ardito Barletta was a PRD-led grouping called the National Democratic Unity Coalition (UNADE) which consisted of PRD, two right-wing parties, the Liberal Party, and a splinter group from the main opposition party. Ardito became the first elected president in 16 years. The vote count took place behind closed doors, and the military was widely suspected of fixing the vote toals. Adding to the election controversy was the revelation that AIFLD and the PRODEMCA (two USAID-funded organizations) contributed $20,000 to Ardito Barletta's campaign. September 1985: Gen. Manuel Antonio Noriega, chief of Panamanian Defense Forces, forces Ardito Barletta to resign, replacing him with Vice President Eric Arturo Delvalle. ============================================= from The NY Transfer BBS 718-448-2358 Source: NY OnLine BBS 718-852-2662

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