The Panama Canal From Teddy Roosevelt to the Treaties Fight of 1978

Want to start a fight at a Republican cookout? Skip abortion, skip taxes, skip the designated-hitter rule. Just say, loudly, over the burgers: "We should never have given away the Panama Canal." Within thirty seconds you will have a table of sensible, conservative people shouting at each other, and half of them will be wrong in an interesting way.

That tells you something. Few foreign-policy fights in the last half century divided the conservative movement as sharply as the treaties of 1977 and 1978, and the argument has never really ended. One camp remembers a giveaway of American property. The other remembers a hard-headed deal that secured a waterway we could not have held by force against the people who lived around it. Both camps have a point. Let me walk you through the whole story, in order, and then tell you who I think won the argument and what they won.

A waterway that changes the map

Start with the problem, because the problem is geography. Before the canal, a ship going from New York to San Francisco had to sail around the southern tip of South America. The Isthmus of Panama is a narrow strip of land with an ocean on each side, and anyone who could cut through it would shorten the trip by thousands of miles. For a country with a coast on two oceans and a Navy that had to be at both, that was not a convenience. It was a strategic necessity.

The Spanish-American War of 1898 drove the lesson home. The battleship USS Oregon had to make a long voyage from the Pacific coast around South America to join the fight in the Atlantic and Caribbean. The whole country followed its progress. Nobody who watched that trip needed a lecture on why a canal would be a good idea. A fleet that cannot be in two places at once is, in effect, half a fleet.

This is what I mean by strategic geography. Armies, flags and treaties come and go, but the map does not move. Whoever controls a narrow chokepoint between two seas holds a lever on everyone who uses it. Americans understood that in 1900, and we understood it in 1978. The only question in either year was who should hold the lever, and on what terms.

1903: how America got the canal

A French company had tried to dig a canal and failed, losing money and a great many lives to disease and difficult terrain. The United States wanted to finish the job. In the early 1900s the isthmus belonged to Colombia, and Washington negotiated a treaty with Colombia, the Hay-Herran Treaty, which the Colombian Senate rejected in 1903.

What happened next is not a story that makes anyone look noble. In November 1903 Panama declared its independence from Colombia, with the United States quickly recognizing the new republic and American warships nearby. President Theodore Roosevelt, a man who never met a big idea he did not want to ride at, had his canal. On November 18, 1903 the United States and Panama signed the Hay-Bunau-Varilla Treaty. It is named for John Hay, the American Secretary of State, and Philippe Bunau-Varilla, a French engineer who represented the new Panama in Washington and who signed it before Panamanian delegates could even arrive.

Think about that for a second. The treaty that gave America rights over a strip of another country's territory was signed on that country's behalf by a Frenchman. The treaty granted the United States control of a zone across the isthmus, about ten miles wide, in terms that read as if it were sovereign there. It also gave "in perpetuity" a status that Panamanians would resent for the next seventy years, as you would too if somebody drew a line through your country and flew a foreign flag over it.

Defenders of Roosevelt will tell you the United States paid for the rights, which it did, with a lump sum and an annual payment, and that the work was a feat. They are right about the feat. The Americans took over the construction in 1904, brought engineering and sanitation to a scale the world had not seen, and the canal opened to traffic in August 1914. It was one of the great engineering achievements of the century, and Americans built it. That is true and it is worth being proud of.

But the origin of the Zone also planted a grievance. If you wonder why the next sixty years of Panamanian politics so often turned on the Canal Zone, the answer is in the signature lines of that 1903 treaty.

The slow boil

For decades the arrangement held, and so did the resentment. The Canal Zone was American territory in everything but name, with its own schools, its own police, its own American flag, and Panama's capital city right next door. In January 1964 rioting broke out over the question of whose flag should fly in the Zone. Americans and Panamanians died, and Panama broke diplomatic relations for a time. The lesson Washington took was not subtle: an arrangement that needs a permanent garrison to protect it against the people next door is a weak foundation for a vital asset.

By the 1970s the Panamanian government was led by General Omar Torrijos, an authoritarian ruler with whom no one would want to be photographed on a first date. But Torrijos had a card to play, which was the threat of unrest, including sabotage of the canal itself. And his government was not alone in wanting change. The Nixon and Ford administrations, both Republican, had started the negotiations. In 1974 Secretary of State Henry Kissinger and Panama's foreign minister signed a statement of principles that pointed toward a new treaty. That is worth remembering whenever someone says the treaties were a Carter invention. The negotiating began under Republican presidents who judged that the 1903 arrangement could not last.

1976: Reagan makes it a campaign

Then politics arrived. In 1976 President Gerald Ford faced a challenge from the former governor of California, Ronald Reagan, in the Republican primaries. Reagan had been losing early contests. He took the canal and made it a signature issue, arguing that the United States should not surrender control of a vital asset that Americans had built and paid for. He won the North Carolina primary in March 1976, and the canal helped him do it. He did not win the nomination, but he kept the fight alive all the way to the convention, and he turned a technical subject in diplomacy into a rallying cry for conservatives.

I want to be fair to what Reagan was arguing, because the caricature of his position is wrong. He was not saying that Panama had no rights or that the 1903 treaty was a holy writ. He was saying that you do not hand over a strategic asset to an unstable government, under pressure, with no guarantee about the future. That is a serious argument. It is the argument that anyone should hear before signing anything.

1977 and 1978: the treaties and the Senate

Jimmy Carter, the Democratic president, finished the negotiation. On September 7, 1977 the United States and Panama signed two agreements, known together as the Torrijos-Carter treaties.

1. The Panama Canal Treaty ended the Canal Zone and set the schedule: Panama would take over the canal on December 31, 1999, and until then the two countries would share operation under American leadership.
2. The Treaty Concerning the Permanent Neutrality and Operation of the Panama Canal, usually called the neutrality treaty, guaranteed that the canal would be open to the ships of all nations, in peace and in war, on terms of equality. Each country gained the right to defend the canal's neutrality, and American warships would have the right to go to the head of the line in an emergency.

Under Article II of the Constitution, a treaty needs the consent of two-thirds of the senators present. If all 100 senators vote, two-thirds of 100 is 66.67, so a treaty needs 67 votes. That is why the Senate matters so much in these fights, a point our post on Why Republicans Said the Iran Deal Should Have Been a Treaty develops, and why the whole treaty-power machinery is worth knowing; for the full text see A Walkthrough of the Constitution You Can Finish in One Evening.

The Senate took the neutrality treaty first. On March 16, 1978 it voted 68 to 32 to approve it. A month later, on April 18, 1978, it approved the Panama Canal Treaty by the same count, 68 to 32. Now do the arithmetic. 68 plus 32 is 100, so every senator voted. Sixty-seven were needed, and 68 voted yes, which means the treaties passed with one vote to spare. One. If a single senator had changed his vote, the treaties would have died.

How did supporters get there? Two things stand out. First, the amendment-and-understanding process. Senator Dennis DeConcini of Arizona, a Democrat, secured a condition on the neutrality treaty stating that the United States could use military force, if necessary, to keep the canal open to its ships. Panama objected, and the Senate added an understanding to soften the text, but the DeConcini language gave wavering senators something to hold. Second, Republican leadership mattered. Howard Baker of Tennessee, the Senate Republican leader, supported the treaties and paid a political price in the party for it. Conservative voices such as William F. Buckley Jr. also argued in favour, and he debated Reagan on the subject on television.

The strongest case against the treaties

Here is the best version of the opposition, and I want you to feel its force.

1. Americans built it and paid for it. The canal was an American achievement, and giving it away rewards no one.
2. Property is property. The United States had acquired its rights by treaty, and a treaty is a treaty.
3. The future government is unknown. Torrijos was a military ruler, and there was no assurance that his successors would be friendly or competent.
4. Strategic geography does not retire. The canal would matter in the next war as much as it mattered in the last.
5. Weakness under threat invites more demands. If threats of riot and sabotage produce a treaty, the lesson is that threats work.

That is not a foolish list. Several points stand up. Point four in particular is exactly right, and it is the reason this blog cares about the subject.

The answer, and my verdict

Here is why I come down on the side of the treaties' framework, while holding that the critics were right to be loud.

First, the canal could not be held indefinitely against the will of the country around it. The Zone was a sovereignty problem, not a property problem. You can own a house. You cannot own a slice of another country's capital for ever, defended by troops, and expect the neighbours to forget it. A canal that must be defended against its own host nation is the most expensive kind of asset.

Second, and this is the point the cookout debaters miss, the treaty that mattered was the neutrality treaty, and it did not give Panama a blank cheque. It gave the United States a permanent right, not a temporary one, to defend the canal's neutrality and to move warships through in an emergency. The ownership passed on a schedule. The strategic guarantee did not expire. That is the clause conservatives should know by heart, because it is the one that survives the handover in 1999.

Third, the treaties were not a surrender to the left. They began under Nixon and Ford, they were negotiated with the participation of senior military leaders, and they were defended by Republicans like Baker who understood the strategic stakes.

Fourth, and here is where I give the critics their due, a guarantee is only as good as the will to enforce it. A right to defend the canal means little if America loses the ability, or the nerve, to act. That is the real lesson of 1978: a treaty is a promise on paper, and promises are kept by capability. If you want the canal to remain open, the solution is not to wish the treaty away but to keep the Navy, the alliances and the readiness that give the neutrality clause teeth. For that argument see Why Deterrence Is a Promise You Have to Be Willing to Keep.

1999 and after

The transfer took place on December 31, 1999, exactly as the treaty scheduled. The earlier decade had contained its own drama. In December 1989 the United States sent forces into Panama to remove the dictator Manuel Noriega, an operation conducted during the treaty period, and the neutrality right was part of the legal background. The point is that the treaties did not stop American action when American interests and the treaty's logic aligned. Readers who want to understand how the old hemispheric idea shaped all of this should start with What the Monroe Doctrine Actually Said and Why It Still Matters, and the Cuban chapter of the same story is in Thirteen Days in October and What the Quarantine Teaches About Resolve. Taken together, they show a consistent American habit: keep other great powers out of the hemisphere, and keep the chokepoints open.

As for the modern argument over who has influence around the canal, I will leave the current specifics to the news and keep to what is permanent. The treaty text is public, the neutrality clause is there for anyone to read, and a voter who wants to hold officials to it can do so. Read the neutrality treaty yourself, and ask your senator whether he or she knows what it says.

The bottom line

• The canal is the textbook example of strategic geography: a narrow strip of land that shortened the voyage between two oceans and gave the country a lever on world trade.
• The 1903 treaty got America the canal and also planted seventy years of grievance. Both facts are true, and honest conservatives hold both.
• The 1978 treaties passed 68 to 32, one vote over the 67 required, and the neutrality treaty is the part that matters most to American security.
• Do not argue about the handover without reading the neutrality clause. It is the piece that gives America a continuing right to see the canal stays open.
• Ask the right question of any treaty: not "does it sound tough?" but "does it leave us the ability to enforce it?"