.. lt. In a letter he wrote to Banau-Varilla, he said “Is that they are eager to take advantage of the deeds of the man of action when action is necessary and then eager to discredit him when the action is once over.”(McCullough 617) The Panama Canal had substantial effect on the Panamanian Economy. In addition to the $10 million payment to Panama, the U.S paid $250,000 after the canal had been in operation for nine years. That annuity has increased since, in 1999 it was well over $100 million.
The canal also prompted many American Companies to invest in Panama. They bought land from the nations rich land owning families. This money seldom filtered down to the ordinary citizens. However, there were advantages for these citizens. (Dolan 98) The canal and the zone, until recently, were ran by two organization, the zone government (to supervise such bodies as the police, postal, and court systems) and the Panama Canal Company, which held responsibility for operating and maintaining the waterway.
These two organizations were the major employer on the isthmus. Between 1914 and 1940 they consistently employed between 10,00 and 13,000 civilian workers. When the work force stood at 13,000 in 1977, 3,500 employees were Americans and 9,600 were non-U.S. citizens. The non U.S.
citizens were mainly Panamanians. (Dolan 99) Many other Panamanians also profited from the waterway. Though not directly employed by the canal, they sold goods and services to the zone and its workers, the passing ships, and the 10,000 U.S. military troops (and their families) stationed in the zone to protect the canal. It has been estimated that the canal accounted for over 20 percent of Panamas employment. (Dolan 99) The canal tolls per ton were not raised for 59 years. In 1915 tolls were about $14 million. By 1970 they exceeded $100 million.
In 1973 the Panama Canal Company recorded its first loss, this was the reason for the change from 90 cents per cargo ton to $1.08. Revenues in 1975 exceeded $ 140 million. (McNeese 215) Was the Hay-Banan-Varilla Treaty fair? In the words of former President Jimmy Carter “No Panamanians had ever seen the terms of the treaty of which were highly favorable to the U.S.”. Among the terms that Panama resented was the U.S. control over the zone. The question of sovereignty over the canal aroused deep passions, which came to boil in 1964 with massive rioting by Panamanians, a response to U.S.
troops, bloodshed on both sides. In the aftermath, President Lydon Johnson agreed to renegotiate the treaty related to the Panama Canal. (Conaway) In 1977 United States and Panama agreed on a new treaty. The most significant agreement was the transferring of ownership of the canal to Panama to take the place on December 31, 1999. Also they agreed to cooperate in the defense of the canal.
The annual payment was upped to $ 10 million and was to be paid from the canals revenue, plus a payment of 30 cents for each ton of shipping. And when Panama took control of the canal it was free to employ Americans. (Dolan 128) Also included in the treaty was a neutrality clause. The canal is to remain open to merchant vessels of all nations indefinitely, without discriminations as to conditions or tolls. The clause does not allow the U.S.
to intervene in the internal affairs of Panama. It does however give the United States and Panama the responsibility to insure that the canal remains open. (Crane 81) Though it was rich with symbolic significance the signing ceremony on September 7, 1977, hardly ended the controversy over the treaties. The ratification battle in the U.S. Senate still lay ahead, and it called for the use of every political tool available to President Carters team.
It was a battle won vote by vote, through personal appeals, political accommodations, and occasionally silly details. Carter recall one senator, a former college professor, was proud of a book he had written on semantics. Before meeting with him to try to persuade him to vote for the treaties, Carter read the entire book “which was really boring” and proved that he had by discussing some of its point with him. He eventually got the senators vote. (Second Decade) In 1988 the canal became involved in a struggle for power in Panama. Manuel Noreiga had assumed military power over Panama. In response President Ronald Reagan decided to ban the annual payments to Panama and freeze Panamas assets in U.S.
banks. This cut Noriega revenue by $180 million a year. (Dolan 140) Facing a rapidly deteriorating situation, President Bush ordered U.S. troops into Panama on December 20 1989, to protect U.S. citizens, to meet treaty responsibilities, to defend the canal, and to assist in restoring democracy and bring Noreiga to Justice.
The Panamanian democratic opposition formed a new government led by President Guillermd Endum. (Second Decade) Finally Panama was under democratic control and had something to look forward to. The turning over of the Panama Canal to Panama. No longer would their economic depend on how another country wanted to run things. They now will decide how they want to run the canal. And they will run it as the please because as of December 31, 1999, the day the U.S.
turned over the canal, they owned the canal. Finally after decades of frustration they were truly free. Politics will undoubtedly have an influence in the maintaining, the economics, and the operation of the Panama Canal in the years to come. They will help the canal expand in the lives of more Panamanians and maybe someday even building of another canal over the Isthmus of Panama. Bibliography Crane, Phillip F: Surrender in Panama, the Case Against the Treaties. New York: Dale Books, 1978 Conaway, Janell. Americas.
Jan 1999, 16. NewsBank, Online 1999 Dolan, Edward F.: Panama and the United States, Their Canal, and Their Stormy Years. New York: Moffy Press Inc., 1990 McCullough, David: The Path Between the Seas. New York: Simon a Schuster, 1977 McNeese, Tim. The Panama Canal. San Diego: Lucent Books.
Inc, 1997 “Panama”. The Volume Library. South Western Company, 1994 The Second Decade: Panama at the Canal Treaties. U.S. Department of Dispatch, 1990.