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Panama Canal Becoming Panama’s Canal

November 20, 1999

PANAMA CITY, Panama (AP) _ It is shortly after dawn and the tanker Diligence rides high in the calm waters of the Panama Canal, heading into the old shortcut between the seas to take on 11 million gallons of Gulf Coast gasoline and haul it back to a fuel-hungry California.

The quiet glide through the bends of the little man-made river, and through the ancient machinery of the locks, is so routine that it’s easy to forget the wrenching sacrifice and extraordinary can-do vigor that made it possible.

As birds skim over the water, canal pilot Ronald Nessler, born and raised alongside the waterway, clambers up a rope ladder to a deck lined with pipes and takes command from Captain Jim Ash. For much of the day, Nessler and a fellow pilot will carefully squeeze the vessel through the locks and channels of the big ditch.

Nessler has done this hundreds of times over the past 10 years. Not for much longer.

On Dec. 31, the Panama Canal becomes Panama’s canal. Ninety-five years of American control over the canal _ and over much of Panama _ comes to a close, and Nessler, 55, is joining the thousands of other Americans who have already retired and headed to the United States.

``It was a way of life. That has changed. Of course it hurts,″ Nessler said as electric locomotives helped haul the Diligence through the Miraflores Locks and, in the distance, the American flag flapped in the wind over Fort Clayton.

If anything symbolizes the American Century, it is the Panama Canal, built by a confident, expansive America and maintained as an American stronghold even as European empires crumbled.

Now the Stars and Stripes is about to come down (in tandem, coincidentally, with a closing chapter of European colonization _ the return on Dec. 31 of the Portuguese colony of Macau to China). And even though the Panama withdrawal has been slowly taking place over the past 22 years, the final handover still generates questions.

Panamanians treat it as a coming of age, a recognition of their ability to manage one of the world’s most important seaways. Yet most express reluctance to lose the Americans and their dollars.

In Washington, some conservatives worry that control of the canal is falling into Chinese hands because of extensive port concessions awarded to a Hong Kong company. They say America has made a strategic blunder by giving up a waterway that cuts nearly 8,000 miles, or two weeks’ sailing time, off a voyage from San Francisco to New York.

``We built it, we paid for it, we use it,″ retired Adm. Thomas H. Moorer, former chairman of the Joint Chiefs, told a recent news conference. America, he said, should ``make sure the Chinese communists don’t gain control of it.″

But the Pentagon says it sees no threat to U.S. interests, and others point out that Taiwan, China’s arch-rival, is also deeply invested in the Canal Zone.

Marine Gen. Charles E. Wilhelm, commander of U.S. forces in Latin America, has said he is more concerned by the threat of terrorist attack, and by environmental damage to the lake system on which the canal’s network of locks depends.

Panama’s new president, Mireya Moscoso, tried in August to reassure doubters: ``We will guarantee the world safe passage through the canal, just as the United States did.″

The country she governs didn’t even exist until 1903, when the Americans helped a tiny independence movement snatch it from Colombia, which was resisting the conditions demanded by Washington.

Picking up in 1904 from a bankrupt French effort, the Americans triumphed in a heroic 10-year campaign against the elements. Rains averaging 140 inches a year could turn the Chagres River across the canal’s path into a rampaging monster. Mosquitoes made Panama a deathtrap of malaria and yellow fever.

By the time the 50-mile chain of locks and channels opened on Aug. 15, 1914, 5,609 people had died, 4,500 of them black laborers imported from the Caribbean, according to historian David McCullough’s book ``The Path Between the Seas.″

McCullough estimates that if the French project were included, 25,000 people may have died in the effort _ one for every 10 feet of canal.

A 10-mile-wide zone along the canal became an English-speaking enclave under American laws. The Americans called themselves Zonians, and Panamanians needed permission to enter. The zone was the center of U.S. military activity in Latin America. Hundreds of thousands of U.S. soldiers served here. It’s where John McCain, presidential contender and scion of a U.S. Navy family, was born.

Local resentment over U.S. privileges emerged almost from the start and the United States sometimes meddled in Panamanian politics to get rid of inconvenient governments.

On Jan. 9, 1964, 23 Panamanians and four U.S. Marines were killed in riots triggered by a U.S. reluctance to let the Panamanian flag fly at a high school. Thirty-five years later, Jan. 9 is still a public holiday called Day of the Martyrs.

In 1977, President Jimmy Carter signed a treaty agreeing to start turning over all U.S. facilities to Panama starting in 1979 and finishing at noon (also noon EST) on Dec. 31, 1999.

At that point, a country of fewer than 3 million people will take charge of one of the world’s most important waterways, serving almost 15,000 vessels a year, or roughly 5 percent of all the world’s shipping.

Already, 95 percent of the work force is Panamanian. Fewer than 500 are American, and most will be gone by year’s end. A few key employees, notably canal pilots, will continue for a couple of years until Panamanian replacements are trained.

Panamanian officials insist that little will change. ``What will happen after Dec. 31? The answer to that is that it will be Jan. 1,″ said Canal Administrator Alberto Aleman. ``Everything will continue as it is today. ... The same people who are working here are the same people who will be working.″

Shipping businessmen seem relaxed.

``We are convinced ... it’s going to operate in the right way. Certainly the same people are going to be in charge,″ said Alec Bilney, marine manager for the London-based International Chamber of Shipping.

He noted that the 1956 nationalization of Egypt’s Suez Canal, although much more abrupt, did not cause long-term problems.

The challenge to the canal may be economic. It still has all the business it can handle, but in an era of ever-larger ships, it can’t take vessels wider than 100 feet. So about 10 percent of ships, notably modern tankers, don’t fit. Already one-third of ships going through the canal brush against the locks as they pass.

Also, improvements in containerized rail transport make it easier to move goods across continents.

Aleman said Panama hopes to improve service and capacity by widening the Gaillard Cut, the narrowest part of the canal, and may build a larger, third set of locks alongside the existing side-by-side locks.

Zonians like Nessler are bitter about losing the place they grew up in and call home. The canal pilot believes Panamanian politicians will see the waterway as a source of loot and that the new regime will cut corners. ``Anything that is 85 years old has to be maintained,″ Nessler said. ``That’s a foreign word to Panama, maintenance.″

Panamanians are aware of the doubts.

``I think it’s obvious Panama is taking over the canal with zero credibility,″ said Roberto Eisenmann, a banker and political activist often critical of the government. ``This is a major international asset being transferred from the most important power to a small Third World country.″

But he said he expects the transfer to be ``imperceptible″ and believes public pressure will curb venal politicians.

``The Panamanian workers have shown they can do the job as well as anybody,″ said Juan Feliu, a 32-year-old Panamanian canal pilot who graduated from the U.S. Merchant Marine Academy. ``I would like to think that the Panamanian decision makers will make the right call at the right time.″

Critics also worry about plans to build housing, industrial parks and hotels along the canal and its watershed, saying these could lead to erosion, silting up lakes and reducing the water supply that keeps the canal running. It takes 52 million gallons of water to raise and lower a vessel through the locks, and in some years a shortage of water has forced ships to lighten their load to make it through.

But Juan Hector Diaz, an environmental official, insisted that Panama has reduced the rate of settlement and deforestation in the 1,300-square-mile watershed and is considering expanding the area with new dams to increase the water supply. He said silting has not been a big problem.

The canal and the American presence have made Panama unique _ and uniquely prosperous _ in Central America.

Underpinned by the U.S. dollar serving as a local currency, it has developed a major international banking industry. The duty-free zone in otherwise seedy Colon on the Atlantic does $12 billion in business a year.

The canal and U.S. military bases have paid wages near U.S. levels, helping create a large middle class. Pilots can make $150,000 a year _ an immense sum for a non-executive job in Latin America.

With cheap credit and decent jobs, many Panamanians have cars. Panama City’s clogged, chaotic streets are a battleground of cars, terrified pedestrians and smoke-spewing buses known as ``Red Devils,″ exuberantly painted with alpine landscapes, lizards, saints, girlfriends or nudes, as well as vaguely ominous slogans: ``Corruption Boy″...″Breaking the Rules″... ``Watch Out for Me.″

Soaring above the waterfront are the glass towers of banks and hotels. But raw sewage pours into the spectacular bay, and there are no swimmers or fishermen.

While the canal takeover was a wildly popular boost to Panamanian pride and sovereignty, the departure of U.S. military bases was not. Thousands of Panamanians worked at the bases, which pumped hundreds of millions of dollars into the economy.

As late as September, a poll of 1,219 Panamanians found 61 percent favored talks on some form of continued U.S. military presence, 31 percent said they were opposed and only seven percent said they didn’t know. The poll, published in the newspaper La Prensa, had a margin of error of three percentage points.

``We have to thank them for all they have done for us,″ said Panama City clothing store worker Luis Sanchez, 38. With the bases closing, business ``is horrible. We are not selling anything. ... People are afraid. Nobody wants to buy anything.″

Daniel Ortega, a worker at Colon’s free zone, said a new Taiwanese industrial park built on the old Fort Davis near the Atlantic port of Colon pays workers less than one-third of what the U.S. military paid.

``I can’t eat sovereignty,″ he said, sipping a beer with friends on the porch of a restaurant in rural Escobal.

Panamanians say the handover means a coming of age for a country that has always been dependent on a foreign power and has seen Americans as ``a superior entity,″ said Mario Rognoni, a politician and engineer with a Georgia Tech degree.

``If it was American it was good. If it was Panamanian it was not,″ he said. ``You even paid attention to the police in the Canal Zone and ignored them in Panama.″

Eisenmann, the banker, said the handover ``is a little bit like when you left your father. There comes a time to tell him to get out of the way.″

``It requires a change in our habit of having somebody to blame for everything,″ he added. ``If something goes wrong, we have to learn to look in the mirror.″

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