811.04418/120
The Secretary of War (Dern) to the Secretary of State
My Dear Mr. Secretary: The Governor of The Panama Canal has called my attention to the neutrality bills pending before Congress (S. 3474, S. 3478, H. J. Res. 422 and H. R. 9482), all of which by the definition of the term “United States” extend all of their provisions to the Canal Zone.
The status of the Canal Zone as a Government reservation in which no manufacturing operations can be carried on except those carried on by the United States, or its adjunct, the Panama Railroad Company, and in which no business operations are permitted and no person is permitted to reside, except as such business operations and such person have a direct connection with Panama Canal operations, makes [Page 175] it unnecessary to extend thereto all the provisions of the neutrality bills. No arms and ammunition, etc., could be imported into the Canal Zone except for the use of the United States and therefore none could be exported therefrom. Similarly, the status of the Panama Canal as an international highway to be operated in conformity with the provisions of existing treaties seems to make it inadvisable to enact legislation under which some of the provisions of the above-numbered bills in regard to clearing of vessels from United States ports and making exportations might be construed as being applicable to the Canal Zone.
It is suggested that the words “Canal Zone” be stricken from the provision defining the term “United States” in the pending bills and that a clause be added to the definition reading “excluding the Canal Zone” so that no question may arise as to whether the Canal Zone is included within the term “possession” of the United States.
It seems questionable whether we should exercise at the Panama Canal any police jurisdiction over vessels transiting the Canal other than such as may be necessary to protect the interests of the United States. The status of the Canal Zone is such that general neutrality provisions which are applicable to conditions existing in the United States do not meet the requirements at the Canal Zone. It would seem that, if additional provisions in regard to neutralizing the Panama Canal are required, they should be included in a separate bill, or under a separate title, or in different sections of the pending legislation and made applicable to the Panama Canal and the Canal Zone only.
As it is understood from Mr. Hackworth, Legal Adviser of your Department, that this legislation is now being given detailed consideration by committees of Congress, no attempt is made in this letter to outline all the considerations which would seem to justify special consideration of provisions relating to the Panama Canal and Canal Zone.
Governor Schley of The Panama Canal is now in Washington and will be available to discuss more fully the questions involved.
Sincerely yours,