Foreign Relations of the United States, 1964–1968, Volume XXXI, South and Central America; Mexico

385. Memorandum From Senator Mike Mansfield to President Johnson¹

Washington, January 31, 1964.

SUBJECT

• The Panama Situation

I. In response to your request, this memorandum contains observations and suggestions relative to the Panamanian situation. They are based on limited access to the facts and on history. As such, they are, at best, additional yardsticks which may have some use in weighing the difficult decisions which fall within your heavy responsibilities.

II. The following assumptions underlie the observations and suggestions in this memorandum.

A. We have only one fundamental national interest to protect in the present situation. We have got to insure untroubled and adequate water-passage through Central America. It is desirable to seek to secure this interest at a minimum total cost to this nation and, if possible, by ways which do not undermine our capacity to exercise a constructive influence elsewhere in Latin America.

B. The pressure for social change is just short of violent revolution in Panama and in much of the rest of Latin America. The pressure comes primarily from the inside, from the decay and antiquation of the social structures of various Latin American countries.

Even if we desired to do so, we could not, as a practical matter, stop the pressure for change. But we may have something constructive to contribute to the form and pace of the change if we play our cards carefully and wisely.

C. Change in Panama is part of the whole problem of change in Latin America. Our actions with respect to the part will have a significant effect on our ability to act constructively with respect to the whole.

D. Our actions in Panama will produce respect, rather than fear and suspicious hostility in Latin America, provided that our unquestionable power is used only with restraint and with justice and in accord with the decent opinion of Latin America.

III. If the above assumptions are accurate and are at the heart of our national interest in the present situation, the following general observations on United States policy will be derived from them:

A. Those United States policies (words and actions) which preserve untroubled water-passage through Central America but also tend to permit reasonable and peaceful adjustments in our relationship to the changing situation in that region make sense in terms of our national interests.

B. Conversely, those policies (words and actions) which enable us to preserve the water-passage only by a large increase in the costs of military and police protection and at the price of intensified suspicion and antagonism towards the United States throughout Latin America are to be minimized or avoided entirely if at all possible.

IV. Specific suggestions on policy (words and actions):

In the light of these assumptions and general observations the following specific suggestions may be worth considering:

A. Welcome, wholeheartedly, consideration by the OAS of the difficulties in Panama and urge that body’s help in finding a solution; offer every facility for on-the-spot study in the Zone.

B. Reject firmly but without fanfare the charges of aggression and also make it clear that we will not accept unilateral dictation from any nation, large or small.

C. Make clear that the President of the United States does not quibble over words such as “discussion or negotiations”; that, if changes are desirable, as well they may be, we are prepared at all times to sit down to discuss, to negotiate and to agree on a mutually acceptable basis.

D. Avoid boxing ourselves in at home against change through the fanning of our own emotions by crediting Castro and Communism too heavily for a difficulty which existed long before either had any significance in this Hemisphere and which will undoubtedly continue to plague us after both cease to have much meaning.

E. Stress with our own involved bureaucracy that our national interest is trouble-free water-passage, not the safeguarding of an outdated position of privilege (Zonists, understandably, might have difficulty differentiating between the maintenance of their special interests and the national interests). To this end, at an appropriate time:

1. Act to limit continuous service in the Zone for all U.S. military and civilian personnel to a maximum period of four years and seek a sharp reduction particularly in civilian personnel.

2. Cut the commissaries or so alter and limit their character that they will handle only those few unique items of U.S. merchandise which may not be readily available locally.

3. Fully integrate all schools and colleges in the Zone.

4. Tighten up on all salaries and emoluments to Zone employees to bring them in line with general U.S. personnel practices applicable elsewhere to overseas personnel.

F. Indicate a readiness, at an appropriate time and when not under duress, to consider:

a. Steps to give additional recognition to Panamanian titular sovereignty in the Zone.

b. Revision of the rental agreement.

c. An increase of Panamanian participation in the operation of the Canal up to and including some Panamanian representation on the Board of the Canal Company, always, however, contingent upon the need for a trouble-free operation of the waterway.

G. Begin to give serious consideration in diplomacy to marshalling international support for a Mexican-owned and operated canal through Mexico, with a view to sobering the Panamanians in their demands and, also, in recognition of the growing need for additional water-passage through Central America.

Some or none of the above specifics may have applicability in the light of your understanding of all the facts. They are merely suggestive of the kinds of words and actions which, it would seem, might be helpful in the present difficulty. And to ease those difficulties may be the best that can be hoped for until it is crystal clear that another canal will be built and our dependence on this outdated monopoly will have thereby been reduced.

1. Source: Johnson Library, National Security File, Country File, Panama, Vol. I, December 1963 to January 1964. No classification marking. The memorandum is unsigned.