Panama Is Back in the News. That Can Be a Good Thing.

The Panama Canal and its home country should be newly important to Americans. But in the opposite way from what Donald Trump has been talking about.

A heavily laden container ship making its way through the Cocoli Locks of the Panama Canal earlier this month. The tug boat in front of the ship is not pulling it forward but instead using taut lines to nudge it left and right, so as to manage its few inches of clearance on each side. This is the hugely complex, technically and economically successful operation on which much world trade depends, and which Donald Trump has made the latest object of his grievance-politics. (Photo by Deborah Fallows.)

This post is about one of the places where Deb and I have been during these past holiday weeks, far from our home in Washington and generally off-line. That place is Panama, which has again entered headlines in the United States.

The journey was highly instructive. For Deb, it was the first experience in the country. For me, it was the second, after a gap of nearly half a century. The previous time was in 1978, as part of Jimmy Carter’s traveling team formalizing the treaties that began the transfer of the Canal Zone and the canal itself back to Panama.

[IMPORTANT UPDATE I have learned just as pushing the “publish” button on this post that former President Carter died this afternoon. More on this soon. For now, a piece I wrote about him earlier this month, and one in The Atlantic from early 2023.]

Later on I plan to write in more depth about what we learned this month, and why today’s Panama holds significant lessons and surprises. My purpose now is to offer a quick guide on how to react to Donald Trump’s recent threats (or promises) to “take back” the Canal. Here are four points to bear in mind.

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1) The triumph of resentment.

As with so many other “grievance” issues, the recent Trump flap about Panama has virtually nothing to do with real-world developments there, and virtually everything to do with Trump’s instinct for the politics of resentment.

The next time you hear Trump say that Panama is “cheating” and “ripping off” American shippers, or that the US must stop being a “sucker” country and “loser” and instead step in to combat China’s influence, think of this as one more chapter in his ceaseless “it’s all so unfair!” life-narrative. This rhetoric comes from the same place as his claims that migrants are bringing in deadly fentanyl (they aren’t), that public schools authorize gender-change surgery (they don’t), or that regulation has crippled the US oil industry (which is producing more than ever before). It’s based on lies; it’s designed to make his followers mad; and it works.

Is the Canal authority cheating American shippers by selectively charging them too much? Oh, please. You can read every detail of the Canal’s published fee schedule here, which is based on tonnage and ship length (and cargo and other factors), not on nationality.

Remember too that when the current Chinese government took its most dramatic step toward increased influence in Panama, by persuading the Panamanian government to shift its diplomatic recognition from Taiwan to the PRC back in 2017, the serving American president was Trump himself, in his first term. As far as I can tell, he didn’t utter a single public word of complaint. At the time he was busy kissing up to Xi Jinping.

Panama itself is just the latest backdrop. (See also: Greenland.) The unchanging drama is Trump making Americans feel aggrieved.

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2) The triumph of make-believe.

The chance of the US forcibly (or in other ways) “taking back” the Canal is zero. The next time you hear this idea, put it in the category of other make-believe Trump threats and promises. These range from his promise to end the warfare in Ukraine “in one day,” to his threat to slap a 25% tariff on goods from Mexico and Canada, the US’s two largest trading partners. Or even the Musk-Ramaswamy fantasy of cutting trillions in “fat” from the federal budget.

None of these claims is meant to happen, in the first day or the first year or ever. Their purpose is to work partisans up right now.

In fact, one of the most important reasons the US began negotiations to “give away” the Canal nearly 60 years ago was mounting fear from the US military that it would become impossible to defend such a large, sprawling asset if local sentiment kept turning more strongly anti-American.

It’s common knowledge that the transfer deal was signed under Jimmy Carter. But the serious talks began under Richard Nixon, out of realpolitik concerns about guarding the Canal in the long run. These strategic issues weren’t a big part of the in-public debate in the 1970s about transferring control to Panama. But they were a huge, perhaps decisive background factor.

Yes, US forces have actually invaded Panama in modern times, even after the transfer treaties were signed. This was during “Operation Just Cause,” ordered by the first George Bush back in 1989, and aimed strictly at deposing the narcotrafficker-dictator Manuel Noriega.¹

But the very circumstances that made this limited, two-week operation a relative “success” underscore why a grander-scale “take back” of the Canal would be disastrous.²

A few months after approving “Just Cause” in Panama, the same George H.W. Bush led a broad international coalition through “Operation Desert Storm” in Kuwait. This was a focused, limited drive to push Iraqi forces out of Kuwait, and explicitly not to take over Iraq or overthrow Saddam Hussein. For better and worse Saddam Hussein remained in power for another dozen years. But this selectivity and restraint meant that US forces were not involved in an open-ended catastrophe like the one the younger George Bush brought on with the Iraq War.

Removing Noriega from Panama in 1989 was a smaller-scale version of driving Iraqi forces from Kuwait in 1990. “Taking back” the Canal would be an open-ended invitation to disaster, as with the Iraq war. Even talking about it shows that you’re out of touch with reality.

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3) The triumph of diplomacy—back a while ago.

Last month I mentioned a ceremony honoring the 100-year-old Jimmy Carter for his contributions to peace, of which the best-known is the 1978 Camp David accords between Egypt and Israel. That agreement could not possibly have happened without Carter’s tireless face-to-face diplomacy with Anwar Sadat and Menachem Begin.

But the Panama Canal treaties of 1977-78 should be right up there. And they deserve attention now as illustrations of how presidents, and even members of the US Senate!, can advance long-term US interests rather than scoring immediate partisan points.

A concise but comprehensive backgrounder from the official Historian of the US State Department sets out the issues well. Yesterday Ron Elving of NPR published a useful comparison of the circumstances Carter faced when negotiating these agreements and those today. The main through-lines are these:

• From the mid-1960s onward, as nationalist and anti-American riots broke out in Panama, the US national-security establishment had been arguing in favor of turning the canal and Canal Zone back to Panama. The longer the US held onto a visibly colonialist presence in Panama, the reasoning went, the harder it would be to safeguard the Canal. In 1973, Richard Nixon appointed Ellsworth Bunker, an ambassador and Vietnam war hawk who epitomized the diplomatic establishment, to begin negotiating a handover agreement. Two years later, Henry Kissinger warned Nixon’s successor, Gerald Ford, that if the negotiations failed, “we will be beaten to death in every international forum and there will be riots all over Latin America.” Ford agreed and approved the negotiations.

• When Jimmy Carter ran against Gerald Ford in 1976, the Canal negotiations were a second-tier issue at best in the general-election campaign. At least that’s how I experienced it, through the blur of being on the road with the Carter entourage. In one of his debates against Ford, Carter apparently said he “would not relinquish practical control of the Panama Canal Zone any time in the foreseeable future.” I know that only from checking the transcript today. I wouldn’t have recalled it, since at the time it seemed a rounding-error in political significance, compared with economic crises, the aftermath of Watergate and Vietnam, and other miseries of the mid-1970s. And once in office, Carter also bought into the evidence that a transfer made shrewd strategic sense.

• The real issue—wait for it—was within the Republican party! Before Gerald Ford could run for re-election, he had to nail down the GOP nomination. His main challenger in the primaries was Ronald Reagan, and one of Reagan’s sharpest-edged arguments was that Ford was going to sell out America by giving away the Canal. Years later, when he became president, Reagan (like other presidents, including first-term Trump) lived comfortably with the Panama treaty. But his “sell-out” campaign rhetoric against Ford was a preview of every Trump-era split within the GOP.
  
  Elving’s piece is good on the ties between Reagan-vs-Ford in 1976 and our times. I also recommend this 1977 piece by the staunch libertarian Murray Rothbard. It’s a fascinating time capsule about the factional war among groups we’d now call MAGA, RINOs, and the Deep State.

• Then it was time for the Senate. As with any treaty, these required a two-thirds majority, or 67 votes. The Democrats, under majority leader Robert Byrd, had 61 seats: enough to break a filibuster, not enough to ratify. In the end the Carter administration, Byrd, and the Democrats worked with the Republican leader, Howard Baker, to wrangle enough GOP support to ratify the treaties, with one vote to spare.
  You can read some of the details from the US Senate historian here.³ That account ends with these words:
  “Many years later, recalling the political tightrope of the debate, Byrd summed it up this way: “Courage? That’s Howard Baker and the Panama Canal.”

Where am I going with this comparison? On the one hand, I find it instructive about the enduring power of resentment in our national life. Ronald Reagan was famed for being “sunny,” but he also knew how to make his partisans aggrieved and ready-to-blame.⁴ But sometimes elected leaders have managed to look beyond the short-term and the anger-fueled. It’s worth something to recognize that such moments have occurred.

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4) What we should talk about, when we talk about Panama.

Here’s another possible positive aspect of a new focus on Panama: Conceivably the attention might spill over to that country’s greatest global significance. That is not the Canal itself but what officials in Panama officially refer to as the Canal Watershed.

The managers of the Canal say that what they have to sell the world is not transportation but water. Every ship that travels the 50-plus miles from ocean to ocean through the Canal requires some 50 million gallons of fresh water.

That’s how much it takes to raise a ship from sea level, in the Caribbean or the Pacific, up through multiple locks to Gatun Lake in the middle of the isthmus. The lake is 78 feet above sea level; after reaching it, from either direction, the ships then descend through locks down to sea level on the other side. Every drop of that water to fill the locks comes from rainfall in the largely forested land in the Canal’s watershed, which then drains into Gatun and smaller lakes. After being used to raise and lower ships in the locks, the water eventually makes it way out into the seas.

A screenshot from an informative short YouTube video at the Panama Canal Authority site, illustrating how the locks work. In this image the Pacific Ocean is at the lower right, and the Caribbean leading to the Atlantic is in the upper left. In the middle is the sprawling Gatun Lake, created by damming the Chagras River, which supplies all the water for the Canal’s operation, plus drinking water for the millions of residents of Panama City.

Farmers everywhere present themselves as long-term stewards of their land. The managers of the Canal say that every bit of their enterprise’s future depends on protecting the surrounding watershed.

Over time, this watershed, like so many others, is becoming hotter and drier. Over time, many of these surrounding forests, where not officially protected, are being cut down, paved, and developed or turned into cattle-grazing land. Thus the Canal authorities have put themselves at the center of a struggle to protect their business interests by preserving, and even trying to expand, what is also a globally crucial reservoir of biodiversity.

My intention for now is simply to name a topic that I think should be central to US discussions of Panama. It’s one that Deb and I are determined to learn a lot more about ourselves. Yes, I realize this is like saying: “You know, economic inequality is important. Someone should work on it!” But it seems worth pointing out as a deserving object of new attention to Panama.

For the Canal Authority’s perspective, you can start here; for the Smithsonian Institution’s (which has a longstanding permanent presence in Panama), here and here; for the Global Water Partnership’s, here. A conservation alliance called NDC is here. This fall the NY Times had a skeptical-toned view of these undertakings. Each of these links will lead to many more.

I found that together they make a strong case that the Canal watershed should loom large in global discussions of sustainability. I hope some people now thinking about Panama will reach the same conclusion.

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Next up, more on what may be happening to the world’s airliners. And, as I have just learned, more on the man who signed those important agreements with Panama and did so much else, James Earl Carter Jr. RIP.

1. “Just Cause” last lasted two weeks and culminated with the US military’s famed use of pop-metal music as an instrument of war.

Noriega, on the run, at last sought refuge in the Vatican’s embassy in Panama City. US forces then parked military Humvees, equipped with deafening speakers, outside the embassy. They blasted rock songs at Noriega around the clock. You can see part of the playlist here, of which #43 is the RickRoll. A piquant current detail is that the music calculated to derange a dictator included one of today’s MAGA anthems, “God Bless the USA,” but not two others: “YMCA” or “The Snake.”

After several days of this Noriega gave up and came into US custody.

2. The US was still officially in control of the Panama Canal and the Canal Zone then, neither of which is true now. In those days the US had many more troops, command facilities, and armaments immediately on hand in Panama than it does now. And “mission accomplished” of removing one powerful figure is vastly easier and more realistic than “taking back” a critical and complex part of global infrastructure.

3. Many fascinating memos from inside the Carter administration are now available online. For instance this one, from my friend Robert Pastor, the NSC specialist on Latin American affairs.

4. See Rick Perlstein’s Reaganland on this theme.