Panama and the United States: The End of the Alliance

10. Canal Ownership and Sovereignty at Last

10 CanalOwnership and Sovereignty at Last US. Ambassador to Panama Simon Ferro leaned across the banquet table to speak with Attorney General Janet Reno. She smiled graciously as several well-wishers took their pictures with her It had been a long, tiring day and Ms.Renodid her best to be friendly and positive regarding Panama-U.S* relations. Shesaid that President Clinton regretted that his schedule would not allow him tobe present but assured everyone that he had the warmest expectations for the final implementation of the Panama Canal treaties of 1977. At that moment the band struck up a loud salsa piece, and the lead singer's voice filled the convention hail. Ms. Renosmiled and leaned back in her chair. Unbeknownst to those attending President Mireya Moscoso'sinauguration , that evening in September 1999 set the tone for a very low-key turnover to Panamanian ownership and operation of the Panama Canal and all the lands and military bases around it. Long one of the most contentious issues in inter-American diplomacy, the final transfer of ownership a few months later turned out to be anticlimactic, Neither experts nor futurists had predicted such an undramatic finale tonearly a century of acrimonious relations between Panama and the United States. The forced alliance ended quietly, The 19905showed a gradual recovery and stabilization in Panama-U.S. affairs following the traumatic invasion of 1989. This recovery culminated in the successful turnover of the canal and the military bases inlate 1999. The canalceased to be a "body of water completely surrounded by controversy/' For better or worse, Panama and the United States had overcome the passions and heated rhetoric of many decades. As of mid2001 , the canal was operating largely as it had under U.S.jurisdiction and actually earned slightly higher toll revenues. Before and after the canal turnover (or reversion in Spanish), few ma169 1/0 PANAMA AND THE UNITED STATES jot issues arose to make headlines, at least in the United States. During the 19903Panama held two presidential elections with minimal difficulties , and in each case the governing party lost, a sign of honest procedures , Two referenda were also held, and the government lost both. As one expert wrote, "The 19903 have witnessed a series of elections that have been increasingly free, fair, and almost fraud-proof/'1 The elections were internal affairs related to Panama's recovery from the invasion and to rebuilding the institutions ofstate—U,S, involvement was minimal And perhaps most important those who believed that Operation Just Cause was a cover for canceling the reversion of the canal were proved wrong, The symmetry of acquiring the land and rights for the canal in 1904 and then returning the entire enterprise toPanama in 1999 was remarkable in its simplicity and collusiveness, U.S. objectivesin Panama changed in the 19905, due in part to the end of the cold war. Throughout the 19803, Pentagon planners assumed that they could negotiate some post-turnover agreement to allow continued military operations there, under aStatus ofForcesAgreement (SOFA) like those executed with other countries. After the fall of the Soviet Union, however, global security planning shifted its focus to other problems and made bases in Panama less vitaL In the end, the United States left with no SOFA and no troops inPanama besides those assigned to the embassy. Post-InvasionRecovery Throughout 1991 and 1992, U.S.authorities watched the Panamanian economy for signs of life, and as the recovery gained steam, they scaled back the amount of aid they disbursed. Construction led the revival, beginning in the burned-out areas of Chorillo, where high-rise public housing went up, and leading to commercial and residential building in middle-class districts to the north. By 1992 employment had recovered somewhat and the economy grew at a modest rate. The cobbled-together alliance of President Guillermo Endara (Panamenista) and Vice Presidents Ricardo Arias Catderon (Christian Democratic) and Billy Ford (MOL1RENA) that had assumed titular 171 Canal Ownership and Sovereignty at Last leadership of the country at the onset of Just Cause began falling apart in early 1991, Personal rivalries, ambitions, and fallings-out among their backers condemned the administration to mediocre performance. In par* tkular, Panamenistas' demands for jobs led to the resignation ofArias Calderon. Endara seemed to lack leadership skills and the intellectual capacity necessary for governing Panama, He had previously served as faithful aide to Arnulfo Ariasand was little known...