During the last half of the nineteenth century, violent clashes left the isthmus’ affairs in constant turmoil. This period saw many riots and rebellions. Economic
problems and intensified grievances against the central government of Colombia were in force. Between 1863 and 1886, the isthmus had twenty-six presidents. Coups rebellions, and violence were almost continuous . Early in 1885, a revolt headed by a radical Liberal general and centered in Panama City . Col n was virtually destroyed. United States forces landed at the request of the Colombian government but were too late to save the city. United States naval forces occupied both Col n and Panama City. The United States consul general reported that most of the Panamanians wanted independence from Colombia and would revolt if they could get arms and be sure of freedom from United States intervention.
Panama was drawn into Colombia’s War of a Thousand Days. By early 1902 the rebels had been defeated in most of Colombia proper. At that point, the Colombian
government asked the United States to intercede and bring about an armistice in Panama, which was arranged aboard the U.S.S. Wisconsin in the Bay of Panama in 1902. Throughout the period of turmoil, the United States had retained its interest in building a canal through either Nicaragua or Panama. An obstacle to this goal was overcome in December 1901 when the United States and Britain signed the
Hay-Pauncefote Treaty. This treaty nullified the the Clayton-Bulwer Treaty of 1850 and the Brisish allowed a canal constructed by the United States.
Naval operations during the Spanish-American War convinced President Theodore Roosevelt that the United States needed to control a canal somewhere in the Western Hemisphere. The Spooner Bill of 1902, provided for a canal through the isthmus of Panama. In The Hay-Herr n Treaty of 1903, Colombia gave consent to the U. S. and 100-year lease on an area 10 kilometers wide. This treaty, however, was not ratified and the United States, determined to construct a canal across the isthmus, intensively encouraged the Panamanian separatist movement. By 1903, a Panamamian revolution was taking place. The native Panamanian leaders conspired to take advantage of United States interest in a new regime on the
isthmus. In October and November 1903, the revolution with the protection of United States naval forces, carried out a successful uprising against the Colombian government. President Roosevelt recognized the new Panamanian government on November 6, 1903. Bunau Varilla who led the uprising was considered the new leader. While residing in the Waldorf-Astoria Hotel in New York City, he wrote the Panamanian declaration of independence and constitution and designed the Panamanian flag. Approval by the United States Senate came on February 23, 1904.
The rights granted to the United States included the use, occupation, and control of a sixteenkilometer -wide strip of territory and extensions of three nautical
miles into the sea for the construction, maintenance, operation, sanitation, and protection of an isthmus canal. The United States was entitled to acquire additional areas of land or water necessary for canal operations and held the option of exercising eminent domain in Panama City. Within this territory Washington gained all the rights, power, and authority . The Republic of Panama became a protectorate. The United States guaranteed the independence of Panama and received in return the right to intervene in Panama’s domestic affairs. The United States paid $10 million and also purchased the rights and properties of the French canal company for $40 million. Major disagreements arose concerning the rights granted to the United States by the treaty of 1903 and the Panamanian constitution of 1904. The United States government thought these rights meant that the United States could rule over all matters in the Canal Zone. Panama, thought that the original agreement related only to the construction, operation, and defense of the canal.
In 1904 Amador became Panama’s first president. The constitution was modeled mostly, after that of the United States. When the United States canal builders arrived in 1904 to begin their momentous task, Panama City and Col n were both
small, squalid towns. A single railroad stretched between the towns. The new builders were haunted by the ghosts of de Lesseps’s failure and of the workers, some 25,000 of
whom had died on the project. These new builders were able, however, to learn from de Lesseps’s mistakes and to build
on the foundations of the previous engineering. The most formidable task that the North Americans faced was that of
ridding the area of deadly mosquitoes.
After a couple of false starts under a civilian commission, President Roosevelt turned the project over to the United States
Army Corps of Engineers, guided by Colonel George Washington Goethals. Colonel William Crawford Gorgas was
placed in charge of sanitation. In addition to the major killers–malaria and yellow fever–smallpox, typhoid, dysentery, and
intestinal parasites threatened the newcomers.
Because the mosquito carrying yellow fever was found in urban areas, Gorgas concentrated his main efforts on the terminal
cities. “Gorgas gangs” dug ditches to drain standing water and sprayed puddles with a film of oil. They screened and
fumigated buildings, even invading churches to clean out the fonts of holy water. They installed a pure water supply and a
modern system of sewage disposal. Goethals reportedly told Gorgas that every mosquito killed was costing the United
States US$10. “I know, Colonel,” Gorgas reportedly replied, “but what if one of those ten-dollar mosquitoes were to bite
you?”
Gorgas’s work is credited with saving at least 71,000 lives and some 40 million days of sickness. The cleaner, safer
conditions enabled the canal diggers to attract a labor force. By 1913 approximately 65,000 men were on the payroll. Most
were West Indians, although some 12,000 workers were recruited from southern Europe. Five thousand United States
citizens filled the administrative, professional, and supervisory jobs. To provide these men with the comforts and amenities
to which they were accustomed, a paternalistic community was organized in the Canal Zone.
The most challenging tasks involved in the actual digging of the canal were cutting through the mountain ridge at Culebra;
building a huge dam at Gat*n to trap the R o Chagres and form an artificial lake; and building three double sets of
locks–Gatun Locks, Pedro Miguel Locks, and Miraflores Locks–to raise the ships to the lake, almost twenty-six meters
above sea level, and then lower them. On August 15, 1914, the first ship made a complete passage through the canal.
By the time the canal project was completed, its economic impact had created a new middle class. In addition, new forms of
discrimination occurred. Panamanian society had become segregated not only by class but by race and national origin as
well (see Ethnic Groups and Social Organization , ch. 2). Furthermore, United States commercial competition and political
intervention had already begun to generate resentment among Panamanians.
Data as of December 1987
Panama
United States Intervention and Strained Relations
In the very first year of the Hay-Bunau-Varilla Treaty, dissension had already arisen over the sovereignty issue. Acting on
an understanding of its rights, the United States had applied special regulations to maritime traffic at the ports of entry to the
canal and had established its own customs, tariffs, and postal services in the zone. These measures were opposed by the
Panamanian government.
Mounting friction finally led Roosevelt to dispatch Secretary of War William Howard Taft to Panama in November 1904.
His visit resulted in a compromise agreement, whereby the United States retained control of the ports of Anc n and
Crist bal, but their facilities might be used by any ships entering Panama City and Col n. The agreement also involved a
reciprocal reduction of tariffs and the free passage of persons and goods from the Canal Zone into the republic.
Compromises were reached in other areas, and both sides emerged with most of their grievances blunted if not wholly
resolved.
Before the first year of independence had passed, the intervention issue also complicated relations. Threats to constitutional
government in the republic by a Panamanian military leader, General Est ban Huertas, had resulted, at the suggestion of the
United States diplomatic mission, in disbanding the Panamanian army in 1904. The army was replaced by the National
Police, whose mission was to carry out ordinary police work. By 1920 the United States had intervened four times in the
civil life of the republic. These interventions involved little military conflict and were, with one exception, at the request of
one Panamanian faction or another.
The internal dynamics of Panamanian politics encouraged appeals to the United States by any currently disgruntled faction
for intervention to secure its allegedly infringed rights. United States diplomatic personnel in Panama also served as
advisers to Panamanian officials, a policy resented by nationalists. In 1921 the issue of intervention was formally raised by
the republic’s government. When asked for a definitive, written interpretation of the pertinent treaty clauses, Secretary of
State Charles Evans Hughes pointed to inherent difficulties and explained that the main objectives of the United States were
to act against any threat to the Canal Zone or the lives and holdings of non-Panamanians in the two major cities.
Actual intervention took several forms. United States officials supervised elections at the request of incumbent
governments. To protect lives of United States citizens and property in Chiriqu Province, an occupation force was
stationed there for two years over the protests of Panamanians who contended that the right of occupation could apply only
to the two major cities. United States involvement in the 1925 rent riots in Panama City was also widely resented. After
violent disturbances during October, and at the request of the Panamanian government, 600 troops with fixed bayonets
dispersed mobs threatening to seize the city.
At the end of the 1920s, traditional United States policy toward intervention was revised. In 1928 Secretary of State Frank
B. Kellogg reiterated his government’s refusal to countenance illegal changes of government. In the same year, however,
Washington declined to intervene during the national elections that placed Florencio H. Arosemena in office. The
Arosemena government was noted for its corruption. But when a coup d’ tat was undertaken to unseat Arosemena, the
United States once again declined to intervene. Though no official pronouncement of a shift in policy had been made, the
1931 coup d’ tat–the first successful one in the republic’s history–marked a watershed in the history of United States
intervention.
Meanwhile, popular sentiment on both sides calling for revisions to the treaty had resulted in the Kellogg-Alfaro Treaty of
1925. The United States in this instrument agreed to restrictions on private commercial operations in the Canal Zone and
also agreed to a tightening of the regulations pertaining to the official commissaries. At the same time, however, the United
States gained several concessions involving security. Panama agreed to automatic participation in any war involving the
United States and to United States supervision and control of military operations within the republic. These and other
clauses aroused strong opposition and, amid considerable tumult, the National Assembly on January 26, 1927, refused to
consider the draft treaty.
The abortive Kellogg-Alfaro Treaty involved the two countries in a critical incident with the League of Nations. During the
fall of 1927, the League Assembly insisted that Panama could not legally participate in the proposed arrangement with the
United States. The assembly argued that an automatic declaration of war would violate Panama’s obligations under the
League Covenant to wait three months for an arbitral decision on any dispute before resorting to war. The discussion was
largely academic inasmuch as the treaty had already been effectively rejected, but Panama proposed that the dispute over
sovereignty in the Canal Zone be submitted to international arbitration. The United States denied that any issue needed
arbitration.
Data as of December 1987
Panama
A New Accommodation
In the late 1920s, United States policymakers noted that nationalist aspirations in Latin America were not producing
desired results. United States occupation of the Dominican Republic, Haiti, and Nicaragua had not spawned exemplary
political systems, nor had widespread intervention resulted in a receptive attitude toward United States trade and
investments. As the subversive activities of Latin American Nazi and Fascist sympathizers gained momentum in the
1930s, the United States became concerned about the need for hemispheric solidarity.
The gradual reversal of United States policy was heralded in 1928 when the Clark Memorandum was issued, formally
disavowing the Roosevelt Corollary (see Glossary) to the Monroe Doctrine. In his inaugural address in 1933, President
Franklin D. Roosevelt enunciated the Good Neighbor Policy. That same year, at the Seventh Inter-American Conference
in Montevideo, the United States expressed a qualified acceptance of the principle of nonintervention; in 1936 the United
States approved this principle without reservation.
In the 1930s, Panama, like most countries of the Western world, was suffering economic depression. Until that time,
Panamanian politics had remained a competition among individuals and families within a gentleman’s club–specifically,
the Union Club of Panama City. The first exception to this succession was Harmodio Arias Madrid (unrelated to the
aristocratic family of the same name) who was elected to the presidency in 1932. A mestizo from a poor family in the
provinces, he had attended the London School of Economics and had gained prominence through writing a book that
attacked the Monroe Doctrine.
Harmodio and his brother Arnulfo, a Harvard Medical School graduate, entered the political arena through a movement
known as Community Action (Acci n Communal). Its following was primarily mestizo middle class, and its mood was
antioligarchy and anti- Yankee (see Glossary). Harmodio Arias was the first Panamanian president to institute relief
efforts for the isolated and impoverished countryside. He later established the University of Panama, which became the
focal point for the political articulation of middle-class interests and nationalistic zeal.
Thus, a certain asymmetry developed in the trends underway in the 1930s that worked in Panama’s favor. While the
United States was assuming a more conciliatory stance, Panamanians were losing patience, and a political base for
virulent nationalism was emerging.
A dispute arose in 1932 over Panamanian opposition to the sale of 3.2-percent beer in the Canal Zone competing with
Panamanian beers. Tension rose when the governor of the zone insisted on formally replying to the protests, despite the
Panamanian government’s well-known view that proper diplomatic relations should involve only the United States
ambassador. In 1933 when unemployment in Panama reached a dangerous level and friction over the zone commissaries
rekindled, President Harmodio Arias went to Washington.
The result was agreement on a number of issues. The United States pledged sympathetic consideration of future
arbitration requests involving economic issues that did not affect the vital aspects of canal operation. Special efforts were
to be made to protect Panamanian business interests from the smuggling of cheaply purchased commissary goods out of
the zone. Washington also promised to seek appropriations from Congress to sponsor the repatriation of the numerous
immigrant canal workers, who were aggravating the unemployment situation. Most important, however, was President
Roosevelt’s acceptance, in a joint statement with Harmodio Arias, that United States rights in the zone applied only for
the purposes of “maintenance, operation, sanitation, and protection” of the canal. The resolution of this long-standing
issue, along with a clear recognition of Panama as a sovereign nation, was a significant move in the direction of the
Panamanian interpretation of the proper United States position in the isthmus.
This accord, though welcomed in Panama, came too early to deal with a major problem concerning the US$250,000
annuity. The devaluation of the United States dollar in 1934 reduced its gold content to 59.6 percent of its former value.
This meant that the US$250,000 payment was nearly cut in half in the new devalued dollars. As a result, the
Panamanian government refused to accept the annuity paid in the new dollars.