The Ambassador in Panama ( Hines ) to the Secretary of State

No. 2897

Sir: I have the honor to refer to the Embassy’s despatch No. 2393, September 16, 1946, Subject: “Alleged Discrimination in the Canal Zone”,95 and to report that Acción, October 30, 1946, the weekly official organ of the UPW–CIO Local 713 with a reported circulation of 10,000, published a table of the average wages paid by The Panama [Page 1165] Canal based on budget estimates for the 1947 fiscal year. According to this chart, the total number of “silver” employees of The Panama Canal is 16,252, while the total annual wage is given as $11,166,108.

Acción points out that on the basis of this table the average weekly wage earned by “silver” workers is $13.00, or 30 cents an hour, which is lower than the 40 cents an hour which is called for by the Federal Fair Labor Standards Act.

The Executive Office of The Panama Canal has informed the Embassy that during the month of October 1946 there were 20,943 “silver” employees on The Panama Canal and Panama Railroad pay rolls (including intermittent and temporary employees); while there were 6,039 “gold” employees with The Panama Canal and the Panama Railroad. These figures are lower than for the month of August 1946 as indicated on Page 47 of the report entitled “The Communist Movement in Panama” prepared by Mr. V. Lansing Collins, Jr., Second Secretary of Embassy, and represent a difference of 1,880 employees on the combined Panama Canal and Panama Railroad “gold” and “silver” pay rolls, which figure will give the Department some idea of the amount of people affected by the reduction of force program in effect in Panama Canal organizations. The Executive Office also informed the Embassy that there were approximately 750–1,000 “silver” contract laborers presently employed in the Canal Zone and that at the peak there were approximately 5,000. It is believed that the above difference between the months of August and October is greatly due to the reduction in force and subsequent repatriation of contract laborers.

The total pay roll for “silver” employees during the month of October 1946 for The Panama Canal and Panama Railroad Company was $1,402,726 as compared to $1,794,341 on the Panama Canal and Panama Railroad pay rolls for “gold” employees.

It is interesting to note that Acción fails to mention any of the advantages accruing to the “silver” employees of Panama Canal organizations, such as housing, commissary privileges, hospitalization, etc.

The Executive Office of The Panama Canal has also informed the Embassy that the “silver” roll of The Panama Canal and Panama Railroad Company will be increased considerably when the dry season begins.

I feel that it is regrettable that publicity is not given to the information furnished the Embassy by the Executive Office as it would certainly counter-balance the dangerous propaganda which has been disseminated among the “silver” employees by such CIO organizers as Len Goldsmith, Jack Strobel and Robert Weinstein.

Respectfully yours,

Frank T. Hines
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