Foreign Relations of the United States, 1955–1957, American Republics: Central and South America, Volume VII

128. Letter From the Assistant Secretary of State for Inter-American Affairs (Holland) to the Ambassador in Panama (Harrington)¹

Washington, December 27, 1955.

Dear Julian: The intricacies of our relations with Panama always are a surprise to the uninitiated, and not always a pleasant one at that.² I think I have a pretty good insight into some of the problems which confront you there, for the Panamanian negotiations were among the first order of business for me when I came to Washington and I had to spend many a weary hour on some of these same problems. I agree that, in coping with these problems, the situation on the Isthmus is such as to emphasize the importance of personalities. I am delighted, therefore, to learn of your high opinion of and close working relationships with the Governor³ and General Harrison. With you as our representative on the team, I think we have a combination that, with patience, can lick these problems.

I am sorry that the liquor matter has come to the pass that it has. I have tried to impress upon Ambassador Vallarino my view that Panama’s attitude in this matter is extremely short-sighted. The only logical explanation of the Panamanian position would appear to be that they are convinced we are bluffing in our talk about reconsideration of Executive Order 6997⁴ and will settle for less than what we are entitled to under the agreement. We propose to ask the Secretary for authorization to take the preliminary steps toward rescission of the Order. If he approves, we will authorize you to inform the Panamanian Government of the steps we are taking, in order to dispel any doubts they may have as to the seriousness of our intentions. If they remain adamant, then we shall proceed with cancellation of the Order. In making your recommendation to this end, you and the Zone authorities have, I am sure, weighed its possible effect upon some of our pending requests of Panama.

In spite of the problems which seem endemic there, I have always found Panama a most interesting place and I hope that I shall have the opportunity of visiting there soon.

My wife and I thank you for your holiday greeting and we wish you and Alys a most happy and successful New Year in your important post.

Sincerely yours,

Henry F. Holland⁵

1. Source: Department of State, Central Files, 611.19/12–1355. Official Use Only. Drafted by Sowash.

2. Harrington to Holland, December 13, reads in part as follows:

   “I never suspected that a place as pleasant and peaceful as Panama could have so many headaches. It looks as if the honeymoon of the treaty is over, if our difficulties over the liquor tax issue are an example. I can only ascribe this Panamanian attitude on this question to the fact that they got off on the wrong foot. Now they either do not know how to alter their position gracefully or they are unwilling to do so under pressure.” (Ibid., 611.19/12–1355)

   The liquor matter was summarized in despatch 146 from Panama City, October 11. (Ibid., 611.1913/10–1155)

3. Brigadier General John S. Seybold, Governor of the Panama Canal Zone.
4. This order, signed by President Franklin D. Roosevelt on March 25, 1935, prohibited the direct importation of hard liquor into the Canal Zone.
5. Printed from a copy which bears this typed signature.