241. Memorandum From the Department of Defense Representative for Panama Canal Treaty Affairs (Dolvin) to the Deputy Secretary of Defense (Claytor)1


  • Panama Canal Treaty Implementing Legislation

Reports from Senate-House staffers who are working on the main differences between the two bills indicate that staff compromises are being worked out on the major issues. The exception to this encouraging report is the form that the new Panama Canal Commission will take—corporate versus appropriated fund agency. House staffers have apparently been instructed not to compromise on the appropriated fund [Page 581] structure. We are concerned that the Senate conferees may acquiesce to this form if pushed to the wall.

I recommend that you talk to Senator Stennis and encourage him to support the Administration position as reflected in the Senate Bill. A talking paper and supporting rationale is attached.2 The talker includes several options which we could live with if a compromise is required to obtain timely legislation.

Welborn G. Dolvin
Lieutenant General, USA (Ret)
Department of Defense Representative for Panama Canal Treaty Affairs
  1. Source: Washington National Records Center, OSD Files, FRC: 330–82–0205, Panama (May–Dec 1979). No classification marking. A stamped notation reads: “Sep 13 1979 Dep Sec Has Seen.”
  2. The talking points and supporting rationale are attached but not printed. The Senate bill established the Panama Canal Commission (PCC) as a U.S. Government corporation, continuing the arrangement already in place in Panama and the form of the entity favored by the administration. The House bill established the PCC as an appropriated fund agency, requiring all canal revenues to be paid into a general Treasury fund and permitting expenditures only by separate, annual authorization and appropriations bills.