242. Memorandum From the Special Assistant to the Secretary of State (Tarnoff) to Secretary of State Vance 1


  • Your Breakfast with the President Friday, September 21, 1979

[Omitted here is information unrelated to Panama.]

11. Panama Canal Legislation. The Conference version of the Panama Canal implementing legislation was defeated in the House because of the absence of supporting, primarily Democratic votes.2 The negative [Page 582] vote was within one of the total on the original House bill (203 compared to 202) while the affirmative vote fell from 224 to 192. The House/Senate conference could meet as early as tomorrow3 to prepare a second report and another try in both Houses. We will work out our tactics with our friends before that time.

The political consequences of this setback are obvious. We are urging the Panamanians to react with restraint (a message to this effect is being passed to Torrijos Thursday evening)4 pointing out that we expect to have a law before October 1. We will be very active in Congress next week to obtain a better result before the weekend, and to get on track the authorization and appropriations legislation required. These await action on the implementing legislation.

It is of course possible that we may not have implementing legislation by October 1. In this event we have two alternatives. We can either shut down the Canal and keep the pressure on Congress to complete the legislation, or keep the Canal open without it. As to the latter, the most serious problem would be to spend funds for Canal operations and payments to Panama without appropriations. We have been working with Justice on a contingency plan giving us some legal justification to do this on an emergency basis.

The October 1 observance will of course go ahead in any event, since the Treaty comes into effect regardless of Congressional action. Obviously the circumstances would be considerably more difficult in that event.

  1. Source: Department of State, Records of Cyrus R. Vance, 1977–1980, Lot 84D241, Box 3, Pres Breakfast 9/1/79 thru 12/31/79. Secret; Nodis. Vance’s initials are stamped on the memorandum.
  2. The House-Senate Conference approved a compromise implementation bill on September 17. On September 20, the White House released a statement by Carter expressing his deep disappointment that the House did not adopt the legislation proposed by the Conference. For the text of the statement, see Public Papers: Carter, 1979, Book II, pp. 1698–1699.
  3. An unknown hand struck the words “will meet on Monday” and wrote in the right margin: “could meet as early as tomorrow.”
  4. September 20. No record of the message has been found.