Foreign Relations of the United States, 1977–1980, Volume XXIX, Panama

64. Briefing Memorandum From the Assistant Secretary of State for Congressional Relations (Bennet) to Secretary of State Vance¹

Washington, July 22, 1977

SUBJECT

• Gravel on the Panama Canal—Possible Evening Reading

FYI: The negotiators believe the sea-level treaty issue can be detrimental to the negotiations.² I am not at all convinced that Gravel’s approach will pave the way for a treaty on the Hill, although it is intriguing. One thing is certain, however: We must make sure that all of us—the President, the negotiators, DoD and State—are singing the same tune. Otherwise we will certainly be carved to pieces on the Hill. I believe you should consider talking to the President rather than writing on this subject. We have a heavy Panama schedule on the Hill next week—see the attached excerpt³ from this week’s legislative report to the White House—and need to have our position in order.

With that preamble, here is some possible material for the President:

I had breakfast with Mike Gravel at your suggestion.⁴ He outlined his proposal for a sea-level canal. His presentation certainly gives one the feeling that we are spending a lot of energy and political capital on the past rather than on the future as we negotiate the Canal treaty. Gravel now recognizes, however, that success in the present negotiations is critical to future good relations with Panama.

I am sure Gravel reviewed the Congressional picture with you—particularly his idea that we might sign the Treaty but not seek a two-thirds vote in the Senate until we have paved the way with some enabling legislation by majority vote in both Houses. Gravel proposed a legislative package consisting of the following elements:

—Pension and other labor legislation to reassure the Americans in Panama,

—Authorization for a $7 million update on the existing sea-level Canal studies,

—Authorization for the President to transfer lands, so that we could begin to disengage even before the Treaty is signed,

—Provision for transferring some measure of responsibility for operation of the Canal to Panama

—Toll increases to help Panama finance the cost of services for which it will assume responsibility.

Gravel’s legislative strategy may have merit, and we will work out the implications in detail. He believes the property transfer question can somehow be buried in an attractive legislative package and slip by without too much opposition; I am skeptical.

If we handle it creatively, the idea of a new canal in Panama could, I believe, be helpful in gaining support for a settlement on the old canal. People may feel more comfortable if they see the possibility that we and the Panamanians may be building toward a promising joint enterprise in the future rather than simply disengaging from an unsatisfactory past relationship. We must not, however, allow the sea-level canal idea to gain currency as an alternative to a new treaty.⁵

1. Source: National Archives, RG 59, Central Foreign Policy File, P770138–2209. Unclassified. A stamped notation and his written initials indicate Vance saw the memorandum.
2. In a May 5 letter to Carter, Gravel outlined a proposal advocating the delayed ratification of the treaty and the immediate pursuit of a legislative package that included an updated sea-level canal study by the U.S. Government. (Library of Congress, Manuscript Division, Linowitz Papers, Box CL–1, Government Service, Pan Canal Treaties, Sea Level Canal Proposal, 1977) According to the President’s Daily Diary, Carter met with Gravel to discuss the Panama Canal on July 13 from 2–2:25 p.m. (Carter Library, Presidential Materials, President’s Daily Diary) In a July 21 memorandum to Vance, Bunker and Linowitz argued that backing a sea-level canal would have an overall negative effect on the negotiations: “First, it would signal a firmer U.S. intention to build a sea-level canal than Panama now perceives we hold . . . Second, it could very well cause the Panamanians to question our interest in bringing the present negotiations to a successful and rapid conclusion . . . Third, the proposal, if it became known, could also diminish potential support for a new treaty in Congress.” (Library of Congress, Manuscript Division, Linowitz Papers, Box CL–1, Government Service, Pan Canal Treaties, Sea Level Canal Proposal, 1977)
3. Not attached.
4. In a July 15 memorandum Bennet told Vance that Gravel reported after briefing Carter on his Panama Canal proposal the President had asked whether Gravel had briefed Vance. Gravel requested an appointment with Vance and a breakfast meeting was set for July 22. (National Archives, RG 59, Central Foreign Policy File, P770138–1490) An unknown hand inserted “Mike” before “Gravel.”
5. An unknown hand highlighted this paragraph.